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Irina Slav

Irina Slav

Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry.

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Embattled Dakota Access Pipeline To Start Operating Next Year

An expanded Dakota Access pipeline could go into operation by the third quarter of next year, Energy Transfer said in an investor presentation.

The embattled project, which aims to transport crude oil from the Bakken shale play to the Gulf Coast, recently suffered a blow from a federal judge, who ruled in July that the pipeline had to be emptied and closed for the duration of a new environmental review.

The United States District Court for the District of Columbia said that the Army Corps of Engineers had violated the National Environmental Policy Act (NEPA) when it gave a permit to the pipeline to build beneath Lake Oahe.

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Following that last unfavorable ruling, however, an appeals court overturned it, allowing Energy Transfer to keep Dakota Access in operation until that same court decided whether it needed to be closed for the environmental review.

The Dakota Access pipeline has a capacity of 570,000 bpd, and according to Energy Transfer, the recently completed open season had seen this capacity fully committed. By the third quarter of next year, the company also said, “additional capacity to service commitments received through recent open seasons” will be in use.

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The $3.8-billion project has faced stiff opposition from the beginning. There were even mass protests against it that resulted in clashes with police, and ultimately arrests and forceful removal of the protesters. Despite all this, earlier this year, Energy Transfer said it planned to boost the capacity of the DAPL to 1 million bpd of oil.

Then reports emerged that the company had declared force majeure on the project in order to prevent companies that had already made commitments for certain volumes of oil from pulling out amid the oil price crisis.

“Honestly, DAPL is not needed,” one industry insider told Reuters at the time. “They’re trying to build a house that all these people signed up for. Even if there’s no longer a need for the house, you can’t really walk away from it. Would I like to get out? Yes, for sure.”

By Irina Slav for Oilprice.com

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