[00:00:00] Speaker 05:
case number 20-1161 Ed Al.

[00:00:03] Speaker 05:
Deborah Evans Ed Al, petitioners versus Federal Energy Regulatory Commission.

[00:00:10] Speaker 07:
Good morning, Council.

[00:00:12] Speaker 02:
Good morning, Your Honor.

[00:00:14] Speaker 07:
Council, arguing on justiciability, do you wish to proceed?

[00:00:19] Speaker 02:
Yes, ma'am, I do.

[00:00:22] Speaker 07:
Please do.

[00:00:24] Speaker 02:
Good morning, and may it please the Court.

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First up is justiciability.

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Land owner petitioners, including the state of Oregon, had standing when they petitioned for review of Pembina Certificate, which FERC does not contest, and subsequent events have not mooted their claims.

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This project and previous iterations have made petitioners lives miserable for more than 15 years, threatening to take their property and thus forcing them to put all of their plans on hold.

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For example, Richard Brown has not been able to plant an orchard and Pamela Ordway has not been able to plant a vineyard because they don't know whether they will be able to reap what they have sown or instead watch Pembina tear up and cut down everything they planted.

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FERC argues petitioners lost their standing because Pembina failed to attain two necessary permits for the project, meaning that Pembina cannot build it.

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And this led Pembina

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And this led to Pembina saying that it would not condemn petitioner's property while it paused to think about what to do.

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The issue of building the pipeline is a complete red herring.

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Those permit denials mean that Pembina, at least for now, can't build the project, but they have no effect on Pembina's eminent domain authority.

[00:01:38] Speaker 01:
So what if either FERC or this court

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said that impose the condition on the certificate order that can't proceed with eminent domain proceedings at this time until they move the court or move FERC to do so in order to, I guess, after they've completed their pause and reassessment.

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If that were the case, non-judicial, justiciable.

[00:02:16] Speaker 02:
No, Your Honor, because the issue would still have to, we raised that issue.

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Pembina already moved for an abeyance based on that.

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And it's not clear that, I mean, if FERC has said it does not have the authority to stay eminent domain proceedings under a certificate.

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They've repeatedly said that.

[00:02:37] Speaker 06:
They can stay- Yes, but Mr. Bookbinder, Pembina would have the ability to agree when did, and so- Yes.

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So what is your position if Pembina were to represent that it would agree to a condition like the one that Judge Wilkins indicated?

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That would relieve the immediate problem for landowner petitioners, but it would not eliminate the injury that they're suffering right now.

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It merely prolongs the condition they've existed under 15 years.

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Pembina won't start condemnation.

[00:03:11] Speaker 02:
It can't start condemnation.

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Great, they've been thinking this pause now for eight months, and we have no answer.

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Is it going to take another year, another two years?

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We don't know.

[00:03:23] Speaker 06:
But let me just be clear on my part of the question as to piggybacking on what Judge Wilkins said.

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I'd understood that Pembina moved to hold the case in abeyance in light of the certifications.

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And there was a point in, I believe, the landowner's brief

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in which there seemed to be an agreement that if the necessary conditions from the landowner's perspective were included, that the court could and should hold it in abeyance, perhaps.

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In other words, if Pembina were to agree that it would not exercise its eminent domain authority, not just during the pause, but even if they decide ultimately to

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cancel the project, why isn't that good enough for the purpose of holding the case in advance and then we can all go home?

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because your honor, we agreed to that condition and that would have eliminated all of the problems many months ago.

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Now we're faced with the idea that there can be a state of condemnation and there won't be condemnation until such time as this court issues its final ruling or until, unless FERC decides to vacate the certificate, it's the amount of time that it takes.

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We don't want

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We want this case adjudicated to give them some finality.

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They, every day, these people are living under the threat they've lived under for 15 years.

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They want this decision.

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They want this case over.

[00:05:02] Speaker 06:
And it's- Will you eliminate rightness, Mr. Bookbinder?

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I mean, I do understand that they want the case to be over, but if we set up a set of circumstances in which there was no opportunity for the harm that your clients are

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focused on the condemnation to her, then wouldn't that solve the problem for the foreseeable future?

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And to the extent the case was held in abeyance, they can come back if it looked as though the project were going to move forward.

[00:05:37] Speaker 02:
Yes, Your Honor.

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But we would request that any such stay, even if Pembina decides to

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cancel the project, we have to ensure that the stay is effective through that period of time, because they would still have eminent domain authority.

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If they continue with the project, obviously, this case will be adjudicated.

[00:05:57] Speaker 07:
Let me ask you, a motions panel denied the motion to hold the case in abeyance.

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And our precedent, including an in-bank, says that's the law of the case.

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Why aren't you arguing that as well in response to FERC's brief now seeking abeyance as a solution to what it views as the rightness issue?

[00:06:31] Speaker 02:
Because, Your Honor, frankly, I did not know that a decision of the motions panel was binding on the merits panel.

[00:06:37] Speaker 07:
Well, if you look at DC Circuit precedent, I can cite you cases where we have said is the law of the case.

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And the only question I would have is in that situation, a motion was presented to a motions panel, a staff attorney memo was written suggesting that the case be held in abeyance and the motions panel rejected that recommendation.

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And we have noted repeatedly in our precedent

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that the merits panel is bound by the motions panel decision under the law of the case doctor.

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Now, the only question I would have here is, and I guess I'll ask first, since you aren't familiar with this line of precedent, whether or not

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we can distinguish those cases here because so far as I can tell at this point, there is no indication that the motions panel as such was expressly dealing with the rightness question.

