Doug Hayes

Judges Nixing Keystone XL South Cases Had Tar Sands-Related Oil Investments

On August 4, the U.S. Appeals Court for the 10th Circuit shot down the Sierra Club's petition for rehearing motion for the southern leg of TransCanada's Keystone XL tar sands export pipeline. The decision effectively writes the final chapter of a years-long legal battle in federal courts. 

But one of the three judges who made the ruling, Bobby Ray Baldock — a Ronald Reagan nominee — has tens of thousands of dollars invested in royalties for oil companies with a major stake in tar sands production in Alberta.  And his fellow Reagan nominee in the Western District of Oklahoma predecessor case, David Russell, also has skin in the oil investments game.  

The disclosures raise questions concerning legal objectivity, or potential lack thereof, for the Judges. They also raise questions about whether these Judges — privy to sensitive and often confidential legal details about oil companies involved in lawsuits in a Court located in the heart and soul of oil country — overstepped ethical bounds. 

These findings from a DeSmog investigation precede President Barack Obama's expected imminent decision on the northern, border-crossing leg of Keystone XL.

Emails: How State Department Secretly Approved Expanding Piece of Enbridge's "Keystone XL Clone"

State Department Enbridge Emails

DeSmogBlog has obtained dozens of emails that lend an inside view of how the U.S. State Department secretly handed Enbridge a permit to expand the capacity of its U.S.-Canada border-crossing Alberta Clipper pipeline, which carries tar sands diluted bitumen (“dilbit”) from Alberta to midwest markets. 

The State Department submitted the emails into the record in the ongoing case filed against the Department by the Sierra Club and other environmental groups in the U.S. District Court for the District of Minnesota. Collectively, the emails show that upper-level State Department officials hastened the review process on behalf of Enbridge for its proposed Alberta Clipper expansion plan, now rebranded Line 67, and did not inform the public about it until it published its final approval decision in the Federal Register in August 2014.

According to a March 17, 2014 memo initially marked “confidential,” Enbridge's legal counsel at Steptoe & Johnson, David Coburn, began regular communications with the State Department on what the environmental groups have dubbed an “illegal scheme” beginning in at least January 2014. 

Enbridge State Department Emails
Image Credit: U.S. District Court for the District of Minnesota

Environmental groups have coined the approval process an “illegal scheme” because the State Department allowed Enbridge to usurp the conventional presidential permit process for cross-border pipelines, as well as the standard National Environmental Policy Act (NEPA) process, which allows for public comments and public hearings of the sort seen for TransCanada's Keystone XL pipeline.

Further, the scheme is a complex one involving Enbridge's choice to add pressure pump stations on both sides of the border to two pipelines, Enbridge Line 3 and Enbridge Line 67, to avoid fitting under the legal umbrella of a “cross-border” pipeline.

Hastening the approval process — and thus dodging both the conventional presidential permit and NEPA process — came up in a June 6, 2014 memo written by Coburn and his Steptoe co-counsel Josh Runyan. Enbridge's legal argument centered around ensuring profits for its customers “consistent with its obligations as a common carrier.”

State Department Enbridge Emails
Image Credit: U.S. District Court for the District of Minnesota

Court: Key Environmental Law Doesn't Apply to Part of Enbridge Keystone XL "Clone"

Keystone XL Clone Flanagan South

A U.S. District Court for the District of Columbia has ruled that Enbridge’s 600-mile-long Flanagan South Pipeline, a Keystone XL “clone,” is legally cleared to proceed opening for business in October

Approved by the U.S. Army Corps of Engineers via a controversial regulatory mechanism called Nationwide Permit 12 (NWP 12), Judge Kentanji Brown Jackson, an Obama-appointed judge, ruled NWP 12 was not a federal government “action.” Thus, Brown posited that Enbridge did not need to use the National Environmental Policy Act (NEPA) regulatory process and NWP 12 was up to snuff.

The case pitted the Sierra Club and the National Wildlife Federation (NWF) against the Army Corps of Engineers and Enbridge and has lasted for just over a year, with the initial complaint filed on August 13, 2013 (Case #: 1:13-cv-01239-KBJ). 

Sierra Club and NWF submitted the recent precedent-setting Delaware Riverkeeper v. Federal Energy Regulatory Commission (FERC) case as supplemental authority for Sierra Club v. U.S. Army Corps of Engineers on the day that decision was handed down. 

