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Wine and Gas Clash in New York's Finger Lakes

A proposed gas storage facility on Seneca Lake has inflamed winemakers, but are fears overblown?

Ben O'Donnell
Posted: August 19, 2014

On July 14, roughly 500 protesters gathered in the heart of New York's Finger Lakes wine region, carrying signs that read, "Save Seneca Lake," "Vines Trump Dimes" and "Don't Frack With New York." The crowd marched on the Schuyler County Courthouse, where local lawmakers were weighing whether to overturn earlier support for a project that has become a flashpoint in the community. The proposal, by Texas-based gas storage company Crestwood Midstream, would expand storage of natural gas and introduce millions of barrels of liquid propane and butane in salt caverns near Watkins Glen, on the lake.

Depending on whom you ask, the Crestwood Midstream facility would be either hardly visible, highly safe and a boon to the region, or an industrial black mark of compressor stations, flare stacks and constant truck traffic that would disrupt the pastoral wine country and perhaps even poison the lake.

With passions running high and the proposal approved by the Schuyler County legislature (despite the protest outside their door), some winemakers are now pressing Gov. Andrew Cuomo to halt the project. On Aug. 11, Cuomo's commissioner of the state Department of Environmental Conservation announced he would hold a conference to explore the issue.

"It's not good for the environment, and the potential for a catastrophic accident is very real," said Doug Hazlitt of Hazlitt 1852 Vineyards on Seneca Lake. "This is wine country; people come here for the natural beauty. We're finally developing a reputation for making world-class wines, and to take the whole head of the lake and turn it into industrial gas storage is just nuts."

The salt caverns, located in Reading, are part of what Crestwood calls the U.S. Salt Complex. There is a long history of storing gas here, both natural gas and liquefied petroleum gas (LPG). Currently, Crestwood has 1.5 billion cubic feet of natural gas at the facility. LPG—liquid propane and butane—was stored in the caverns until the 1980s. Crestwood's proposal, first put forth in 2009, would add 450 million cubic feet of natural gas storage and 2.1 million barrels of LPG storage.

Winemakers cite their most immediate fear as an increase in industrial activity: More trucks on already-congested roads, more rail traffic, noisy gas compressors, an eyesore flare stack, a precedent for development and the potential for future expansions of gas storage at the facility—with little payoff to the region. "With the wineries, the restaurants, the bars—you're making a huge, huge impact on the economic viability of this whole region," said Hazlitt.

According to the legislature's approval, the Crestwood facility would add an estimated $20 million to the local tax base. In a statement to Wine Spectator, Crestwood argued that the Seneca location would alleviate local energy shortages. "Local propane storage benefits local consumers, including wineries and family farmers throughout the Finger Lakes," the company stated. "This past winter alone, New York consumers paid more than $100 million extra to obtain propane from far away places because there was not enough propane stored locally to meet local demand."

There are also longer-term concerns about the safety and environmental impact of the storage facility. Gas companies like Crestwood use large amounts of brine in their storage facilities. When liquid gas is pumped in, brine is pumped out into nearby storage ponds until the gas is pumped out. The proximity of the highly saline brine to a lake that provides drinking water for over a hundred thousand people is troubling for some.

In addition to potential leakage issues, there have been documented cases of gas seepage through salt caverns resulting in explosions in other areas, some deadly. "When you Google the Finger Lakes right now, in your top choices, you'll see wine country," said Lou Damiani of Damiani Wine Cellars. "First truck that explodes, first major accident, you're going to see: gas explosion."

The assistant state geologist with the New York State Geological Survey assessed the caverns in 2013 and wrote that Crestwood's subsidiary had demonstrated the caverns were viable and had implemented a proper monitoring program. "[The] proposed use of the [U.S. Salt] caverns is geologically sound," said the report.

But some geologists, in briefs filed on behalf of opposition organization Gas Free Seneca, disagreed, arguing that the salt formations have not been explored in enough detail to merit their go-ahead for more gas storage. The opposition points to a geologist's records from the 1960s that report a 400,000-ton cave-in at the property and an earthquake along a nearby fault line in 2013 as evidence of the caverns' questionable integrity for holding hazardous materials.

Crestwood denies any cave roof collapse has ever happened at the U.S. Salt property. "Our proposed LPG storage project is designed to achieve the highest levels of safety and regulatory compliance," stated the company.

"If there's a hundredth of one percent chance that anything should happen, they should never do this," said Hazlitt. "Certainly no one is against energy independence. It's just that they're storing it in the wrong place. We can't pull up our vines and go somewhere else."

Some winemakers declined to speak on the record on this issue, citing the charged atmosphere and a desire to wait out Cuomo's decision. But sentiments ranged from fear of the worst to skepticism toward the conflicting information coming from both sides.

Now the decision rests with Cuomo, on the advice of the DEC. The governor, so far, has been very supportive of the state wine industry. "If [Cuomo] passes this, that's kind of a slap in the face to this industry," said Hazlitt. "Does he want this to be industrial gas storage up here? Does he want it to be a world-class wine region?"

Eric Campos
Canada —  August 19, 2014 3:42pm ET
Given that nature has a funny way of connecting the dots, I cannot imagine tree-hugging foodies embracing wine from plants whose roots are potentially getting tickled by LPG. I wish the Finger Lakes producers better luck than their Mosel counterparts....
Mary Hack
Hudson, NY USA —  August 20, 2014 3:25pm ET
Cuomo needs to ban this ill-considered project. I support the winemakers and citizens who are fighting this and hope they prevail.

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