Trump signs executive actions to advance Keystone XL, Dakota Access pipelines

Trump signs executive orders on Keystone and Dakota pipelines

President Donald Trump on Tuesday took steps to advance construction of two oil pipeline projects that have been fiercely disputed and were delayed under his predecessor.

Trump signed executive memos that will make it easier for TransCanada to construct the Keystone XL pipeline and for Energy Transfer Partners to build the final uncompleted portion of the Dakota Access pipeline.

The president said both memos were subject to terms and conditions to be negotiated by the United States. He also signed three additional actions to expedite environmental reviews for "high priority infrastructure projects," streamline the permitting process for domestic manufacturing and to insist pipeline companies buy materials from U.S. companies.

Shares of Energy Transfer Partners and TransCanada both rose more than 3.5 percent on Tuesday.

Trump has vowed to cancel Obama's Climate Action Plan and has threatened to pull out of or defund the Paris Climate Agreement, a landmark international accord aimed at reducing mankind's impact on global warming.

The Keystone XL would bring oil from Alberta, Canada, to Nebraska, where it would connect to an existing pipeline to bring the crude to Illinois. Former President Barack Obama refused to approve the cross-border project, saying the environmental review was not adequate in light of its route through the Sandhills ecosystem in Nebraska.

Environmentalists oppose the project because it will encourage the development of Canada's oil sands, a type of oil resource that requires more energy to tap than conventional reserves. Backers of the project say it will reduce U.S. reliance on oil from the Middle East and allow the country to fulfill its energy needs from one of its closest allies.

Keystone XL pipeline route, source: TransCanada

Former Secretary of State John Kerry denied TransCanada a presidential permit in November 2015, saying the Keystone XL would not have a major impact on America's energy security, lower gas prices or contribute meaningfully to the economy. At the same time, the pipeline could impact local communities, water supplies and cultural heritage sites, and would facilitate the import into the United States of "a particularly dirty source of fuel," Kerry concluded.

"The critical factor in my determination was this: moving forward with this project would significantly undermine our ability to continue leading the world in combating climate change," Kerry wrote.

Dakota Access pipeline route, source: Energy Transfer Partners

In a statement on Tuesday, TransCanada said the Keystone XL would create thousands of construction jobs and generate tens of millions of dollars in property taxes annually to counties along the proposed route.

"We appreciate the President of the United States inviting us to re-apply for KXL. We are currently preparing the application and intend to do so," the company said.

The project would employ a significant number of temporary construction workers during the building phase, though pipelines generally do not require much labor to operate in the long term.

Obama also backed a delay to completion of the Dakota Access pipeline, which would bring oil from North Dakota to Illinois.

In December, the Army Corps of Engineers said it would deny Dallas-based Energy Transfer Partners the easement it needs to complete the final stretch of the $3.7 billion pipeline. Jo-Ellen Darcy, United States assistant secretary of the Army for civil works, said the best path forward was to explore alternative routes for the pipeline, something Energy Transfer Partners says it will not do.

Members of the Standing Rock Sioux and other tribes, as well as environmentalists from around the country, have fought the pipeline project on the grounds that it crosses beneath a lake that provides drinking water to Native Americans. They say the route beneath Lake Oahe puts the water source in jeopardy and would destroy sacred land.

Tribe members and protesters have been camped out for months in Cannon Ball, North Dakota, in opposition to the pipeline.

Legal challenges ahead

Both projects could still face challenges, according to Bruce Huber, an associate professor of law at the University of Notre Dame who specializes in environmental, natural resources and energy law.

The Keystone XL pipeline requires state approval, and Nebraska landowners fought a yearslong legal battle with TransCanada over the project. The company withdrew its application with the state's Public Service Commission in November 2015 after the State Department decision.

Nebraska activists are likely to renew their protests, Huber said.

Trump has less room to maneuver when it comes to the Dakota Access pipeline, he added. The executive memo "directs agencies to expedite reviews and approvals for the remaining portions of this pipeline," White House press secretary Sean Spicer clarified during Tuesday's news briefing.

Should the Army Corps of Engineers' current environmental review pave the way for a new route, that plan will likely to face a lawsuit, Huber said.

"Any time you make an environmental analysis there's always room for a lawsuit on whether the review was complete enough," he said.

"If he truncates the process or speeds up the process, it just means that lawsuit will happen faster."

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