Standing Rock Sioux: DAPL shutdown has modest and manageable impact | Oil and energy
The impact of the Dakota Access shutdown is “modest and manageable,” Standing Rock Sioux and other tribes said in court documents filed Friday night during the second round of their efforts to force the DAPL to cease operations .
The tribe’s response to the updated DAPL Economic Impact Analysis was filed the same day an appeals court upheld the lower court’s decision requiring the US Army Corps of Engineers to conduct a longer environmental study due to the controversial nature of the pipeline. The ruling paves the way for a second hearing on whether the pipeline, which no longer has a valid easement for the crossing under Lake Oahe, should be closed while the additional study is completed.
In its analysis last week, Dakota Access said the shutdown meant billions in losses for the state of North Dakota, its oil and gas industry and the pipeline company itself.
But Standing Rock Sioux lawyer Jan Hasselman said the DAPL exaggerates the harm a temporary injunction would cause. The lawyer submitted an independent market analysis by S&P Global Ratings, which said a temporary shutdown of DAPL would not affect its credit ratings for Bakken producers. Hasselman also cited statements from officials at Hess and Continental on the recent earnings conference call, in which the CEOs of each company said he was ready for a shutdown and only expected to face up to it. at slightly higher transport costs.
Hess CEO John B. Hess told investors that the company’s existing mid-level assets allow it to move all of its Bakken production, thanks to “the flexibility provided by our marketing capability; our [Hess Midstream LP] infrastructure and long-term commitments in multiple markets, ”Hasselman wrote.
The company planned to ship oil by rail, as well as other pipelines it already carries oil on.
“So it wouldn’t have a major impact on moving all of our production if DAPL was closed,” Hess told investors. “And the cost to us would be a few dollars a barrel.”
The tribes have also suggested that North Dakota is overly optimistic about the prospects for oil recovery, and thus overestimate the tax losses the state is likely to incur due to depressed production.
But economic harm shouldn’t be what the court is focused on anyway, the tribes argued. Substantive success should be the first consideration, especially given “the terrible history of the US government’s dispossession of the resources of the Great Sioux Nation, as well as its ongoing duty of trust which governs its actions today. “.
“The long-held (tribal) position that the project was never properly considered has been upheld by both this Court and the DC Circuit,” Hasselman wrote. “To date, the pipeline operates without a valid permit, in violation of the Mineral Leasing Act and NEPA. The Court has previously ruled that the violations are so “serious” that the pipeline must be shut down, and nothing in DAPL’s latest filing compels a different conclusion.
The tribe also continues to be concerned about the safety of the pipeline and took issue with DAPL’s claims that it is spill-free.
“The DAPL-ETCO line has experienced 12 spills, including 6,000 gallons of crude during its short life,” wrote Hasselman. “Other ETP-managed pipelines tracked by tribal safety officials from 2012 to present have spilled 290 times, an average of 2.9 spills per month, of which 32% were considered significant incidents under of federal regulations. ”
What’s more, Hasselman said, is that ETP tends to have much larger spills in high-impact areas.
“DAPL is a major pipeline with massive capacity adjacent and under a particularly sensitive and important waterway, the Missouri River. It’s DAPL that indulges in the apple-to-orange comparison by placing it next to minor pipelines in less sensitive locations. “
Hasselman also pointed to the expansion of the DAPL road – already licensed and under construction – as another reason why the injunction is needed.
“The Corps has never confirmed that it will prevent DAPL from violating its permit by doubling the volumes of crude without changing the permit,” Hasselman wrote. “Not only is DAPL calling for continued illegal operations to mitigate the economic damage, to the detriment of the tribes, but it intends to make the damage worse by doubling the risk and potential for catastrophic impacts.”
The tribe also mentioned the MHA Nation in their response, which they claimed had previously supported Standing Rock Sioux and the efforts of other tribes to block the construction of Dakota Access.
“Like the complaining tribes, MHA Nation is a ruler and is free to change its position, although its claims about economic impacts carry little weight if they are not supported by admissible evidence,” Hasselman wrote. “The tribes have never denied that closing the pipeline would have consequences; however, they stressed that the profits of others should not come at the expense of the tribes, especially when the law has not been obeyed. “