Trump Pipeline Efforts Likely to Face Future Delays

most far reaching regulatory reform in American history. We've approved long stalled projects like the Keystone Excel and the Dakota Access pipelines. But even though the Trump administration has approved the projects, that doesn't mean they're going forward as lawsuits continue to interfere with their progress. Joining me is Brandon Barnes, Bloomberg Intelligence Senior litigation analyst. Brandon set the stage for us. How many pipeline projects is the Trump administration trying to

restart and where has it succeeded? Well, I think that any of the positive vibes that the Trump administration gave to the pipeline companies coming in has sort of receded in a major way from this new obstacle. Of course, they're facing in the courts and through the states. So you know, some of the crude pipes that are big in the news to go to access in Keystone, Keystone

still hanging out there waiting. I got a number of pipes in the Northeast which would help alleviate some of the much needed capacity constraints for Marcellis and Utica producers. There's just not enough infrastructure to get the gas out. So it's just sitting there and you've I mean, in the last two years we've been tracking all these these various litigations and across the country, most concentrated in that northeastern area. But there at least six or seven pipelines

that have been stymy by these various actions. So you have intervention by the courts, the states, and the Federal Energy Regulatory Commission. It's the role of each. I think that's a very important question to ask because it's largely misunderstood, uh by investors in the general public. So the Federal Energy Regulatory Commission or FIRK as as some call it, um has jurisdiction over natural gas pipelines from tip to tail, so they regulate and approve the sighting or where those

the route in the environment. They do the environmental for natural gas pipelines that are moving between states, and those projects can't be built until FIRK says Okay, that's not true for crude pipelines, which are regulated in a different set of laws, and so the federal jurisdiction. FIRK doesn't get involved on the sighting. The Feds get involved only where there's federal jurisdiction incurred. So if they're crossing a navigable water, you may need Army Corps to get involved.

That's Dakota access. So I think the biggest area where this federal preemption issue comes into play is on those natural gas pipelines, which are so needed for these producers in the Northeast. UH states very different. They have this state permitting authority that's been they've had for years. It's been delegated, especially on the water side by e p A. FIRK won't allowed projects to be built until they've gotten

all of their state permits. So the states sort of had this effective hijack that they can use to take over these projects even though FIRK has federal oversight over everything. So you write that the lawsuits have basically used a shotgun approach. Explain that and how successful or unsuccessful they've been. June, I think it's the it's the case of success. He gets success. So where there is success opposing these projects,

those get funded. And we've seen the midstream area these pipelines get funded more and more on the legal side where they've gotten success. So the shotgun approach here is these lawsuits come in a number of different venues. They challenge every single one of the permits. They go to the federal side, they challenge the first certificate, they go to the state side and they challenge the water permits,

and they find a way. And the approach has largely been successful, but much more so recently than in the past. And I really do believe that it's it has to do with how much activity and how how much force they're throwing. It's almost like blunt force they're throwing out through the courts. Is that environmental groups that are challenging these pipelines. Certainly your traditional opponents of pipelines are the

environmental groups, and they are very much involved. They have they have all of the expertise and experience needed in the courts to bring these very nuanced challenges to projects, but also there's a very strong element of nimby, you know, not in my backyard. That has always been a problem for energy projects and pipelines in particular, and it certainly doesn't help when you have explosions or leaks or something

like that hitting the news. That that really, if you know pipeline is going through your backyard, you may want to oppose it, and you're gonna be very anxious to get involved. Speaking about FIRK, you describe how a federal

court decision has influenced FIRK and changed it. Perhaps, Yeah, I think, uh, And the one I'm referring to is is related to the Southeast Market pipeline, which involves the Sable Trail pipeline UM and that was a sort of a c change if you're following this, where the federal court, the d C. Circuit said, Firk, you didn't consider end use greenhouse gas emissions when you did your environmental review, which is a real change from what we've seen when

they've when challenge has been brought to l en G projects or pipelines Firk. You know, they just regulate the pipeline. They're supposed to look at the pipeline and not necessarily how the gas at the end is going to be used and what those that emissions O file or what

the potential environmental impact is going to look like. So this is dramatically expanding the scope of Firk's review and by doing so, expanding the ability for opponents to challenge these projects and potentially forced for to do a re review or maybe change the calculus for whether that projects actually beneficial or worth doing and therefore should get approved

at all. And how have the commissioners reacted? For the most part, in the past, we've seen commissioners sort of be on the same page, but starting when Norman Bay left, back when Trump was elected, and since then, as as Commissioner Glick has been involved, you've seen a movement where

the Democrats um CHERYLA. Fleur Commissioner Glick have been using the certificates or the approvals for these pipelines is a way too descent against maybe we don't need all these projects, maybe we should include greenhouse gas emissions in a different And I think in response to that, FIRK has really taken up the mantle of looking at this process and they are currently reconsidering their policy on approving pipelines. So some more to more to be found about a minute here, Brandon.

One state that is mentioned over and over again and your analysis is New York State. Is that a state that's particularly difficult. It is the toughest of the nuts to crack for pipelines. New York will continue to be the gateway that remains closed for pipes trying to get from Marcelis, you know, Pennsylvania into and through New York and into the New England states. That has just been a place of of you just cannot find any development and projects continue to be stopped by the state and

the courts back in them. Well, your your your analysis is so thorough and you've covered every case. It's just amazing. Thanks so much, Brandon. That's Brandon Barnes. He's Bloomberg Intelligence Senior litigation Analyst. Thanks for listening to the Bloomberg Launp podcast. You can subscribe and listen to the show on Apple Podcasts, SoundCloud, and on Bloomberg dot com slash podcast. I'm June Brosso. This is Bloomberg