Regulators need to increase trespass fines against pipeline companies, and other pipeline news

With oil pipeline companies brazenly flaunting trespass laws, you have to wonder whether the penalties are just too low. Perhaps it’s cheaper for them to break the law and pay the fines than the cost of taking the time to follow the law.

Recent trespass cases involving the Tesoro High Plains Pipeline in North Dakota and the Bayou Bridge Pipeline in Louisiana raise the question of whether pipeline penalties are too lax.

File photo.

On July 2, the U.S. Interior Department’s Bureau of Indian Affairs (BIA) ruled that the Tesoro pipeline was trespassing on lands in the Fort Berthold Reservation and ordered it shut down, according to a report from Buffalo Fires. It also ordered Tesoro to pay affected land owners $187 million.

The 500-mile pipeline runs through both Montana and North Dakota.

The trespass “includes 44 tracts of land totaling 90 acres belonging mostly to individual landowners on Fort Berthold,” the story said. “The tribe owns 10 tracts.” (The $187 million covers more than half of the affected properties, but not all of them.)

The trespass dates back to 2013. The trespass dispute lingered for years, including class action suits and appeals to the BIA. During that time, Tesoro kept making profits.

You have to wonder whether this was a meaningful penalty.

“The $187 million represents only a fraction of the seven years of profit made by transporting oil across Native lands to the Marathon Petroleum Mandan Refinery in Mandan, N.D.,” the story said.

In a more egregious example of trespass, the Third Circuit Court of Appeal for Louisiana ruled last week that the Bayou Bridge Pipeline Company (BBP) violated landowners’ rights by building its pipeline across their property with no legal authority to do so, according to the Center for Constitutional Rights.

The construction – including clearing trees, trenching, and laying pipe – took place across privately owned land in the ecologically sensitive Atchafalaya Basin. The court awarded each of the property owners $10,000 and legal fees.

In its decision, the court wrote:

When BBP consciously ordered construction to begin on this property prior to obtaining a judicial determination of the public and necessary purpose for that taking, it not only trampled Defendants’ due process rights as landowners, it eviscerated the constitutional protections laid out to specifically protect those property rights.

The Bayou Bridge pipeline is a joint venture between Energy Transfer Partners, Phillips 66, and Sunoco Logistics Partners LP.

The pipeline owners had to know they would get sued for trespass. You have to wonder whether if it was cheaper for them to ignore the law and pay the fine rather than wait for permission — or run the risk of having regulators reject the project because of its environmental impacts.

Penalties for such a brazen violation need a big increase.

In other pipeline news:

ND props up faltering Bakken oil fields, reduces environmental protections

File photo.

North Dakota’s Bakken oil fields have 791 abandoned wells, those that haven’t produced for at least a year, according to a June 26 presentation by the state’s Bakken Restart Task Force. The state has 5,000 wells that are temporarily closed, representing more than 400,000 barrels a day of production. Some 9,700 workers in the industry have filed unemployment claims.

The state is pursing “regulatory relief” (aka loosening environmental standards) to prop up the industry. It includes reducing fees, reducing bonding requirements to cleanup landfills and treatment plants, and granting “flexibility” in groundwater and air quality monitoring and “tank integrity testing.”

The Governor’s Office is receiving an “increase in requests for Gas Capture relief specifically on Fort Berthold Indian Reservation,” the report said. “Gas Capture relief” is an opaque way of saying companies want permission to release more air pollution, such as methane that contributes to climate damage.

North Dakota plans to use $33.2 million in federal Coronavirus relief funds to clean up the oil industry’s mess, reclaiming abandoned wells confiscated by the state. It will require 300-600 workers.

Sheriff tries to block Line 3 protests on public lands

Hubbard County Sheriff Cory Aukes is trying to close access to tax forfeited land along the Enbridge Line 3 corridor so protestors can’t use it, the Park Rapids Enterprise reports.

County Land Commissioner Chip Lohmeier said he didn’t think that closing access was possible, since it’s public land.

Trans Mountain Pipeline loses its biggest insurer

Zurich, the largest insurer for Canada’s Trans Mountain Pipeline, has withdrawn its coverage, an apparent response to pressure from some indigenous groups and environmental organizations.

The German insurance company Talanx dropped its Trans Mountain coverage earlier. Trans Mountain carries tar sands oil from Alberta to Canada’s Pacific coast. The project still has approximately two dozen insurance carriers, but recent news shows that public pressure on insurance companies is working.

DAPL back in court as early as tomorrow

A court fight continues over the Dakota Access Pipeline (DAPL). A lower court ruled that DAPL had to shut down operations because of a flawed environmental review process allowed it to prematurely start operations. Energy Transfer, DAPL’s owner, got the U.S. District Court for the District of Columbia to delay the shut down while it pursued an appeal. This issue will be back in court as early as tomorrow.

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