Ruling on Dakota Access startles pipeline industry

BISMARCK, N.D. — A judge’s ruling that might open the door for at least a temporary shutdown of the disputed Dakota Access pipeline surprised the industry that hailed the project as a “game changer” for North Dakota oil.

But shippers said Thursday that they aren’t concerned that there will be any long-term disruption to service on the $3.8 billion pipeline that on June 1 began moving crude from the Bakken oil patch to a distribution point in Illinois, from which it’s shipped to the Gulf Coast and potentially high-paying markets abroad.

“It’s business as usual today,” said Ron Ness, president of the North Dakota Petroleum Council, which represents nearly 500 energy companies including Dallas-based Energy Transfer Partners, which built Dakota Access.

U.S. District Judge James Boasberg ruled Wednesday that the Army Corps of Engineers “largely complied” with environmental law when approving the pipeline but didn’t adequately consider some matters important to the Standing Rock Sioux. The tribe draws its water from Lake Oahe and is opposed to the pipeline crossing beneath the Missouri River reservoir in North Dakota.

The pipeline — whose completion was pushed through earlier this year by the Trump administration — has the capacity to move half of North Dakota’s daily oil production. Ness just a few weeks ago called it a “game-changer that opens up everything.”

But the Standing Rock Sioux and other tribes are fighting the project in federal court in Washington, D.C., and they’ve hailed Boasberg’s ruling as a victory.

Boasberg said the Corps didn’t adequately consider how an oil spill under Lake Oahe might affect tribal fishing and hunting rights, or whether it might disproportionately affect the tribal community.

He will rule later on whether the pipeline should be shut down while the Corps reconsiders those matters, though he acknowledged such a move “would carry serious consequences that a court should not lightly impose.”

ETP in a Thursday statement said, “Dakota Access believes the record supports the fact that the Corps properly evaluated both issues, and that the record will enable the Corps to substantiate and reaffirm its prior determinations.”

“Pipeline operations can and will continue as this limited remand process unfolds,” the company said.

Corps spokeswoman Catalina Carrasco said the agency was still reviewing Boasberg’s decision.