Georgia transportation officials on Tuesday rejected a company's plans to build a $1 billion fuel pipeline from Florida through Georgia to South Carolina, likely setting up a legal battle over the fate of the project.
The state Department of Transportation said in a letter to Texas-based Kinder Morgan, which wants to build the 360-mile pipeline, that there is "substantial evidence showing that the pipeline would not constitute a public convenience or necessity." It said there is little evidence of increasing fuel demand in Georgia despite a growing population, and questioned whether the pipeline would reduce the price of fuel in the region.
Kinder Morgan President Ron McClain said in a statement that he was disappointed with the decision but that the company wasn't giving up on the pipeline.
"We continue to believe in the viability of the project and its economic benefits to the Southeast region and Georgia in particular, and we plan to pursue all available options to move forward with the project,” said McClain.
The state's decision came as no surprise. Gov. Nathan Deal telegraphed the move in an interview earlier this month, saying that he expected the pipeline's fate to be hashed out in court.
“It’s one of those issues that’s very controversial, and up to this point in time, the state has had very little input,” said Deal. “We should not, at this point in time, agree to the process.”
Deal's decision came after two Kinder Morgan surveyors were charged with trespassing on a Screven County property owned by the family of Billy Morris, the head of a Morris Communications. According to an incident report obtained by The Savannah Morning News, one of the surveyors told an arresting officer: "You can't stop the pipeline, they have enough money to push the pipeline through the county."
Kinder Morgan's plan calls for a pipeline that would run from Jacksonville, Florida to a storage facility in Belton, S.C. Officials there have said it would create about 30 permanent jobs in South Carolina.
The pipeline's supporters said the project would provide more fuel supply to Georgia and the first direct pipeline service into the Savannah market. About 86 percent of the right-of-way necessary for the pipeline's Georgia section runs along existing pipeline or utility routes, wrote Jonathan Chally, a King & Spalding attorney representing the project, in a letter to Deal's office.
"Georgia citizens have seen the impact that hurricanes in the Gulf of Mexico or along the Atlantic Coast, for instance, can have on the transportation of petroleum products through truck, rail or marine transport," he wrote. "The Palmetto Pipeline would provide a stable source of delivery for petroleum products uninterrupted by these events."
It has met stiff resistance from some coastal residents and Savannah business groups. The Savannah Area Chamber of Commerce, one of the staunchest opponents, sent Deal a letter in April that said Kinder Morgan hadn't "disclosed key important information" to justify its construction.
"We do not yet understand specifically how Georgians benefit from this pipeline," wrote Trey Cook, the chamber's chairman. "And without that clear benefit, the state's very powerful use of eminent domain should be reserved."
About the Author