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Although it is clear that the question whether the project would ever go forward was clearly presented.

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And in one sense, that's six of one, half a dozen of another.

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And therefore, since the motions panel denied abeyance, we ordered full briefing and in oral argument, I wonder why we're discussing this now.

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Your honor, by the way, rightness was raised in the advance motion.

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And in fact, the advance motion relied entirely on the same case, the Divya case, that FERC relies on here.

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That motion was brought by Pembina.

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That's the only distinction.

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But the arguments they make are absolutely the same.

[00:08:52] Speaker 06:
Mr. Bookbinder, can I just be clear?

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Were the arguments contemplating the kind of agreement over conditions that we are discussing now?

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In other words, I understood Pembina's, or excuse me, the petitioner's rejection or opposition to the motion to be that it didn't have these sorts of conditions.

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And so to the extent now that Pembina may be amenable to the conditions that the petitioners want, I'm wondering if this really is the same scenario that the motions panel considered.

[00:09:31] Speaker 02:
We, yes, if Pembina were to step forward and say, and accept a stay until this court issued its opinion or until it decided what to do with the project or rather a stay of eminent domain, whether or not it goes forward with the project until such time as this court issues its decision.

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then we would have basically an unjoined or unopposed motion because you would agree with that, right?

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And so now it's not even really a motion.

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It's more like a voluntary cessation from both parties pursuant to these conditions.

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If Pembina rejected that offer from us last time, they have not participated in the merits briefing.

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We don't know what they're thinking.

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But Your Honor, I wanna go back to the issue of the current harm.

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It's these people, you can't sell your property if the buyer thinks, oh my God, I don't know what I'm buying.

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I could be buying something where a pipeline is coming through.

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They can't use the potential areas because the Pembina claims easements on them.

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This is a serious infringement on their property rights currently.

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You know, it's simply, it's not a question of an abstract issue, and it's an issue they've dealt with.

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And I honor, really, I have to emphasize that 15 years, we even included, it's not in the Joint Appendix, but it is in the record.

[00:11:11] Speaker 07:
A report by a geriatric psychiatrist talking about- Well, let's stick to the record if you don't mind.

[00:11:23] Speaker 02:
Yeah, by the way, that report is in fact in the record, Your Honor.

[00:11:28] Speaker 02:
So if we can get an agreement from Pembina that they will not exercise eminent domain until either this court issues a decision or the FERC vacates the certificate, then the worst of the harm is eliminated, but certainly not all of it.

[00:11:52] Speaker 07:
Well, I know that the state of Oregon has some other issues as to why we should go forward.

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And that that type of condition, barring any exercise of eminent domain, does not resolve other issues that were decided before the certificate order was issued that the state claims

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may harm it.

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So I'm concerned that at this stage of the game, this court is trying to craft something as distinct from the parties having had the opportunity at the motion stage to examine all these issues and before FERC to have examined them as well.

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And FERC apparently, and I'll ask counsel for FERC,

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I don't know what the phrase is, but was not concerned about Oregon's pre-certificate claims.

[00:13:01] Speaker 02:
Your honor, what the state of Oregon is saying is that under the certificate, Pembina can still engage in activities that would result in discharges to waters of the state.

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I understand.

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And such a stay would have to, I assume, include a stay of any such activities.

[00:13:27] Speaker 07:
Well, that's what I'm trying to get at.

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I think this is complicated.

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All right?

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There are a lot of aspects to this type of project.

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And for us on appeal to try to craft an order, the next time there'll be a motion saying, well, the order didn't cover this, and we need to amend it.

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So I'm a little troubled by that.

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The other thing I'm concerned about here is the harm that the landowners are claiming.

[00:14:01] Speaker 07:
I don't deny for a moment that they are suffering the types of harms you have suggested, but in terms of what FERC statutory obligation is and what it said in

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the certificate order and the rehearing order, where it acknowledged that there were harms to the landowners, but that it was satisfied weighing the benefits versus the harms, that the project should go forward.

[00:14:36] Speaker 07:
So my question focuses on, I know somebody wants to plant trees, I know somebody wants to sell their home, but that kind of relief

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is not the kind of relief that I understand FERC normally to offer.

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I mean, FERC would not, for example, pay your clients the difference between fair market value and assessed value, for example, or they would not pay for the planting of trees.

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So in terms of what your clients seek, as I understand it, the only remedy

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that's going to protect them, as you presented to us, is to say that the project should not go forward for any number of reasons, citing what you will say are either errors by the agency or arbitrary and capricious action.

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Do I understand your position?

[00:15:39] Speaker 02:
Yes, Your Honor, we're seeking vacatur of the certificate.

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That is correct.

[00:15:43] Speaker 07:
And absence that.

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the harms that you say have been going on for 15 years, and I'll take that as a given, they will continue.

[00:15:57] Speaker 02:
Yes, they will, your honor.

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Unless this certificate is vacated.

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And as Ferck points out, given the demand and the economies involved, if this

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proposal doesn't go forward, somebody else is going to come forward.

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And while maybe the route will change a little or something like that, the quote harm in this broad way you defined it does not go away.

[00:16:30] Speaker 02:
Your honor, first of all, it goes away for the parties before you in this case.

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Moreover, first statement that if they don't build this, they'll build something else, which my colleague Mr. Matthews will deal with.

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is absurd, for it presents absolutely no evidence in support of that statement.

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It is simply an assumption.

