In a setback for Energy Transfer LP’s Dakota Access Pipeline (DAPL), judges with the U.S. Court of Appeals for the D.C. Circuit on Tuesday upheld an earlier ruling that vacated a key federal permit issued to the controversial oil conduit.
The appeals court affirmed U.S. District Court Judge James Boasberg’s ruling last year that the U.S. Army Corps of Engineers violated the National Environmental Policy Act when it issued an easement to cross under Lake Oahe without preparing an environmental impact statement (EIS).
The crossing of the large reservoir, behind the Oahe Dam on the Missouri River that begins in central South Dakota and continues north into North Dakota, has been a focal point for Native American tribes, including the Standing Rock Sioux Tribe, seeking to stop DAPL’s operations. As Tuesday’s ruling noted, Lake Oahe “provides several successor tribes of the Great Sioux Nation with water for drinking, industry and sacred cultural practices.”
While it upheld the decision to vacate DAPL’s easement, the appeals court reversed Boasberg’s order, previously stayed by the court, to suspend operations on the pipeline pending the completion of an updated environmental review.
Still, the appeals court judges said it “may well be” that the law or Army Corps regulations “oblige” the agency to “vindicate its property rights by requiring the pipeline to cease operation.” Further, the tribes seeking to stop operations on the pipeline could file a legal challenge under the Administrative Procedure Act should the Army Corps “fail to do so,” according to the ruling.
The latest appeals court ruling does not preclude a potential injunction based on a pending request before Boasberg filed by tribes led by the Standing Rock Sioux, analysts at ClearView Energy Partners LLC wrote in a note to clients.
“We also observe that the D.C. Circuit specifically spoke to the possibility that we have identified in our analysis as remaining available to the Biden administration: the Corps needs to address the pipeline’s ‘trespass’ on Corps property,” the ClearView analysts wrote.
Even without an injunction, it’s possible the Army Corps could “seek an order from the Department of Justice to cease operations pending the completion” of an EIS in late 2021, they wrote.
The 1,172-mile DAPL, which began operations in 2017, transports crude oil from the Bakken Shale to refineries in the Gulf Coast and Midwest, and to other downstream markets.
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