U.S. Supreme Court backs consortium of pipeline companies including Enbridge in N.J. land dispute

U.S. Supreme Court backs consortium of pipeline companies including Enbridge in N.J. land dispute

The U.S. Supreme Court on Tuesday ruled in favour of a consortium of energy companies including Enbridge Inc seeking to seize land owned by New Jersey to build a $1-billion natural gas pipeline despite the state’s objections.

The 5-4 ruling, authored by conservative Chief Justice John Roberts, handed a victory to PennEast Pipeline Company LLC, a joint venture seeking to build the 116-mile (187-km) pipeline from Pennsylvania to New Jersey. The justices overturned a lower-court ruling in favour of New Jersey’s government.

Other companies joining Enbridge in the consortium include South Jersey Industries Inc , New Jersey Resources Corp (NJR), Southern Co and UGI Corp .

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The court ruled that a 1938 U.S. law called the Natural Gas Act that lets private energy companies seize “necessary” parcels of land for a project if they have obtained a certificate from the Federal Energy Regulatory Commission (FERC) can be applied to state-owned land.

The law effectively gives private companies the power of eminent domain in which government entities can take property in return for compensation.

“Specifically, we are asked to decide whether the federal government can constitutionally confer on pipeline companies the authority to condemn necessary rights-of-way in which a state has an interest. We hold that it can,” Roberts wrote for the court.

The court, which has a 6-3 conservative majority, was divided on non-ideological lines. Roberts was joined in the majority by two conservative justices, Samuel Alito and Brett Kavanaugh, and two liberals, Stephen Breyer and Sonia Sotomayor.

Roberts wrote that the U.S. Constitution’s 11th Amendment, which prevents courts from hearing certain lawsuits against states, does not bar the lawsuit, as the state had argued.

FERC in 2018 approved PennEast’s request to build the pipeline. The company then sued to gain access to properties along the route.

New Jersey did not consent to PennEast’s seizure of properties that the state owns or in which it has an interest.

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PennEast wants the land to build a pipeline designed to deliver 1.1 billion cubic feet per day of gas – enough to supply about 5 million homes – from the Marcellus shale formation in Pennsylvania to customers in Pennsylvania and New Jersey.

After a federal judge approved the property seizure, the Philadelphia-based 3rd U.S. Circuit Court of Appeals ruled in 2019 that PennEast could not use federal eminent domain to condemn land controlled by the state, prompting the appeal to the Supreme Court.

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Published at Tue, 29 Jun 2021 14:49:13 +0000

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Written by Riel Roussopoulos


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