[00:16:49] Speaker 02:
Well, if these people don't build it, someone else will.

[00:16:53] Speaker 07:
Well, this particular party has been trying to build this for many years, correct?

[00:16:59] Speaker 07:
Correct.

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And obviously, I won't say obviously, but I'm assuming it sees this as a very profitable endeavor.

[00:17:10] Speaker 07:
The notion that no one else would come in

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strikes me as a little unrealistic.

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And certainly FERC is in a better position than the court to make that kind of judgment.

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So I'm just concerned in terms of the harms, exactly what relief your clients can in fact get in terms of the harms as they have described them in their affidavits

[00:17:40] Speaker 07:
and in commenting on the draft EIS.

[00:17:46] Speaker 02:
Your honor, here the petitioners are injured by this certificate.

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And whether if this certificate is vacated, another company tries to build or this company tries to build a facility here again or somewhere else will have different petitioners.

[00:18:05] Speaker 02:
Moreover, FERC says this is the most desirable location.

[00:18:09] Speaker 02:
So it's not clear to me that if

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They can't build it here that a second or third best location would make the same business sense to them.

[00:18:21] Speaker 02:
I can't speak to their thinking, but.

[00:18:25] Speaker 06:
Mr. Bookbinder, can I ask you, are you speaking today about just disability with respect to all of the plaintiffs?

[00:18:31] Speaker 06:
Because I discern a difference between the harms alleged by the landowner and the states.

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and the harms alleged by the tribes.

[00:18:42] Speaker 06:
So I'm just trying to understand whether you are in a position to answer questions about the latter.

[00:18:49] Speaker 02:
No, Your Honor, I'm not speaking on behalf of the tribes as to justiciability.

[00:18:54] Speaker 02:
Our standing and justiciability arguments are based on the strongest possible ones, which are the landowner and the state of Oregon's arguments.

[00:19:03] Speaker 06:
But don't the tribes, to the extent that they have a different claim

[00:19:09] Speaker 06:
the claim about cultural heritage and resources, don't they have to have standing independently?

[00:19:14] Speaker 02:
Yes, they do have standing to do that.

[00:19:19] Speaker 02:
They do have standing to raise the National Historical Preservation Act claims they do, which is that FERC should not have conditioned its certificate on going back after the fact and doing the NHPA Section 106.

[00:19:32] Speaker 06:
I understand that's their claim.

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What's their basis for standing, their injury?

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What gives them the right to make that claim in this court?

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Is that their cultural resources may be damaged by the construction and operation of a pipeline long before the NHPA 106 consultation is completed.

[00:19:55] Speaker 01:
What affidavits do we have from them or what evidence in the record can we point to from them to establish that as a fact?

[00:20:07] Speaker 02:
I am not familiar with the affidavits they've placed into the record on that.

[00:20:14] Speaker 07:
I couldn't find them.

[00:20:16] Speaker 07:
And I suppose we'll ask counsel whether or not under this court's precedent, when this court is unable to determine standing where to the tribes, it may be obvious.

[00:20:33] Speaker 07:
Nevertheless, the court needs affidavits.

[00:20:36] Speaker 07:
They could file affidavits now.

[00:20:39] Speaker 07:
And I'm citing the American Libraries case decided by this court.

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And of course, any such affidavits would also have to address the issue of eminence, because even a supported contention that they would be harmed if the pipeline was built

[00:21:02] Speaker 06:
seems to me to run into a little bit of a problem in this situation where it's pretty clear from everything that has been submitted that the pipeline is not going to be under construction anytime soon.

[00:21:17] Speaker 02:
Yes, Your Honor.

[00:21:19] Speaker 02:
Their injuries would result from the construction unlike the injuries to the state of Oregon and to the landowners, which stemmed directly from the threat of eminent domain

[00:21:31] Speaker 02:
And in Oregon's case, in addition to the threat of eminent domain on state lands, it's also the issue of PEMBA allowed even while pausing, even though it cannot do quote construction, it still is allowed to do activities which Oregon has said would or could result in the discharge of pollutants to state waters.

[00:21:52] Speaker 02:
And they do not have the certification, the 401 certification that justifies them doing so.

[00:22:02] Speaker 07:
Anything further?

[00:22:04] Speaker 02:
No, Your Honor, not on the issue of just disability, except to say that ultimately what FERC, by moving to dismiss this issue on the basis of either standing, which was determined as when the case was started, or on rightness is ultimately an attempt to deny petitioners their due process rights.

[00:22:29] Speaker 02:
allowing Pembroke to take their property without there ever being an adjudication of the legitimacy of the taking, whether the taking is proper under the natural law.

[00:22:40] Speaker 07:
So we have your argument in your brief on that.

[00:22:43] Speaker 07:
Do my colleagues have any further questions of this council?

[00:22:47] Speaker 01:
No, no, no, no.

[00:22:50] Speaker 07:
Thank you.

[00:22:51] Speaker 07:
We'll give you a few minutes on rebuttal.

[00:22:55] Speaker 05:
Council for first.

[00:22:57] Speaker 05:
Yes, good morning, your honor.

[00:22:59] Speaker 05:
Susanna Chu for the commission.

[00:23:00] Speaker 05:
Thank you for hearing us today.

[00:23:03] Speaker 05:
I'd like to start with the eminent domain issue.

[00:23:11] Speaker 05:
I am sensitive to the landowner's concerns, but I do want to point out that Oberlin says that

[00:23:21] Speaker 05:
that uncertainty about eminent domain does not necessarily equate to actual harm.

