US Gas Pipeline Now at Heart of Far-Reaching Legal Debate

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The scuffle over a 20-mile stretch of gas pipeline in rural America has exploded into a national debate over the role of government, with the legal implications potentially reaching far beyond a single project or industry.

With the embattled Mountain Valley Pipeline (MVP) asking the US Supreme Court to intervene, “we are now looking at a compelling separation-of-powers case,” Dan Farber, faculty director of the University of California-Berkeley’s Center for Law, Energy & the Environment, told Energy Intelligence.

The outcome is anyone’s guess in a case Farber called “procedurally messy,” and already involves two separate federal appeals courts and all three branches of government. For MVP, it will determine the fate of the 303-mile project that has already cost $6.6 billion but hasn’t shipped a molecule of gas.

Calling on Roberts

MVP lead developer Equitrans Midstream on Jul. 14 filed an emergency petition with the Supreme Court in the hope of keeping the long-delayed project in parts of West Virginia and Virginia on track for completion this year.

At issue is whether the Fourth US Court Circuit of Appeals still has jurisdiction in the MVP case after Congress intervened via measures contained in the Fiscal Responsibility Act (FRA) that President Joe Biden signed into law.

Equitrans argues that the FRA specifically banned the Fourth Circuit — which has repeatedly smacked down state-issued permits for the 2 billion cubic feet per day pipeline — from taking any further action in the case.

The court last week blocked construction yet again by throwing out two more permits required to build the remaining 20-mile leg through forests and waterways until it reviews challenges to those approvals.

"Instead of heeding Congress’ unambiguous command, the Fourth Circuit exceeded the scope of its jurisdiction by entering stays of the very agency orders that Congress deprived the Fourth Circuit of jurisdiction to review," the company said in its petition.

Equitrans urged Supreme Court Chief Justice John Roberts to reject the latest rulings by Jul. 26, when the Fourth Circuit has scheduled oral arguments in Richmond, Virginia, on motions to have those actions nullified.

Roberts has specific jurisdiction over emergency appeals in Fourth Circuit cases, and he could rule alone or refer the decision to the full court, as is his typical practice.

Constitutional Question

MVP was approved by the Federal Energy Regulatory Commission in 2017 but is already five years behind schedule. Market players say the pipeline is needed to ease midstream constraints out of Appalachia and provide an additional source of gas to growing markets in the US Southeast.

In a transparent effort to get MVP up and running, Congress attached a rider to the FRA — a bill raising the US debt ceiling — automatically approving the remaining MVP permits and shielding them from judicial review, shifting jurisdiction from the Fourth Circuit to the US Court of Appeals for the D.C. Circuit. But even there, challenges can only be made to the new law itself, not to any MVP permits.

Environmentalists and other MVP opponents argue the FRA is unconstitutional due to an 1871 Supreme Court precedent mandating the separation of powers between the judicial and legislative branches of government.

Many legal scholars tend to agree, with several filing an amicus brief this week. “If the constitutional structure separating the legislative power from the judicial is to mean something, it is that there is a line between making laws and applying them,” they wrote. “It is the Judiciary’s role — not Congress’ — to say where that line is.”

'Tricky' Legal Morass

But Farber said the issue may not be that simple. In his view, existing statutes and legal precedent do allow Congress to engage in “jurisdiction stripping” by deciding which courts have purview over the actions of federal agencies.

But he said it’s “tricky” whether Congress has authority to go that extra step and actually bar challenges to specific permits for a specific project, because that gives the appearance of picking winners and losers in a legal case.

Aaron-Andrew Bruhl, a law professor at William & Mary Law School, told Energy Intelligence that if the Fourth Circuit opts to uphold challenges to MVP’s permits, it will have effectively ruled the FRA unconstitutional. If that happens, the government and pipeline opponents would likely file a challenge at the DC Circuit.

Both Farber and Bruhl agreed that the Supreme Court will likely be the ultimate decider, but the timing is unclear. Bruhl said it makes sense for Roberts to wait until after the Fourth Circuit makes a ruling rather than intervene while proceedings at the lower courts are ongoing — particularly given the wide-reaching implications.

“The potential importance of this case is broader than energy or the environment,” Bruhl said. “It’s about what authority Congress holds over the courts.”

Policy and Regulation, Gas Pipelines, Gas Supply, Gas Demand
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