Dec 052014

Marcellus Watch: LPG storage plan needs to stand trial


  • By Peter Mantius
    Posted Nov. 17, 2014 @ 12:11 pmCorning, N.Y.After five years of secrecy and deception, it’s time to throw the bright light of day on a proposal to store liquid petroleum gas, or LPG, in abandoned unlined salt caverns next to Seneca Lake.Long overdue sunlight must finally be allowed to shine on the caverns’ history. To do that, the state Department of Environmental Conservation — with Gov. Andrew Cuomo’s guidance — will need to order Crestwood Midstream’s proposal to stand trial.Earlier this month, the DEC issued draft conditions for the LPG storage permit in advance of an “issues conference” scheduled for Feb. 12.

    At that hearing, a DEC administrative law judge will determine whether unresolved questions need to be aired in a trial setting with sworn testimony, independent expert witnesses and witness cross-exams.

    Expect Crestwood to try to convince Cuomo to let it off the hook.

    Crestwood knows it must avoid sworn testimony. Throughout its long campaign for permits, it has repeatedly hidden damning evidence from both the public and the regulators.

    Even so, the Federal Energy Regulatory Commission approved in October an expansion of Crestwood’s natural gas storage operations next to Seneca, and that work is now proceeding. But the DEC has jurisdiction over the LPG project, the larger and more dangerous of the two.

    Crestwood’s plan is to turn a profit by stuffing natural gas and LPG from Marcellus Shale fracking operations in Pennsylvania into the cheapest, riskiest type of underground storage facility in the industry — salt caverns.

    The Seneca caverns are deeply flawed, bounded by layers of salt and brittle shale rock. They are subject to collapse and leakage, and the residents who live next to them face the statistically significant prospect of a catastrophic accident or a forced evacuation.

    The company has repeatedly attempted to conceal that danger from the people it would put at risk. The DEC has enabled that irresponsible behavior out of fear that transparency invites controversy.

    In late 2011, the agency held two public hearings on the LPG project in a Watkins Glen school auditorium.

    But they were largely for show because the DEC was withholding key information from the hundreds who showed up. The DEC still keeps key parts of the company’s “reservoir suitability report” under lock and key. And while the state geologist must by law sign off on the integrity of caverns used for hydrocarbon storage, his reports — if they exist — aren’t public record.

    Formal requests under the Freedom of Information Law were needed to pry lose bits of truth. They revealed letters that showed that the company’s own engineer had concluded in 2001 that the cavern now slated to hold liquid butane was “unusable for storage” after its roof had collapsed, leaving a giant rubble pile. He urged his boss to order the cavern plugged and abandoned. His boss agreed. So did the DEC. The cavern was plugged and abandoned.

    Years later, the company redrilled the rejected cavern in response to the Marcellus Shale boom.

    When the well’s history leaked to the public, Crestwood rushed to patch the problem by prompting the company engineer to deny the roof collapse. He did, and the company now insists the collapse never happened, despite company documents showing a 200-foot rubble pile on the cavern’s floor.

    Other discrepancies raise doubts about the safety of the cavern set to hold liquid propane. The company even denied to FERC that it knew about a gigantic roof collapse in the cavern just approved for gas storage.

    Crestwood must not be allowed to wiggle out of providing sworn testimony. If Cuomo lets it skip out, his permit process is a sham.

    • Peter Mantius is a freelance journalist from Schuyler County who follows shale gas drilling issues. He is a former reporter at the Atlanta Journal-Constitution and former editor of two business weeklies in the Northeast.

Upstate New Yorkers fear gas caves could blow wine, tourism industries

Activists fight expansion of energy storage facility they say poses safety, environmental and economic threat

In Watkins Glenn — an idyllic part of upstate New York best known for its Finger Lakes, fall foliage and wine — activists worry it could soon be known for something less appealing: industrial disaster.

Protesters in the area are engaging in civil disobedience to stop the expansion of a gas storagefacility that stores fracked gas from Pennsylvania in old mined-out salt caves, claiming it presents a safety risk to local residents, an environmental danger to the Finger Lakes region and an economic threat to the area’s wine and tourism industries.

“We do not want the crown jewel of the Finger Lakes and the font of the wine industry turned into a massive gas station for the fracking industry,” said Sandra Steingraber, a prominent anti-hydraulic-fracturing activist and environmental studies professor at Ithaca College who was one of about a dozen protesters who have been arrested several times during continued protests, most recently on Nov. 3, for blocking the entrance to the storage facility.

The controversy over the facility, owned by Houston-based energy company Crestwood Midstream Partners, was brewing for years but came to a head this summer after the legislature of Schuyler County, where the facility is, voted in favor of the proposed expansion, triggering protests that brought out hundreds.

The facility is made up of dozens of old salt deposits that were mined out over the last century, creating naturally sealed caverns that can be used to store liquids or pressurized gas. The caverns are conveniently located a few hundred miles from the booming natural gas fields of the Marcellus Shale in Pennsylvania and close to two gas pipeline routes. But they’re also right next to Seneca Lake, the largest of New York’s Finger Lakes, and one of its most environmentally compromised, thanks to years of leaching pesticides and fertilizers from surrounding farms.

