Energy Transfer Preps to Finish Dakota Line as U.S. Reviews

  • Pipeline giant to finish rest of project by December 1
  • No decision made on project, administration official says

Trudeau Clears Path for Pipeline Decision

Energy Transfer Equity LP said Friday that it was mobilizing equipment in preparation to drill the final portion of its controversial Dakota Access crude pipeline, even as an Obama administration official said no decision has been made on the project.

The pipeline giant can’t actually drill the final piece of the oil line beneath Lake Oahe in North Dakota until it gets an easement from the U.S. Army Corps of Engineers, company spokeswoman Vicki Granado said in an email Friday. The government’s review of the project is still ongoing, an administration official said Friday, asking not to be identified because the information isn’t public.

The company said in a statement Friday that it has told the Army Corps it would suspend construction near the lake “to diffuse tension and to facilitate the peaceful removal of protestors,” so long as the agency agreed on a date to finish construction. “The Corps has steadfastly and repeatedly rejected that offer,” it said.

The Dakota Access project has become a flashpoint in the wider battle over new pipelines proposed across the U.S. The 1,172-mile (1,886-kilometer) project has been a rallying point for the anti-fossil fuel movement. Opponents have argued it would damage sites culturally significant to Native Americans and pose an environmental hazard where it crosses the Missouri River. 

For its part, Energy Transfer said Thursday that it expects the project to be in service by spring.

Nearly Complete

Construction on the $3.8 billion line is nearly complete in North Dakota, where Energy Transfer has been waiting for the easement from the Army Corps. Once it receives that easement, Energy Transfer would begin a three-to-four month drilling program and draw the remaining $1.4 billion from a $2.5 billion credit facility that’s financing the project, company officials have said.

Earlier Friday, Politico reported that the Obama administration was expected to approve the easement as soon as Monday, citing two unidentified sources familiar with the timing. Energy Transfer units surged as much as 6.5 percent on the news. Units of Energy Transfer Partners LP, the entity behind the crude oil pipeline project, climbed as much as 3.4 percent.

The project’s future was thrown into question in September, when the Army Corps halted construction and ordered a review of its prior approval of the project after objections were raised by the Standing Rock Sioux Tribe. The review stopped work on the segment of the pipeline that crossed federal land near Lake Oahe in North and South Dakota. 

Hundreds of Arrests

This fall, protests have resulted in hundreds of arrests and drawn support from celebrities including actresses Shailene Woodley and Susan Sarandon. The standoff is emblematic of a broader effort by environmentalists to stall oil and gas pipelines, which they argue aren’t needed and hurt the the nation’s progress in reducing its reliance on fossil fuels.

On a Thursday call with analysts, Energy Transfer said it’s under no legal obligation to stop construction on the Dakota Access project and hasn’t voluntarily agreed to do so, despite requests from the Army Corps.

Energy Transfer also said that gaining the easement from the Army Corps also satisfies the closing conditions for its sale of a stake in the project and that it’s “confident” it’ll receive it.

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