Williams Begins Louisiana Pipeline Construction Despite Ongoing Legal Dispute with Energy Transfer
By Mary Holcomb, Digital Editor
(P&GJ) — Williams Cos. will begin construction of its Louisiana Energy Gateway natural gas pipeline, aimed at transporting gas from the Haynesville shale field to the Gulf Coast, despite ongoing disputes with Energy Transfer.
Williams has notified the Federal Energy Regulatory Commission (FERC) that it intends to move forward with pre-construction activities starting July 25, 2024. The company has been granted necessary easements and federal permits, clearing the way for construction to begin.
The legal conflict between Williams and Energy Transfer, which involved litigation over right-of-way issues, has been resolved in Williams’ favor in state court. This resolution, along with the existing permits and landowner agreements, allows Williams to push ahead with its project.
The legal conflict between Williams and Energy Transfer has been marked by contention since late 2023. In December 2023, Energy Transfer faced allegations of anti-competitive practices, accused of obstructing multiple projects, including Williams' Louisiana Energy Gateway System. The accusations centered on Energy Transfer's refusal to allow access to its pipelines, which was seen as an attempt to monopolize pipeline infrastructure and impede competitors.
The situation intensified as Momentum Midstream's affiliate, New Generation Gas Gathering LLC, filed a lawsuit in December, accusing Energy Transfer of blocking its $1.6 billion project. This legal battle highlighted Energy Transfer’s alleged aggressive stance on pipeline crossings, raising concerns about potential monopolistic behavior and its impact on the energy sector.
By May 2024, Williams Cos., the parent company of LEG LLC, expressed confidence in overcoming the dispute, despite delays pushing the project's operational date to the second half of 2025. Williams' optimism was based on recent legal rulings that favored their position in the ongoing conflict with Energy Transfer. Williams highlighted the critical nature of the LEG System for supplying gas from the Haynesville shale field to the Gulf Coast, a region experiencing increasing energy demand.
This confidence was further reinforced in June 2024 when the 36th Judicial District Court of Beauregard Parish ruled in favor of Williams, granting an injunction against Energy Transfer to prevent interference with the construction and maintenance of the pipeline. This decision covered seven key crossings, marking a significant legal victory for Williams and setting a precedent for resolving similar disputes.
Most recently, on July 4, 2024, the 42nd Judicial District Court of DeSoto Parish issued a ruling that allowed Williams to proceed with its construction plans, despite Energy Transfer’s attempts to block the project. The court's decision included a restriction on using the open-cut method for laying pipelines, reflecting ongoing concerns about the environmental impact and safety of construction practices.
Energy Transfer Responds
As Williams moves forward, Energy Transfer has raised concerns about the legality of the project’s advancement.
On July 22, Energy Transfer submitted a letter to FERC highlighting its objections to Williams’ plans to commence pre-construction activities starting July 25, despite ongoing jurisdictional reviews.
Energy Transfer argues that Williams is attempting to bypass the Federal Energy Regulatory Commission’s (FERC) authority under the Natural Gas Act (NGA) to review the LEG project’s jurisdictional status. Energy Transfer points out that, despite Williams' notification of upcoming construction, significant questions remain about whether the project should be classified as a transmission pipeline, which falls under FERC’s jurisdiction, or as a non-jurisdictional gathering system.
Energy Transfer's filing references previous admissions by Williams that the current configuration of the LEG project might be subject to FERC jurisdiction, with the potential for adjustments to avoid this oversight. The company also highlights discrepancies between Williams' recent notice and earlier sworn testimony indicating that construction on the LEG project had already commenced.
The letter underscores Energy Transfer’s request for FERC to address these jurisdictional issues and provide clear guidance on the regulatory framework applicable to the Williams project. Energy Transfer seeks to ensure that the Commission's policies are applied consistently and fairly, emphasizing the need for clarity on whether the LEG project falls under FERC’s jurisdiction.
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