Energy Transfer seeks Supreme Court DAPL review

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.

By Eunice Bridges