Energy Transfer seeks Supreme Court DAPL review

  • Market: Crude oil
  • 29/04/21

Energy Transfer is planning to ask the US Supreme Court to review a case involving the environmental permitting of its 570,000 b/d Dakota Access crude pipeline (DAPL).

The action comes as a lower court is weighing whether to shut DAPL as the US Army Corps of Engineers conducts a new, court-mandated environmental review.

Energy Transfer intends to seek Supreme Court review of lower court rulings that ordered the new Army Corps review and threw out a key easement for DAPL to cross under Lake Oahe in North Dakota, according to a court filing today.

Energy Transfer will ask the highest court for review after the US Court of Appeals for the District of Columbia Circuit last week denied a petition to rehear the case.

Energy Transfer was seeking a rehearing before the district's full court of appeals, which has 15 judges. The company argued that a January appeals court ruling conflicted with decisions by the Supreme Court and other circuit courts regarding the standard of review to determine whether the company complied with the National Environmental Policy Act (NEPA).

The Supreme Court "could reasonably conclude" that the appeals court approach conflicts with the Supreme Court's own recognition that NEPA reflects a "rule of reason," not a rigid test, Energy Transfer said in the filing today.

Energy Transfer also asked the appeals court for "a stay in the mandate" in the case which would allow the appeals court to retain jurisdiction if a future shutdown order makes it necessary for DAPL to seek a stay pending the Supreme Court review.

In the January decision, the appeals court left the door open for the Army Corps to take action on shutting DAPL.

The Army Corps, now under the administration of President Joe Biden, earlier this month told the US District Court for the District of Columbia that it would not immediately move to shut the line, leaving the decision to US district court judge James Boasberg.

Boasberg subsequently gave the Army Corps one more chance to state an opinion on the shutdown order with a deadline of 3 May for the filing. A decision could come shortly after.

DAPL moves Bakken crude to Patoka, Illinois, where it connects to another Energy Transfer pipeline to Nederland, Texas. It is the largest crude pipeline out of the Bakken shale. A pipeline shut down would shift large volumes of crude onto railcars and alternate pipelines.

The underlying lawsuit brought by the Standing Rock Sioux and other Native American groups contends that the Army Corps' original environmental review failed to adequately study certain issues related to potential oil spills from the pipeline.

The initial startup of DAPL was delayed for months in 2016 and 2017 amid large protests and regulatory delays. Since its startup in June 2017, the line has been expanded amid record-high North Dakota production prior to the Covid-19 pandemic.


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US breaks $79/bl ceiling in latest SPR purchase

US breaks $79/bl ceiling in latest SPR purchase

Washington, 27 March (Argus) — President Joe Biden's administration has exceeded a price ceiling that has guided when the US government would buy crude to refill the US Strategic Petroleum Reserve (SPR), with the latest crude purchase hitting a price of $81.32/bl. The US Department of Energy (DOE) six months ago adopted a new strategy for replenishing the SPR, with a plan to use consistent monthly purchases to replace some of the 180mn bl of crude that Biden sold from the reserve in 2022 after Russia invaded Ukraine. For months, DOE has said it would continue to buy crude so long as it was a "good deal for taxpayers," which the agency defined as a purchase price not to exceed $79/bl. But the agency's latest crude purchase, for nearly 2.8mn bl of sour crude for delivery in September, came at a cost of $225.6mn, an average price of $81.34/bl, according to data DOE recently published on its website. The crude contracts went to Macquarie Commodities Trading, Sunoco Partners Marketing & Terminals and Total's Atlantic Trading & Marketing. DOE, asked for comment about why it purchased crude in excess of its price target, said there would "likely be news coming later today." Before this week, the administration had largely adhered to its $79/bl price target to buy 24.7mn bl of crude for delivery to the SPR from January through August, with the exception of a $79.10/bl purchase for January delivery. DOE reiterated the price ceiling on 14 March, when it announced a new solicitation to buy crude, and last year had called off multiple crude solicitations when prices came in too high. DOE has previously increased its price ceiling based on shifts in the oil market. DOE in 2022 had initially targeted a purchase price of $67-$72/bl, resulting in the purchase of 6.3mn bl of crude last summer at an average price of $72.67/bl. But after rising prices put that target out of reach, DOE raised its price ceiling to $79/bl. The SPR held 363mn bl of crude as of 22 March, according to federal data. By the end of this year, as a result of crude purchases, the reserve is expected to "be back to essentially where we would have been had we not sold during the invasion of Ukraine," US energy secretary Jennifer Granholm said on 20 March, after accounting for the cancellation of 140mn bl of congressional mandated crude sales that were scheduled through 2031. With the latest crude purchase, DOE will have signed contracts to buy 32.4mn bl of crude at an average price of nearly $77/bl, of which more than 19mn bl has yet to be delivered to the SPR. Another 20mn bl of crude that oil companies and traders borrowed from the SPR in 2022 is set to be returned by year-end, which would push inventories in the reserve to above 400mn bl. By Chris Knight Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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South Sudan crude output halves on pipeline blockage


27/03/24
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27/03/24

South Sudan crude output halves on pipeline blockage

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Grupo Carso expande su huella en energía


27/03/24
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27/03/24

Grupo Carso expande su huella en energía

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Serica CEO warns on UK offshore investment


27/03/24
News
27/03/24

Serica CEO warns on UK offshore investment

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Oil transition plans inadequate for investors: Report


27/03/24
News
27/03/24

Oil transition plans inadequate for investors: Report

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