Monday, December 12, 2016

Federal Judge Turns Down Quick Decision on Dakota Access Pipeline Lake Oahe Easement

The Wall Street Journal is reporting that Federal D.C. District Judge James Boasberg today denied a requested motion by Energy Transfer Partners for rapid issuance of a Court order granting the Company an easement through Federal lands through and near Lake Oahe for the Dakota Access Pipeline.

Instead, the Judge ordered the pipeline Company and the Army Corps to submit additional motions and pleadings by January 31, 2017.

The decision means any Judicial granting of the requested easement will necessarily be delayed until after President Obama leaves office, thus foreclosing any possible easement issuance decision from either the Courts or the Army Corps until at least the end of January, 2017 when Trump will assume the Presidency.

With today’s Court decision, this leaves only the Congressional Legislation route for Energy Transfer Partners to obtain or gain any real estate right of way authorization required sooner than January 31 of next year.

The Mineral Leasing Act requires a ‘right of way’ authorization for Federal lands to be issued by any Agency Head with Federal Jurisdiction, which, in this case, means the Army Corps of Engineers under 30 USC Part 185.

How much revenue per month will Energy Transfer Partner lose from not being in operation?

They have commitments for 470,000 barrels per day likely throughput, and the transportation tariff is about $8/barrel, so:

470,000 barrels/day * $8 * 31 days/month = $116,560,000/month

A NBC News piece indicated that the Army Corps of Engineering Omaha Engineering and Command staff had recommended approval of the DAPL Lake Oahe easement, but that their recommendation was countermanded by Jo Ellen Darcy, an Assistant Secretary of the Army, and who is considered a “Political Appointee” at Management level and whose office will end with the end of the Obama Presidency.

Darcy’s decision absolutely guarantees that President Obama will not have to make any approval/denial final actions addressing DAPL or its route.

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