But Jackson brushed it aside, saying it doesn't apply to Flanagan South, despite the fact that the Delaware Riverkeeper v. FERC decision said that a continuous pipeline project cannot be segmented into multiple parts to avoid a comprehensive NEPA review.

Although Enbridge will operate this project as a single pipeline, Flanagan South was broken up into thousands of “single and complete” projects by the Army Corps of Engineers. This helped Enbridge skirt the requirement of a more comprehensive and public-facing NEPA review, which involves public hearings and a public comment period.

“Here, not only was there no NEPA analysis of this massive project, there was never any public notice or opportunity for involvement before it was constructed across four states,” Sierra Club attorney for the case, Doug Hayes, told DeSmogBlog. “The entire thing was permitted behind closed doors.”

For all intents and purposes, then, Flanagan South is a fait accompli and tar sands diluted bitumen (“dilbit”) will begin pumping through it as summer turns to fall. 

Recent Federal Court Decision Could Muddy Waters for Keystone XL South, Flanagan South

On June 6, the U.S. Court of Appeals for the District of Columbia Circuit handed down a ruling that will serve as important precedent for the ongoing federal legal battles over the Keystone XL and Flanagan South tar sands pipelines.

In the Delaware Riverkeeper v. Federal Energy Regulatory Commission (FERC) case, judges ruled that a continuous pipeline project cannot be segmented into multiple parts to avoid a comprehensive National Environmental Policy Act (NEPA) review. This is what Kinder Morgan proposed and did for its Northeast Upgrade Project.

As reported on DeSmogBlog, the U.S. Army Corps of Engineers did the same thing to streamline permitting for both the southern leg of TransCanada's Keystone XL and Enbridge's Flanagan South. Sierra Club and co-plaintiffs were denied injunctions for both pipelines in October and November 2013, respectively.

Delaware Riverkeeper v. FERC dealt with breaking up a new 40-mile long pipeline upgrade into four segments. For the other two cases, the Army Corps of Engineers shape-shifted the two projects — both hundreds of miles long each — into thousands of “single and complete” projects for permitting purposes.

On the day of the Delaware Riverkeeper v. FERC decision, Sierra Club attorney Doug Hayes submitted the case as supplemental authority for the ongoing Flanagan South case.

On May 5, Hayes also submitted paperwork to appeal the Keystone XL South decision in front of the U.S. Court of Appeals for the Tenth Circuit, which was docketed by the clerk of Ccurt the next day.

Hayes told DeSmogBlog his side will file an opening brief for the appeal on July 30. It seems likely Delaware Riverkeeper v. FERC will be a key part of that appeal.

In a sign of the importance of the outcome for the oil and gas industry, the American Petroleum Institute (APIentered the Sierra Club v. Army Corps of Engineers case on Keystone XL as an intervenor on May 16, represented by corporate law firm Hunton & Williams.

At the federal level, Hunton & Williams lobbies on behalf of Koch Industries, a company with a major stake in tar sands leases and refining.

US Court Denies Halt on Pipeline Set to Replace Keystone XL Northern Half

Flanagan south, keystone xl pipeline

The ever-wise Yogi Berra once quipped “It's like déjà vu all over again,” a truism applicable to a recent huge decision handed down by the United States District Court for the District of Columbia. 

A story covered only by McClatchy News' Michael Doyle, Judge Ketanji Brown Jackson shot down Sierra Club and National Wildlife Federation's (NWF) request for an immediate injunction in constructing Enbridge's Flanagan South tar sands pipeline in a 60-page ruling.

That 600-mile long, 600,000 barrels per day proposed line runs from Flanagan, Illinois - located in the north central part of the state - down to Cushing, Oklahoma, dubbed the “pipeline crossroads of the world.” The proposed 694-mile, 700,000 barrels per day proposed Transcanada Keystone XL northern half also runs to Cushing from Alberta, Canada and requires U.S. State Department approval, along with President Barack Obama's approval. 

Because Flanagan South is not a border-crossing line, it doesn't require the State Department or Obama's approval. If Keystone XL's northern half's permit is denied, Flanagan South - along with Enbridge's proposal to expand its Alberta Clipper pipeline, approved by Obama's State Department during Congress' recess in August 2009 - would make up that half of the pipeline's capacity and then some. 

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