[00:23:28] Speaker 05:
The court in Oberlin said that the harm occurs when a petitioner is put to the choice of either selling land to the pipeline company or having property condemned.

[00:23:39] Speaker 05:
And here, the project is at a complete standstill.

[00:23:43] Speaker 05:
It cannot be resurrected without the state of Oregon's approval, because these two critical state authorizations have been denied.

[00:23:52] Speaker 05:
And of course, as you know, the pipeline has paused development and in the eight months since it stated that it was pausing its development, my understanding is it has not sought to obtain any of the other outstanding permits for this project.

[00:24:06] Speaker 05:
It has initiated no eminent domain proceedings and it has done absolutely nothing to advance this pipeline project.

[00:24:14] Speaker 01:
And I understand exactly what your position is.

[00:24:18] Speaker 01:
that the motion to hold the matter in abeyance was denied.

[00:24:26] Speaker 01:
What are you asking the court to do now because of this and the pause to dismiss these petitions, to hold them in abeyance?

[00:24:36] Speaker 01:
What does FERC say is the appropriate thing that we should be doing?

[00:24:42] Speaker 05:
Right, Your Honor, the commission believes that either the case should be dismissed for lack of standing or it should be held in abeyance.

[00:24:51] Speaker 05:
And if the court finds it appropriate, as Judge Rogers was mentioning, to stay the effect of the certificate while the case is in abeyance, that is, of course, within the court's discretion and appropriate.

[00:25:07] Speaker 05:
And I think that holding the case in abeyance while

[00:25:12] Speaker 05:
while staying the effect of the certificate would eliminate any potential harms.

[00:25:19] Speaker 05:
And I think it would alleviate the petitioner's concerns.

[00:25:22] Speaker 01:
And is it your position that FERC cannot impose that condition on the certificate order itself?

[00:25:34] Speaker 01:
and say, well, since you are taking a pause and since you want to hold the DC Circuit petition in abeyance, we're going to amend the certificate order to say that you cannot proceed with eminent domain proceedings absent relief from us.

[00:26:01] Speaker 05:
Well, Your Honor, I don't think that the agency can do that while this case is pending before the court, because jurisdiction lies with the court.

[00:26:09] Speaker 05:
Of course, if the court directs the agency to make that order upon dismissal or upon abeyance, of course, that's appropriate.

[00:26:22] Speaker 05:
If directed to do so, the agency will, of course, carry out the court's directive.

[00:26:26] Speaker 01:
Well, here's the problem that I have with what the agency is doing.

[00:26:31] Speaker 01:
These homeowners, the only merits defense they have to an imminent domain proceeding is my land isn't within the area of the pipeline.

[00:26:45] Speaker 01:
They essentially don't have any defenses to an imminent domain proceeding when there's a certificate order that's been issued.

[00:26:53] Speaker 01:
And do you agree with that?

[00:26:58] Speaker 05:
No, Your Honor, I don't think I agree with that.

[00:27:01] Speaker 05:
Because while it is true, excuse me, while it is true that a district court cannot entertain a collateral attack on a FERC certificate order, this would not be a collateral attack on the merits of the certificate itself.

[00:27:16] Speaker 05:
This would be a defense relating to the pipeline's lack of state authorizations.

[00:27:23] Speaker 01:
I understand that.

[00:27:25] Speaker 01:
What I'm saying is

[00:27:28] Speaker 01:
Is you're saying that in an eminent domain proceeding, they could use the lack of the state authorizations to prevent eminent domain to prevent the condemnation.

[00:27:40] Speaker 05:
I think it's possible, Your Honor.

[00:27:42] Speaker 05:
I'm not aware of any case that has

[00:27:46] Speaker 05:
had that issue raised.

[00:27:49] Speaker 05:
But I think it's certainly a defense that a land owner could bring.

[00:27:53] Speaker 01:
I'm not either.

[00:27:54] Speaker 01:
I mean, the problem that I have with FERC's position, just to be candid, is the only real defense that we know that they have would be to vacate that certificate order.

[00:28:11] Speaker 01:
And the only way that that can happen is by

[00:28:15] Speaker 01:
us hearing their petition and adjudicating their petition.

[00:28:20] Speaker 05:
I'm not sure about that, Your Honor.

[00:28:22] Speaker 01:
Just taking the position that we should just hold all of that in abeyance while not preventing them from going, while not preventing the pipelines from going forward with

[00:28:41] Speaker 01:
condemnation proceedings.

[00:28:44] Speaker 01:
And it seems like you are putting the landowners in an untenable position by adopting that litigation strategy.

[00:28:55] Speaker 01:
I can see why the pipelines would want to adopt that litigation strategy, because they can argue in this court, oh, don't hear the certificate, while they argue in another court, condemn the property

[00:29:09] Speaker 01:
and we have a valid certificate and they can't challenge the certificate here.

[00:29:14] Speaker 01:
So go forward with the condemnation.

[00:29:17] Speaker 01:
They're basically in a legal position where they're kind of talking out of both sides of their mouths.

[00:29:25] Speaker 01:
I don't understand why FERC would want to join them in proceeding in that fashion.

[00:29:36] Speaker 05:
I appreciate your concern, Your Honor.

[00:29:37] Speaker 05:
I understand it.

[00:29:39] Speaker 05:
I think that there are a couple different options for the court to alleviate these concerns.

[00:29:46] Speaker 05:
The first is the court could hold the case in abeyance and place a stay on the certificate order and any eminent domain proceedings.

