A few days ago, I mentioned in various comments that it would be difficult for Trump to overturn the Army Corps of Engineers' ("ACOE" or "Corps," hereafter) decision to refuse an easement to the backers of the Dakota Access Pipeline (DAPL) to allow them to drill and complete their pipeline under Lake Oahe. Why? To understand what President-Elect Trump faces should he attempt to reverse by fiat what the Corps determined is mandated by our federal environmental laws, let's review the history and the legal issues that led up to the ACOE's ultimate decision to require an Environmental Impact Statement (EIS) for the project.

Brief History of DAPL's Legal Issues and Protests

An independent internal environmental assessment of DAPL by the Corps to determine whether an EIS was required under the National Environmental Policy Act (NEPA) and its associated regulations, a step they had previously and unlawfully failed to take when granting permits to the company constructing the pipeline.

BISMARCK, N.D.—Senior officials at the U.S. Environmental Protection Agency and two other federal agencies raised serious environmental and safety objections to the North Dakota section of the controversial Dakota Access oil pipeline, the same objections being voiced in a large protest by the Standing Rock Sioux tribe that has so far succeeded in halting construction.

But those concerns were dismissed by the U.S. Army Corps of Engineers, which relied on an environmental assessment prepared by the pipeline's developer, Dakota Access LLC, when it approved the project in July, according to public documents.

Indeed, the granting of permits by the ACOE makes it one of the agencies most frequently required to apply NEPA and the regulations that determine the level of environmental review. Under NEPA, an agency cannot rely upon assessments made by proponents of the project that falls within the aegis of the federal agency responsible for taking action regarding that project.

The EA document [i.e., the initial Environmental Assessment to determine if an EIS is required] is prepared by the acting federal agency, not by a private applicant. The EA constitutes the basic record necessary for a determination that an EIS is not necessary -- in federal parlance, a Finding of No Significant Impact ("FONSI").

Each federal agency involved in a proposed action (i.e., which funds, constructs or permits an
action) must make its own independent determination of significance. [...

"Crossings of the Missouri River have the potential to affect the primary source of drinking water for much of North Dakota, South Dakota, and Tribal nations," Philip Strobel, National Environmental Policy Act regional compliance director for the EPA, wrote in a March 11 letter to the Army Corps. [...]

The EPA shared its concerns and recommended that the Army Corps undertake a new draft environmental assessment and release it for public comment. In that process, the EPA asked the Army Corps to consider "other available routes or crossing locations that would have reduced potential to water resources, especially drinking water supplies," and to carry out a "more thorough" analysis of environmental justice concerns. The other agencies also asked for further assessments and consultation with the tribes. [...]

In its public comments, the Department of the Interior, the government agency responsible for the administration and management of Native American lands, called for the Army Corps to conduct an Environmental Impact Statement, a more comprehensive analysis of the potential impact of the proposed pipeline.

Despite these rather pointed recommendations, the ACOE brushed them aside, claiming that "the anticipated environmental, economic, cultural, and social effects [of DAPL are not] not injurious to the public interest." So, the Corps failed to abide by federal environmental regulations that it prepare its own internal environmental assessment after being raked over the coals by the Department of the Interior, the EPA and the EPA's regional NEPA compliance officer. Instead, ACOE chose to rely on an environmental assessment prepared by the pipeline construction company.

However, several months after the Standing Rock Sioux took their complaints and objections public, and the first of many peaceful protests were met by law enforcement with extreme violence, the feds began to reverse course. On September 9th of this year the Departments of Justice and of the Interior essentially ordered the Corps to reconsider its "previous decisions regarding the Lake Oahe site under the National Environmental Policy Act (NEPA) or other federal laws."

Two monts later, on November 14, 2016, the ACOE released its initial statement regarding its review of the legal requirements necessary before construction could proceed under Lake Oahe. The Corps categorically stated that no easement would be granted to Energy Transfer Partners, and Dakota Access, LLC (the pipeline owners) to drill under Lake Oahe to complete construction, until the following had been accomplished:

The Army has determined that additional discussion and analysis are warranted in light of the history of the Great Sioux Nation’s dispossessions of lands, the importance of Lake Oahe to the Tribe, our government-to-government relationship, and the statute governing easements through government property.

