A day after New York State denied approval of The Williams Cos.’ (NYSE: WMB) Northeast Supply Enhancement (NESE) project, a Trump administration official declared it was “incredibly short-sighted to the environment to stop these pipeline projects.”

Andrew Wheeler, administrator of the U.S. Environmental Protection Agency, in remarks at the Bipartisan Policy Center in Washington, D.C., said that canceling projects like NESE inevitably results in imports of LNG from other countries, particularly to pipeline-constrained areas like New England.

“We have almost doubled the amount of natural gas and LNG since 2000, and at the same time we have reduced our methane emissions 15%,” he said. “Russia not reducing their methane emissions and they do not produce their natural gas in an environmentally conscious manner.”

Wheeler appeared to be referring to shipments of Russian LNG aboard French tankers in December. Pipeline constraints precluded gas shipments to New England from Appalachian shale plays and the Jones Act meant that LNG produced on Gulf Coast facilities had to be shipped to the East Coast on foreign-flagged tankers.

The New York Department of Environmental Conservation cited concerns over water quality and aquatic life in its permit denial of Williams’ $1 billion NESE project. The project plans include about 23 miles of submarine pipeline off New York City’s coast.

“Construction of the proposed project would result in significant water quality impacts from the re-suspension of sediments and other contaminants, including mercury and copper,” the department said in its announcement. The decision was made “without prejudice,” meaning that the company would be able to reapply.

Williams responded in a statement that it would resubmit an application to obtain the permits.
“The Department of Environmental Conservation raised a minor technical issue with our application for water quality certification,” said Chris Stockton, a Williams spokesman.

The decision comes a week after Washington State Gov. Jay Inslee opposed two natural gas projects in his state, and three months after Los Angeles Mayor Eric Garcetti said the city would phase out natural gas operations at three power plants.

The Federal Energy Regulatory Commission issued a certificate of public convenience and necessity authorizing the project on May 3 but the company still required water permits from the states of New York and New Jersey.

The pipeline will provide 400,000 dekatherms per day to National Grid, the largest distributor of natural gas in the northeastern United States. The company is in the midst of converting about 8,000 customers annually from heating oil to natural gas in New York City and Long Island. 

Reuters contributed to this report.

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