W.Va. Dems praise Buffett’s purchase of Dominion assets
CHARLESTON — Seeing the sun beyond the gray sky, Democratic members of the West Virginia Senate wrote a letter Monday to Warren Buffett – the Oracle of Omaha — after his company purchased the pipeline assets of Dominion Energy.
Buffett, chairman of Berkshire Hathaway and considered to be one of the most successful investors in the world, announced July 5 his company was purchasing the pipeline and transmission assets of Dominion Energy. The news came the same day that Dominion and Duke Energy announced the cancellation of the Atlantic Coast Pipeline project.
In the letter sent to Buffett, 10 out of the 14 Democratic state senators they praised Buffet for investing in Dominion.
“You may not have realized it, but you brightened the faces of West Virginians everywhere with your recent purchase of pipeline assets from … Dominion Energy,” the senators wrote. “But when we learned of your acquisition, it gave us hope. When one of the greatest investors of all time makes a bet on your home state, you can’t help but feel a sense of optimism.”
Sen. William Ihlenfeld II, D-Ohio, was among the signers of the Buffett letter. He said his fellow signatories all want to work with Buffett and Berkshire Hathaway to grow natural gas production jobs while also protecting landowners and the environment.
“The purpose of sending the letter was to let him know we want to be a friend to him from a legislative perspective,” Ihlenfeld said. “We want to make sure that the regulatory environment is friendly to him. As we said in the letter, we want to let him know that the rights of landowners are important to us and so is keeping our air and water clean, but we want to let him know we’re here to work with him.”
According to a statement from Dominion Energy and Duke Energy released July 5, the Atlantic Coast Pipeline project was canceled due to additional regulatory hurdles and uncertain market conditions.
The pipeline would have carried natural gas 600 miles, from Harrison County through four other West Virginia counties through Virginia to North Carolina. The project, started in 2014, ballooned in cost from $5 billion to $8 billion. The companies won a substantial victory against environmental groups in June when the U.S. Supreme Court ruled the project could move forward with building the pipeline underneath the Appalachian Trail.
In a statement last week, Dominion and Duke cited additional federal court cases, including a case in Montana that overturned federal permit authorities for waterbody and wetlands crossings, which also could cause substantial delays in the Atlantic Coast Pipeline project. According to the Affiliated Construction Trades, the project was expected to employ as many as 5,000 workers over its lifetime.
“The cancellation of the Atlantic Coast Pipeline Project was a major blow to our state, as we were counting on the revenue generated to help lead West Virginia through these uncertain economic times,” The senators stated in their letter to Buffett. “Our construction workers stood to earn an estimated $10 million a week in wages until the plug was pulled. Those kinds of earnings will be difficult to replace.”
So far, 2020 has been a bad year for natural gas. According to the U.S. Energy Information Administration, natural gas production was down 2.3 percent in April due to a decline in demand when most non-essential businesses were shut down due to the COVID-19 pandemic.
While other natural gas producing states saw decreases in production in April, West Virginia saw an increase or decrease, though the EIA estimates that production will continue to decrease nationwide for the remainder of 2020. The uncertainty of the pandemic, the mild winter and an oversupply of natural gas moved prices to their lowest since 1989.
Other natural gas projects are seeing delays and setbacks. Daelim Chemical USA pulled out of a partnership in the proposed PTT Global Chemical America ethane cracker plant, citing the continuing pandemic and uncertainty in the natural gas market. Chesapeake Energy, once a major player in West Virginia and the country, filed for bankruptcy last month. And Chevron has been selling off its natural gas assets in Ohio, West Virginia and Pennsylvania since February.
That’s why Senate Democrats see the silver lining in Buffett and Berkshire Hathaway agreeing to buy Dominion’s natural gas pipeline and transmission assets. “We are very proud to be adding such a great portfolio of natural gas assets to our already strong energy business,” Buffett said in a press release last week.