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Alaska pipeline approved, new pipe safety rule struck down in pair of rulings

One decision praises regulators for their thorough environmental analysis of a proposed natural gas project, while the second says regulators "cut corners" in their rulemaking.

WASHINGTON (CN) — Gas pipelines had their day in the U.S. Court of Appeals for the D.C. Circuit, which ruled Tuesday on two challenges against gas pipeline proposals: one involving a potential liquefied natural gas pipeline in Alaska, and the other, additional safety measures for gas and hazardous liquid pipes.

A three-judge panel unanimously rejected the first challenge, brought by the Center for Biological Diversity and Sierra Club, deciding that the Alaskan pipeline project could move forward because the Federal Energy Regulatory Commission had taken ample consideration of how the project would affect the surrounding environment.

The second panel of three ordered the review of a regulation proposed by the Pipeline and Hazardous Materials Safety Administration, which requires new or replaced pipelines be fitted with remote-controlled or automatic shut-off valves. The court found that the agency did not disclose that the rule would also apply to so-called “gathering pipelines" — which collect raw gas or crude oil from wells — and the economic burden that would create.

U.S. Circuit Judge Neomi Rao, a Donald Trump appointee, wrote the court’s opinion for the first case, saying the commission better known as FERC had made a “lawful and reasonable” decision.

“CBD fails to provide any reason for this court to disturb the Commission’s reasonable determinations,” Rao wrote, referring to the challengers under the umbrella of the Center for Biological Diversity.

Rao was joined by U.S. Circuit Judge Justin R. Walker, a Donald Trump appointee, and Senior U.S. Circuit Judge A. Raymond Randolph, a George H. W. Bush appointee.

The proposed Alaska pipeline, developed by the Alaska Gasline Development Corporation, would extract natural gas in the North Slope, 250 miles inside the Arctic Circle, and transport it to processing facilities near Cook Inlet on the southern side of the state.

The project has received backlash from environmental groups since its announcement but got the green light from the Biden administration earlier this year.

According to court documents, when FERC conducted the Environment Impact Statement for the project, it concluded the project would “cause a range of temporary, long-term and permanent environmental impacts” on the region, but made 165 environmental conditions before authorizing the project.

Critics argue that the project will not only hamper climate change efforts but will also directly harm endangered species and their habitats, such as the Cook Inlet beluga whales. The National Oceanic and Atmospheric Administration counts only 279 of these whales remaining today, an 80% decline from 1,300 in 1979.

According to the commission's study, if constructed, the pipeline would cause a “30-47% increase in annual fossil fuel combustion inventory” or emissions, and could increase national emissions by 0.17-0.28%.

Erin Colón, senior attorney at Earthjustice, called the court’s decision disappointing.

“This project would destroy thousands of acres of wetlands, harm communities across Alaska and produce 50 million metric tons of carbon dioxide pollution emissions annually, all when we must rapidly transition to clean-energy alternatives,” Colón said in a statement.

She emphasized that a similar suit challenging the Department of Energy’s approval of gas exports from the project is still underway.

FERC declined to comment.

The pipeline safety administration did not find the same success as energy commission in their case before the court.

Senior U.S. Circuit Judge Douglas H. Ginsburg, a Ronald Reagan appointee, wrote the court’s opinion in the challenge brought by the GPA Midstream Association and American Petroleum Institute.

Ginsburg, along with Senior U.S. Circuit Judge Harry T. Edwards, a Jimmy Carter appointee, and U.S. Circuit Judge J. Michelle Childs, a Joe Biden appointee, found that the agency failed to answer the question of whether the benefits of regulating gathering pipes is worth the extra cost it would require to make the necessary adjustments compared to other types of piping.

Ginsburg called a cost-benefit analysis the agency presented “inadequate” and concluded the agency failed to make a “reasoned determination that the benefits, including safety and environmental benefits, of the intended standard justify its costs.”

The pipeline safety agency proposed the rule in 2020, requiring that all newly constructed or entirely replaced have the automatic or remote shut-off valves in order to eliminate risks of potential gas leaks or pipeline ruptures. The agency was required by law to “identify the costs and benefits associated with the proposed standard.”

According to court documents, the resulting assessment made no mention of gathering pipelines. Indeed they were not mentioned until the rule was proposed to advisory committees. Then in the final rule, the agency argued that the proposal never said that gathering lines would be exempt from the regulation.

Ginsburg granted the agency that, but only because “the proposed rule said nothing at all about gathering lines.”

The court granted the petition to review the proposal and vacated it from applying to gathering pipelines.

“As the Supreme Court has said, ‘the Government should turn square corners in dealing with the people,’” Ginsburg concluded. “The PHMSA did not turn square corners here. It cut corners to the prejudice of the petitioners, the administrative process, and thus the public.”

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