Farm Bureau News
Gas pipeline work begins
Farmers are pleased with low impact approach
By Marsha Dorgan
Construction on a 35-mile underground gas storage pipeline across prime ag land in San Joaquin County is underway and several of the farmers affected by the project are giving high kudos to Lodi Gas Storage officials for keeping their commitments to the ag industry.
Pipeline construction began in Acampo on April 9, and work in that area is expected to wrap up the first of July, according to LGS officials.
In May 2000, the California Public Utilities Commission voted 5-0 to approve, LGS's application to build the underground pipeline from Acampo to Sherman Island, north of Antioch. Gas will be pumped into a depleted natural gas well what lies under 1.450 acres of what is largely vineyards, orchards and dairy farms.
The gas will be stored at an underground reservoir 2,200 feet underneath the ground at Jahant Road and Ray Road in Acampo.
The pipeline and gas storage unit comes with a hefty price tag of $115 million. The approval of the project, which covers 1,800 acres, brought cries of protest from farmers and property owners who worried the pipeline would create problems ranging from aesthetic to the loss of their property through eminent domain.
The Farm Bureau took up the flight for the farmers at the PUC meetings. After several meetings and hearings, compromises between LGS and the opposition were reached.
San Joaquin Farm Bureau Board member Brad Lange served on the original steering committee that ironed out a memorandum of understanding between the two parties.
Although the pipeline does not affect Lange's property, he has kept a watchful eye on the operation.
"I have not heard any complaints about their (LGS) operations since the pipeline got going. Hopefully they will continue to live up to the MOU and what they have promised landowners," Lange said. "I talked to a grower this morning who said the pipeline people were doing a clean-cut job. He said they're polite and sensitive to moving the equipment up and down the land. I really hope this will continue. It's really important they be a good neighbor."
SJFB Board member Joe Petersen's vineyards are across from the proposed gas storage wells. "The construction hasn't bothered my farming operations at all," Petersen said. Petersen isn't worried about the construction affecting grape harvest. "They will be done long before harvest, which doesn't start until late August, early September," he said. "I haven't had any inconveniences from the project. So far, the people at Lodi Gas Storage are living up to their word. I hope they follow through."
The pipeline borders the north property of SJFB Board member and wine grape grower Stanton Lange. "I've have no problems. Everything has been going as we negotiated. The workers have been very careful about staying within their work area. And they have been mindful about creating dust. I was worried about the dust situation with the vines, but so far, that hasn't been a problem," Lange said. "They are moving along pretty quickly."
Lange said the barrage of heavy equipment needed for the pipeline project hasn't created any conflicts for his ag operation. "They have made a very conscientious effort stay within their work area," he said. During negotiations among LGS, farmers and property owners, the threat of the use of eminent domain was high on the list of the opposition.
"I know that really was a big concern for the property owners and growers," said Scott Wilson, LGS vice president.
Of the about 120 property owners affected, "We were able to lay the entire 35 miles of pipe without having to use eminent domain. There is only one landowner who fell into the eminent domain process. His property is in the storage area," Wilson said. "We are in the PUC administrative process now, prior to going to court. Hopefully, we can settle it before it goes to court."
Wilson admits the project will cause inconveniences for farmers. "There is no doubt that will happen. But as part of the executed agreement between property owners and LGS, we have agreed to compensate farmers for loss of crops and replanting," he said.
Wilson confirmed construction will not impact grape harvest. "As per requirements from PUC, we must complete all construction that's within the area of vineyards one month prior to harvest. And we will meet this."
Wilson believes the natural gas storage in the San Joaquin Valley will have some benefits for farmers. "We can provide a warehouse of gas for consumers. The benefits for ag are direct and indirect. The company will be able to supply gas to food processors and other industries that support the ag industry," Wilson said. "Most of the industries that support ag are big consumers of gas."
Stanton Lange believes his farming operation will reap some benefits from the gas storage facility. "It will have a secondary effect for farming. Hopefully, it will stabilize natural gas prices. And in turn, stabilize the cost of doing business for us," Lange said.
Winegrape grower Joe Petersen isn't sure the ag industry will see any benefits from the stored gas.
"There has been talk it will decrease gas prices, but I don't think we will see it. It's amazing how things get absorbed. Even if they create something that is suppose to benefit the consumer, I believe, many times the consumer never realizes any significant benefit," Petersen said.
Other regulations ordered by the commission are that LGS obtain $150 million in insurance coverage and performance bond that would pay for removing abandoned equipment if the company leaves the area or goes bankrupt. The company also agreed to install control devices to lower the air emissions from the compressor station.
LGS plans to charge a fee to customers who wish to purchase low-cost gas, store it underground and withdraw it when gas prices are higher.
LGS is the state's second approved competitive gas storage facility, the first to receive opposition. In 1997, the PUC approved the Wild Goose Storage project in Butte County, which uses a depleted field underneath rice fields and affects only a few property owners.