Williams Begins Louisiana Project Despite Lingering Legal Dispute

Williams Cos. (WMB) notified the Federal Energy Regulatory Commission (FERC) that it would begin construction on the Louisiana Energy Gateway (LEG) project, regardless of the current status of its legal battle with Energy Transfer (ET).

“In light of Energy Transfer LP’s pending Petition for Order to Show Cause, LEG LLC hereby provides notification to the Commission that it intends to proceed with construction of the System,” Williams told FERC in a statement submitted on July 19.

Williams and Energy Transfer have an ongoing legal dispute over the LEG project that stretches back to 2023.

The Louisiana Energy Gateway is a 1.8-Bcf/d capacity project designed to move natural gas from the Haynesville Shale to coastal Louisiana LNG export terminals. The dispute with Energy Transfer has forced Williams to adjust its pipeline routes and push back its start date from fourth-quarter 2024 to 2025.

In April 2024, ET petitioned FERC to declare that part of the LEG project that crosses the Texas-Louisiana border is a transport pipeline instead of a gathering and processing line, meaning that it would fall under the FERC’s jurisdiction.

The FERC has not yet ruled on the dispute. Analysts said it would be difficult to determine the timeframe, as categorical rulings on pipelines are usually brought by the companies building the lines rather than competing organizations.

Bloomberg reported that an Energy Transfer spokeswoman called Williams’ move surprising, as the legal proceedings determining the final outcome are complete, and said that, “None of the state court cases between LEG and Energy Transfer are final.”

Other than the contest with the FERC, Williams and ET have been battling over the project’s rights-of-ways in Louisiana state courts. According to Williams’ plans, the LEG will cross ET’s lines in several Louisiana parishes.

ET argued that the line crossings were unsafe and that the company had the right to refuse Williams, as well as other crossings planned in separate projects by DT Midstream (DTM) and Momentum Midstream. Williams argued ET was claiming rights that were not part of Louisiana law and the primary motivation for the dispute was to delay the work of competitors.

Williams has won all cases decided at the district level so far. Williams released a statement July 19 saying the company would move forward in the near future.

“But for the crossing litigation drama with Energy Transfer, construction of the Louisiana Energy Gateway gathering system would be well underway, and we’d be closer to bringing clean, Louisiana-produced natural gas to market. Today, having prevailed in certain right-of-way litigation in Louisiana state courts and with federal permit authorizations in hand, Williams will commence pre-construction activities along its right-of-way in the coming weeks, and then proceed with construction,” said Laura Creekmur, Williams’ vice president of communications and corporate social responsibility, in a statement released by email.