June 25, 2003


In Reply Refer To:

2880 (WO 350) P


Instruction Memorandum No. 2003-197

Expires:  09/30/2004


To:              All Field Officials


From:           Assistant Director, Minerals, Realty and Resource Protection


Subject:        Interagency Agreement - Interstate Natural Gas Pipelines


Program Area: Right-of-Way Management, Interstate Natural Gas Pipeline Projects


Issue: This Instruction Memorandum (IM) provides BLM guidance on implementing the “Interagency Agreement (Agreement) on Early Coordination of Required Environmental and Historic Preservation Reviews Conducted in Conjunction with the Issuance of Authorizations to Construct and Operate Interstate Natural Gas Pipelines Certified by the Federal Energy Regulatory Commission (FERC).” The Agreement, dated May 2002, is signed by ten Federal agencies including the Department of the Interior.  A copy of the Agreement is attached (Attachment 1).


Background:  Executive Order (EO) 13212 issued on May 18, 2001, directed federal agencies to expedite their review of applications for energy related projects, while maintaining safety, public health and environmental protections.  Consistent with the EO and in recognition of the fact that the timely authorization of new interstate natural gas pipeline projects are essential to the nations ability to meet the goal of sufficient availability and increased use of natural gas, the BLM and the other participating agencies have entered into this Agreement.


The FERC is responsible for authorizing the construction and operation of interstate natural gas pipelines.  It issues certificates of public convenience and necessity for such pipelines under Section 7 of the Natural Gas Act of 1938 (NGA), as amended, and authorizes the construction and siting of facilities for the import or export of natural gas under Section 3 of the NGA.  It also authorizes the construction and operation of natural gas pipelines pursuant to the Natural Gas Policy Act.  Typically, FERC has the overall responsibility for determining whether projects are consistent with the public convenience and necessity.   FERC makes this determination in part through the NEPA analysis process.  For projects covered by the Agreement, the FERC will also be the lead agency for preparation of the NEPA document unless, at the request of BLM or another participating agency, FERC, in consultation with that agency, determines that another agency better meets CEQ lead agency requirements.   FERC, acting as lead agency for NEPA review, will be the lead agency for all required consultation activities with the U.S. Fish and Wildlife Service and National Marine Fisheries Service for compliance with the Endangered Species Act and the Magnuson-Stevens Act, and for compliance with Section 106 of the National Historic Preservation Act through consultation with the appropriate State Historic Preservation Officer and Indian tribes.


As an additional streamlining effort, the FERC has recently offered an option to natural gas pipeline companies whereby the FERC would commence the NEPA analysis of pipeline projects prior to the filing of a complete application with the FERC.  Prospective project proponents must meet certain criteria to be eligible to participate in FERC’s NEPA Pre-Filing Process, including contacting other Federal and State agencies in the project area with relevant permitting requirements to determine their willingness and ability to work within the timeframe of the NEPA Pre-Filing Process.  Therefore, project proponents proposing to use this option would be contacting the BLM at an earlier point than might normally occur. 


Policy/Action:  The primary objective of the Agreement is to encourage the concurrent review and to minimize the duplication of process and thereby shorten the cumulative processing time in evaluating applications and making permitting decisions for interstate natural gas pipeline projects.  The Agreement is intended to accomplish the objective by establishing an interagency approach to processing proposals and applications. Participating agencies will commit to early and active engagement in the review of a project proposal to identify and mitigate project specific issues, concerns, barriers and environmental effects with the proponent and the FERC, while ensuring that the responsibilities of each agency are met. 


The Agreement emphasizes the importance for the FERC to receive timely information from the participating agencies at mutually agreed to times during project development and analysis. Essentially the Agreement requires all participating agencies to commit to early involvement in project review and analysis.  By conducting an early initial review of a prospective project, the participating agencies will be able to identify their needs and requirements to the FERC as part of the NEPA Pre-Filing Process.


Recognizing the FERC Filing Procedures:  A reference paper (Attachment 1) has been prepared by the FERC, describing the two processing options available to interstate natural gas pipeline project proponents.  Proponents have the discretion to use one of these two procedures for any given project.  However, note that use of the NEPA Pre-Filing Process must be requested by the proponent and approved in advance by the FERC.  The two processing options are the FERC’s:


A.    “Traditional Filing process”; or


B.    The recently adopted “NEPA Pre-Filing Process”


The FERC strongly encourages project proponents to utilize the NEPA Pre-Filing Process because of the benefits and efficiencies potentially gained from increased public and agency involvement.  To demonstrate the difference between the two processing procedures, the FERC prepared a timeline illustrating the traditional process vs. NEPA Pre-Filing Process.  The FERC timeline is attached as Attachment 2.  Additional information regarding the FERC’s Pre-Filing Process can be found at the following website locations:






As soon as a project proponent either files an application with the FERC, or submits to the FERC a request to use the NEPA Pre-Filing Process, the FERC will assign an Environmental Project Manager (PM).  The FERC PM will coordinate with the BLM as soon as possible to ensure that the BLM requirements for processing a right-of-way application are addressed at the early stages of an interstate gas pipeline project. The BLM will work with the FERC, the lead agency, and with the other participating agencies to establish the requirements, responsibilities and schedule for the NEPA document.


