Energy Company Commits to Restoring Farmland Torn Up by Pipeline

WASHINGTON (CN) — Oklahoma farmers who have had their land destroyed by the Midship Pipeline will finally have their property restored by May 17, the pipeline’s owner promised House lawmakers at a hearing on Wednesday. 

The farmers have been left with a mess of debris, erosion, flooding and missing soil caused by construction of Cheniere Energy's 200-mile pipeline, but still haven’t had their land repaired. 

“If I had to pay out of pocket to fix the stuff that Midship tore up, it would cost me almost as much as the farm is worth,” said Terry Luber, an Oklahoma farmer who says his ruined farm has been in the family for four generations and over 100 years. Farmers are estimating that it will cost between $20 and $40 million to restore each of their properties.

“These are individual farmers for whom millions of dollars is a huge amount of money,” said Representative Jamie Raskin of Maryland, chairman of the House Oversight Subcommittee on Civil Rights and Civil Liberties. “But to Cheniere, that amount is barely a rounding error.”

Cheniere has already missed several deadlines to repair farmers’ private land over the past year, and has faced no consequences from the Federal Energy and Regulatory Commission, the primary federal permitting agency for major interstate natural gas pipelines. 

FERC allows pipeline companies to construct pipelines before meeting their obligations to fix private land that they damaged, giving landowners little to no opportunity to prevent use of their private property against their will, and giving pipeline companies little incentive to satisfy the demands of landowners to repair their land. 

“If I come onto your land by way of eminent domain and I disrupt your farm and your business, evade the ground, tear it up, and I start making money immediately — what’s my incentive to repair and restore your land?” said Raskin. “I’ve already gotten out of you what I want to get out of you.”

The subcommittee launched an investigation into the use of eminent domain in the construction of natural gas pipelines in February 2020, and in December it pressed FERC to pause its certificates so that a company could not assert eminent domain over a landowner’s objections while the landowners’ appeals are still pending. On Tuesday night, FERC issued an order that did just that. 

“This common sense and eminently fair practice was long overdue, but there’s still a lot of work to do,” Raskin said. 

The Maryland Democrat says that FERC only requires companies to demonstrate they’ve made substantial progress on restoration prior to the pipeline going into service, but they never specify what that means. 

“In practice, as the Midship Pipeline case illustrates, FERC’s standard is totally slippery and woefully insufficient," Raskin said. “It’s a promise written in basically disappearing ink.”

Last year, FERC said the damage would be repaired by June 30, 2020. Now, the new deadline, as set by FERC orders in March, is May 17 of this year. 

Christopher Smith, senior vice president of Cheniere Energy, testified that the company is actively working to engage stakeholders and landowners to address their concerns and repair their land. 

“We are doing everything we can to quickly address the issues identified in the FERC order, and we have dedicated a team working around the clock to do so,” Smith said. 

Smith told lawmakers that as of Wednesday, 75% of the identified tracts of land in the FERC order have either been fully repaired, are awaiting inspection results from FERC, or have been resolved through alternate arrangements. 

But Cheniere has not provided weekly completion updates to the subcommittee in several weeks, which was part of their agreement. 

“Mr. Smith, do you think Cheneire is above the law?” asked Representative Debbie Wasserman Schultz, a Florida Democrat.

“No,” Smith replied. 

“So if you’re not above the law, then I assume you’ll be fully compliant with FERC’s March 2021 orders by May 17?” Wasserman asked. “I mean truly restoring, not by your definition but by the farmer’s definition?”

Smith replied in the affirmative: “We will be fully complying with the FERC order and meeting the deadlines in that order.” 

The Midship Pipeline is only a small part of the larger problem of private pipeline companies’ ability to use eminent domain to take property away from individual landowners, said Samuel Gedge, an Institute of Justice attorney.

“Unlike the federal government, pipeline companies get to take land first and pay later,” Gedge told lawmakers in the hearing. “When the federal government themselves want to exercise eminent domain, landowners get compensated before the government enters on their property.”

Gedge said there is a huge need to reform the Natural Gas Act to prevent this from happening. 

“At the best of times, eminent domain is disruptive, and is harsh, and often falls hardest on people who lack political clout,” Gedge said. 

Raskin said that the subcommittee will explore legislation to reform the FERC process to better protect landowners from the federal government and from pipeline companies.

“For the landowners in Oklahoma, FERC is simply not doing its job as a public regulatory agency,” Raskin said. “It’s basically working for the private companies.”

Subscribe to Closing Arguments

Sign up for new weekly newsletter Closing Arguments to get the latest about ongoing trials, major litigation and hot cases and rulings in courthouses around the U.S. and the world.

Email *

Submit