On July 6, 2020, the United States Supreme Court (Supreme Court) temporarily revived the use of the U.S. Army Corps of Engineers’ (Corps) Nationwide Permit (NWP) 12¹ to construct new oil and gas pipelines across waterways, but explicitly excluded the Keystone XL pipeline from its ruling. The one-paragraph order, without explanation or noted dissent, stayed an earlier federal district court decision that vacated NWP 12 pending an appeal to the Ninth Circuit.

Environmental groups challenged NWP 12 as it related to the Keystone XL pipeline, arguing that the permit threatened endangered species. On April 15, 2020, the District of Montana concluded that the Corps’ reissuance of NWP 12 in 2017 for the Keystone XL pipeline was arbitrary and capricious and violated the Endangered Species Act (ESA). The district court vacated NWP 12 for all infrastructure projects and remanded it to the Corps to complete consultations with the U.S. Fish and Wildlife Service and the National Marine Fisheries Service.

After additional briefing addressing how a complete vacatur of NWP 12 would impact utility projects nationwide, the district court revised its original ruling in May 2020 to allow for non-pipeline projects, such as communication lines and electric transmission and distribution lines, to proceed under NWP 12. The district court, however, continued vacation of NWP 12 as it relates to the construction of new oil and gas pipelines.

The Corps and TC Energy Corporation (TC Energy), the developer of the Keystone XL pipeline, among other parties, appealed and requested a temporary stay of the order during the appeal, but the Ninth Circuit denied the stay. The government, TC Energy, and other interested parties applied for a stay in the Supreme Court arguing that “[t]he district court had no warrant to set aside NWP 12 with respect to Keystone XL, let alone for the construction of all new oil and gas pipelines anywhere in the country.” The government argued that the lower court’s order (1) “grants nationwide equitable relief that is inconsistent with Article III and traditional principles of equity;” (2) “was issued without fair notice that the court itself would unilaterally grant relief beyond the equitable remedies . . . sought”; and (3) “lacks any sounds basis in the ESA.” The government further argued that if the lower court’s order was not stayed pending the Ninth Circuit appeal, it would “cause irreparable harm to the Corps and the public.”

The Supreme Court’s order returns the case to the Ninth Circuit for further consideration and disposition.

¹NWP 12 authorizes discharges of dredge or fill material into jurisdictional waters as a result of construction, maintenance, repair, and removal of utility infrastructure that otherwise would be prohibited by the Clean Water Act.