Bluegrass Pipeline company admits to mistaken trespassing but claims it can take land by eminent domain

09/05/2013 08:16 PM

Lawmakers on Thursday took up concerns of Kentucky landowners who might be in the path of the proposed Bluegrass Pipeline, forcing the pipeline builders to acknowledge that they might have acted over-zealously by trespassing.

Meanwhile, the company made its case to lawmakers that it could take land from reluctant property owners as a last resort, touching off a debate among other government officials at Thursday’s hearing.

Officials from Williams and Boardwalk Pipeline Partners, the two joint-venture partners in the natural gas liquids pipeline, told the interim Committee on Natural Resources that the proposed pipeline could generate $136 million new tax revenue, 1,500 jobs during construction and between $30 million and $50 million payments to property owners.

But in local meetings across the proposed path of the pipeline, residents have expressed concerns about surveyors for the company on their properties and whether the company can take the land by eminent domain.

Democratic Sen. Robin Webb of Grayson pressed Williams Boardwalk’s senior vice president, James Scheel, about how some landowners might not be respected by company personnel when it came to land inspections.

Scheel acknowledged that some actions may have been taken improperly and that the company should seek permission.

“I know there have been some areas where that has not taken place and I’m here today to say that is not the standard we expect for ourselves, that is not the standard to industry sets for itself,” Scheel said.

The proposed Bluegrass Pipeline would transport natural gas liquids of Marcellus and Utica shale producing areas in Pennsylvania, West Virginia and Ohio through Kentucky and to the Gulf of Mexico.

The proposed pipeline would run from Northern Kentucky to Hardinsburg in Breckinridge County where an existing line exists and goes to the Gulf of Mexico.

Some worried landowners and their advocate, Tom FitzGerald of the Kentucky Resources Council, were concerned that the project lacks government oversight.

The companies’ representatives say that they have the power of eminent domain if a property owner doesn’t want the pipeline on his or her property.

Mike McMahon, Senior Vice President of General Council for Boardwalk Pipeline Partners, told the committee that the company could declare eminent domain if forced to, but it wouldn’t be its first choice.

Responding to a question from Republican Sen. Whitney Westerfield of Hopkinsville, McMahon said, “we are an interstate pipeline, we are a common carrier, as the statute is currently written, we believe that we fit into the four corners of the statute.”

But Energy and Environment Cabinet Secretary Leonard Peters told the committee that the pipeline builders wouldn’t qualify as a public utility that has the power to take property through eminent domain.

“I’ve asked the Cabinet’s general counsel and his legal staff to conduct a rather thorough analysis relating to eminent domain for this transport. Based on this research, relative to federal law and statutes, and how natural gas liquid pipelines are regulated, they do not see how eminent power can be involved,” Peters said.

Attorney General Jack Conway said last month he, too, doesn’t believe the pipeline builders would be able to seize land.


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