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Kentucky Supreme Court Won't Take Up Bluegrass Pipeline Challenge

The Kentucky Supreme Court denied a request on Wednesday by the Bluegrass Pipeline to consider an appeals court ruling that restricts eminent domain to regulated utilities in the state.

The Bluegrass Pipeline was originally proposed in 2013. It was a multi-state natural gas liquids pipeline that would have crossed 13 Kentucky counties, carrying NGLs from the Northeast to processing plants in the Gulf of Mexico. The project met a significant amount of grassroots opposition by residents concerned about safety issues and land and water contamination.

The pipeline company Williams officially put the project on hold in April 2014.

One of the factors that likely ultimately played into the Bluegrass Pipeline's demise was the question of eminent domain. Kentucky law was murky on the subject. Williams representatives said they were confident the Bluegrass Pipeline would qualify, but some legal experts disagreed. Before the project was scuttled, a group of citizens calling themselves Kentuckians United to Restrain Eminent Domain filed a lawsuit, arguing that because it wasn't a regulated utility, the Bluegrass Pipeline wouldn't be eligible for eminent domain in Kentucky.

A Franklin County judge ruled in favor of the citizens in March 2014. Williams put the pipeline on hold a month later, but still appealed the decision to the Kentucky Court of Appeals.

In May 2015, the Kentucky Court of Appeals also ruled in favor of the citizens. Williams also appealed that decision.

Now, with the Supreme Court denying to consider the appeal, the issue should be settled in Kentucky.

“Bluegrass is of course disappointed with yesterday’s ruling by the Kentucky Supreme Court, but does not plan take any further action on the issue," said Williams company spokesman Tom Droege.

Attorney Tom FitzGerald of the Kentucky Resources Council represented KURE in the lawsuit; he said the decision will have implications for another project proposed in the state.

The Tennessee Gas Pipelineis an existing natural gas pipeline; energy company Kinder Morgan is seeking federal permission to reverse the pipeline's flow and convert it to carry natural gas liquids.

“To the extent that any new easements are required for the natural gas liquids project, that company will have to acquire them in a good faith, arms-length transaction, and the landowner very clearly can just say ‘no,'" FitzGerald said.

This story has been updated.

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