Senate votes down proposal to greenlight the Mountain Valley Pipeline

The U.S. Senate has rejected Sen. Joe Manchin’s latest attempt to extricate the Mountain Valley Pipeline from a series of legal and regulatory snags that have delayed its completion by four years.

Manchin’s effort to include his permitting reform bill as an amendment to national defense legislation died Thursday with a 47-47 vote. Sixty votes were needed.

The West Virginia Democrat had attempted to attach his bill — which would streamline federal permitting for energy projects in general and greenlight Mountain Valley in particular — to a larger piece of legislation that required immediate action.

A part of Manchin’s bill that would move legal challenges to a court where the pipeline developers might fare better drew strong opposition from Sen. Tim Kaine, D-Virginia.

If Mountain Valley was allowed to switch venues from the 4th U.S. Circuit Court of Appeals, which has repeatedly struck down its federal permits, to a federal appeals court in Washington D.C., what would prevent other large corporations dissatisfied with a court’s ruling from doing the same thing? Kaine asked.

“If we go down this path on this project, I can see it opening a door we will not want to open — a door that can even lead to corruption,” Kaine said from the Senate floor earlier this week.

Late Thursday, the Senate voted down Manchin’s proposed amendment to the National Defense Authorization Act, the annual budget for the U.S. military.

Manchin had attempted a similar move in September, when he tried to include his permitting reform package in another “must-pass” piece of legislation, a budget resolution needed to avoid a government shutdown. He withdrew the bill after it drew opposition from both sides of the aisle.

Pipeline opponents praised the Senate vote.

“The Mountain Valley Pipeline, which has been cited for hundreds of permit violations related to water quality, should not get special treatment in Congress,” said Chelsea Barnes, legislative director for Appalachian Voices.

Manchin’s proposal “sends terrible messages to the public — that corporations that curry favor with an elected official do not have to comply with our laws, and that processes designed to protect transparency, public participation and our environment can be sacrificed,” Barnes said in a statement.

Delays in construction of the 303-mile pipeline, which was supposed to be in service by now, are in part attributable to decisions by the Fourth Circuit. Raising environmental concerns, the court has repeatedly struck down federal permits for the $6.6 billion project.

In an earnings call last month, the lead partner in the joint venture referenced the court’s “continued hostility” to Mountain Valley, saying the most probable path to completion may be through Congress.

The war in Ukraine and other global events have only increased the demand for natural gas, and “clearly highlight the need for expeditious action by Congress on federal permitting reform as the best path to complete the MVP project in 2023,” said Thomas Karam, chairman and CEO of Equitrans Midstream Corp.

Twice in the past four years, the Fourth Circuit has thrown out permits allowing Mountain Valley to pass through the Jefferson National Forest, and reversed an opinion from the U.S. Fish and Wildlife Service that endangered species would not be jeopardized by running a buried pipeline through their habitats.

Critics have long said it would flirt with environmental disaster to build such a large pipeline across steep mountain slopes and through pristine forestland.

Mountain Valley is in the process of applying for new permits for the third time. The company also faces uncertainty with a different set of permits, also invalidated by the Fourth Circuit, that would allow it to cross the remaining streams and wetlands along the pipeline’s route from northern West Virginia, passing through the New River and Roanoke valleys to connect with an existing pipeline near the North Carolina line.

In granting legal challenges by the Sierra Club and other opponents, a three-judge panel of the appellate court has raised questions about Mountain Valley’s ability to curb muddy runoff from construction sites, and the government’s oversight of the company.

Environmental agencies in the two Virginias have cited Mountain Valley about 500 times for violating erosion and sediment control regulations.

Although Karam said last month that Mountain Valley is committed to seeking new permits that will withstand legal scrutiny, he expressed hope for a legislative solution.

Manchin — who won support from Democratic leaders for his permitting reform legislation in exchange for his key vote supporting a climate, health and tax bill that was a key priority of the White House — says he’s not done.

“Permitting reform and the completion of the Mountain Valley Pipeline are essential to ensuring lasting American security and independence,” Manchin said in a statement following the Senate vote.

His proposal to streamline federal approvals of all energy projects could still proceed as stand-alone legislation — albeit at a slower pace than the methods he has tried so far.

Several other lawmakers, including Sen. Pat Toomey, R-Pennsylvania, have introduced similar proposals that would mandate strict timelines for review under the Clean Water Act and speed up the National Environmental Policy Act approval process.

Those bills, like Manchin’s, give specific leeway to Mountain Valley.

However, the Senate’s vote this week does not bode well for permitting reform early next year, according to Height Capital Markets, an investment banking firm that follows Mountain Valley and regularly releases commentaries on developments.

Democrats tend to be skeptical of giving too much clout to the fossil fuel industry, while some Republicans view Manchin’s bill as not going far enough to loosen regulatory red tape.

“It is possible that a new Congress will bring a clean slate for bipartisan compromise in 2023,” Height said Friday. “The White House has emphasized the need for permitting reform to facilitate electric transmission to access high-value renewable resources” that are a key part of the climate, health and tax bill that passed earlier this year, it said. “A grand compromise here is easy to visualize.”

But given the political realities, Height added, “we are very cautious on passage in early 2023.”