[00:29:57] Speaker 05:
that would resolve the eminent domain issue.

[00:30:00] Speaker 05:
Secondly, the court potentially could choose to dismiss the case as moot and direct the agency to vacate the certificate order if the court chooses to go that route that is within the court's discretion.

[00:30:15] Speaker 06:
I don't understand the second route that you just crafted.

[00:30:23] Speaker 06:
How could the court dismiss the case and order relief?

[00:30:28] Speaker 06:
pursuant to the case.

[00:30:29] Speaker 06:
Maybe I misheard you.

[00:30:30] Speaker 06:
I thought you said the court could dismiss the case as moot and order vacator of the certificates.

[00:30:42] Speaker 05:
Right, Your Honor.

[00:30:42] Speaker 05:
I think my understanding is under Allied Signal, Munsingware, similar cases, I believe that the court could

[00:30:54] Speaker 05:
find that the case is moot and not just achievable, it could order the certificate to be vacated if it wanted.

[00:31:01] Speaker 01:
That's under like a voluntary secession theory, but we don't have the intervener, a pipeline company saying they've said that they've paused, but they haven't said that they've abandoned the project, right?

[00:31:20] Speaker 05:
That's right.

[00:31:21] Speaker 05:
Well, the pipeline in their motion for abeyance said that they have not filed and do not intend to file any eminent domain proceedings.

[00:31:33] Speaker 05:
And they've said that they've taken a pause.

[00:31:35] Speaker 05:
They have not represented to the court that they've canceled the project entirely.

[00:31:39] Speaker 05:
But in light of the state denials, it is clear that this project is not going forward.

[00:31:46] Speaker 05:
And while I'm sensitive to the petitioner's arguments, what petitioners are seeking is effectively an advisory opinion from the court.

[00:31:55] Speaker 07:
Well, Oregon's denial was without prejudice.

[00:32:00] Speaker 07:
So that leaves it open, it seems to me.

[00:32:04] Speaker 07:
Right, Your Honor.

[00:32:06] Speaker 07:
And I thought the landowner's problem was a pause, but the pause and when it ends is defined by the project owners.

[00:32:16] Speaker 07:
not for, not the court.

[00:32:20] Speaker 07:
And that's the problem.

[00:32:23] Speaker 05:
Right, Your Honor, but I still think that there are remedies that the court can address the situation without proceeding to adjudicate all of the merits in this case.

[00:32:33] Speaker 05:
I think that while we are sensitive to landowner concerns, it is purely speculation that the pipeline might

[00:32:46] Speaker 05:
to try to conduct eminent domain outside the scope of this certificate, for example, we know that under the Natural Gas Act under Section 7H, eminent domain is only authorized for the land that is necessary to complete this particular project.

[00:33:02] Speaker 05:
That is the one that is authorized by the commission.

[00:33:05] Speaker 05:
The commission's order is not a wide ranging authorization for the pipeline to do anything it wants and to condemn any property that it wants.

[00:33:12] Speaker 05:
It is, of course, limited to the scope of the orders itself.

[00:33:15] Speaker 06:
So if that's the case, we don't have the certificates.

[00:33:22] Speaker 06:
The project is on pause.

[00:33:25] Speaker 06:
I'm trying to understand if we still have a live and ripe controversy to review if the company agrees not to exercise its eminent domain and the petitioners are fine with conditions that the company would agree to concerning not

[00:33:43] Speaker 06:
exercising it through the pendency of any pause up until, you know, any determination is made, whatever other conditions there are to ensure that there is no exercise.

[00:33:56] Speaker 06:
I mean, you seem to be saying under these circumstances, it's obvious that there's not going to be an exercise.

[00:34:02] Speaker 06:
I'd like to take it a step further to say, isn't there, do we still even have a controversy where we've had representations from both sides about

[00:34:13] Speaker 06:
the extent to which we wouldn't have a dispute, at least as far as the landowner petitioners are concerned, if we nullified somehow through an agreement the possibility of eminent domain, of condemnation.

[00:34:32] Speaker 06:
I just don't understand what's left from a justiciability standpoint if the harm is abated

[00:34:41] Speaker 06:
through agreement of the parties.

[00:34:45] Speaker 05:
Right.

[00:34:46] Speaker 05:
Yes, Your Honor, absolutely.

[00:34:47] Speaker 05:
I think that you are absolutely correct that we don't have a life and right controversy before us right now.

[00:34:54] Speaker 05:
There is really nothing for the court to adjudicate under Article 3.

[00:34:59] Speaker 06:
I mean, we may, excuse me, let me just be clear.

[00:35:02] Speaker 06:
We may have it right now because we don't have this agreement that I'm talking about, right?

[00:35:07] Speaker 06:
I mean, we don't have an agreement.

[00:35:08] Speaker 06:
So what what the petitioners at least the landowner petitioners are proceeding under is something that I think I was going to go back to your original statement about Oberlin.

[00:35:19] Speaker 06:
You know, uncertainty about eminent domain may well be a harm.

[00:35:25] Speaker 06:
It was just not one covered by Oberlin.

[00:35:27] Speaker 06:
I didn't read Oberlin to suggest that being put to the choice is the only harm that one could have.

[00:35:33] Speaker 06:
And what the landowners are saying is, in this situation where we don't have an agreement by the company not to exercise its domain under the conditions that we think are appropriate,

[00:35:46] Speaker 06:
we are living under the threat that they may well do so.

[00:35:50] Speaker 06:
And you might say that's speculative, that it's probably not going to happen.

