Massive gas pipeline project to resume; Sunoco fined $12M

Sunoco has agreed to a $12.6 million fine over problems with a massive natural gas pipeline project, but work will resume under a consent agreement, Pennsylvania regulators said Thursday.

The Department of Environmental Protection said Sunoco Pipeline has made changes since work on the $2.5 billion Mariner East 2 pipeline was halted Jan. 3.

The 350-mile project has been plagued by spills and leaks of drilling fluid and improper construction methods.

"Sunoco has demonstrated that it has taken steps to ensure the company will conduct the remaining pipeline activities in accordance with the law and permit conditions, and will be allowed to resume," Environmental Protection Secretary Patrick McDonnell said in a statement. "DEP will be monitoring activities closely to ensure that Sunoco is meeting the terms of this agreement and its permits."

In stopping the work last month, the state agency said Sunoco demonstrated it could not or would not comply with Pennsylvania's clean streams law and other regulations.

The company said Thursday it agreed to the deal to avoid litigation and resume construction on a major pipeline project.

"While we strongly disagree with their legal conclusions that our conduct was willful or egregious, we felt it was important to our unit holders and to the commonwealth of Pennsylvania that we move forward rather than engage in continued litigation," according to a statement released by spokesman Jeff Shields.

The consent agreement , dated Thursday, specifies that Sunoco will withdraw an appeal of last month's order filed a few days ago with the state Environmental Hearing Board.

The state agency called the fine one of the largest civil penalties it has ever imposed and said the money will be deposited into funds for clean water and dams and encroachments.

The 20-inch pipeline will move liquid natural gas products from Marcellus Shale drilling fields in western Pennsylvania to a terminal in Philadelphia. It is scheduled for completion by summer, and a companion 16-inch pipeline is expected to begin operation later in the year.

Environmental groups have vigorously opposed the pipeline, citing concerns about deforestation, crossings of hundreds of streams and wetlands and the impact on farms and drinking water.

Food & Water Watch organizer Sam Rubin called the settlement an "outrageous deal" that put corporate profits ahead of safety.

"Make no mistake," Rubin said in a statement. "The communities threatened by this pipeline will protect themselves from this danger, with or without Gov. Wolf's support."

Sunoco Pipeline LP, based in Sinking Spring, Pennsylvania, is a subsidiary of Energy Transfer Partners LP. Energy Transfer companies own and operate about 71,000 miles of pipeline.