New Montana District Court Ruling Could Impact Energy Development Throughout the U.S.

The Federal District Court for Montana, in a ruling that could impact energy and development projects across the United States, ruled in favor of the pipeline opponents in a case concerning challenges to the Keystone XL Pipeline. While the case mostly focused on the permitting for this particular pipeline, the court’s ruling resulted in the court vacating NWP 12 and the remanding of the permit back to the United States Army Corps of Engineers (Corps). The court’s order requires the Corps to complete a programmatic consultation under Endangered Species Act (ESA) section 7 with the United States Fish and Wildlife Service (FWS). As a result, parties wishing to utilize NWP 12 for stream crossings for pipelines will need to potentially obtain an individual permit, thus likely extending permitting time frames for these types of projects.

The court found that the Corps’ renewal of NWP 12 in 2017 failed to account for potential impacts to endangered species and critical habitat. In 2017, during the Corps’ consideration for re-issuance of NWP 12, the Corps issued a finding of no significant impact (FONSI) related to potential impacts to endangered species and critical habitat pursuant to the ESA resulting from usage of NWP 12. The Corps’ reasoning found that General Condition 18 of NWP 12 which states that the permit cannot be used in instances where an activity will directly or indirectly impact an endangered species or its critical habitat and further requires the filing of a Pre-Construction Notice (PCN) and a formal consult process under Section 7 of the ESA where a project “may” impact a species or its critical habitat and would be sufficient to address its duties under the Act. The court found the actions by the Corps were not sufficient and did not address concerns under the ESA on a programmatic level based upon the national scale of the NWP 12 program based upon the record presented to the court and past practice by the Corps in 2007 and 2012 when it requested a programmatic consult with the FWS and a Biological Opinion was issued prior to renewal of NWP 12.

The court remanded NWP 12 to the Corps for compliance with the ESA, vacated NWP 12 pending compliance with the court’s order, and enjoined the Corps from authorizing dredge or fill activities under NWP12 pending compliance with the court’s order. Vacation of the NWP 12 may have national implications beyond the jurisdiction of the federal district court. Nationwide injunctions have been criticized by Attorney General Barr as violative of the separation of powers. A spokesperson for the DOJ commented that it is reviewing the opinion, but an appeal is likely.

A copy of the opinion can be accessed using this link.