On August 27, 2015, the Clean Air Council, a Philadelphia based environmental rights group, sued Sunoco Pipeline, LP (“SPLP”) in the Philadelphia Court of Common Pleas challenging the status of SPLP as a public utility under the Pennsylvania Public Utility Code and its authority to exercise the right of eminent domain for construction of the Mariner East II Pipeline Project (“Mariner II”). SPLP had received approval from the Federal Energy Regulatory Commission (“FERC”) in 2012 for a pipeline project known as the Mariner East I Pipeline (“Mariner I”) which would transport natural gas liquids (“NGLs”) from the Marcellus and Utica Shale fields of Ohio and West Virginia across Pennsylvania to a terminal at Marcus Hook for the purpose of shipping the NGLs to markets outside of Pennsylvania. In 2014 SPLP secured federal approval from FERC for the construction of the new Mariner II pipeline project.
Over the past several months SPLP has endeavored to obtain easement agreements from the owners of properties upon which the Mariner II pipeline is to be constructed. Faced with the refusal of many property owners to voluntarily execute the easement agreements, SPLP has commenced eminent domain proceedings in a number of Pennsylvania counties to obtain the easements. Challenges to Sunoco Pipeline’s use of eminent domain to take property for the 350-mile Mariner II pipeline have been filed in many of those counties.
Clean Air Council contends that because the Mariner I and Mariner II pipelines are in interstate commerce, as distinguished from intrastate commerce, the Pennsylvania Public Utility Code is not applicable. Consequently, SPLP lacks the statutory authority to exercise the right of eminent domain as a “public utility” under the Pennsylvania Public Utility Code. Clean Air Council further argues that because the proposed pipelines will carry NGLs, not natural gas, SPLP is subject to federal jurisdiction under the Interstate Commerce Act, which does not confer eminent domain authority, as opposed to the Federal Natural Gas Act.
The recent Pennsylvania Supreme Court decision in Robinson Township v. Commonwealth of Pennsylvania, in which the Pennsylvania Supreme Court invalidated provisions of Act 13 as violative of the Equal Rights Amendment of the Pennsylvania Constitution may bolster the arguments of Clean Air Council. The Pennsylvania Constitution, Article I, § 27 provides that “the people have a right to clean air, pure water and to the preservation of the natural, scenic, historic and aesthetic values of the environment. Pennsylvania’s public natural resources are the common property of all the people, including generations yet to come. As trustee of these resources, the Commonwealth shall conserve and maintain them for the benefit of all the people.”
The Clean Air Council case is in its preliminary pleading stages so it is not yet known what action the Philadelphia County Court will take. While the jurisdiction of the Philadelphia court is limited to the confines of Philadelphia County; nevertheless a decision upholding the challenge to Sunoco Pipeline’s eminent domain authority will likely have far reaching effects.