Last we had heard, the official word coming from Equitrans, builder of the Mountain Valley Pipeline (MVP), is that the project will be done and online by the end of this year. However, a partner in the project, NextEra Energy, is now saying otherwise.
Earlier this week NextEra issued their quarterly update and held a conference call with investors. From that call we get the following MVP comments from NextEra’s executive VP and CFO, Rebecca Kujawa, in her prepared remarks to investors:
Beyond renewables, while we continue to advance MVP toward ultimate completion and we expect to ramp up construction activities in the coming months, the Fourth Circuit’s decision not to pursue, an en banc review on the Atlantic Coast Pipeline Appalachian trail crossing authorization presents a challenge to both timing and cost. Since the original court decision, we have been working with our project partners on several alternatives to address the issue, and we continue to vigorously pursue these tasks.
At this point our previously announced fourth quarter 2019 target in-service date appears unlikely. We are continuing to work through options with our partners and we’ll provide a further update in the near future.
As a reminder, we do not expect any material adjusted earnings impacts, nor any change to NextEra Energy’s financial expectations regardless of the outcome of the ongoing challenges related to MVP.*
Hmmm. That’s interesting.
Then, during the Q&A portion of the conference call, the topic of MVP came up again:
Okay, great. So just could you maybe give a little more color on the MVP comments with respect to just more color and also what would be driving an update soon as opposed to like now for the Analyst Day?
So as I mentioned in the in the prepared remarks, we along with everybody else were certainly disappointed by the Circuit Court not taking up the en banc review. And as soon as you know the initial adverse decision was made, we started working closely with our partners on a variety of different options whether it’s legislative administrative etcetera to resolve the issues so that we can continue to build and ultimately bring online MVP. And we remain confident that you know one of those many options will ultimately come together so that we can put MVP into service, which at this point we think will be even more valuable than what we originally thought just because of the challenges that building pipelines in this area has proven to be. But at this point, looking at what we previously targeted for our in-service date of year-end 2019 that’s challenging.
So we’re still working on what exactly the path forward is and the timing for COD. We are going to resume construction. As you know we temporarily you know paused construction during kind of tone down construction during the winter period just for the overall conditions, as we’re starting to get to the spring, we’ll resume construction where we can. And then as we firm up plans, it’s clear which of these options will come to fruition and we’ll give you more specifications in terms of timing and ultimate cost.*
Finally, one analyst asked if NextEra is specifically coordinating an “administrative option” with competitor Atlantic Coast Pipeline (ACP), being built by Dominion Energy:
Got it. And then lastly, Rebecca just you mentioned administrative options with MVP. Can you confirm if you’re working with the ACP owners around this option? Like what stated — obviously they are completely different projects, but what how much collaborating are you doing with the ACP owners like Dominion, especially when…
I don’t want to talk through really the details of that. As we’ve — as I talked about a couple of minutes ago, we worked very closely with our partners to develop different options and we do believe there are various options in order to complete it, but we don’t really think that it’s to our advantage to get through a lot of the details of that out publicly. So, we’re working on it very hard. We remain confident in our ability to ultimately construct and bring it into service.*
As you can see, “no comment” on anything NextEra may have cooking with ACP, whatever that may be. To be honest, we’re not exactly sure what the analyst was implying with his question about ACP. However, Kujawa’s reaction in shutting down the question raises a flag for us. Is there some coordination going on? If so, what is it?
*Seeking Alpha (Apr 23, 2019) – NextEra Energy Inc. (NEE) CEO James Robo on Q1 2019 Results – Earnings Call Transcript
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