Court Orders Dakota Pipeline Shut in Latest Blow to US Fossil Fuel Projects
A U.S. court ordered the shutdown of the Dakota Access oil pipeline on Monday over concerns about its potential environmental impact, a big win for the Native American tribes and green groups who fought the major…
A U.S. court ordered the shutdown of the Dakota Access oil pipeline on Monday over concerns about its potential environmental impact, a big win for the Native American tribes and green groups who fought the major pipeline’s route across a crucial water supply for years.
The decision by U.S. District Court for the District of Columbia followed the cancellation of another high-profile U.S. pipeline project on Sunday and came as a blow to the Trump administration’s efforts to lift the domestic fossil fuels industry by rolling back environmental red tape.
According to the ruling, the U.S. Army Corps of Engineers violated the National Environmental Policy Act (NEPA) when it granted an easement to Energy Transfer LP <ET.N> to construct and operate a segment of the oil pipeline beneath Lake Oahe in South Dakota, because they failed to produce an adequate Environmental Impact Statement (EIS).
The court ordered Energy Transfer to shut and empty the 570,000 barrel-per-day (bpd) line within 30 days, closing off the biggest artery transporting crude oil out of North Dakota’s Bakken shale basin to Midwest and Gulf Coast regions.
“Given the seriousness of the Corps’ NEPA error, the impossibility of a simple fix, the fact that Dakota Access did assume much of its economic risk knowingly, and the potential harm each day the pipeline operates, the Court is forced to conclude that the flow of oil must cease,” it said.
It is rare for regulators or officials to force an oil pipeline to be drained, unless it is in the aftermath of a spill, oil market sources said.
Energy Transfer said it was looking at legal and administrative measures to avoid a shutdown, and was considering an appeal if those efforts fail.
In a filing seeking a temporary stay to the order, the company argued that time-consuming and expensive steps are required to shut the pipeline down safely and empty it of oil, which means the process would take well more than 30 days.
If the motion for a stay pending an appeal is denied by the district court, the company said it intends to file one in the Washington, D.C., circuit court.