By Stephen Borgna

READING - For the second time, the Federal Energy Regulatory Commission (FERC) has denied opponents of the Seneca Lake natural gas storage expansion project a request for a rehearing asking it to reject the plan under its current proposal.

The request, submitted in June 2016, is the second one FERC denied. According to opposition group Gas Free Seneca, it originally requested FERC deny the request and have the project application resubmitted for further vetting following new, upcoming regulations on underground gas storage facilities. 

The upcoming regulations were issued by the Pipeline & Hazardous Materials Safety Administration (PHMSA) in December last year due to a gas leak at the Aliso Canyon storage field in Porter Ranch, California. They're scheduled to debut this summer. 

Gas Free Seneca claimed in a letter to Gov. Andrew Cuomo in late December that the project doesn't meet some of the regulations as it's currently proposed.

“If Crestwood is allowed to construct this facility before the federal rules take effect, it will be built without meeting minimum federal safety standards,” Gas Free Seneca President Joseph Campbell said. “Such an outcome is unacceptable.”

Gas Free Seneca Vice President Yvonne Taylor said FERC hasn't ever granted a public request for a rehearing. She said the group will try a different route.  

“We are looking into avenues for an appeal of this decision with the Circuit Court,” Taylor said. 

The storage facility in the Town of Reading in Schuyler County is owned by Stagecoach Gas Services, a 50-50 partnership between Crestwood LP and Consolidated Edison formed to develop and maintain energy assets in the Northeast.

Among their other objections, environmental activists are concerned the salt caverns to be used for storage aren’t capable of storing pressurized natural gas. They’ve said there’s a chance failure could lead to an explosion, which could pollute the lake - a drinking water source for 100,000 people in the region.

Supporters and regulators have disputed the likelihood of that scenario as no more than minimal to completely baseless.

In a statement, Stagecoach said the company is currently assessing the upcoming regulations, is in compliance with much of them already and is invested in the facility’s safety. The rules do not take effect until July 18. 

“Safety is our top priority, and we embrace PHMSA’s mission of protecting people and the environment. We are evaluating PHMSA’s interim final rules (IFRs) related to underground natural gas storage facilities and their potential impact,” the company said. “Our storage facilities already comply with many of the practices and programs required by the IFRs, and we will continue to work closely with regulators to conduct our operations safely.”

The project is expected to provide a modest job boost and generate hundreds of thousands of dollars in annual tax revenue for the region, among other possible benefits. 

Construction is pending approval of an underground storage permit from the New York Department of Environmental Conservation.