The Army invites the Standing Rock Sioux Tribe to engage in discussion regarding potential conditions on an easement for the pipeline crossing that would reduce the risk of a spill or rupture, hasten detection and response to any possible spill, or otherwise enhance the protection of Lake Oahe and the Tribe’s water supplies. Therefore, construction of the pipeline on Army Corps land bordering or under Lake Oahe will not go forward at this time. The Army will move expeditiously to make this determination, as everyone involved — including the pipeline company and its workers — deserves a clear and timely resolution.

Despite this declaration by the Corps to halt construction, DAPL construction continued and the level of violence against the Water Protectors and other peaceful protestors was ramped up to a degree not seen since the Civil Rights and anti-war protests in the 60's by local and regional law enforcement, the North Dakota National Guard and the pipeline company's hired security forces. This culminated in the atrocities that occurred on November 20, 2016, when these corporate thugs and law enforcement used water cannons, rubber bullets and grenades to cause grave bodily harm to hundreds of unarmed people, including medics seeking to help people wounded by the assault.

Noah Morris was [a] medic at the scene. “They were just hosing people down with their water cannon that continued for the entirety of the four hours I was out there watching,” he said. He said that earlier in the week, the rivers and creeks nearby had started to crust over with ice. As he and his team flushed the eyes of people sprayed with tear gas, the water and milk of magnesia they used turned to black ice on the ground.

Morris said he knew of multiple people that had been hit in the head with rubber bullets or bean bag rounds. In a statement, the Medic and Healer Council described injuries including an elder who lost consciousness before being revived on site, a man who experienced a seizure, and a woman whose eye was injured when she was shot in the face by a rubber bullet.

A 21-year-old woman from New York, Sophia Wilansky, underwent surgery Monday after her arm was severely injured by a concussion grenade, according to the council.

Shortly after this attack, Wes Clark, Jr. and a number of other US veterans announced that they would organize a large group of vets to go to the Standing Rock Reservation and act as human shields for the Water Protectors. Ultimately hundreds of veterans, including Tulsi Gabbard, (D-Hawaii) arrived on or about December 4th at Camp Oceti near the construction site.

Perhaps coincidentally (and perhaps not), on December 4, 2016 ACOE announced the completion of the review process that was initially begun on September 9th. The ACOE stated that it would now seek, for the first time, an Environmental Impact Statement for the pipeline. In the press release regarding the decision, Army Assistant Secretary for Civil Works, Jo-Ellen Darcy, is quoted as saying the following:

Jo-Ellen Darcy said she based her decision on a need to explore alternate routes for the Dakota Access Pipeline crossing. Her office had announced on November 14, 2016 that it was delaying the decision on the easement to allow for discussions with the Standing Rock Sioux Tribe, whose reservation lies 0.5 miles south of the proposed crossing. Tribal officials have expressed repeated concerns over the risk that a pipeline rupture or spill could pose to its water supply and treaty rights.

"Although we have had continuing discussion and exchanges of new information with the Standing Rock Sioux and Dakota Access, it's clear that there's more work to do," Darcy said. "The best way to complete that work responsibly and expeditiously is to explore alternate routes for the pipeline crossing."

Darcy said that the consideration of alternative routes would be best accomplished through an Environmental Impact Statement with full public input and analysis.

You can read the full "Memorandum for Commander, US Army Corps of Engineers" signed by Secretary Darcy regarding the decision to require an EIS for the DAPL project at this link. The Memorandum is quite detailed and it is written in such a way as to make any automatic reversal of its decision look capricious at best.

What Will Trump Do Re: DAPL?

Now that ACOE has rectified its own violation of governing federal law and determined that, yes, the Dakota Access Pipeline project does indeed require an Environmental Impact Statement, concern has shifted to what the incoming Trump administration will do. Many fear that Trump will simply overrule this decision, and order the Corps to grant the easement, resulting in the immediate resumption of drilling under Lake Oahe to complete the pipeline's construction.

Putting aside the issue of whether the pipeline is economically viable in the present market for oil and gas, and whether companies that signed contracts for shipment using DAPL may have revocation or price renegotiation rights, the legal issue of whether Trump can arbitrarily put aside the conclusions of the ACOE and Army officials is not as straightforward as one would imagine.

Ordering his administration to reverse the Army Corps’ decision (even though, to be clear, he could do so) would be a mistake, legal experts say.

