FERC backs Williams in Texas-Louisiana pipeline dispute with Energy Transfer
By Mary Holcomb, Digital Editor
(UI) — The Federal Energy Regulatory Commission (FERC) has rejected Energy Transfer LP's request to challenge the jurisdictional status of a major pipeline project by The Williams Companies Inc. (Williams), according to a Sept. 27 ruling.
In its petition, Energy Transfer sought an order requiring Williams to demonstrate why its Louisiana Energy Gateway (LEG) pipeline system in Texas and Louisiana should not fall under FERC's jurisdiction. The petition centered on whether portions of the pipeline are "gathering" facilities or subject to federal oversight as transmission lines.
Williams plans to build the LEG System, a massive project designed to gather and process natural gas from the Haynesville Shale region. The system will consist of two major segments: the Haynesville Spine, a 64-mile pipeline system in Louisiana, and the Juniper South segment, a 110-mile pipeline. Energy Transfer argued that the size and scope of the system make it more like a transmission network, which would place it under FERC’s regulation.
However, FERC disagreed. The commission ruled that the LEG System will function as a gathering facility, exempt from its jurisdiction under the Natural Gas Act (NGA). FERC applied its "primary function test," considering the system's geographic configuration, pipeline size, and operational purpose, concluding that it meets the criteria for non-jurisdictional gathering activities.
In dismissing Energy Transfer’s petition, FERC stated that Williams' LEG System serves an essential role in gathering and processing gas from productive regions like the Haynesville Shale, Austin Chalk, and Tuscaloosa Marine Shale. The commission found no basis to treat the LEG System as part of Williams' larger interstate Transco pipeline system, as argued by Energy Transfer.
This decision clears the path for Williams to proceed with the construction and operation of the LEG pipeline as planned, exempt from federal oversight under the NGA.
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