1. Federal Energy Regulatory Commission
FERC’s Natural Gas Pipeline Certification Program
Interstate Pipeline Regulatory Committee
October 9, 2003
Berne L. Mosley, Director
Division of Pipeline Certificates

2. FERC Organizational Structure

3. OEP Organizational Structure

4. Office of Energy Projects - Functions
OEP has the engineering and environmental expertise to:
certificate new gas pipeline projects,
authorize and monitor hydroelectric projects, and
analyze energy infrastructure needs and policies.
OEP focuses on:
project siting and development,
balancing environmental and other concerns,
ensuring compliance,
safeguarding the public, and
providing infrastructure capacity information.
Other FERC Offices
OGC has corresponding hydro and pipeline legal responsibilities
OMTR, OMOI, OED, and OEA also have input to our products

5. Gas Pipeline Program
Evaluate applications for facilities to import, export transport, store or exchange natural gas
Authorize the construction and operation of facilities for such services
Approve abandonment of such facilities
Conduct environmental reviews of proposals involving construction, modification, or abandonment
Implement NEPA Pre-Filing Process
Conduct inspections of LNG facilities and pipeline construction

6. Regulation of Interstate Construction
Natural Gas Policy Act (NGPA)
Natural Gas Act (NGA)

7. NGPA OR NGA? NGA Certificate Grants a Right of Federal Eminent Domain
NGPA Does Not Confer Any Rights of Federal Eminent Domain; Pipeline May Seek State Eminent Domain

8. Section 3 Import/Export
Natural Gas Act
NATURAL GAS ACT
Section 7(c)
Interstate
Section 3 Import/Export
Case
Specific
Blanket
Authority
Case
Specific
Automatic
Prior
Notice

9. Natural Gas Act Blanket Certificate Automatic Authorization
• Cost of facilities is less than $7.6 million
• Facilities are “eligible” facilities
• Prior Notice
• Cost is between $7.6 and $21.2 million
• 45-day notice period prior to construction
• Facilities are “eligible” facilities

10. Natural Gas Act Case Specific Section 7(c) Certificate
• Conduct a full review of proposal
including engineering, rate, accounting,
and market analysis
• Conduct an environmental review by
preparing an Environmental Assessment
or an Environmental Impact Statement

11. Project Evaluation How Does FERC Evaluate All Of These Major Projects?
What Are The Criteria Used in
This Evaluation?

12. Balancing Interests

13. FERC’s Internal Review Process
Initial review for completeness (10 days)
Issue notice of application
Assign review team
Environmental
Certificates
Rates
Attorney
Markets

14. (Traditional Process)
Environmental Review
FERC
Review
Process
Public Interest Review
(Traditional Process)
Notice of Intent
Notice of Application
Scoping Meetings
& Site Visit
Interventions
Protests
LNG
Cryogenic Design &
Safety Review
Data Requests
Analysis
Agency Coordination
Data Requests
Analysis
Tech Conference
(Optional)
Preliminary Determination
(Optional)
DEIS
FEIS
Authorization / Rejection 1

15. Traditional vs. NEPA Pre-Filing Process
Develop
Study
Corridor
File At
FERC
Announce
Open
Season
Prepare Resource
Reports
Traditional - Applicant
Conduct
Scoping
Issue
Draft
EIS
Issue
Final
EIS
Issue
Order
Traditional - FERC
Announce
Open
Season
Develop
Study
Corridor
File At
FERC
Prepare Resource
Reports
NEPA Pre-Filing - Applicant
Conduct
Scoping
Review Draft
Resource Reports
& Prepare DEIS
Issue
Draft
EIS
Issue
Final
EIS
Issue
Order
NEPA Pre-Filing - FERC
(months)

16. Traditional vs. NEPA Pre-Filing Process
Develop
Study
Corridor
File At
FERC
Announce
Open
Season
Prepare Resource
Reports
Traditional - Applicant
Conduct
Scoping
Issue
Draft
EIS
Issue
Final
EIS
Issue
Order
Traditional - FERC
NOT A SHORTCUT
Announce
Open
Season
Develop
Study
Corridor
File At
FERC
Prepare Resource
Reports
NEPA Pre-Filing - Applicant
Conduct
Scoping
Review Draft
Resource Reports
& Prepare DEIS
Issue
Draft
EIS
Issue
Final
EIS
Issue
Order
NEPA Pre-Filing - FERC
(months)

17. How to “Expedite” the NEPA Pre-Filing Process
Projects Can Be Expedited Only If
The company follows the NEPA Pre-Filing guidelines;
Public involvement is made an integral part of the project planning process;
The company works in partnership with the agencies; and
The project is READY to move forward.

