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Pipeline firm, utility company reach agreement to serve Schoharie County

Talks seen as boost for proposed natural gas project

Sunday, November 4, 2012
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— Talks between the Constitution Pipeline Co. and a southern New York utility that could lead to natural gas service are seen as a positive sign by an official in Schoharie County eyeing the economic benefits of the pipeline proposal.

Constitution Pipeline, a joint venture between Williams Partners and Cabot Oil & Gas, announced Friday an agreement signed with Leatherstocking Gas Co. to “work in good faith to pursue agreements for the design, construction and operation of delivery interconnects along Constitution’s proposed pipeline route.”

Constitution is in the pre-filing process with federal regulators and plans to file a formal application early next year.

The company wants to build a 120-mile natural gas pipeline from northern Pennsylvania to the Schoharie County town of Wright.

“Leatherstocking’s plan is to provide lower cost, clean burning, abundant, domestic natural gas to rural communities,” Leatherstocking CEO Mike German said in a release. “Tapping into the Constitution Pipeline would help us achieve that goal.”

Up until now, there’s only been suggestions that the “open access” pipeline could lead to natural gas availability in rural areas that would serve as a route for the pipe.

Leatherstocking Gas Co. currently serves customers in and around the Binghamton area, but the company envisions bringing local distribution to Broome, Chenango, Delaware and Madison counties, according to the release.

Natural gas is only available in the Cobleskill area in Schoharie County, provided by New York State Electric and Gas.

Utilities have to secure franchise agreements with localities and get authorization from the state’s Public Service Commission before offering natural gas service. Utility spokesmen have said the decision hinges on the costs of a project compared with projected returns on the investment.

Talks beginning on the development just south of Schoharie County is “promising” from the aspect of getting less-expensive gas into the area, Schoharie Town Councilman Matt Brisley said Friday.

“People in Cobleskill now, they’re paying much less for their stoves and everything else than anybody else in the county,” Brisley said.

Constitution Pipeline has suggested real property taxes on the line, if built, would equate to about $5 million to Schoharie County.

Another benefit the company has underlined is the money, not yet described, that property owners would be paid for an easement to build the line on their parcels.

Brisley said it would take work of local utilities to bring natural gas from such a pipeline and he’s unsure if Schoharie County towns have enough demand to warrant it.

But if they do, it could be a benefit, he said.

“To me, that would be the number-one silver lining. That would be the biggest benefit that any of us could see if the pipeline does come through,” Brisley said.

Efforts to garner comment from NYSEG were unsuccessful Friday.

Constitution Pipeline spokesman Christopher Stockton said in an email Friday the company anticipates spending about $14.5 million in new annual sales, income and property taxes throughout the proposed pipeline’s path.

This is in addition to an estimated $86 million in new labor income and $12 million in sales and income tax revenue from the construction phase of the project if it’s approved, Stockton said.

“This is a big reason why we’ve seen supportive comments filed with FERC from other county governments,” Stockton said, citing favorable input from the mayor of Oneonta, from Delaware and Otsego county legislative boards and from the Worcester Town Board in Otsego County.

Schoharie County government has not issued a statement regarding the pipeline proposal.

Aside from property and sales tax, locals are already getting in line for another benefit from Constitution Pipeline — a grant program is being offered even before a decision by federal regulators on the pipeline proposal.

The company in August announced a community grant program for those along the proposed pipeline’s path.

It offers grants of up to $25,000 to support emergency personnel, youth and senior services, education programs, open space and park land recreation efforts, wildlife habitat enrichment, promotion of environmental education, land purchases to protect wetlands and wildlife and for access to public land with scenic and wildlife views and to develop active recreational areas.

Since it was announced, Stockton said the grant program received 58 applications, 10 of which came from entities within Schoharie County.

A committee is reviewing those applications and an announcement on funding is expected in December, Stockton said.

 
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