Amid COVID-19 Pandemic, Some Pipeline Projects Push Forward While Others Falter Nationwide

Read time: 12 mins
pipeline in Permian Basin

Last Friday, the Iowa Utilities Board issued an order that would allow the Dakota Access pipeline (DAPL) to double the amount of oil that flows through the state from 550,000 barrels a day to 1.1 million barrels a day. The utilities board, which also announced it had waived a hearing on the matter, made its move over the objections of environmental organizations and other civic groups opposed to DAPL operator Energy Transfer’s expansion plans.

Iowa’s approval landed just two days after a federal judge in North Dakota found that the project must undergo a full environmental review in a March 25 order, throwing the pipeline’s legal status into question. U.S. District Judge James E. Boasberg, who issued that order, also asked attorneys involved in that dispute to submit briefs on whether DAPL should be shut down while the pipeline undergoes its environmental review.

The DAPL expansion, meanwhile, still needs approval from Illinois state regulators, and environmental groups have asked the Illinois Commerce Commission to hold off from making any decisions for the time being, citing not only Judge Boasberg’s ruling but also the turmoil in the global oil market and the impacts of the COVID-19 pandemic on oil demand.

DAPL expansion plans previously were approved by state regulators in North Dakota and South Dakota, leaving only the Illinois permit left unobtained. A ruling from the Illinois Commerce Commission is expected this month, likely between April 7 and 16, according to those closely following the matter.

That means the DAPL project now sits at a point of enormous uncertainty — it could wind up, despite its lack of environmental review, allowed to carry twice as much oil a day as it has over the past three years or it could wind up without the legal authority to carry any oil at all.

In other words, for DAPL — the focus of years of grassroots organizing, legal battles, and protests worldwide — this could be a double or nothing moment.

From March 11, when COVID-19 was officially recognized by the World Health Organization as a pandemic, to today, with global confirmed COVID-19 cases well over 1 million, developments in the oil and gas pipeline industry have nonetheless marched onwards.

Below, you’ll find more important pipeline stories from across the U.S. from the past few weeks that may have escaped the national spotlight — many related to COVID-19 and others not — for readers who seek to catch up on some of what’s transpired during that time.

East Coast

In North Brooklyn, New York City, a National Grid pipeline — the 30-inch diameter Metropolitan Reliability Infrastructure Project planned to carry gas from Long Island and Massachusetts — had drawn community opposition and protests before the pandemic set in, in part due to climate concerns and objections to its $185 million price tag for National Grid customers, and in part because construction had proved disruptive for neighborhood businesses. On March 24, the Brooklyn Eagle reported that a construction worker had tested positive for COVID-19 — but it wasn’t until two days later, on March 26, that National Grid stopped work on the project, after photos showed workers were not social distancing (National Grid denied that there had been positive cases at its construction site, Brooklyn Eagle added).

We’re sheltering in our homes to protect our neighbors and the people that we love,” Kevin Lacherra, an area resident, told the Eagle. “And while we were doing that, buying food and medicine and checking in on the elderly people on our block, National Grid was working around the clock to keep up construction on this pipeline.”

In Pennsylvania, the troubled Mariner East project has also been at the heart of controversy after its builder, Energy Transfer, sought to continue construction following the state’s shut down of all “non-life sustaining” businesses. Though the order, by Governor Tom Wolf, lists pipeline construction among industries required to shut down, it allows companies to seek waivers. Energy Transfer sought and obtained waivers allowing it to continue construction at 15 sites across Pennsylvania, according to State Impact.

The waivers were requested to ensure the continued safety, integrity, and stabilization of these construction sites,” a spokesperson told the NPR affiliate. Those opposed to Mariner East described concerns that the company would rush construction forward at sites covered by the 10-day waivers, citing Energy Transfer’s rocky record in the state. A Mariner East worker was recently charged with a felony for forging weld records and the project reportedly remains under an ongoing investigation by the Federal Bureau of Investigation and others.

