East Tennessee Natural Gas Co. v. Sage

361 F.3d 808, 161 Oil & Gas Rep. 573, 2004 U.S. App. LEXIS 5343, 2004 WL 549824
CourtCourt of Appeals for the Fourth Circuit
DecidedMarch 22, 2004
DocketNo. 03-1708 No. 03-1709 No. 03-1710 No. 03-1711 No. 03-1712 No. 03-1713 No. 03-1714 No. 03-1715 No. 03-1716 No. 03-1717 No. 03-1718 No. 03-1719 No. 03-1720 No. 03-1721 No. 03-1722 No. 03-1723 No. 03-1724 No. 03-1725 No. 03-1726 No. 03-1727 No. 03-1728 No. 03-1729 No. 03-1730 No. 03-1731 No. 03-1732 No. 03-1733 No. 03-1734 No. 03-1735 No. 03-1736 No. 03-1737 No. 03-1738 No. 03-1739 No. 03-1740 No. 03-1741 No. 03-1797
StatusPublished
Cited by173 cases

This text of 361 F.3d 808 (East Tennessee Natural Gas Co. v. Sage) is published on Counsel Stack Legal Research, covering Court of Appeals for the Fourth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
East Tennessee Natural Gas Co. v. Sage, 361 F.3d 808, 161 Oil & Gas Rep. 573, 2004 U.S. App. LEXIS 5343, 2004 WL 549824 (4th Cir. 2004).

Opinion

Affirmed by published opinion. Judge MICHAEL wrote the opinion, in which Judge NIEMEYER and Judge DIANA GRIBBON MOTZ joined.

OPINION

MICHAEL, Circuit Judge:

The Natural Gas Act (NGA or the Act), 15 U.S.C. § 717f(h), gives a gas company the power to acquire property by eminent domain, but the Act does not provide for immediate possession, that is, possession before just compensation is determined and paid in a condemnation action. The main question in this appeal is whether a gas company can obtain immediate possession through the equitable remedy of a preliminary injunction. We hold that it can. We also hold that the district court properly granted preliminary injunctive relief to the gas company in the several cases consolidated in this appeal; we therefore affirm the injunction orders.

I.

East Tennessee Natural Gas Company (ETNG) is a regional gas transportation company. Several years ago the company developed plans for what it calls the Patriot Project, a project to construct an interstate gas pipeline, twenty-four inches in diameter and about ninety-four miles long, through portions of Tennessee, Virginia, and North Carolina. Before a gas company like ETNG can build and operate a new pipeline, it must obtain a certificate of public convenience and necessity from the Federal Energy Regulatory Commission (FERC or the Commission). The procedure for obtaining a certificate from FERC is set forth in the NGA, 15 U.S.C. § 717 et seq., and its implementing regulations, 18 C.F.R. § 157.1 et seq. The process begins with an application from the gas company that includes,among other information, (1) a description of the proposed pipeline project, (2) a statement of the facts showing why the project is required, and (3) the estimated beginning and completion date for the project. 15 U.S.C. § 717f(d); 18 C.F.R. § 157.6(b). Notice of the application is filed in the Federal Register, 15 U.S.C. § 157.9, public comment and protest is allowed, id. § 157.10, and FERC conducts a public hearing on the application, id. § 157.11. As part of its evaluation, FERC must also investigate the environmental consequences of the proposed project and issue an environmental impact statement. See 42 U.S.C. § 4332. At the end of the process FERC issues a certificate if it finds that the proposed project “is or will be required by the present or future public convenience and necessity.” 15 U.S.C. § 717f(e). In its order issuing a certificate, FERC specifies a date for the completion of construction and the start of service. 18 C.F.R. § 157.20(b). The certificate may include any terms and conditions that FERC deems “required by the public convenience and necessity.” Id. § 157.20. Once FERC has issued a certificate, the NGA empowers the certifícate holder to exercise “the right of eminent domain” over any lands needed for the project. 15 U.S.C. § 717f(h).

[819]*819On July 26, 2001, ETNG filed its application for a certificate of public convenience and necessity for the Patriot Project. See Preliminary Determination of Noro-Environmental Issues 1, 98 FERC ¶ 61331, 2002 WL 471183 (2002). Notice of the application was published in the Federal Register on August 9, 2001. Id. at 4. Thereafter, approximately 200 interested parties submitted comments or protests, id. at 4, appendix, and FERC held several public hearings on the application. FERC released its preliminary determination on March 27, 2002. In this document, which did not cover environmental issues, the Commission found that the Patriot Project would help satisfy the growing energy needs in portions of the three-state area of Tennessee, Virginia, and North Carolina. Specifically, the project would supply gas to new electric generation plants, meet the needs of local utilities for additional gas, and bring gas service to portions of southwestern Virginia for the first time. Id. at 15. The preliminary determination also noted that “there may be some adverse impacts on landowners from the construction of the project.” Id. After weighing these and other factors, FERC concluded that, subject to consideration of environmental issues, the public benefits of the Patriot Project would out-weigh any adverse impacts. Id. at 1. The Commission then moved to the environmental review process. Again, the public and interested parties were invited to submit comments and to participate in public meetings. Order Denying Rehearing, Authorizing Abandonment, and Issuing Certificate 13-14, 101 FERC ¶ 61188, 2002 WL 31973796 (2002). On September 22, 2003, the Commission issued its final environmental impact statement (FEIS). Id. at 14. The FEIS recommended a number of mitigation measures that ETNG should take to avoid or minimize environmental damage. Id. at 14-19. In the end, the FEIS concluded that construction and operation of the Patriot Project would result in limited adverse environmental impacts. Id. at 30.

FERC’s sixteen-month review of ETNG’s application ended on November 20, 2002, when the Commission by formal order issued ETNG a certificate of public convenience and necessity. Id. at 1. The FERC order confirms that “[ijssuance of the certificate ... permits [ETNG] to acquire land for the pipeline by eminent domain, if it cannot reach agreement with the owner of land authorized.” Id. at 20. The order requires ETNG to complete construction and make the pipeline available for service by January 1, 2005. Id. at 31. As the FEIS recommended, the certificate incorporates sixty-nine conditions that ETNG has to meet during construction. Id. at 31-44. Among other things, the conditions require ETNG to: (1) file weekly status reports with FERC during construction, (2) follow the mitigation measures described in the environmental impact statement, (3) employ environmental inspectors to monitor compliance with the mitigation measures, (4) monitor vegetation for at least two growing seasons following the completion of the project, and (5) limit construction to daylight hours.

As soon as FERC issued the certificate to ETNG, the company pursued negotiations with the affected landowners to acquire the easements to construct, operate, and maintain the new pipeline. The line will cross over 1,300 tracts of land in Tennessee, Virginia, and North Carolina. Through negotiations with landowners and a limited amount of condemnation litigation in North Carolina and Tennessee, the company was able to acquire over ninety percent of the right-of-way. That left about 130 tracts in Virginia where easements were still needed.

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Bluebook (online)
361 F.3d 808, 161 Oil & Gas Rep. 573, 2004 U.S. App. LEXIS 5343, 2004 WL 549824, Counsel Stack Legal Research, https://law.counselstack.com/opinion/east-tennessee-natural-gas-co-v-sage-ca4-2004.