ND leaders call for DAPL approval; Energy Transfer, Sunoco merge

By Patrick C. Miller | November 23, 2016

Three of North Dakota’s top political leaders sent a letter to Pres. Barack Obama today calling on him to approve—without delay—the final federal easement that will allow the Dakota Access Pipeline (DAPL) to cross the Missouri River under the Oahe reservoir.

Following a weekend of violent protests, the letter from Sen. John Hoeven, Congressman Kevin Cramer and Gov. Jack Dalyrymple—all North Dakota Republicans—urged Obama “in the strongest possible terms” to provide federal law enforcement resources immediately to state and local agencies to maintain public safety and “to prevent further destruction on and surrounding federal lands.”

In another DAPL-related event, Sunoco Logistics Partners LP (SXL) announced Tuesday that it would acquire Energy Transfer Partners LP (ETP), the Dallas-based company building the pipeline. Sunoco owns a 30 percent interest in DAPL.

Last week, the two companies said they were taking legal action in federal court to seek a judgement declaring that they have a legal right-of-way to build and complete DAPL without interference from the U.S. Army Corps of Engineers, which has said it is continuing its review of the easement.

According to a news release, the merger agreement “is expected to provide significant benefits for SXL and ETP unitholders as the combined partnership will have increased scale and diversification across multiple producing basins and will have greater opportunities to more closely integrate SXL’s natural gas liquids business with ETP’s natural gas gathering, processing and transportation business.”

Michael Hennigan, Sunoco president and CEO, said that despite the current low-oil-price market, he remains bullish on the merger’s long-term prospects.

“At the end of the day, we’re trying to position ourselves such that we can do well in the current markets and then really thrive if the market recovers from a demand standpoint,” he explained. “I personally remain very bullish on global demand and, in time, I think you’re going to see U.S. supply coming up to meet that. I think we’re positioned to take advantage to that.”

Asked if ETP would do anything differently on the DAPL project going forward, Kelcy Warren, the company’s CEO, said, “We’ve done everything right. We’ve not done one thing incorrectly on this project. Sure, can you Monday morning quarterback? There were some things done along the way that maybe we would not have done exactly the same, but we followed all the laws, rules, regs, procedures—and we get this.”

The letter from Hoeven, Cramer and Dalrymple said the Obama administration’s inaction on granting the final easement has “created undue hardship and uncertainty for area residents, private landowners, tribal members, construction workers and law enforcement personnel.”

According to the letter, the 1,172-mile-long, $3.8 billion pipeline is 98 percent complete in North Dakota and 86 percent complete overall. DAPL would carry about 500,000 barrels of Bakken crude per day to a terminal in Patoka, Illinois.

“We have seen instances of trespassing, vandalism, theft and fire on privately owned ranchland,” the letter continued. “Residents have endured the challenges caused by roads being blocked or closed, either by protest activity or law enforcement’s response to it to ensure safety at a time when farmers and ranchers are busy harvesting, hauling hay, shipping calves and moving their herds from summer pasture. In addition, law enforcement is investigating cases of butchered, mutilated, injured and missing cattle, horses and bison in areas adjacent to sites occupied by protesters.”

The letter concludes by asking Obama to direct the Corp of Engineers to follow established regulatory criteria and approve the final easement.


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