NextEra Energy Inc. is reevaluating its investment in a key natural gas pipeline project that’s seen as crucial for shale drillers in the Appalachians after a court rejected two necessary approvals.
NextEra will take an $800 million impairment charge this quarter for the Mountain Valley Pipeline, according to a filing Friday.
The decision is another setback for the $6.2 billion project that was designed to give drillers in the gas-rich Appalachian Basin much-needed takeaway capacity. It also reflects the growing opposition to U.S. pipeline projects as gas comes under pressure from climate advocates.
The U.S. Court of Appeals for the Fourth Circuit on Feb. 2 vacated the project’s biological opinion that had been issued by the U.S. Fish and Wildlife Service, NextEra said in the filing. That move came a week after the same court tossed out the federal government’s prior approval to run the pipeline through a national forest in Virginia and West Virginia.
“These events caused NextEra Energy Resources to reevaluate its investment in Mountain Valley Pipeline,” the company said in the filing.
The 303-mile (488-kilometer) conduit, which is 48% owned by Equitrans Midstream Corp., is now more than 90% complete.