Revealing Lessons about Federal Energy Regulatory Commission (FERC)

Steckman Ridge Project, Bedford County, PA
Federal Energy Regulatory Commission Docket No. CP08-15-00

A two-hour drive from Washington, DC, will bring you to the beautiful countryside of Bedford County, Pennsylvania.  Here in the community of Clearville is the proposed location for a 12 billion cubic feet underground natural gas storage facility (in depleted natural gas wells).  Known as the Steckman Ridge Project, it is a joint venture between Spectra Energy Corporation (Houston) and New Jersey Resources.

The depleted natural gas wells are the result of original lease agreements made by landowners in 2003 with Pennsylvania General Energy Corporation (PGE).  PGE recovered gas in the Oriskany layer then sold the leases to Spectra Energy Corporation in 2007.  These gas wells were “depleted” in a remarkably short period of time — 2-3 years.  While the life of a gas well can certainly vary, many sources suggest the average life of gas wells in Pennsylvania is 6-12 years.

Early in the process for the proposed underground natural gas storage project (in 2007), the Federal Energy Regulatory Commission (FERC) Project Manager Maggie Manco told our group’s attorney that FERC considered this a “done deal.”

This comment no doubt reflected the views of other persons in positions of responsibility at FERC; and FERC needs to understand that no “proposed” project is to be considered a “done deal.”

That may explain why the behavior of Spectra Energy employees toward property owners was so bad (coercive and threatening). After challenging FERC on Spectra Energy’s inappropriate behavior toward property owners, the CEO of Spectra, Mr. Fred Fowler, promised an investigation in a June 11, 2008, letter.  BUT the alleged investigation was to be conducted by Spectra employees investigating Spectra employees.

FERC project meetings on Steckman Ridge always included Spectra Energy representatives, but never landowners. The irony here is that landowners possess the underlying asset – the property. Without rights to the property, there is neither recovery nor storage potential. Since landowners were excluded from these meetings, there was never an opportunity for them to confirm, correct or clarify what was claimed in the meetings.  This reinforces the lack of transparency in energy industry proceedings involving FERC.