On Thursday, President Trump signed an executive order that guts environmental protections for new mines and pipelines, using an “emergency” declaration.
Citing the economic emergency stemming from the fallout of the COVID-19 pandemic, the President signed an executive order that waives requirements as part of the Endangered Species Act and the National Environmental Policy Act. These are decades-old environmental processes with which fossil fuel projects need to comply before breaking ground, but Trump’s executive order erases those protections.
With the U.S. economy suffering from around 20 million fewer jobs compared to February, the economy is indeed in a crisis, notwithstanding the surprise uptick in jobs in May. But the ‘emergency’ context, with protests taking place across the country right now, may face legal challenges at a later date.
Environmental groups blasted Trump’s executive order as an overreach. “President Trump is exploiting a global pandemic to further marginalize voices calling for a more just and equitable society,” Lauren Pagel, Earthworks Policy Director, said in a statement. “Today's Executive Order is another example in far too long a list of how this Administration runs roughshod over our basic values: an attempt to deliberately silence people in decisions that immediately impact their lives.” Related: Will U.S. Shale Ever Return To Its Boom Days?
The National Mining Association, on the other hand, welcomed Trump’s decision. “Today’s executive order provides an opportunity to jumpstart our economic recovery by ensuring that we are rebuilding and modernizing with American-made materials, equipment and jobs,” Rich Nolan, NMA President & CEO, said in a statement.
But there are questions about the efficacy of Trump’s executive order. The fast-tracked permitting process is intended to juice the economy. However, it is hard to imagine fossil fuel companies making risky investments on projects that are given the green light under an executive order that will likely be subject to litigation.
It is also unlikely that companies will be looking to pour money into large-scale fossil fuel projects when the energy market is suffering as it is.
On the other hand, some analysts say that Trump’s executive order could still be effective. While it will almost certainly be subject to litigation, “the Administration’s project-by-project approach suggests to us that infrastructure opponents would have to take these actions to court individually as they occur,” ClearView Energy Partners wrote in a note. “The wheels of justice can move slowly and the hurdles to opponents securing stays pending judicial review can be difficult to reach.”
ClearView said that it had received questions from clients about whether the executive order was intended to fast-track projects to completion before the presidential election later this year, but the firm said that the answer is unclear because not all of the options available would result in that outcome. Related: Global Oil Demand To Fall To Levels Not Seen Since 2014
The firm identified the Atlantic Coast Pipeline and Mountain Valley Pipeline as two issues that immediately come to mind. Both projects are natural gas pipelines that would connect Marcellus Shale gas to the southeast, but they have each had permitting troubles.
It’s unclear what the effect of the executive order might be, since they are both likely already priorities of the Trump administration. In other words, federal agencies are already trying as hard as possible to push them along. ClearView Energy Partners says that perhaps the order would call upon the Department of Agriculture – within which is the Forest Service – to dedicate “more manpower” to the permit reviews.
But for now, it is too early to tell how significant this particular executive order will be. At a minimum, the move may be an attempt to change the conversation away from nationwide protests and back to Trump’s efforts to revive the economy.
By Nick Cunningham of Oilprice.com
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