The prospects for increased oil sands imports from Canada brightened on October 19th with the U.S. District Court for Minnesota’s decisive rejection of the Sierra Club’s National Environmental Policy Act (“NEPA”) challenge to the State Department’s final environmental impact statement (“FEIS”) for the Alberta Clipper (“AC”) pipeline. (Sierra Club v. Clinton, D. Minn., 09-CV-02622, Oct. 19, 2010) The Court held that there was ample evidence of both a need for the project and its benefits (i.e., the Canadian imports will reduce U.S. dependence on less stable crude oil suppliers and provide an economical, flexible, integrated crude oil transportation alternative). In analyzing need for the pipeline, the court upheld the State Department finding that this “unconventional” heavy crude oil will supply the U.S. with 4.3 million barrels per day (“bpd”) by 2030, which cannot be transported using existing pipeline capacity.
According to the court, the FEIS adequately evaluated at least six alternatives (including taking no action and reliance on energy conservation and renewable energy sources). The FEIS also considered the impacts of spills associated with the operation of both the Alberta Clipper and the Southern Lights Diluent Pipeline (“SLD Pipeline”) and submitted a Spill Prevention, Containment, and Control Plan for both pipelines. The Department assessed potential impacts from the SLD Pipeline even though it is not a connected action under the relevant NEPA regulations (i.e., it would be constructed even if the Alberta Clipper were not built). However, since the two pipelines are collocated, a leak from either pipeline would impact the same natural resources. Further, the court held that building the pipeline had no effect on crude oil demand and, absent such an effect, there is no legal obligation to analyze the impact of the Alberta Clipper Pipeline on alternative sources of energy.
Perhaps most important from a long-term legal perspective, the court determined that NEPA does not require the trans-boundary impacts associated with the oil sands production in Canada to be considered in this EIS because: (a) the Alberta Clipper Pipeline is not the only pipeline through which Canadian oil sands will be transported (and thus is not the cause of the development of the oil sands in Canada); and (b) the FEIS cannot be insufficient if it does not consider or attempt to mitigate impacts outside the United States, in this case, because oil sands development is under the jurisdiction of Canada.
While this decision is important, it is not the end of the road for this debate. It is likely to be appealed. Additionally, the State Department has not yet officially ruled on the separate Presidential Permit for the Keystone pipeline. Secretary of State Clinton suggested in a recent speech that the State Department, although it has not issued a final decision, is leaning toward approving the AC pipeline permit (because “we’re either going to be dependent on dirty oil from the Gulf or dirty oil from Canada”). However, local opposition to the Keystone Pipeline in Nebraska and from national environmental groups remains high and even if the State Department formally approves the permit early in 2011, that decision is subject to court challenge.
Leave a Comment so far
Leave a comment
