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Industry leaders concerned by pipeline project cancellation

Published: Jul. 7, 2020 at 6:41 PM EDT
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PARKERSBURG, W.Va (WTAP) -An economist at West Virginia University says a number of pipeline projects could suffer the same fate of the Atlantic Coast pipeline-legal delays leading to rising construction costs.

“If you have an increasing number of pipeline projects that are challenged continuously, and the backers of the project determine that, at this point, there’s too much uncertainty,” says Brian Lego, Research Assistant Professor, WVU Business and Economic Research. “If that happens, then you would see bigger problems for the industry as a whole.”

The U.S. Supreme Court issued a ruling in June essentially upholding the Atlantic Coast project. But Tuesday, the court let stand a lower court ruling denying a permit for another major project: the Keystone XL pipeline originating in Canada.

There’s been a lot of talk about the cost in construction and pipeline jobs. But the reason for the pipelines is to transport natural gas in larger quantities to customers.

“It clearly takes away opportunity for our producers in Ohio to drill more wells, and pay more taxes and royalties to landowners in Ohio to put gas in that pipeline,” says Mike Chadsey, Spokesman, Ohio Oil and Gas Association. “So it’s not simply, ‘aw shucks, the pipeline’s not going to get built’. That really impacts a lot of people from Ohio all the way down to the Carolinas.”

Environmentalists applauding the Atlantic Coast decision cited the need to move to renewable energy. Chadsey, however, touted natural gas’s properties as being cleaner than other fossil fuels.

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