Energy groups fight back against effort to shut down Dakota Access pipeline

Dakota Access Pipeline FBN AP

Energy groups are pushing back against an effort to shut down the Dakota Access pipeline during an additional environmental review.

The American Petroleum Institute and other trade organizations say taking the Dakota Access pipeline out of commission would have a negative impact on the oil industry and local economies. The response comes amid a court battle between four American Indian tribes and Energy Transfer Partners (NYSE:ETP), the company that built Dakota Access.

The Standing Rock Sioux and three other American Indian tribes in the Dakotas have been fighting the pipeline for more than a year, arguing that the $3.8 billion project built by Texas-based Energy Transfer Partners (NYSE:ETP) threatens cultural sites and tribal water supplies. The company disputes that and maintains the pipeline is safe.

After months of delays, it began moving North Dakota oil through South Dakota and Iowa to a distribution point in Illinois on June 1. However, U.S. District Judge James Boasberg later that month ordered the Army Corps of Engineers, which permitted the project, to further review the pipeline's impact on the Standing Rock tribe. The judge is deciding whether to shut down the pipeline until the completion of the work, which is expected to take several more months.

Groups including the American Petroleum Institute, American Fuel and Petrochemical Manufacturers, Association of Oil Pipe Lines, national Chamber of Commerce and National Association of Manufacturers asked to submit their stance on the matter. They maintained in court documents that ceasing pipeline operations "would have serious adverse economic impacts throughout the oil industry and local and regional economies."

Boasberg gave his approval in a one-sentence statement without providing details on his reasoning. Standing Rock attorney Jan Hasselman on Monday said the tribe doesn't object because "everybody who wants to be heard should be heard."

Boasberg in June approved a schedule for arguments that set Monday as the final deadline. His ruling on a potential shutdown could come any time after that.

While Energy Transfer Partners continues defending the project in court, it also is dealing with state government allegations in North Dakota that it improperly reported the discovery of American Indian artifacts during construction.

North Dakota regulators two weeks ago offered a settlement under which the company would make a $15,000 "contribution" and wouldn't have to admit fault. Commissioners said it was an effort to end the drawn-out dispute over whether the company should be fined.

The company responded to the offer by last Thursday's deadline but neither it nor the state disclosed what the answer was. The Public Service Commission scheduled a closed meeting Monday afternoon to discuss the response.

The commission also is looking into whether Energy Transfer Partners removed too many trees and improperly handled some removed soil while laying pipe in the state. Company and state attorneys have been working to negotiate a resolution.

The Associated Press contributed to this report.