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Oil pipeline company’s ability to seize S.C. property questioned

Oil pipeline company’s ability to seize S.C. property questioned
David Dykes, ddykes@greenvillenews.com 6:53 p.m. EDT July 16, 2015

Kinder Morgan said it disagrees with a South Carolina Attorney General’s opinion that said there is “substantial doubt” state law, which gives the right of condemnation to pipeline companies, conveys such power to an oil pipeline firm such as Kinder Morgan.

The opinion also said that to the AG’s knowledge no South Carolina Court has construed state law as bestowing power of eminent domain on an oil pipeline company.

The opinion is important to Kinder Morgan, which has proposed a $1 billion pipeline to run from Belton, S.C., to Jacksonville, Fla., and the company’s intent to purchase easements or property to run it through South Carolina.

When they can’t reach a mutually agreeable purchase price with landowners, company representatives have said they would exercise their power of eminent domain and pay money into a court so a judge could determine a just compensation price.

That concerns property owners, who worry about environmental problems and how communities could be impacted.

Kinder Morgan sought the AG’s opinion to determine if state law that mainly concerned waterworks, sewage disposal and natural gas lines also applied to oil and gasoline pipelines and extended to them the public power of eminent domain.

“We respectfully disagree with the Attorney General’s advisory opinion that a petroleum products pipeline company is not a ‘pipeline company’ under the clear language of the statute in question,” said Kinder Morgan spokesperson Melissa Ruiz. “As the Attorney General’s opinion notes, there is another reading of the statute that supports our view.”

That reading suggests the Kinder Morgan could have the right of condemnation as simply a pipeline company, according to the AG’s opinion.

“But, such construction may sweep too broadly, thereby allowing any company with a pipeline – of whatever kind – to possess the power of condemnation,” the opinion said. “Thus, (state law) cannot be read in a vacuum. The context and history of the statute’s passage suggests a possible alternative interpretation, one which would give only natural gas pipelines the power of eminent domain.”

Kinder Morgan is committed to negotiating route access with South Carolina landowners “for full and fair compensation whenever possible,” Ruiz said.

In addition, Kinder Morgan believes the Palmetto Pipeline project “will serve a necessary public purpose that will bring many benefits to South Carolina and its residents,” Ruiz said.

Those include high-paying jobs, increased state and local tax revenues, and safe transportation of petroleum products, Ruiz said.

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