Midla Pipe bill gets House approval - KNOE 8 News; KNOE-TV; KNOE.com |

Midla Pipe bill gets House approval

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BATON ROUGE, La. (KNOE 8 News/Adley Press Office) - At the urging of District 36 State Senator Robert Adley, the Louisiana State Legislature overwhelmingly gave final approval to Senate Bill 525. The bill sets up a process for the Louisiana Public Service Commission to intervene on behalf of Louisiana consumers if the Federal Energy Regulatory Commission (FERC) allows the abandonment of the American Midstream Pipeline (Midla) without the agreement of those who now pay for and depend on the pipeline for their natural gas service.

Tens of thousands of Louisiana families and businesses in the eastern part of Louisiana from Ouachita Parish in the north to East Baton Rouge Parish in the south, mostly in rural areas and small towns, depend on the American Midstream Pipeline (Midla) for their natural gas service. There are no other existing options.

ArcLight Capital Partners, a hedge fund based in Boston that owns Midla, has asked FERC for permission to abandon the pipeline. The owners claim the pipeline is antiquated and unsafe to operate. The move to abandon the service came after the pipeline users refused to go along with rate increases amounting to 10 to 14 times the current rates.

“The pipeline owners are just not telling the whole story,” Sen. Adley (R-Benton) said. “The pipeline is old, but so is just about every other natural gas pipeline in Louisiana. The difference here is, for decades, consumers have paid rates set by federal regulatory authorities that included an amount to be used for maintenance of the pipeline. Instead the pipeline operators pocketed the money all those years. The consumers did not get what they paid for and are now being asked to just do without natural gas service. That shouldn’t happen.”

The proposed new state law outlined in Senate Bill 525 would require the approval of the Louisiana Public Service Commission (PSC) to abandon any portion of an interstate pipeline that runs through Louisiana once an abandonment plan has been approved by the federal government, unless the users of the pipeline agree to the abandonment plan. If the PSC agrees to the shutdown of the pipeline, the operators could have to cover any costs associated with making an alternative provider available.

Sen. Adley’s Senate Bill 525 next heads to the governor’s desk for action.

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