Immediately after being sworn in as President of the United States on Jan. 20, Joe Biden signed an executive order revoking the permit for the construction of the Keystone XL pipeline, an international project a little over ten years in the making. On Feb. 9, fourteen Republican attorneys general wrote a letter to the President informing him they were examining all legal options over his abrupt cancellation of the pipeline permit, declaring, “Please be aware that the states are reviewing available legal options to protect our residents and sovereign interests.”

Many believe the Keystone XL Pipeline is essential to national security as it creates U.S. energy independence from foreign adversaries such as Russia and Middle Eastern oil tyrannies and is (was) estimated to generate over 13,000 jobs (many of them union jobs) and inject $8 billion into the North American economy. Canadian company TC Energy Corp. owns the Keystone Pipeline System along with the landlocked Alberta government, which joined in on Mar. 31, 2020. The 1,179-mile pipeline is an extension of an existing pipeline and would carry crude oil from Western Canada to Steele City, Neb., where it would connect with another leg of the pipeline stretching to Gulf Coast refineries.

Attorneys General Issues with Biden’s Executive Order

The coalition of AG’s who signed the letter to the President is led by Montana’s Attorney General Austin Knudsen, who criticized Biden for failing to consult with his state before making his decision. The letter emphasizes the harm the President’s decision will wreak on American citizens and notes that five of the six impacted counties in Montana alone are designated high-poverty areas. The loss of Keystone XL’s economic activity and tax revenues will be particularly devastating.

In this Dec. 18, 2020 photo, pipes to be used for the Keystone XL pipeline are stored in a field near Dorchester, Neb. photo/Chris Machian /Omaha World-Herald via AP.

The 13 other attorneys general signing the letter are from Alabama, Arkansas, Georgia, Indiana, Kansas, Louisiana, Mississippi, Missouri, North Dakota, South Carolina, South Dakota, Texas, and West Virginia. The officials wrote to the President, “Your decision will result in devastating damage to many of our states and local communities. Even those states outside the path of the Keystone XL pipeline—indeed all Americans—will suffer serious, detrimental consequences.” The letter continues:

In your January 20, 2021 Executive Order, you concluded that the Keystone XL pipeline “disserves the U.S. national interest.” You supported that determination with vague statements about the “climate crisis,” how “[t]he world must be put on a sustainable climate pathway,” and that “[t]he United States must be in a position to exercise vigorous climate leadership….” Nowhere, however, do you explain how killing the Keystone XL pipeline project directly advances the goals of “protect[ing] Americans and the domestic economy from harmful climate impacts.” Nor does your decision actually cure any of the climate ills you reference. Observers are thus left with only one reasonable supposition: it is a symbolic act of virtue signaling to special interests and the international community.

The U.S. State Department, under the Obama administration, analyzed the Keystone XL pipeline and concluded that it would actually reduce emissions compared to the alternative of moving the energy by rail transport, which is less secure and carries a higher carbon footprint. While Biden has indicated he is the President for the American worker as the nation navigates through the COVID-19 pandemic, he has offered no “green-job” employment alternatives to the thousands of people who lost their lucrative jobs the moment he signed his executive order. John Kerry, the United States Special Presidential Envoy for Climate, suggested one alternative, stating, “What President Biden wants to do is make sure that those folks have better choices… That they can be the people to go to work to make the solar panels.”

Nationwide Permits And The Statutory Waters

Controversial projects like the Keystone XL pipeline rely on Nationwide Permit 12 (NWP 12), issued by the U.S. Army Corps of Engineers (the Corps), to operate. The Corps issues  Nationwide Permits (NWPs) to authorize various types of development projects in wetlands and other waters across the country. NWPs are reissued every five years with various, usually minor, changes, and were last reissued in 2017.

Prior to recent modifications (discussed below), NWP 12 advanced the approval of the construction, maintenance, repair, and removal of utility lines [including oil and gas pipelines] and associated facilities (as well as the transport and/or delivery of water, sewer, electricity, gas, and telecommunications services) in U.S. waters, without requiring an applicant to seek an individual permit under the federal Clean Water Act. In most cases, projects utilizing NWP 12 may be constructed without further interaction with the Corps, all but guaranteeing that the general permit will cover pipelines despite extensive impacts to listed endangered species.

The use of NWP 12 for oil and gas pipelines has raised many legal and practical questions for developers and has been the subject of significant litigation. On Apr. 15, 2020, in a case challenging NWP 12, a federal court in the District of Montana rendered void NWP 12, stating the Corp violated the Endangered Species Act (ESA). Recognizing the need to reevaluate its rulemaking in the immediate aftermath of the court’s decision, On Apr. 17, the Corps issued an order to all of its regions to halt NWP verifications until further notice. 

In May 2020, the District Court of Montana narrowed the judgment to just oil and gas pipeline projects. In July 2020, the U.S. Supreme Court further limited the ruling, suspending the District Court’s order granting partial nullification except as it applied to the Keystone XL Pipeline.

On Jan. 13, 2021, the Corp concluded its reevaluation and revamping of its NWPs. The agency released a pre-publication version of its final ruling, reissuing and modifying a dozen existing NWPs, including NWS 12, and issuing four new ones. The final rule split the previous NWP 12 into three new permits, streamlining the new NWP 12 to only authorize activities related to and required for the construction, maintenance, repair, and removal of oil and natural gas pipelines. The modifications go into effect on Mar. 15, 2021.

Despite the Corps fine-tuning of NWP 12 following the District Court of Montana’s April decision declaring the re-issuance of NWP 12 violated the ESA, it determined the new rule will have “no effect” on threatened or endangered species. Therefore, the Corps’ new NWPs, including the revised NWP 12, appear still vulnerable to litigation for the same reasons the courts vacated the use of NWP 12 for the Keystone XL Pipeline.

The NWP 12 permit has been under fire by many who reject the continued use of fossil fuels. Court filings indicate ongoing disputes over what opponents believe is a lack of compliance with the ESA. The fourteen attorneys general declared they are reviewing available legal options to protect their residents and sovereign interests regarding Biden’s decision to shut down the Keystone XL Pipeline. However, the permit grants the president sole discretion to terminate or revoke the permit at any time. With little to reference in the murky statutory waters about a potential legal recourse for the state AGs, we will be waiting to see how they respond.