Activists say pressurizing the old salt caverns could cause salt and gas to seep into the lake and pollute the ground, affecting the region’s wine industry. And they point out several catastrophic underground gas and oil storage accidents, including some that have been deadly.

In one incident near Houston in 1992, a salt cavern was overfilled, causing flammable liquid to leak and explode, causing one death and dozens of injuries. Two people were killed in a salt dome explosion in Texas in 1985.

Still, the Federal Energy Regulatory Commission (FERC), the presidentially appointed panel that oversees most natural gas infrastructure in the United States, gave the Crestwood Midstream expansion plans the go-ahead last month. To the company’s supporters, that showed the plans were safe. To the company’s detractors, it confirmed that the FERC nearly always sides with industry despite local concerns.

“FERC works with the gas company,” said Joseph Campbell, a co-founder of protest group Gas Free Seneca. “They just rubber-stamp these things. We’re calling on our federal representatives to step in and hold FERC accountable.”

But so far, protesters say calls to representatives have proved fruitless. Sen. Charles Schumer has not responded to protesters’ concerns and did not respond to requests for comment for this story.

‘We do not want the crown jewel of the Finger Lakes and the font of the wine industry turned into a massive gas station for the fracking industry.’

Sandra Steingraber

environmental studies professor, Ithaca College

The FERC has developed a reputation for siding with industry. The agency has received 803 applications for natural gas infrastructure since 2006. It has approved 451 of them, and 98 are pending review. According to the FERC, 258 have been denied or withdrawn, but the agency could not provide a breakdown of how many were denied, as opposed to voluntarily withdrawn by companies. Some have speculated that the FERC has denied nearly none of them. FERC spokeswoman Tamara Young-Allen said the commission has rejected only two applications since 2011.

“Unless we have some intervention from people in power to intercede on behalf of their constituents, we’re going to be taking all this risk while Crestwood takes the profits back to Texas,” Campbell said.

Crestwood wouldn’t comment for this story, except in an email from a spokesman who would not allow his name to be used. That email addressed why Crestwood called the police on protesters last week but not the protesters’ concerns about the facility.

“We have respected the protesters’ rights to oppose our growth projects, but our employees and contractors depend on having access to our existing operations at the U.S. Salt complex,” the statement read.

Crestwood’s official plans are to expand its current natural gas storage capacity by a third, from 1.5 billion cubic feet to 2 billion cubic feet. It also wants to add 2.1 million barrels of liquid gas storage capacity for propane and butane at the facility, a project that received a preliminary permit from the New York Department of Environmental Conservation last week, though that permit is still subject to public input and could be changed.

The department said in a statement that Crestwood’s permit application is pending as the state gathers public comments, but the protesters contend that the state has also proved its allegiance to industry. An investigation by news outlet Capital New York last month found that a fracking study performed at the request of Gov. Andrew Cuomo’s administration was edited to downplay risks associated with natural gas storage before it was made public.

Activists say Crestwood has much larger expansion plans than what it is permitted for, pointing that in several interviews and statements, company officials have spoken of expanding the facility to 10 billion cubic feet of storage — five times what their current permit allows. Crestwood would not comment on this disparity.

Underground oil and gas storage accidents are rare but can be catastrophic. Data on salt cavern storage is sparse, but one report commissioned by the British government in 2008 found that salt cavern facilities worldwide have collapsed or been breached 27 times since they began being used to store oil and gas in the 1940s. According to nonprofit investigative news outlet DC Bureau, salt caverns represent 7 percent of the U.S.’s approximately 400 underground gas storage sites. All eight deadly cavern disasters have occurred in the U.S., according to the British report. In those disasters, the contents of the caverns caught fire, causing explosions.

Nonlethal accidents have nonetheless created major headaches and environmental disasters. Perhaps the most infamous is the Bayou Corne sinkhole in rural Louisiana. There, a salt cavern collapsed in 2012, creating a 750-foot-deep hole that spans 30 acres and is filled with a toxic brew of oil, chemicals and water. It is still growing. Louisiana has urged the 350 residents of the area to move, and many are involved in a class-action suit against Texas Brine, the company that owned the caverns.

Bayou Corne represents the worst-case scenario for residents near Seneca Lake, but residents worry that less dramatic but nonetheless troubling hardships could stem from the expansion of the facility.

Seneca Lake is already several times saltier than other Finger Lakes, and research from Hobart and William Smith Colleges in 1995 points to salt-related industries as the probable cause.

“If you salt up a river or put methane in a river, you can clear that in a matter of days or weeks, but you can’t do that with a lake,” Steingraber said. “Pushing more salt and brine into the lake would be catastrophic.”

That’s particularly worrisome for the area’s vineyards, which rely on the groundwater around Seneca Lake for their grapes and the pristine nature of the region for tourism.

“The local wine industry is an agritourism-based industry,” said Justin Boyette, owner of Hector Wine Co., across the lake from the Crestwood facility. “I don’t want people to look up ‘Finger Lakes’ online and the first thing they come up with to be about a disaster.”


 Posted by at 5:29 pm