[00:35:54] Speaker 06:
All that's fine, but it still is a possibility.

[00:35:58] Speaker 06:
And so what I'm trying to understand is if the company were to eliminate that possibility in a way that was clear, that the petitioners accepted, that, you know,

[00:36:15] Speaker 06:
abated the harm from their perspective, do we still have a case from the landowners' point of view?

[00:36:21] Speaker 05:
No, we would not, Your Honor.

[00:36:23] Speaker 05:
I think you're absolutely right that a commitment by the company would abate any harm.

[00:36:28] Speaker 06:
And I think we already have- So why should we ask the company?

[00:36:31] Speaker 06:
Can we ask the company what their position is now after the petitioners have come back in their grave brief and said, well, the problem is these conditions weren't there.

[00:36:44] Speaker 06:
But maybe if those conditions were there, we'd be fine, says Mr. Bookbinder today.

[00:36:48] Speaker 06:
Why don't we ask the company?

[00:36:51] Speaker 05:
I think you could, Your Honor.

[00:36:52] Speaker 05:
You certainly could.

[00:36:53] Speaker 05:
However, the company has already said it has no intention of initiating eminent domain.

[00:37:00] Speaker 05:
And also, the court could direct the company.

[00:37:04] Speaker 05:
I mean, it could stay the effect of the certificate, which would stay any eminent domain proceeding.

[00:37:10] Speaker 07:
I thought the company's commitment was so long as we, the company, is holding this matter in abeyance, we do not plan on exercising eminent domain and what the homeowners, landowners,

[00:37:35] Speaker 07:
argue is the first clause is left entirely to the discretion of the company.

[00:37:44] Speaker 07:
And that's no protection whatsoever.

[00:37:47] Speaker 05:
Well, yes, Your Honor.

[00:37:48] Speaker 05:
But this court has the authority to make that binding on the company.

[00:37:54] Speaker 05:
That is absolutely within the court's power.

[00:37:56] Speaker 07:
Well, I'm concerned about the appellate court trying to come up with finding facts and issuing an order.

[00:38:05] Speaker 07:
without sending it back and letting all this be fleshed out before the commission.

[00:38:14] Speaker 07:
And I'm troubled where this matter has been pending before FERC for a long time.

[00:38:22] Speaker 07:
And everybody's had a chance to raise all these issues that now, after the motions panel denied the motion to hold the matter in abeyance,

[00:38:35] Speaker 07:
We're suggesting not with any new facts, as in a case we just heard, not in a change of position by the government, that we ought to sit as sort of an appellate firm and try to flesh this out among the parties.

[00:38:56] Speaker 08:
That's normally not our role.

[00:39:01] Speaker 05:
Right, Your Honor, the agency is not asking the court to flesh out the facts here.

[00:39:06] Speaker 05:
What we're saying is that there is no live, right controversy for the court to adjudicate.

[00:39:12] Speaker 05:
And the court could dismiss, it could hold the case in abeyance to its satisfaction.

[00:39:20] Speaker 07:
Would you say that as to the state's arguments as well?

[00:39:24] Speaker 05:
Yes, Your Honor, absolutely, as to the state's arguments as well.

[00:39:28] Speaker 05:
Why?

[00:39:30] Speaker 05:
The state as I understand it is concerned that any pre construction activities.

[00:39:38] Speaker 05:
might result in discharges to the waters of the state.

[00:39:45] Speaker 05:
Similarly, the pipeline is at a complete standstill.

[00:39:49] Speaker 05:
There are no activities going on.

[00:39:52] Speaker 05:
And as we pointed out in our brief, the environmental conditions, conditions 11 and 27 to the FERC certificate order make clear that

[00:40:02] Speaker 05:
the company cannot engage in any construction or any ground disturbing activity prior to receiving authorization from the state.

[00:40:13] Speaker 05:
Now the state in particular is the entity that has denied the necessary approvals for the pipeline.

[00:40:21] Speaker 05:
So we think that the state falls completely within the Delaware Department of Natural Resources case

[00:40:27] Speaker 05:
I mean, that case is on all fours from this court in 2009.

[00:40:31] Speaker 05:
And it's the situation where the state of Delaware denied a Coastal Zone Management Act authorization for an LNG terminal within its borders.

[00:40:43] Speaker 05:
So the same situation

[00:40:46] Speaker 05:
arises here where the state has blocked the project that it does not want.

[00:40:51] Speaker 05:
So there is no standing to contest the merits of the FERC certificate.

[00:40:56] Speaker 05:
I know that the state has said that there is special solicitude for the states, but in the Delaware Department of Natural Resources case at footnote six, the court pointed out that the special solicitude does not eliminate a state petitioner's obligation to establish a concrete injury.

[00:41:12] Speaker 05:
And that's exactly the situation here.

[00:41:14] Speaker 05:
The state cannot establish a concrete injury where it itself has blocked the project from going forward.

[00:41:21] Speaker 07:
You want to address the questions I raised with counsel about law of the case and our circuit position as to the binding nature of a decision by a motions panel in denying the motion to hold this case in advance.

[00:41:41] Speaker 05:
But yes, your honor, I appreciate the question.

[00:41:46] Speaker 05:
I think it's important to remember that Kempena filed the motion for abeyance on the same day that the commission filed its merits brief in this case.

[00:41:58] Speaker 05:
The pipeline's pause was announced very soon before the commission's brief was due.

[00:42:07] Speaker 05:
So those filings happened on the same day.

