The Dakota Access Pipeline can keep transporting oil for now, but the U.S. Army Corps of Engineers will need to decide whether it can continue operating without a key permit, following a federal appeals court ruling Wednesday.
A three-judge panel of the U.S. Court of Appeals for the District of Columbia Circuit threw out the shutdown order issued last month by U.S. District Judge James Boasberg, saying that he “did not make the findings necessary" to justify his ruling. Boasberg on July 6 ordered that the pipeline be emptied of oil within 30 days, prompting a swift appeal by pipeline developer Energy Transfer and the Corps, which permitted the line.
The higher court, however, kept in place Boasberg’s March decision revoking the Corps permit for the pipeline’s Missouri River crossing in North Dakota just upstream from the Standing Rock Sioux Reservation. Tribal members fear that an oil leak could devastate their water supply.
Boasberg invalidated the permit after he concluded that the Corps’ past environmental review of the pipeline was inadequate. He ordered a lengthy study known as an Environmental Impact Statement.
In Wednesday’s ruling, the judges wrote that the agency and pipeline company “have failed to make a strong showing of likely success” in their effort to avoid conducting an EIS, a process that could take at least 13 months.
Various aspects of the ruling drew praise from either side of the pipeline fight.
An attorney representing the Standing Rock Sioux Tribe and other tribes in the lawsuit over the pipeline said “there’s more to like than to dislike.”
“The pipeline doesn’t shut down today, but the fight continues,” said Jan Hasselman, an attorney with the firm Earthjustice. “Dakota Access remains in a precarious situation.”
He said the ruling leaves open the question of whether the Corps ultimately will reissue a permit for the pipeline. That could put the fate of the pipeline in the hands of the next presidential administration, which could be less friendly to the fossil fuel industry if former Vice President Joe Biden, a Democrat, were to defeat Republican President Donald Trump.
“I feel like the tribe is in a good position with respect to that,” Hasselman said.
Energy Transfer Executive Vice President and General Counsel Tom Mason briefly addressed the ruling during the company’s quarterly earnings call, saying, “We will need to run the course with this litigation."
"We believe our legal positions are strong, and we are confident that the pipeline will continue to operate,” he said.
Pipeline supporters largely welcomed the ruling, in part because it removes the imminent threat of a potential shutdown. Dakota Access transports up to 570,000 barrels of oil per day from the Bakken to a shipping hub in Illinois. That amounts to about half the state’s estimated daily oil output, prompting concerns across North Dakota about the economic fallout for the oil industry and state revenues should the pipeline have to stop operating.
“Today’s ruling allows for continued safe pipeline operations, protecting our communities and limiting further disruption to our state’s economy during an already challenging time amid the COVID-19 pandemic,” Gov. Doug Burgum said in a statement.
The pro-pipeline GAIN Coalition said Wednesday that companies “should not be penalized when they follow the letter and spirit of the law in their efforts to strengthen our economy and national security.”
“Activist courts that seek to shut in our nation’s natural resources and upend regulatory certainty in the energy sector will only succeed in weakening our nation and tip the balance of power in favor of foreign adversaries like Russia, Iran, and Venezuela,” spokesman Craig Stevens said in a statement.
The Corps and U.S. Department of Justice, which represents the agency in court, both declined to comment on the ruling.
The ruling means that Dakota Access continues to lack a permit to cross under the Missouri River, and the tribe maintains that the pipeline thus operates in violation of federal law, Hasselman said.
The appeals judges indicated that the Corps will need to make a decision on whether the pipeline ought to keep operating while the permit remains invalid. They directed that matter back to the lower court, where Boasberg likely will hear from the agency, pipeline company and tribes in the weeks ahead.
The Corps, in court filings, has said that without an active easement, the pipeline constitutes an “encroachment” on federal property. The agency says it has discretion in how to respond.
“That administrative process provides for a range of outcomes, from requiring the removal of the pipeline to consenting to its encroachment,” the agency wrote in a brief filed last month with the appeals court.
If the Corps allows oil to keep flowing through the pipeline, Standing Rock would challenge that decision, Hasselman said.
Meanwhile, other aspects of the pipeline fight will continue to play out before the appeals court. The Corps and Energy Transfer are still pursuing a broader appeal challenging the merits of Boasberg’s orders revoking the permit and requiring an EIS.
Lawyers for the parties involved will be busy making their arguments in written briefs over the course of the next two months. The judges on Wednesday set deadlines for those documents, the last of which is due Sept. 30. A hearing during which the parties deliver oral arguments could take place at a later date.
A different panel of judges will consider the appeal.
Energy Transfer has long maintained that the pipeline is safe. Standing Rock fears a spill into the Missouri River would contaminate water that tribal members rely on for drinking, fishing and religious practices.
Thousands of pipeline opponents from around the world who took up the cause flocked to southern North Dakota in 2016 and 2017 to protest the project. Some clashed with police, resulting in more than 760 arrests.
Reach Amy R. Sisk at 701-250-8252 or email@example.com.