American Oil and Gas Reporter - January 2017 - 20

IndustryDigest
lawsuit seeks to reimpose a ban on new
stimulation permits off the Southern
California Coast.
In addition, NOIA mentions,
California Governor Jerry Brown
requested a permanent federal ban on
drilling off the California Coast in a
December letter to President Barack
Obama. "Federal and state lawmakers
have echoed those sentiments and called
for an executive order imposing a
permanent moratorium on oil and gas
exploration off the West Coast," NOIA
points out. ❒

Army Corps Denies
Dakota Access Permit,
Energy Transfer Sues
Round two of the Dakota Access
Pipeline standoff left the parties in
pretty much the same positions they
found themselves at the end of round
one.
On Nov. 14, after the Army Corps of
Engineers announced it was suspending
Energy Transfer Partners' request for an
easement to construct the final section
of the pipeline underneath Lake Oahe in
North Dakota, ETP filed a lawsuit in the
U.S. District Court for the District of
Columbia, seeking the legal right to
complete the project without further
Corps action (AOGR, December 2016,
pg. 37).
On Dec. 4, published reports
indicate, the Corps announced it was
denying the easement. "Although we
have had continuing discussion and
exchanges of new information with the
Standing Rock Sioux and Dakota
Access, it is clear there is more work to
do," reports quote Jo-Ellen Darcy,
Corps assistant secretary for civil
works.
She adds, "The best way to complete
that work responsibly and expeditiously
is to explore alternate routes for the
pipeline crossing."
ETP responded by saying, "The
White House's directive to the Corps for
further delay is just the latest in a series
of overt and transparent political actions
by an administration that has abandoned
the rule of law in favor of currying favor
with a narrow and extreme political
constituency."
ETP calls the announcement "a
purely political action, which the
administration concedes when it states it
20 THE AMERICAN OIL & GAS REPORTER

has made a 'policy decision'-
Washington code for a political
decision."
The following day, published reports
say, ETP was back in court, asking a
judge to grant the permit, arguing the
Corps was responding to "political
pressure and an escalating campaign of
violence and disorder waged by
protesters."
Industry responses to the
administration's announcement likewise
had a ring of déjà vu. American
Petroleum Institute President and Chief
Executive Officer Jack Gerard said, "I
am troubled, though not surprised, that
the Obama administration is again
putting politics over sound public policy
and ignoring the rule of law. The
Dakota Access Pipeline went through an
open, transparent, and established
permitting process that was upheld
twice by the courts, making this
decision even more baffling.
"I am hopeful President-elect Trump
will reject the Obama administration's
shameful actions to deny this vital
project, restore the rule of law, and
make this project's approval a top
priority as he takes office," Gerard
concludes.
Jay Lehr, science director for the
Heartland Institute, comments, "There
is no technical, scientific or engineering
reason that this pipeline would create
any problem for the landscape,
environment or natural resources.
Therefore, one must conclude that it is
Obama's death rattle attempt to
continue to block capitalistic progress in
our nation until his last day in office."
Heartland Institute Policy Analyst
Tim Benson adds, "A project that is 90
percent complete, not sitting on any
tribal land, and which was approved by
the Army Corps this past July, now is
being blocked for no other reason than
because it has become the cause of the
month for professional progressive
activists, and President Obama has
decided to throw them a bone on his
way out the door."
Karen Harbert, CEO of the U.S.
Chamber of Commerce's Institute for
21st Century Energy, agrees, saying
the White House "sent a clear message.
If your special interest-funded protest
is loud enough and has enough
celebrities tweeting their support, then
the rule of law and the facts no longer
matter." ❒

Congress Authorizes
Sale Of SPR Crude Oil
WASHINGTON-The 114th Congress
dipped into the Strategic Petroleum
Reserve for extra money a couple more
times before concluding its run.
According to published reports, the
temporary spending bill that funds
government operations through April
28, which was sent to the president on
Dec. 9, authorizes the Department of
Energy to sell $375 million worth of oil
to fund "necessary steps to increase the
integrity and extend the life" of the
SPR.
The day before that, reports note, the
House of Representatives gave final
approval to HR 34, the 21st Century
Cures Act, which authorizes selling 25
million barrels from the reserve to fund
medical research. The bill also lowers
the minimum level at which the SPR is
to be maintained to 450 million barrels
of oil.
The 114th Congress used the SPR as
a funding mechanism twice in 2015.
The two-year budget deal passed at the
end of October 2015 called for selling
58 million barrels of SPR crude over
eight years beginning in October 2017
to raise general revenue (AOGR,
December 2015, pg. 28). That same bill
also directed DOE to sell $2 billion
worth of crude from October 2016
through October 2020 to fund SPR
maintenance.
In early November 2015, HR 22, a
highway funding bill, approved selling
another 101 million barrels over eight
years. ❒

PHMSA Releases
Federal Safety Rules
For Natural Gas Storage
WASHINGTON-An interim final
rule (IFR) establishing minimum
federal safety standards for underground
gas storage facilities drew kudos for
following American Petroleum Institute
recommendations, but not for the
implementation timeline.
The Department of Transportation's
Pipeline and Hazardous Materials
Safety Administration published the
IFR in the Dec. 19 Federal Register
(Docket No. PHMSA-2016-0016),
amending 49 CFR Parts 191 and 192,
establishing minimum federal safety
American Oil and Gas Reporter - January 2017

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