[00:42:11] Speaker 05:
So the motion for abeyance was filed before the petitioners' reply briefs were filed.

[00:42:18] Speaker 05:
And of course, the motions panel did not have the benefit that the merits panel has of hearing oral argument and hearing these issues fleshed out.

[00:42:28] Speaker 07:
Well, it could have.

[00:42:29] Speaker 07:
It could have said, we're going to wait to see what the reply brief says, and now we're going to hold oral argument.

[00:42:36] Speaker 07:
And it didn't.

[00:42:38] Speaker 07:
and the staff attorney memos fleshed out the issues, the harm that was being alleged, the use of judicial resources, and the panel, so far as I can tell, weighed those and decided, no, we should go forward and hear this case.

[00:43:06] Speaker 05:
Well, Your Honor, I don't know what the,

[00:43:08] Speaker 05:
panel was thinking, or I don't know its reasoning apart from its denial, but I will say that in the six to eight months since the pipeline has announced its pause, it has done absolutely nothing to advance this pipeline.

[00:43:24] Speaker 05:
So that's something else that the court can take into account.

[00:43:28] Speaker 05:
The court, I believe, still could put this case into abeyance.

[00:43:33] Speaker 06:
And this too, am I wrong to

[00:43:37] Speaker 06:
note that this order that was issued previously by the motions panel did not include reasons.

[00:43:48] Speaker 06:
So notwithstanding what they were looking at, whatever they were looking at, if it's law of the case, it really is not binding us with respect to reasons regarding the holding it in abeyance, because no reasons were given.

[00:44:05] Speaker 06:
Is that correct?

[00:44:07] Speaker 05:
That's correct, Your Honor.

[00:44:08] Speaker 05:
That's correct.

[00:44:09] Speaker 05:
I mean, I don't know the reasons because the order did not put forth the reasons for denying.

[00:44:15] Speaker 07:
Well, that's an interesting legal theory.

[00:44:17] Speaker 07:
But when a three-judge panel decides something and they say deny, another three-judge panel can't just ignore that and say, well, you didn't provide enough explanation.

[00:44:31] Speaker 07:
they may go ahead and reach a different conclusion.

[00:44:34] Speaker 07:
But I think it's a serious jurisprudential matter here where our court has repeatedly said law of the case.

[00:44:43] Speaker 07:
And now, I mean, everybody spent a lot of time and energy preparing for this appeal.

[00:44:50] Speaker 07:
And nothing may have happened so far, but who knows?

[00:44:55] Speaker 07:
Tomorrow, six months from now, Oregon could say, well, we changed our minds.

[00:45:00] Speaker 07:
We think this ought to go forward.

[00:45:04] Speaker 07:
Where are we?

[00:45:07] Speaker 07:
I mean, I don't understand why all of this couldn't have been fleshed out before FERC.

[00:45:13] Speaker 07:
FERC is the expert in this area.

[00:45:15] Speaker 07:
It knows what its orders mean.

[00:45:18] Speaker 07:
It also knows what it means when the company says, when we determine this abeyance period is over.

[00:45:29] Speaker 07:
You know, that's not FERC.

[00:45:31] Speaker 07:
That's what I'm concerned about here.

[00:45:34] Speaker 07:
And I'll stop expressing my frustration, but that is it there too.

[00:45:38] Speaker 07:
It's not only that I think there's a law of the case problem, but it's that we're trying to adjudicate this case

[00:45:45] Speaker 07:
like de novo on appeal.

[00:45:49] Speaker 07:
And yeah, I just don't think that's what we do.

[00:45:53] Speaker 05:
I hear you, your honor.

[00:45:55] Speaker 05:
Judge Rogers, I understand the concerns.

[00:45:59] Speaker 05:
I think the law of the case issue is just firmly within the court's discretion to adjudicate and decide that issue.

[00:46:06] Speaker 05:
As for adjudicating this case de novo, that's not what the commission is asking the court to do.

[00:46:11] Speaker 05:
I would say that

[00:46:14] Speaker 05:
This particular area of permitting of interstate natural gas pipelines is under a serious examination at the commission.

[00:46:24] Speaker 07:
The commission and that council, but we have to take what the commission did here.

[00:46:30] Speaker 07:
Owners have made their position very clear.

[00:46:34] Speaker 05:
Understood.

[00:46:34] Speaker 07:
You can't use their property, that they're suffering loss of property values, all kinds of things.

[00:46:41] Speaker 07:
So the commission was well aware of this when it issued its certificate order.

[00:46:46] Speaker 07:
It was also aware of the state's concerns about what might happen even though the certificate order barred the company from going forward without the permits.

[00:47:01] Speaker 07:
That's what I mean by we're trying to think this case anew.

[00:47:06] Speaker 05:
Well, your honor.

[00:47:08] Speaker 05:
Sorry.

[00:47:09] Speaker 05:
Go ahead.

[00:47:10] Speaker 05:
Well, I think events kind of overtook the unfortunate issue.

[00:47:15] Speaker 05:
The unfortunate thing is the timing here.

[00:47:16] Speaker 05:
I mean, at the time the certificate order issued, it was it was the commission's understanding that the pipeline wanted to

[00:47:26] Speaker 05:
to proceed with this project.

[00:47:28] Speaker 05:
This authorization was issued under that understanding.

[00:47:31] Speaker 05:
But it wasn't until April

[00:47:34] Speaker 05:
2021 or maybe February of 2021, that the pipeline started indicating that it might not be going forward.

