D.C. Circuit takes Dakota Access off ice — for now

By Mike Lee, Pamela King | 07/15/2020 07:20 AM EDT

The embattled Dakota Access oil pipeline last night secured a reprieve from a looming court-ordered shutdown.

Construction of the Dakota Access pipeline near New Salem, N.D.

Construction of the Dakota Access pipeline near New Salem, N.D. Tony Webster/Flickr

The embattled Dakota Access oil pipeline last night secured a reprieve from a looming court-ordered shutdown.

The U.S. Court of Appeals for the District of Columbia Circuit issued a temporary freeze on a lower court’s finding that the 1,172-mile pipeline must be shut down and drained of oil by Aug. 5. The D.C. Circuit instructed parties in the case to weigh in on the issue by July 23 and will then make a final decision on the pipeline’s status pending review of the broader legal battle.

A panel of D.C. Circuit judges is considering appeals by Dakota Access developer Energy Transfer Partners and the Army Corps of Engineers fighting a finding by Judge James Boasberg of the U.S. District Court for the District of Columbia that said the federal government needed to take a deeper look at the environmental impacts of the project’s passage beneath Lake Oahe, which is about a half-mile from the Standing Rock Sioux Reservation.


The judge said the pipeline must be closed down until the Army Corps’ revised National Environmental Policy Act review is complete (Greenwire, July 6).

Dakota Access has been open since 2017, and it carries oil from North Dakota’s Bakken Shale oil field to refineries and pipeline connections in Illinois.

Earthjustice attorney Jan Hasselman, who is representing the Standing Rock Sioux Tribe, noted on Twitter yesterday that the D.C. Circuit’s administrative stay "is routine and in no way a reflection of how the court will decide the motion."

Legal experts noted last week that a temporary stay would at least reset the clock on Boasberg’s shutdown order.

The judge, an Obama appointee, gave Energy Transfer 30 days to close down operations but said he would be willing to work with the company on logistical concerns as appropriate. The firm said it would take 86 to 101 days to empty the pipeline (Energywire, July 10).

Red states: Shutdown would be catastrophic

The state of North Dakota said this week that it will suffer irreparable harm unless the D.C. Circuit allows Dakota Access to remain open pending appeal.

The Monday brief by North Dakota’s attorney general came as 18 other states and several trade groups filed amicus briefs with the D.C. Circuit, all saying the pipeline needs to stay open to preserve the nation’s economy.

Shutting down the pipeline could cost North Dakota thousands of jobs and $2 billion in lost tax revenue, which is nearly one-fourth of its general fund revenue, the office of state Attorney General Wayne Stenehjem (R) said in its filing with the appeals court.

"The State’s economy, and its economic recovery, will be stymied so long as DAPL remains idle," North Dakota argued. "Imagine the chaos if the court shut down an interstate highway handling a significant portion of a state’s interstate commerce, with only 30 days’ notice."

A coalition of trade groups estimated that 7,000 jobs would be lost, including 1,500 at a single company, Hess Corp. The effects would ripple down to refiners and result in higher fuel prices nationwide, according to the American Petroleum Institute, the Association of Oil Pipe Lines and other trade groups.

In a separate amicus brief, Indiana and 17 other states argued that shutting down the pipeline would disrupt grain shipments and other interstate trade. Before the Dakota Access pipeline opened, most of North Dakota’s oil was transported by rail, crowding out other shippers and raising freight rates for farmers.

Trains are more dangerous and produce more pollution than pipelines when shipping oil, the states said.

"[I]f pipeline flow must cease while the environment is studied, it is not only oil producers who will suffer — so will grain farmers, the world food supply, public safety, and the environment itself," the states said.

Long legal battle

The D.C. Circuit appeals are the latest twist in the pipeline’s history, which has been marked by bitter protests and court fights.

The Standing Rock Sioux Tribe held months of protests against the pipeline in 2016, which were joined by thousands of climate activists and environmentalists. President Obama blocked construction of the pipeline shortly before he left office, but the Trump administration quickly overturned the decision (Energywire, Feb. 9, 2017).

The Standing Rock Sioux Tribe continued to challenge permits allowing the project to cross Lake Oahe.

Before the pipeline went into service in 2017, North Dakota’s oil typically sold at a steep discount to other grades of crude because there was no connection from the state’s oil fields to refineries in the Midwest and the Gulf Coast.

The conduit carries about 40% of North Dakota’s oil, about 570,000 barrels a day, and the company is seeking to expand its capacity by adding pump stations.

Boasberg ruled in March that the Trump administration’s environmental review of the pipeline was insufficient under NEPA. He said the Army Corps should have conducted an in-depth environmental impact statement, rather than a less-stringent environmental assessment.

Both Energy Transfer subsidiary Dakota Access LLC and the Army Corps said Boasberg made a series of errors in his decision and ignored the economic harm it would cause. The Army Corps had already concluded that a catastrophic spill into the lake is unlikely, noting that the pipeline is buried more than 90 feet below the lake bed.

There’s little chance that the Standing Rock tribe will be harmed if the pipeline is allowed to stay open while the case is decided, the Army Corps and Dakota Access said.

"No crude oil pipeline in this country is safer than DAPL, which has transported more than half a billion barrels of oil nearly 1,200 miles with zero mainline releases," Dakota Access told the D.C. Circuit.