Reading the Tea Leaves - Today's Dakota Access and FERC Developments Explained
DAPL Status Conference
Today, Dakota Access was back in the District Court for the District of Columbia. The occasion was a status conference scheduled by Judge Boasberg following President Trump's issuance of his "Presidential Memorandum Regarding Construction of the Dakota Access Pipeline" last week. Judge Boasberg quickly summarized the pending issue -- Dakota Access's Motion for Summary Judgment on its claim that it has already received all of the permits and approvals it needs to complete construction of the pipeline, including, effectively, the easement to build on federal land that the U.S. Army Corps of Engineers maintains it has yet to issue.
Judge Boasberg then stated the reason for the conference: he wanted to know what the Corps was now going to do, in light of the direction of the Presidential Memorandum for the Corps to "review and approve in an expedited manner ... requests for approvals to construct and operate the [Dakota Access Pipeline], including easements or rights-of-way to cross Federal areas." He further explained that he did not want to waste "judicial resources" -- his time to draft a written opinion -- only to have that opinion be subsequently rendered moot by a decision by the Corps to, for example, issue the easement.
Judge Boasberg might be particularly sensitive to this issue, in that, in September 2016, he issued a lengthy opinion that denied the Standing Rock Sioux Tribe's request for an injunction to halt construction on the pipeline. That same day, the Corps, the Department of Justice and the Department of the Interior jointly announced that the government would not permit construction on federal land under Lake Oahe, while it reconsidered its previous decisions regarding the pipeline.
The Corps had no answer for the judge. The Corps' counsel stated only that they were reviewing the Presidential Memorandum, and were still in the decision-making process. When pressed by Judge Boasberg, whether the timetable would be known within days or weeks or months, the Corps' counsel could not elaborate beyond his first response. Dakota Access's counsel requested that Judge Boasberg require the appropriate Army official to attend the next status conference, in order to speed the decision-making process along, but Judge Boasberg demurred, and instead merely scheduled another status conference for the parties for Monday, February 6th.
It is perhaps reasonable that the Corps would be unable to address the judge's concerns so soon after its receipt of the Presidential Memorandum. Perhaps a full week to ponder the issue will result in a definitive answer for Judge Boasberg, and, importantly, for when construction of Dakota Access Pipeline may resume.
Operations at the FERC
This morning, the FERC released a brief interview with Acting Chairman Cheryl LaFleur, who provided more details on how the agency will operate without a quorum of commissioners. Last week, then Chairman Norman Bay announced that he was resigning effective Friday, February 3rd, leaving the FERC with only two commissioners and significant questions about their ability to do business. In the brief interview, Acting Chairman LaFleur, reiterated that the FERC is "very focused on the next week and trying to get as much work done while we have a quorum." Pipeline companies, including ANR, Natural Fuel Gas Company, and Nexus Gas Transmission have submitted requests seeking expedited issuance of Certificate decisions this week. Following Commissioner Bay's departure this Friday, Chairman LaFleur confirmed that staff delegated orders, technical conferences and environmental reviews will continue as usual. In addition, she and the remaining Commissioner, Colette Honorable, will continue drafting orders, so they could be approved quickly once a third commissioner is sworn in. The Acting Chairman also indicated that the Commission was attempting to expand the delegated staff's authority, but did not have anything to announce.
For natural gas certificate proceedings, delegated staff can issue a variety of documents, including orders to proceed with construction, data requests and environmental assessments/environmental impact statements. However, only Commissioners may approve certificates for new natural gas projects. This means that if projects that have completed environmental review, such as Rover, Nexus and Northern Access 2016, are not approved this week, they cannot be ruled on until a new commissioner steps in. However, the environmental review for earlier stage projects, such as PennEast Pipeline and Mountain Valley Pipeline, can continue. Similarly, projects that have already received their certificates, such as Leach Xpress, can receive orders to proceed with construction during the non-quorum interim, assuming other state and federal authorizations have been issued.
LaFleur also confirmed that FERC is affected by the White House's hiring freeze. She described the Commission as "well staffed," but indicated that depending on how long the freeze lasts, the Commission could lose staff to attrition or retirement and not be able to replace them. When asked about her priorities as Acting Chairman, she emphasized grid reliability, but did not specifically mention the role of natural gas infrastructure. She did not provide any update on the Trump administration's plans for Commission appointments, but did reiterate that new appointments would be welcome.
non-quorum interim, assuming other state and federal authorizations have been issued.
LaFleur also confirmed that FERC is affected by the White House's hiring freeze. She described the Commission as "well staffed," but indicated that depending on how long the freeze lasts, the Commission could lose staff to attrition or retirement and not be able to replace them. When asked about her priorities as Acting Chairman, she emphasized grid reliability, but did not specifically mention the role of natural gas infrastructure. She did not provide any update on the Trump administration's plans for Commission appointments, but did reiterate that new appointments would be welcome.