Meanwhile, a federal lawsuit brought by pipeline opponents against Energy Transfer, pipeline security contractor Tiger Swan, and others has largely survived a motion to dismiss by the defendants. In a ruling dated March 30, a federal judge in the Middle District of Pennsylvania allowed claims of nuisance, invasion of privacy, trespass, malicious prosecution, and false arrest to move forward in a federal lawsuit alleging that Energy Transfer, Tiger Swan, and other defendants had sent a hired infiltrator to the plaintiff’s property and that the infiltrator then spread false allegations against pipeline opponents.

Further south, in Virginia, opponents of the $5.5 billion Mountain Valley Pipeline (MVP) have urged against resumption of construction on that project, which had been slated to re-start construction this spring. “They're coming from states in many cases that have higher COVID-19 rates than we do, like Louisiana where a lot of pipeline workers come from,” said pipeline opponent Diana Christopulos told a local ABC News affiliate.

In late March, federal regulators pushed back the deadline for their review of MVP’s impacts on wildlife to April 27 and Kallanish Energy reports that construction cannot resume unless those biological permits and two other permits are granted. In the meantime, the Roanoke Times reports that Virginia’s environmental regulators have discovered erosion and sediment control problems persisted at the pipeline project — and that violations had begun soon after a $2.15 million consent decree over earlier erosion problems had expired. Erosion and sediment control problems have been at the center of investigations into other pipeline explosions in recent years.

Meanwhile, the U.S. Supreme Court is still deliberating on a case centered on the $8 billion Atlantic Coast pipeline and whether it would illegally cross the Appalachian Trail on federal land in Virginia. A decision in that case is expected before the end of June, according to a March 19 Energy News Network report.

Gulf Coast

Along the Gulf Coast, four contract workers tested positive for COVID-19 at a Dow Chemical plant in Plaquemine, Louisiana, WAFB9 reported on March 25. The plant, categorized as an essential business, remained operating, though Dow told reporters it was screening for fevers at plant entrances. Similarly, a BASF plant where chemicals used in the Roundup pesticide are manufactured and the Denka Performance Elastomer plant, both in Louisiana, have also discovered that workers have tested positive for the virus, according to The Advocate.

Meanwhile, Shell dropped out of plans to build the Lake Charles liquefied natural gas (LNG) plant in Calcasieu Parish — but Energy Transfer has announced that it remains committed to the project, albeit at a “reduced size,” The Advocate also reports. A January 2020 report by the Environmental Integrity Project had found that the Lake Charles project was expected to be the second-largest contributor to greenhouse gas emissions among the slew of petrochemical and LNG export projects proposed in the U.S.

In Texas, the one-two punch of an oil price war and the reduced demand for gasoline amid the pandemic have left drillers in the Permian Basin reeling. “Occidental, Chevron, Pioneer Natural Resources, Parsley, and other oil companies are sharply cutting operations in the Permian Basin of Texas and New Mexico, the epicenter of the U.S. shale-oil production boom,” The New York Times reported on March 31. “Schlumberger and other large service companies are cutting and furloughing thousands of workers.”

But it’s not clear yet that oil flows have subsided, leaving pipeline companies stuck between drillers who don’t want to cut back and refiners that are overflowing with oil. “If producers do not cooperate and refiners are not buying, pipeline operators can apply force majeure clauses,” Anas Al-Hajji, an energy analyst, told the Houston Chronicle on March 29, referring to contract clauses that can sometimes offer businesses an out from deals in unforeseen circumstances.

Meanwhile, environmental advocacy group Earthworks warns that their field organizers have observed an increase in the number of flares that are left unlit and that are venting raw methane gas — a powerful contributor to climate change — into the atmosphere across the Permian Basin. Because the gases from unlit flares are invisible to the eye, a infrared camera or other specialized device is necessary to spot the emissions spewing from unlit flares. Earthworks thermographers report a 34 percent rise in unlit flares in 2020, adding that “we have documented flares that remain unlit for days, weeks, months — and even over a year.”

