Executives from Energy Transfer said today that plans to complete the expansion of Dakota Access are still on the go; completion may start in 2021, although plaintiffs still want to shut down the pipeline entirely, according to an S&P report.
The pipeline expansion considers 750,000 barrels a day more from the actual 570,000. After this expansion, additional growth is being considered by the end of September 2021.
Nevertheless, these ambitious plans are simultaneous to the legal fight progressing in two federal courts. Even today, November 4, the U.S. Court of Appeals for District of Columbia Circuit held a hearing for oral arguments.
For Mackie McCrea, who will become co-CEO of the pipeline, there is no scenario where the pipeline gets out of service: “We are highly confident the pipeline is going to continue to operate and not be shut-in.”
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Dakota Access is on the go
Dakota Access pipeline has a permit from the U.S. Army Corps of Engineers, allowing the project to operate, although another essential federal license is lacking. A federal court later this year or in early 2021 will consider if the project goes on or another environmental study is needed.
This panorama complicates even more if the U.S. Army Corps of Engineers operates under a Biden or a Trump term. Analysts consider that Biden could kill the project, or at least could make the environmental reviews tougher.
In the center of the battle are also the Standing Rock Sioux Tribe and other plaintiffs against Energy Transfer and the Corp of Engineers. They consider Dakota Access a project that greatly harms the ecosystem and their lands from North Dakota to Illinois.
Closure of the project would set an important precedent for other major midstream projects like Keystone XL, which alarms the industry. Now, the project only needs the construction of new pumping stations and facilities, but not new pipe. Pre-construction activities have already begun.
Due to all the setbacks, Energy Transfer has reported a $782 million net loss for the third quarter of the year, mostly because of the $1.6 billion in impairment and declining values of the pipe’s assets.
