A Pennsylvania court has awarded Cardinal Midstream $51.98m in a contract dispute with Energy Transfer.
The judgement marks a significant victory for Cardinal Midstream, resolving the legal battle in its favour.
The Pennsylvania state court found Energy Transfer liable for failing to pay a $33m earnout to Cardinal as part of a 2017 purchase agreement. The dispute centred on a gathering system acquired by Energy Transfer.
The court, presided over by Judge James J. Ross, determined that Energy Transfer breached its contractual obligations by connecting the gathering system directly to its pipeline.
This move allowed Energy Transfer to monopolise gas flow to its refinery, bypassing a competitor’s facility.
The court also ruled that Energy Transfer’s construction of the 40.5-mile (65.1km) Revolution Pipeline contributed to an explosion, dismissing the company’s force majeure defence.
The ruling awarded Cardinal $33m in damages and an additional $18.98m in prejudgment interest.
Joel Reese, Cardinal’s lead attorney, highlighted the complexity of the trial, which involved more than 1,500 exhibits and multiple witnesses.
“Cardinal hired us just four months before trial in this long-running dispute with Energy Transfer, a company we have faced in multiple other cases,” Reese stated.
The court noted that some Energy Transfer executives appeared as “programmed witnesses” during the trial.
Energy Transfer’s vice-president of crude oil was specifically mentioned for providing “very suspect and concerning” testimony.
Reese commented: “The court’s well-reasoned opinion clearly demonstrates our decisive victory.”
Meanwhile, Energy Transfer has announced the final investment decision for a new intrastate natural gas pipeline, now named the Hugh Brinson pipeline.
This project aims to enhance natural gas flow from the Permian Basin to key markets.
The Hugh Brinson pipeline will be constructed in two phases, with the first phase involving approximately 400 miles (643.7km) of 42in pipeline, designed to transport 1.5 billion cubic feet per day.
