Texas is in the midst of an oil and gas boom. The Permian Basin is quickly becoming the largest producing oil field in the world and shows no signs of slowing down. Elsewhere, environmental activists are coming up with unique, and so-far effective, strategies of blocking the expansion of oil and gas pipelines.
Environmental organizations have gotten creative and are using State’s rights as a sword rather than as a shield. In the past, the Federal Energy Regulatory Commission (“FERC”) would approve interstate pipelines and they would be built. State’s rights were a shield for protecting against environmental harm, but they had little impact on preventing the actual construction of pipelines. Now, activists have flipped the script and have begun employing Section 401 of the Clean Water Act (“CWA”) as a weapon against the oil and gas industry. Section 401 gives states the right to review new projects to ensure that they will not negatively impact the local water supply. Environmental organizations, such as the Waterkeeper Alliance, are claiming that Section 401 results in States having “veto power” over FERC’s decisions meaning that the State can unilaterally deny the Clean Water Act Permit.
Unsurprisingly, oil and gas companies disagree with this novel interpretation of the law by arguing that the law should continue to work as it has always worked. Under the traditional scheme, the FERC approvals are often conditioned in ways that give States some oversight. However, it is a mere “shield.”
So, how does the strategy work? It is quite simple. It requires the support of the State government, a finding of environmental harm, and a denial of the Clean Water Act permit. This is largely a political process which is why these activists have narrowed their sights on more left-leaning states like New York and Oregon.
In New York, the strategy successfully stalled the construction of the Constitution Pipeline. The New York State Department of Environmental Conservation denied Clean Water Act certification to the pipeline even after the pipeline received FERC approvals. In a victory for the environmental activists, the United States Supreme Court denied the pipeline company’s request to appeal the Second Circuit’s decision thereby leaving New York’s decision intact.
In Oregon, groups like Rogue Climate are hoping to repeat the victory in New York in their fight against the Jordan Cove project. The Jordan Cove pipeline is designed to transport natural gas across the Cascade mountains to the Oregon coast. Some activists believe that if they can stop pipelines like Jordan Cove, they can help reduce the demand for drilling, because who wants to drill for a product that can’t make it to market?
But enough about New York and Oregon. Let’s get back to where we started, Texas. Is there a path to victory for environmental activists via the Clean Water Act in Texas? The simple answer is probably not. The key to success for this strategy is a political one. In Texas, there is no side of the political aisle that wants to go to war with oil and gas companies because of their importance to the state’s economy.
Thus, despite their strategic success in other parts of the country, environmental activists are unlikely to prevail in Texas.
Written by Graham Taylor