Federal Regulators Rewrite Rules Again to Pave Way for Massive Pipeline

Last month, a federal appeals court blocked one of the key permits for construction of a massive natural gas pipeline that cuts through West Virginia and that industry officials and their political allies in the state are desperate to see completed.

The 4th U.S. Circuit Court of Appeals found that environmental groups are likely to prevail in a case arguing federal and state regulators wrongly approved the Mountain Valley Pipeline through a streamlined review process for which the project isn’t eligible.

If this sounds familiar, it is. A strikingly similar thing happened two years ago.

In October 2018, the same appeals court blocked the same $5.4 billion pipeline because the developer’s plan to temporarily dam four West Virginia rivers didn’t meet special restrictions that state regulators had put on the streamlined approval process.

But rather than pausing or rethinking the project at the time, the state Department of Environmental Protection rewrote its construction standards so that the pipeline would qualify.

After their most recent court loss, West Virginia officials are once again rewriting their restrictions to help pave the way for the pipeline to qualify for that streamlined permitting process.

“Here we go again,” citizen group lawyer Derek Teaney wrote in frustration in the latest of a series of legal challenges to the government agencies that have bent environmental standards for the pipeline.

When it is built, the Mountain Valley Pipeline, known as MVP, will transport natural gas from Wetzel County, near West Virginia’s Northern Panhandle, to Pittsylvania County, Virginia, crossing 200 miles in West Virginia and 100 miles in Virginia. The project is one of several large transmission pipelines in the works across Appalachia, part of the rush to market natural gas from drilling and production in the Marcellus Shale formation.

Political leaders and business boosters in West Virginia have been big supporters of such projects, hoping that the rise of natural gas would replace jobs and tax revenues lost as the coal industry declines. But some state residents worry that West Virginia’s drive to encourage gas comes with the same environmental costs as its historic dependence on coal.

So far, the promise that natural gas would bring an economic renaissance to West Virginia has not come true.

At least one other major pipeline project, the $8 billion Atlantic Coast Pipeline, also faced delays over problems securing environmental permits. A 4th Circuit ruling on that project had included a reference to Dr. Seuss’ “The Lorax,” saying the U.S. Forest Service had failed to “speak for the trees” when it approved the project.

Despite a legal victory in which the U.S. Supreme Court overturned that decision, the project’s developers, Dominion Energy and Duke Energy, blamed “an unacceptable layer of uncertainty” from other cases over pipeline permitting.

Later, an analysis by E&E News found that legal deficiencies that led to project delays grew out of Trump administration officials who overruled government scientists and land managers during the review process.

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The latest MVP case is particularly instructive in understanding the way government regulatory agencies have manipulated their own rules and processes to push through pipeline proposals.

Projects like MVP need a variety of approvals before they can be built. Developers and regulators must study various alternatives, outline the need for the project and show what steps will be taken to reduce damage to the environment and minimize negative effects on important resources, such as public lands and water supplies.

But a 2018 review by ProPublica and the Charleston Gazette-Mail found that federal and state agencies tasked with enforcing the nation’s environmental laws had expedited the pipeline, sometimes changing the rules to ease the project’s approvals. In numerous instances, officials greenlit the pipeline despite serious unanswered questions.

Among the necessary permits that have been the subject of much controversy is a federal Clean Water Act “dredge and fill” permit. Such permits are issued by the Army Corps of Engineers in two ways, either as an “individual” permit that undergoes more scrutiny or through a streamlined process known as a “nationwide” permit. For a nationwide permit to be used in any state, that state’s environmental regulators have to approve it for use there.

In West Virginia, the state Department of Environmental Protection approved the use of a streamlined permit for pipeline construction, but it added a condition that it could be used only for pipelines of less than 36 inches in diameter.

Corps officials and the WVDEP approved the 42-inch-diameter MVP through this streamlined process anyway, a move that was blocked by the 4th Circuit in its October 2018 ruling.

But even before the court ruled on that issue, the WVDEP was moving to get rid of the size limit on pipelines eligible for the streamlined permit.

In the latest case, pipeline opponents argued that the agencies improperly relaxed those rules. Among other things, they alleged that the wrong official within the Corps — a district engineer, rather than the agency’s chief engineer — approved the WVDEP’s relaxation of the rules.

During a Nov. 9 oral argument on environmentalists’ motion to suspend the Clean Water Act permit, 4th Circuit Chief Judge Roger Gregory pressed lawyers for the Corps about why the agency had approved the state’s changes.

“How was that in the public interest and what procedure did you use to make that determination?” Gregory asked.

Corps lawyer Kevin McArdle pointed Gregory to a memorandum that he said outlined the agency’s decision. The memo, though, simply said that the change was intended to allow larger pipelines to be approved through the streamlined process, and that the Corps was deferring to WVDEP on that issue.

And Judge Stephanie Thacker quizzed MVP’s lawyers about why the company told industry analysts in August that, once its permit was approved, it would try to get construction in streams done “as quickly as possible before anything is challenged” by environmental groups.

“Because it was in recognition, Your Honor, that our opponents are implacable,” responded MVP lawyer George Sibley. “They will challenge anything we do. We are not going to wait to get sued and wait for those lawsuits to be resolved.”

Teaney, the citizen group lawyer, urged the 4th Circuit panel of judges not to focus on MVP’s claims that legal battles have prompted construction delays that are costing the company $20 million a month for temporary sediment control efforts. He noted that the 4th Circuit warned the pipeline company more than two years ago it probably wasn’t going to win approval through the streamlined permitting process.

“Nonetheless, it persisted with these invalid fixes that West Virginia and the Corps have tried and it can’t come to this court now and ask this court to consider that in the equitable balance,” Teaney said.

Later that day, the 4th Circuit issued a short order that suspended the water permit for the pipeline. Then on Dec. 1, the court issued a more-detailed opinion, suspending the permit until a full appeal could be litigated and explaining its reasoning.

A WVDEP spokesman said that the agency is reviewing the 4th Circuit decision. The state agency is not named as a party, because the case focuses procedurally on the federal Clean Water Act permit.

A spokeswoman for MVP noted that the 4th Circuit declined a request from environmentalists to stay a separate regulatory approval for the project, one regarding endangered species protections. The spokeswoman, Natalie Cox, said the company is considering “the various options available” for the water permit, including applying for a new permit through the non-streamlined process. She said the company remains confident the pipeline will be completed and be in service by the second half of 2021.

Meanwhile, the WVDEP and the corps are making changes again that would pave the way for the pipeline. The Corps is reissuing new versions of its streamlined permitting rules, making sure the appropriate process is followed. And the WVDEP is in the process of updating its state conditions for that permitting, including eliminating the mandate that pipelines larger than 36 inches in diameter don’t qualify.

“When they got called out for not following the rules, they just attempted to change the rules,” said Angie Rosser, spokeswoman for the West Virginia Rivers Coalition, one of the groups that has been challenging the pipeline in court. “That’s not the way we can allow it to work.”