Presidential Permitting Authority and the Keystone Pipeline

Opponents of the Keystone XL Pipeline are rallying in Washington, DC this Friday at the State Department’s last public meeting soliciting public comments on the national interest determination for the project. In September 2008, TransCanada Keystone XL applied for a Presidential Permit for the 1700-mile crude oil pipeline from oil sands in Canada to refineries in Oklahoma and Texas. Environmental groups have objected to the proposed route of pipeline which passes across significant portions of the Ogallala Aquifer, one of the world’s largest known aquifers and the primary source of groundwater for approximately 20% of U.S. agricultural production. Because the aquifer is relatively close to the surface, some stakeholders are concerned that a release from the pipeline could potentially contaminate the aquifer with oil, jeopardizing its use for farming and drinking water and causing significant ecosystem damage.

The Presidential Permitting authority has also been a contentious issue in the Keystone XL Pipeline permitting process. Executive Order 11423 states that the executive branch has permitting authority for “pipelines, conveyor belts, and similar facilities for the exportation or importation of petroleum, petroleum products.” Executive Order 13337 provides the procedure for Presidential permits: The State Department reviews applications for proposed projects that would cross an international border with the United States in consultation with other federal agencies and makes a final determination on whether granting the permit is in the national interest taking into account economic, energy security, foreign policy, and other relevant issues. Generally, powers exercised by the executive branch are authorized by legislation or are inherent presidential powers based in the Constitution. E.O. 11423 makes no mention of any authority, and E.O. 13337 refers only to the “Constitution and the Laws of the United States of America” and that the President is empowered to delegate Presidential permitting authority to the head of any department or agency of the executive branch.

In Sisseton v. United States Department of State, the U.S. District Court for the District of South Dakota upheld the Presidential Permitting authority as an exercise of the President’s “inherent Constitutional authority to conduct foreign policy,” as opposed to statutory authority granted to the President by Congress, because “Congress has failed to create a federal regulatory scheme for the construction of oil pipelines, and has delegated this authority to the states. Therefore, the President has the sole authority to allow oil pipeline border crossings under his inherent constitutional authority to conduct foreign affairs.” The court further clarified that, consequently, Presidential Permits are not subject to judicial review under the Administrative Procedure Act (APA), even when the President delegates permitting authority to the head of an executive agency.

As part of the Presidential Permit consultation process, the State Department prepared draft and final Environmental Impact Statements (EIS) in accordance with the National Environmental Policy Act (NEPA) and distributed the EIS for comment from other federal agencies. EPA rated the draft EIS “inadequate” for not fully accounting for the impact of carbon emissions and for not including mitigation measures to minimize the impact on vulnerable communities. On August 26, 2011, the State Department released the final EIS. EPA has yet to comment on the final EIS.

Having completed the EIS, the State Department proceeded to 90-day review period for the national determination decision for the Keystone EL project. Though the State Department was not under an obligation to hold public comment sessions because the APA does not apply to Presidential Permits, State Department has solicited public comments online and in public meetings. The State Department anticipated issuing the national determination decision, denying or granting the permit, in December 2011.

Written by:  Shani S. Harmon, GIELR Staff