The U.S. Supreme Court handed the Trump administration a partial victory in the Keystone XL case late Monday afternoon, reinstating a key permit used to authorize water crossings for utility lines across the nation.
The stay, however, specified that the reinstatement of Nationwide Permit No. 12 would not apply to the Keystone XL pipeline case. That must continue to work its way through the normal appeals process.
A Montana judge ruled in April that risks to the pallid sturgeon and the American burying beetle had been inadequately considered when the U.S. Army Corps of Engineers decided to reissue Keystone XL’s water crossing permits in 2017.
Judge Brian Morris said in his ruling that the government cannot delegate its duties under the Endangered Species Act to permittees, nor rely on project level review as the nationwide permit does.
The U.S. Army Corps of Engineers has been using Nationwide Permit No. 12 since the ‘70s to authorize dredge and fill activities for a wide variety of infrastructure projects that cross water bodies or wetlands. Instead of issuing individual permits, the agency ensures that plans meet preset criteria, then adds specific conditions as needed.
Morris has refused to narrow the scope of his ruling, which threw thousands of utility line projects across the country into doubt — even though plaintiffs in the case had stressed they were not requesting a broad injunction of the permit.
That fact was a key element of the Department of Justice’s request for a stay pending appeal in the case.
Industry groups said the injunction would have a chilling effect on the construction of needed infrastructure. In fact, the freeze of Nationwide Permit 12 was cited by Duke Energy and Dominion Energy in an announcement Monday, July 6, that they were cancelling the Atlantic Coast Pipeline.
Industry groups issued media statements Monday night praising the Supreme Court’s reinstatement of Nationwide Permit No. 12.
“This is a significant step toward restoring more certainty for energy companies, but declining to revive the permit for Keystone XL is short-sighted, as the project has already been thoroughly reviewed for well over a decade,” said American Petroleum Institute’s Chief legal Officer and Senior Vice President Paul G. Afonso. “As this case moves forward, we will urge the U.S. Court of Appeals for the Ninth Circuit to reinstate the permit for all pipeline projects, including Keystone XL.”
Craig Stevens, spokesman for the Grow America’s Infrastructure Now Coalition, said the Supreme Court’s leadership is crucial to restoring legal certainty for companies that invest billions of dollars in large-scale infrastructure projects.
“Energy infrastructure projects already undergo a rigorous and notably lengthy permitting and review process with both state and federal regulators before ultimately receiving the necessary approvals,” he said. “Nationwide permits like NWP 12 are critical to cutting red tape and allowing infrastructure development to efficiently move forward while also maintaining the integrity of the tried-and-true permitting process conducted by the career professionals at the Army Corps. While the Keystone XL Pipeline was not included in today’s decision, we are confident the court will ultimately affirm the permit’s status upon further consideration and allow project construction to proceed.”
TC Energy spokesman Terry Cunha, meanwhile, told the Williston Herald that while the ruling is generally positive for the oil and gas industry, it is still disappointing for the Keystone XL project in particular.
“(Today’s ruling) continues to delay large portions of construction on our Keystone XL project, and the thousands of high-paying union jobs that come with it,” he said. “TC Energy remains committed to the future of this project. We will continue to evaluate our 2020 U.S. Scope. In Canada, our work in 2020 remains unchanged.”
Keystone XL was proposed in 2008 to carry up to 830,000 barrels of crude oil per day to Nebraska. From there, it could access existing pipelines for shipment to the Gulf of Mexico.
The pipeline was twice rejected by the Obama administration, which cited the potential for worsening climate change, but the Trump administration invited the company to resubmit its application, then rapidly green-lighted it, drawing almost immediate litigation from environmental groups that have opposed the pipeline’s route. Tribal groups also oppose the project, and have criticized TC Energy for starting work on the pipeline during the COVID-19 pandemic.
The Alberta government, meanwhile, has provided Keystone XL project with $1.1 billion in funds to jumpstart the project, along with additional temporary credit of up to $4.4 billion.