Equity Method Investments

The Company holds a 25% equity interest in Constitution Pipeline Company, LLC (Constitution) and a 20% equity interest in Meade Pipeline Co LLC (Meade). Activity related to these equity method investments is as follows:



	Constitution					Meade						Total
	Nine Months Ended September 30,
(In thousands)	2017			2016		2017			2016			2017			2016
Balance at beginning of period	$	96,850		$	90,345	$	32,674		$	13,172		$	129,524		$	103,517
Contributions	3,750			8,325		19,632			15,851			23,382			24,176
Earnings (loss) on equity method investments	(3,971		)	211		(15		)	(3		)	(3,986		)	208
Balance at end of period	$	96,629		$	98,881	$	52,291		$	29,020		$	148,920		$	127,901

During 2017, the Company expects to contribute approximately $70.0 million to its equity method investments. For further information regarding the Company’s equity method investments, refer to Note 4 of the Notes to the Consolidated Financial Statements in the Form 10-K.

Constitution

On April 22, 2016, Constitution announced that the New York State Department of Environmental Conservation (NYSDEC) denied Constitution's application for a Section 401 Water Quality Certification (Certification) for the New York State portion of its proposed 126-mile route. During the second quarter of 2016, Constitution filed legal actions in the U.S. Court of Appeals for the Second Circuit and the U.S. District Court for the Northern District of New York challenging the legality and appropriateness of the NYSDEC’s decision. On March 16, 2017, the U.S. District Court for the Northern District of New York issued an order ruling, without prejudice, that it lacked subject matter jurisdiction to hear Constitution’s complaint. On August 18, 2017, the Second Circuit issued a decision denying in part and dismissing in part Constitution’s appeal. The Second Circuit determined that it lacked jurisdiction to address Constitution’s argument that the NYSDEC waived its ability to issue a Certification by unreasonably delaying action on Constitution's application. Instead, the Second Circuit found that jurisdiction over the waiver issue lies exclusively with the United States Court of Appeals for the District of Columbia Circuit. The Second Circuit, however, rejected Constitution’s assertion that the denial of the Certification by the NYSDEC was “arbitrary and capricious” and denied Constitution’s complaint in that regard. On October 11, 2017, Constitution filed a petition for a declaratory order requesting the Federal Energy Regulatory Commission (FERC) to find that, by operation of law, the Section 401 Water Quality Certification requirement for the New York State portion of the pipeline project was waived due to the failure of the NYSDEC to act on Constitution’s application within a reasonable period of time, as required by the Clean Water Act. The FERC has not yet ruled on this petition.

Constitution stated that it remains committed to pursuing the project and that it intends to pursue all available options to challenge the NYSDEC’s decision. In light of the current status of the litigation and the regulatory challenges, Constitution estimates its target in-service date to be as early as the first half of 2019. This assumes the timely receipt of a notice to proceed from the FERC and the timely receipt of all other state and federal permits required for the project.

In light of the NYSDEC’s denial and actions taken to challenge the denial, the Company evaluated its investment in Constitution for other-than-temporary impairment (OTTI) as of September 30, 2017 and does not believe there is an indication of an OTTI. The Company’s evaluation considered various factors, including but not limited to prior FERC approval and the related economic viability of the project, the pending legal and regulatory actions filed by Constitution and the other members’ commitment to the project. To the extent that the legal and regulatory proceedings have unfavorable outcomes, or if Constitution concludes that the project is no longer viable or elects to not go forward as legal and regulatory actions progress, the Company will reevaluate the facts and circumstances relative to its conclusions with respect to OTTI. In the event that facts and circumstances change, the Company may be required to recognize an impairment charge up to its investment value at such time, net of any cash and working capital held by Constitution. The Company will continue to monitor the carrying value of its investment as required.

At this time, the Company remains committed to funding the project in an amount proportionate to its ownership interest for the development and construction of the new pipeline. As of September 30, 2017, the Company has made contributions of $92.3 million since inception of the project.