“It can be undone, and it can be undone pretty quickly,” Shannon Buccino, director of the land and wildlife program at the Natural Resources Defense Council, told ThinkProgress. “But [the administration would] have to justify that decision, they can’t do it arbitrarily.”

By acting in such a a precipitous manner, especially in light of Trump's own financial interest in DAPL, litigation over DAPL very well may tie up the project for years in the Federal Courts.

An Environmental Impact Statement (EIS) could take years to execute, meaning the move would delay the pipeline indefinitely.

And while Trump could move to undo the EIS, groups opposed to the pipeline said this would trigger a legal fight that could tie up the project on its own.

Jan Hasselman, an Earthjustice lawyer who represents Standing Rock in its lawsuit against the project, said any Trump move is “subject to judicial review” and that the tribe is planning to sue.

Pipeline foes acknowledged the Army Corps’ decision was not the end of the Dakota Access fight, vowing to resist any effort to undo it, a strategy that carries the promise of renewed public pressure against Trump.

Prior decisions by the courts that favored the pipeline company occurred before the Corps' reconsideration of its earlier flawed environmental assessment, which now requires an EIS. The issues beofre those courts involved whether the tribes were entitled to a TRO to stop construction based in large part on whether they had been properly consulted regarding the Corp's earlier environmental assessment and whether they were likely to suffer irreparable harm to "sacred sites" as result of pipeline construction activities.

Those court rulings in September and October, in which the tribes bore the burden of proof - under the preliminary injunction standard whereby the tribes had to show irreparable harm - involved issues that are no longer relevant. The Corps' determination to require an EIS dramatically alters the legal positions of the parties involved, making those rulings non-binding with respect to future litigation.

Thus, legally and from a political and public relations standpoint, this would not be an easy battle for Trump to win. He would have some high hurdles to overcome to force the resumption of pipeline construction under Lake Oahe, in light of the Corps' actions that now require a full blown Environmental Impact Statement.

Additional Concerns About DAPL that May Impact the Project

Then there are the concerns of the lenders involved, who might very well have been the prime movers behind the Obama administration's decision, as set forth in Asst. Secretary Darcy's Memorandum. They might want to take their losses now rather than continue to throw good money after bad. No doubt the negative publicity engendered by the treatment of the Standing Rock Sioux may also play a part in how they proceed with any future refinancing of the pipeline.

The pipeline was originally proposed in 2014 as a joint venture of Energy Transfer Partners (with a 75 percent stake) and Phillips 66 (with a 25 percent stake). On August 2, 2016, Energy Transfer Partners announced plans to sell 49 percent of its stake to a joint venture of Enbridge Energy Partners and Marathon Petroleum Corporation. [...]

However, the financing for this sale cannot be finalized until DAPL receives its final easement from the Army Corps of Engineers.

Then there is the question of how much additional infrastructure for transportation of the Bakken shale oil and gas is really needed at this point, and whether DAPL would simply be a pipeline too far.

“The financial environment for ETP looks a lot more risky today when they were first proposing the pipeline,” Derry-Williams said.

His analysis suggests that “DAPL’s capacity could become superfluous by mid-2017” and that “DAPL may represent a substantial overbuilding of the Bakken region’s oil-transport infrastructure.”

[The CEO of Energy Tranfer Partners (ETP), the pipeline owner], Kelcy Warren, has said that overbuilding is part and parcel of the oil industry. But there are multiple market factors at work against the pipeline. Since Dakota Access was proposed in 2014, oil prices have fallen dramatically, even while production from the Bakken formation has decreased.

Conclusion

Overall, I am cautiously optimistic, despite the realization that the new Trump administration represents a wild card when it comes to future federal actions regarding DAPL. Market uncertainties, the complex financing structure underlying the pipeline's construction and ultimate ownership, and the distinct possibility of lawsuits or other legal action by shippers who contracted with ETP, by the lenders and by parties to the proposed sale of an interest in the pipeline that was contingent on the easement under Lake Oahe, are all variables that argue against a reversal of the ACOE's decision. At this point in time, I believe the Standing Rock Sioux and their supporters hold the upper hand regarding any future decision by the Trump administration to authorize further construction of the DAPL project. In my view this is not a battle Trump should chose to fight, and if he does, it's one I believe he and his administration would ultimately lose.