And today, Kinder Morgan, builder of the Permian Highway natural gas pipeline, announced that it was suspending construction on that pipeline following a spill of drilling mud that affected water wells in Blanco County, Texas. That spill first came to light when locals discovered their tap water was muddy and contaminated, according to the Sierra Club. “From the beginning, thousands of Texans and local governments have been concerned about the construction of this pipeline and its long-term impacts on the Texas Hill Country and local waterways and aquifers,” Sierra Club’s Roddy Hughes said in a statement about the spill. “The fact that this spill was not made public until residents spoke out about contamination in their drinking water makes it clear that Kinder Morgan can’t be trusted to build this pipeline safely.”

Central US

In contrast, TC Energy, the Canadian firm formerly known as TransCanada, is pushing forward with plans to build the Keystone XL pipeline project, which would carry 830,000 barrels a day of tar sands oil from Alberta into the United States. The Alberta government said it will be investing roughly $1.1 billion in the construction project and offering TC Energy $4.2 billion in loan guarantees. “We cannot wait for the end of the pandemic and the global recession to act,” Alberta Premier Jason Kenney told NPR. “There are steps we must make now to build our future focused on jobs, the economy, and pipelines.”

“Our rural communities are strained as it is for medical supplies and hospital beds amid a global pandemic,” countered Jane Kleeb, founder of Bold Nebraska. “TC Energy must put an end to any construction in our small towns as the pandemic grows across our country.”

Keystone XL, like many other oil and gas pipelines, will benefit from a designation as “critical infrastructure” in a growing number of states, 350’s Bill McKibben wrote April 2 for The New Yorker.

Since the pandemic was declared, three states — Kentucky, South Dakota, and West Virginia — have all signed “critical infrastructure bills into law,” according to EcoWatch. “While we are all paying attention to COVID-19 and the congressional stimulus packages, state legislatures are quietly passing fossil-fuel-backed anti-protest laws,” Greenpeace USA researcher Connor Gibson, told HuffPost. “These laws do nothing new to protect communities. Instead they seek to crack down on the sort of nonviolent civil disobedience that has shaped much of our nation's greatest political and social victories.”

West Coast

On the West Coast, Pembina's Jordan Cove project in Oregon obtained approvals from the Federal Energy Regulatory Commission (FERC) for an LNG terminal and associated pipeline project in mid-March. The project, however, still lacks state permits — and the move by FERC drew immediate objection from Oregon’s Governor Kate Brown.

Given a national and state emergency, in which the federal government and its agencies are unable to fulfill their basic responsibility to keep citizens safe, it is stunning that the FERC moved forward on this decision today, approving the Jordan Cove project and Pacific Connector Gas Pipeline,” Gov. Brown said in a March 19 statement. “And let me be clear to the concerned citizens of Southwest Oregon: until this project has received every single required permit from state and local agencies, I will use every available tool to prevent the company from taking early action on condemning private property or clearing land.”

Alaska

In Alaska, a BP worker at Prudhoe Bay has tested positive for the novel coronavirus, Alaska Public Media reported on March 31. “The patient traveled to the North Slope on March 25, and displayed symptoms within two days of arriving,” Alaska Department of Health and Social Services Commissioner Adam Crum said in a statement, APM reported. “He was tested and put in quarantine, as were his immediately identified close contacts.”

Alaska regulators also asked for more information about how current market conditions will impact a proposed deal between BP and Hilcorp, APM separately reports. Hilcorp had proposed to buy out $5.6 billion of BP’s Alaskan assets — but state regulators appear concerned about Hilcorp’s capacity to finance that deal.

National

Nationwide, pipeline companies had already trimmed $1.9 billion from their 2020 budgets, according to a March 23 Houston Chronicle report. “Noble Midstream Partners, Rattler Midstream, Targa Resources, EnLink Midstream, Oneok, and Pembina Pipeline made the budget cuts over the past two weeks — representing an overall 30 percent cut in planned capital expenditures for new pipeline and storage projects in 2020,” according to a research note from energy investment firm Simmons Energy, the Chronicle reported. “Canadian pipeline operator Pembina made the largest cut of the six companies, slashing nearly $700 million, or 43 percent, from its nearly $1.6 billion budget. The company now plans to spend nearly $900 million this year.”

Main image: A pipeline in the Alpine High region of the Permian Basin in Jeff Davis County, Texas. Credit: Justin Hamel © 2020
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