The $2 billion Permian Highway Pipeline is rolling east toward the Texas Hill Country and with it a wave of property rights, environmental, and regulatory challenges.
Kinder Morgan, the pipeline builder and operator, has gotten approvals from five state agencies and the blessing of the U.S. Army Corps of Engineers. The company has met with local officials along every one of the 430 miles from North Stockton to Houston and changed the route of the pipeline more than 200 times to accommodate local population and geology. The company has paid out millions to acquire property rights.
But while the experts say everything has been done properly and there is little that could stop its scheduled completion in April 2021, 150 miles into construction the lawsuits keep coming.
The Sierra Club filed suit in U.S. District Court in Austin on April 30 demanding the Army Corps of Engineers rescind its permit for the entire project because of a 36,000-gallon leak of drilling slurry into an underground aquifer March 28, roughly five miles east of Blanco. The spill muddied at least two private water wells that were expected to clear.
Hays County Commissioners responded by withdrawing its permission for the company to drill under any roads in the county. The Wimberley Valley Watershed Association and the Trinity Edwards Springs Association have threatened to sue over the spill. The Texas Railroad Commission (RRC), the agency most responsible for oversight of the project, sent the company a notice of violation for failing to notify regulators of the spill until March 31.
Add to that the commissioners court and Kyle City Council’s decision to join in a lawsuit being brought by a Dripping Springs law firm, Braun & Gresham, which has a page on its website devoted to the Permian Highway Pipeline and solicits negotiating property settlements with Kinder Morgan.
The suit is underwritten by the Texas Real Estate Advocacy and Defense Coalition, a landowner advocacy group that lobbies in Austin and maintains its own political action committee. The group has been buying anti-pipeline ads in the local papers and putting up small billboards on properties along the route.
“This isn’t a shot at the oil and gas industry,” Hays Commissioner Lon Shell said at a meeting April 16. “This isn’t trying to get in the way of the jobs that are created there and some of the benefits. This is about property rights—specifically of our citizens, but [also] citizens across the state of Texas.”
It’s a good bet the city of Austin will also sue, even though not a foot of pipeline will be laid in any part of Travis County. In January the city council approved setting aside $100,000 for future legal fees. The city’s environmental officer, Chris Herrington, said at the time the city had concerns construction, even miles away, might threaten water quality in the Edwards Aquifer.
“We know there is potential for contamination, there is a route for contamination to get into Barton Springs, but since we don’t know more specifics, we can’t do a full risk assessment to really assess the full range of potential impacts,” he said.
What might end up being the most curious attempt to stop the pipeline’s incursion into Hill Country was a request to investigate the degradation of the corrosion coating on stacks of pipe segments laying out in the sun waiting to be laid.
In a March 15 letter to the RRC, obtained in a records request, John Watson, a retired engineer writing on behalf of Hill Country stakeholders, asked that the commission inspect the dates on the pipes and the bonded epoxy coating.
The dates suggested the pipes had been in the sun well beyond “the limit recommended for exposure to ultraviolet sunlight and rain by both manufacturers and industry standard-setting groups,” Watson said in his letter.
According to an evaluation report obtained in a records request, two inspectors went to the site named in Watson’s letter, spoke to a Kinder Morgan crew chief and reviewed a pipe inspector’s report. The investigation was closed after three days with no action taken.
Watson did not respond to an email requesting that he discuss his views on the pipeline coating and the RRC’s investigation.
Still, Watson’s concerns sparked a three-part investigation by Austin’s KXAN-TV, fueled by a local group, Blanco-Stop the Pipeline!, that says little on its website about its membership or its support.
The investigation relied chiefly on the opinions of Nathan Phillips, a Boston University environmental science professor, who had never been to any spot on the construction route.
Phillips had recently completed a two-week hunger strike, losing 22 pounds to protest the construction of a natural gas compressor station near the Massachusetts Department of Environmental Protection.
“Phillips has been arrested for non-violent protests against fossil fuel projects three times since October,” according to the award-winning pro-environment website InsideClimate News. “Phillips has undergone a radical shift from a scientist careful to maintain an apolitical stance to a researcher who disrupts pipeline construction projects, places his body in front of moving coal trains and occupies the offices of state regulators. His increasing activism may lead other scientists, including some potential research collaborators, to question his methods and objectivity.”
Records kept by the federal Pipeline and Hazardous Materials Safety Administration indicate that pipeline corrosion is a relatively insignificant problem. With thousands of miles of oil and gas lines underground, there have been 126 reports made in the last 10 years, 23 of them in Texas. Only one of the 126 was directed at Kinder Morgan, which owns or operates 83,000 miles of pipeline in North America.
“We don’t put pipes in the ground that aren’t safe,” Allen Fore, vice president of Public Affairs for Kinder Morgan, said in a lengthy phone interview Friday. “Bottom line, we have processes in place with our pipe inspections with the expectation that our pipelines will be in service for decades.”
The vast majority of the more than 1,000 property owners affected by the pipeline have been satisfied with their settlements, Fore said. Fore said he has personally been part of “thousands” of discussions with property owners and been host to dozens of public meetings in Blanco, Caldwell, Gillespie, and Hayes Counties.
Not everyone has been happy. After local appraisers for Kinder Morgan set values on the 50-foot easements and workspace needed for the project, special commissioners courts set up to evaluate those appraisals, came back with figures in some cases 20 or 30 times greater. Several property owners told CBS News Austin in November they thought they were being “low-balled” by the company.
Kay Pence, the owner of a ranch and vineyard in Fredericksburg, told CBS News Kinder Morgan’s appraisal of her easement was $45,000. A commissioner’s court, weighing what Pence contended was an overall devaluation of her property, decided Kinder Morgan owed her $1.2 million to settle.
“No one worries about a for-profit, multi-billion dollar company bullying landowners,” Pence told CBS. “We are supposed to sit here, and let them bully us and take our land, and say, ‘That’s fine Kinder Morgan, pay us pennies on the dollar.'”
While Kinder Morgan put $1.2 million in an escrow account for her, Fore said the company will, under the agreements with all property owners like Pence who got an adjustment, review and, if necessary, appeal those adjustments.
Fore declined to discuss Pence’s case specifically because the company is in litigation with the Real Estate Advocacy and Defense Coalition. Pence is now vice-chair of the coalition board.
Pence did not respond to emails sent through the coalition website requesting comment.
“It’s going to be for the courts and the legislature to decide whether or not you’re going to start dealing with the entire parcel rather than the easement. That has never been part of the land acquisition equation and I hope it never is,” Fore said.
Kinder Morgan is prepared for any and all legal actions and is confident nothing can prevent the company from completing the project by next April, Fore said.
Most of the interaction with property owners and their elected representatives has gone smoothly and Fore said the company has gone out of its way to accommodate as many people as possible within reason.
“We can agree that an infrastructure project like this is critically important to the people of this state,” Fore said. “So, it disappoints me when anyone who takes advantage of natural gas suggests that this pipeline can be anywhere else, but no way on God’s green earth should you put it on my 5,000-acre ranch.”
Disclosure: Unlike almost every other media outlet, The Texan is not beholden to any special interests, does not apply for any type of state or federal funding, and relies exclusively on its readers for financial support. If you’d like to become one of the people we’re financially accountable to, click here to subscribe.
Mark Lisheron has been a reporter and editor for more than 40 years, with award-winning stints at The Texas Monitor, Texas Watchdog, the Austin-American-Statesman and the Milwaukee Journal Sentinel.