CLAIM: The Chicago Tribune recently highlighted environmental activists continued opposition to the proposed optimization of the Dakota Access Pipeline. The project – which has been approved by regulators in North Dakota, South Dakota, and Iowa – is awaiting a decision from the Illinois Commerce Commission after hearings took place in early March. On March 25, a federal judge ruled the U.S. Army Corps of Engineers must conduct additional environmental review of the pipeline despite nearly three years of safe operation. The Tribune reported:
Citing the judge’s ruling, as well as possible ramifications of the ongoing coronavirus pandemic on domestic and global oil markets, the environmental groups Save Our Illinois Land and Sierra Club filed a motion Thursday with the commerce commission to “stay further proceedings in this docket, and take additional evidence concerning the unprecedented global events.”
“Even if COVID-19 disappeared tomorrow, there are still indications that the oil market is going to be in bad shape for a long time to come with everything that is going on,” said John Albers, a lawyer representing Save Our Illinois Land and Sierra Club. “Logically and rationally, (the company) should have to prove the need for more oil, if for no other reason, independent of the D.C. case, than the collapse of the oil market. If the demand is not there for oil anymore, and that’s what they have been pointing to as a reason why they need to increase capacity, what’s the point of all of this?”
The natural gas and oil market, like almost all facets of the American economy, has faced new challenges given the ongoing COVID-19 pandemic. While this may be the temporary new normal, it is important to keep in mind that this will pass. And when it does, the American energy market needs to be ready for the bounce-back as Americans return to work, the markets rise, and the demand for natural gas and oil increases.
This starts with greenlighting shovel-ready jobs like DAPL Optimization, which requires no new mainline construction but will double the capacity of the crude oil pipeline through the construction of 3 new pump stations. Projects like optimization showcase the ingenuity of the industry – being able to further invest in existing infrastructure to meet the expected energy needs of American consumers with little to no impact.
When the American economy emerges from COVID-19, shovel-ready jobs can provide significant stimulus. They are often capital-intensive, multi-year projects that support thousands of high-skilled jobs and create new streams of tax revenue. DAPL Optimization is no different. GAIN’s Craig Stevens has previously emphasized the economic benefits of DAPL Optimization for Illinois:
It is critical that Illinois’ policymakers stick to the facts. If they do, they will see that the Dakota Access Pipeline optimization is a reasonable approach to bring much-needed transportation capacity to meet the region’s growing demand. They will see it is an opportunity to secure the nearly $90 million of tax revenue generated by the state’s energy producers and more than $44 million in funding for schools.
Furthermore, the ongoing global pandemic serves as a reminder to the importance of working towards American energy independence and the need to bolster domestic production in order to reduce reliance on potentially unpredictable foreign states.
Strengthening the American energy market is a win-win. It puts Americans back to work and creates significant economic opportunity while improving our national security and reducing reliance on foreign actors. Policymakers shouldn’t be distracted by shortsighted claims to call off DAPL Optimization – they must maintain their focus on the long-term goals of strengthening American energy security while ushering in the economic benefits of a strong energy industry when we need it most.