Pipeline ditch could cost county; Abandoning port line estimated at $700K

Published 12:13 am Tuesday, October 14, 2014

NATCHEZ — Adams County could be saddled with the $700,000 cost of abandoning a pipeline it acquired along with the former International Paper property.

Gulf Coast Synthetic Fuel Center — a subsidiary of Rentech, the former owners of the IP property — has advertised its intent to abandon a pipeline that runs through Tensas and Concordia Parish and into Adams County.

The line ran from a gas field near Lake St. John, where it supplied the natural gas needs of the IP plant during its operation. International Paper closed the plant in 2003.

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But while the advertisement is in the name of Gulf Coast Synthetic Fuel Center, Adams County Board of Supervisors Attorney Scott Slover said the pipeline is actually owned by the county.

“Federal Energy Regulatory Commission law says that you must have a designated use to take over a pipeline, and that is why it says it is being held by Rentech,” Slover said. “But Adams County acquired it during the purchase of the IP property.”

Adams County Supervisor Mike Lazarus said the cost of abandoning the pipeline is approximately $700,000.

Of that total, between $75,000 and $100,000 would be for legal and regulatory filing fees, while the remainder would be to make up the costs of environmental impact studies, Slover said.

Adams County Administrator Joe Murray said the pipeline has already been capped.

Slover said getting the pipeline back to an operational state would cost approximately $350,000.

“The county has some potential industrial clients who are interested in the IP property, and some of those could use the pipeline as an auxiliary (pipeline),” he said. “If the right client comes on, there’s the chance of the pipeline staying on as an auxiliary.”

The pipeline has a scrap value of approximately $1.6 million to $2 million, Slover said, but the cost of recovering the pipe — which would require digging it up — would be approximately $3 million.

Adams County bought the former IP property in mid-2013 from Rentech, which had purchased the shuttered industrial site in 2008 with plans to construct a coal-to-liquid fuel plant.

Rentech’s plans never materialized, and when the company put the property up for sale, the county bought it at the behest of Natchez Inc. so the county could better control its marketing and rehabilitate an industrial water treatment plant on the 478-acre site as a broader economic development tool.