18. NEPA Pre-Filing Process – Completed Projects
Kern River Expansion 2002 (720 miles, looping)
approved in 11 months
Greenbrier Pipeline (280 miles, new pipe)
approved in 9 months

19. NEPA Pre-Filing Process – Pending Projects
FY03
Cheyenne Plains - CIG
Picacho Pipeline - PacTex
Grasslands Expansion - Williston Basin
Weavers Cove LNG - Dominion
Long Beach LNG Project - Sound Energy Solutions
Ruby Project - CIG
San Juan 2005 Expansion - Transwestern

20. Lessons Learned by FERC
Project teams should be ready and able to make commitments necessary to move forward as partners in the process
Participating agencies should be contacted as early as possible
FERC has to work harder to bring agencies together
Stakeholder involvement must proceed according to a well-defined plan supported by management

21. Lessons Learned by FERC
Early in the process, projects are works in progress, routing and documentation will change
Both the company and FERC need to hold focused meetings with stakeholders
Project information must be readily available, easily accessible, and updated regularly.
Changes in routing and mitigation should be tracked and reported frequently to stakeholders

22. New Directions for NEPA Pre-Filing
Not just for Pipelines
Currently being used for two LNG terminals
Lots of LNG work on the horizon
Expected to be large portion of future workload

23. New Directions for NEPA Pre-Filing
Not just for EISs
Process can work for major EAs
No third-party contractor required, but may be requested by staff at a later date
Currently have one project approved that will file an applicant prepared draft EA

24. Benefits of NEPA Pre-Filing
More interactive NEPA process, no shortcuts
Earlier, more direct involvement by FERC, other agencies, landowners
Goal of “no surprises”
Time savings realized only if we are working together with stakeholders
FERC staff is an advocate of the Process, not the Project!

25. Contributing to Success
Interagency Agreement May 2002
FERC as lead agency
Public Outreach Efforts
Last meeting - 10/02/03, Roanoke VA
Other Cooperative Efforts
DOT CATS Program
NASFM Case Study
BLM Training

26. Interagency Communication
Interagency Agreement - August 2002
FERC, ACHP, BLM, BIA, BOR, CEQ, COE, DOT, EPA, Forest Service, FWS, MMS, NPS, and NOAA Fisheries
Concurrent review
Concurrent issuance of necessary approvals

27. Agencies Agree To… Coordinate early and often proactive, informal
Develop a workable schedule with lead agency
FERC, in most cases
Support FERC’s NEPA Pre-Filing Option
Share data

28. Implementation of the Agreement
Establish Working Group
Assist in developing draft guidance for each agency
Evaluate the Agreement’s effectiveness

29. What This Means Signatory agencies stand ready to assist
Consistent key agency contacts
Increased need for consistent and timely information from project sponsors
Good stakeholder communication is imperative, must be transparent
Better project design, quicker decision process

30. Gas Outreach Efforts Ongoing
5th Workshop held on October 2 in Roanoke, VA
Plan to have another meeting before end of the year
Companies are taking stakeholder involvement seriously

31. LNG Supply Stream -- From Production to Distribution
Natural Gas Pipelines
Dock
Dock
Natural Gas Production
Storage and Vaporization Facility
Liquefaction and Storage Facility

32. Economic Oversight – Access to LNG Terminal
FERC
Economic Oversight – Access to LNG Terminal
Liquid to Vapor Flow
LNG
Ship
Dock
Natural Gas Pipelines
Storage and Vaporization Facility
New FERC Policy – Hackberry Case
NO oversight for access, rate or tariff for LNG terminals;
vaporized LNG competes with unregulated domestic supply. 1 32
Office of Energy Projects

33. Benefits of the New LNG Policy
Stimulates development of new LNG terminals
Accommodates various business models
Increases gas supplies to the U.S.

34. Alaskan Natural Gas Pipeline
Long lead time and high cost for delivery to market
Producers say that Alaskan project is uneconomic at this time
Sensitivity in Canada, DC and Alaska
U.S. Government has been monitoring and standing ready to help or act
New legislation for Alaskan Gas Project is pending

35. Pending U. S. Energy Bill re Alaskan Gas
Final outcome of bill is uncertain
Most likely - Provisions to streamline regulatory and legal process
Probably - Some limit or ban on the “Over-the-Top” route (above 68 degrees North)
Possibly - Some type of financial assistance: loans or tax credits

36. Other Gas Initiatives Emergency Reconstruction Rule
Regional Energy Infrastructure Conferences
The “Last Mile”
Other Outreach Efforts

37. Emergency Reconstruction Rule
The Rule allows pipelines to begin work on restoration projects under the blanket certificate program
Construction begins after notification to the Commission
Landowner advance notice required
No cost cap
Rearrangements w/ Compression = OK

38. THE LAST MILE High Pressure Needed In/Near Cities
Congestion/ In-Street Construction
Environmental Justice
State Involvement– CZMA? 401?

39. Other Outreach Efforts
Southwestern Gas Storage Technical Conference, Docket No. AD :
Analysis of relevant market needs and regulatory options available to assure the appropriate development of southwestern natural gas storage facilities
Gathering Conference, Docket No. AD :
Reexamination of our gathering policies, and whether our gathering policies provide sufficient incentives to develop offshore gas supplies needed to meet the country's demand for natural gas