Most interstate natural gas pipeline project proposals will result in the filing of a right-of-way application for a major cost recovery category project.  A major objective for BLM field offices should be to initiate cost recovery procedures early in the process.  To the extent possible, BLM should be reimbursed by the proponent, for the up-front costs for providing information and input to FERC and other participating agencies. When a project is identified, BLM needs to initiate application filing discussions with the project proponent. The proponent should file a preliminary SF-299 at the beginning of the process.  The application must contain enough information for BLM to serialize a case and establish the case in LR2000 but may not contain a detailed project proposal.  Under current procedures established by the National Business Center, a signed Cost Recovery Agreement (CRA), a CBS receipt for the initial deposit, a completed Form 1380-10, Cost Recovery Project Number Assignment and Information Data Form, is required in order to establish a reimbursable account in the Federal Financial System (FFS).  It will be difficult to make accurate processing cost estimates in the CRA without the benefit of a detailed project proposal.  Therefore, the CRA should contain provisions to easily amend cost estimates as project details become available.


When contacted by the FERC regarding a proposed project that includes the use and occupancy of public lands, the BLM will respond in a letter to the FERC, signed by the appropriate BLM line officer which will include the following:


1)     The BLM’s commitment to be a cooperating agency in the project, including a commitment to work closely with the FERC and other participating agencies in: 


a)     Developing a single environmental analysis that will be broad enough in scope to address issues and concerns associated with the public lands and resources in order to approve, or deny the right-of-way application; and


b)     Developing a detailed schedule for the project that will allocate time needed to:


i)       collect information, conduct studies and complete surveys;


ii)     solicit, review and evaluate internal and external comments and concerns;


iii)   conduct an environmental analysis of the potential impacts associated with the construction, operation, maintenance and if appropriate the termination of all proposed right-of-way facilities, including location of temporary use areas and ancillary facilities;


iv)   write and review reports;


v)     if necessary to accommodate the proposed project, make the decision to amend a BLM resource management plan; and


vi)   preparation of authorizations, congressional notifications, plans of development, etc., to authorize the project.


2)     Identification of key contacts to coordinate internal review procedures: lead field office, lead state, Authorized Officer for grant authorization and BLM project manager. 


3)     Identification of readily available land and resource information relative to the proposed project.  Including for example: land use allocations, corridor designations in the proximity of the proposed route, exclusionary areas, existing studies, data and information concerning the lands and resources along the proposed route.


4)     Locating other authorized or proposed facilities that might be impacted by the proposed project.


5)     Identification of known or anticipated concerns of the BLM, landowners, the public, or others regarding the proposed project and if appropriate, possible means of mitigating such concerns.


6)     Determining the roles and responsibilities of all the participating agencies during the construction and restoration stages of the project. This should include selection and use of compliance/monitoring inspectors (both internal and third party compliance inspectors), variance procedures, and jurisdictional responsibilities.


Budget Impact:  Budget impacts should be minimal as long as reimbursable accounts can be established early in the Pre-Filing Process. The BLM currently encourages pre-application meetings and discussions with right-of-way applicants and works cooperatively with FERC in the processing of interstate natural gas pipeline rights-of-way.


Manual/Handbook Sections Impacted: This IM and policy affect BLM Manual 2880 Oil and Natural Gas Pipelines.


Coordination/Contacts: This IM has been coordinated through the BLM Planning, Assessment and Community Support Group, BLM National Energy Team, and the signatory agencies of the Agreement.


Any questions concerning the content of this IM should be directed to the Washington Office, Lands and Realty Group (WO-350) and the attention of Rick Stamm at (202) 452-5185 or by Email at rick_stamm@blm.gov.

Signed by:                                                    

Authenticated by:

Bob Anderson                                                       

Barbara J. Brown

Acting Assistant Director                               

Policy & Records Group, WO-560

Minerals, Realty and Resource Protection



3 Attachments

          1-Interagency Agreement (10 pp)

2- FERC Reference paper (6 pp)

3- FERC Timeline for processing (1 p)