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Dominion Energy and Duke Energy announced Sunday the cancelation of the Atlantic Coast Pipeline (“ACP”) due to ongoing delays and increasing cost uncertainty which threaten the economic viability of the project, an energy companies media release states.

The project would have extended a natural gas pipeline through Northampton, Halifax, Nash, Wilson, Johnston, Cumberland and Robeson counties in North Carolina’s western Coastal Plain.

Despite last month’s overwhelming 7-2 victory at the United States Supreme Court, which vindicated the project and decisions made by permitting agencies, recent developments have created an unacceptable layer of uncertainty and anticipated delays for ACP.

Specifically, the decision of the U. S. District Court in Montana overturning long-standing federal permit authority for waterbody and wetland crossings, followed by a Ninth Circuit ruling on May 28 indicating an appeal is not likely to be successful, are new and serious challenges.

This new information and litigation risk, among other continuing execution risks, make the project too uncertain to justify investing more shareholder capital.

For example, a productive tree-felling season this winter is a key milestone to maintaining the project’s cost and schedule. Unfortunately, the inability to predict with confidence the outcome of the project’s permits and the potential for additional incremental delays associated with continued legal challenges, means that committing millions of dollars of additional investment for tree-felling and subsequent ramp up for full construction is no longer a prudent use of shareholder capital.

A series of legal challenges to the project’s federal and state permits has caused significant project cost increases and timing delays. These lawsuits and decisions have sought to dramatically rewrite decades of permitting and legal precedent including as implemented by presidential administrations of both political parties.

As a result, recent public guidance of project cost has increased to $8 billion from the original estimate of $4.5 to $5.0 billion. In addition, the most recent public estimate of commercial in-service in early 2022 represents a nearly three-and-a-half-year delay with uncertainty remaining.

The Atlantic Coast Pipeline was initially announced in 2014 in response to a lack of energy supply and delivery diversification for millions of families, businesses, schools, and national defense installations across North Carolina and Virginia.

The project was expected to create thousands of construction jobs and millions of dollars in tax revenue for local communities across West Virginia, Virginia and North Carolina.