[00:47:40] Speaker 05:
By that time, this case was already pending before the court.

[00:47:45] Speaker 05:
When the agency learned of this potential pause, the merits brief was already mostly drafted.

[00:47:51] Speaker 07:
Well, I know, but counsel, nothing prevent anybody from moving to remand the case to the agency in light of change circumstances.

[00:48:04] Speaker 05:
I understand, Your Honor.

[00:48:05] Speaker 05:
I mean, that is something that I can certainly take back to the agency.

[00:48:10] Speaker 05:
In this particular case, since we are sitting here now, I do think that the question is in the court's hands as to what to do.

[00:48:23] Speaker 05:
And I do think we

[00:48:25] Speaker 05:
we lack an article three case or controversy, and we lack a right case for review.

[00:48:31] Speaker 05:
I do wanna highlight the Devia case, which I understand the pipeline also relied on.

[00:48:36] Speaker 05:
That case- Okay, so which case?

[00:48:39] Speaker 05:
The Devia versus NRC.

[00:48:41] Speaker 09:
Yes, right, yes.

[00:48:42] Speaker 05:
Right, so that case involved the Nuclear Regulatory Commission's authorization of a nuclear waste facility on land belonging to the Skull Valley tribe.

[00:48:52] Speaker 05:
Right.

[00:48:53] Speaker 05:
And that's a case where the tribal petitioners actually argued that the 20-year license, it was a 20-year license that the NRC had granted, they argued it was ripe for review because even though two federal agencies had denied authorizations that the licensees needed,

[00:49:10] Speaker 05:
to transport waste to the facility.

[00:49:12] Speaker 05:
Despite these denials, according to petitioners, the companies could potentially find another way to transport nuclear waste to the facility that did not require these approvals.

[00:49:26] Speaker 05:
But the court rejected these arguments as too speculative to support review.

[00:49:30] Speaker 07:
Do you agree here that the state denied the application for a permit without prejudice?

[00:49:39] Speaker 05:
Yes, but that would, I mean, it would require the company reapplying to the state.

[00:49:45] Speaker 05:
And presumably, since the state is a petitioner here, it is not going to be inclined to grant those permits.

[00:49:51] Speaker 05:
Moreover, if both of those were upheld, I mean, the state's denials under the Coastal Zone Management Act was upheld by the Secretary of Commerce.

[00:50:03] Speaker 05:
The federal government declined to override the state denial.

[00:50:08] Speaker 05:
And then the Clean Water Act section 401 authorization.

[00:50:11] Speaker 05:
I mean, that also was a situation where the pipeline petitioned the commission to find that the state had waived the one year deadline under the Clean Water Act.

[00:50:22] Speaker 05:
And the commission rejected the pipeline's petition.

[00:50:26] Speaker 05:
So these aren't just temporary ephemeral denials.

[00:50:31] Speaker 05:
I mean, these are denials that have been upheld.

[00:50:35] Speaker 01:
Can you counsel help me understand another aspect of the timing of this?

[00:50:42] Speaker 01:
My understanding from the papers is that it was that the pipelines timeline for construction was 53 months.

[00:50:56] Speaker 01:
I think that's right.

[00:51:00] Speaker 05:
It was almost five years.

[00:51:01] Speaker 05:
That's right.

[00:51:02] Speaker 01:
in that the certificate order expires, I believe in March, 2025, which is less than 53 months from now.

[00:51:13] Speaker 01:
But I'm assuming that FERC has the discretion to extend the deadline so that if the pipeline, you know, six months from now said, okay, we wanna begin construction,

[00:51:32] Speaker 01:
And it does so.

[00:51:35] Speaker 01:
They, and they're not going to make that deadline that they can move for for to extend the deadline is that how that works.

[00:51:43] Speaker 05:
Typically, yes, but I'm not sure your honor if this case is before the court the court has exclusive jurisdiction over the docket.

[00:51:52] Speaker 05:
expect the agency would not be able to extend the deadline if, for example, this case were being held in abeyance.

[00:52:00] Speaker 05:
You know, I think this case, this is very reminiscent of the Atlantic coast pipeline and the pennies pipeline cases, which this court held in abeyance under actually

[00:52:11] Speaker 05:
more tentative circumstances.

[00:52:13] Speaker 05:
I mean, in those cases, the court held them in abeyance pending Supreme Court litigation that might have some bearing on the pipeline's ability to go forward.

[00:52:24] Speaker 05:
I mean, here we have definitive denials from the state and also a pipeline commitment not to

[00:52:33] Speaker 05:
you know, not to initiate eminent domain.

[00:52:36] Speaker 05:
So I think the circumstances are even stronger than Atlantic Coast Pipeline and Penn East, where this court held the cases in abeyance.

[00:52:46] Speaker 01:
All right.

[00:52:46] Speaker 01:
Thank you.

[00:52:48] Speaker 01:
Thank you.

[00:52:48] Speaker 08:
Any further questions?

[00:52:51] Speaker 08:
Thank you, counsel.

[00:52:57] Speaker 08:
So.

[00:52:57] Speaker 07:
I guess, counsel, for petitioners, you have

[00:53:03] Speaker 07:
A few minutes on reply.

[00:53:05] Speaker 02:
Yes, your honor.

[00:53:06] Speaker 02:
Thank you.

[00:53:08] Speaker 02:
First of all, the state permit denials.

[00:53:10] Speaker 02:
First, the CZMA was without prejudice.

[00:53:15] Speaker 02:
And the 401, in fact, the state concluded and in fact, FERC agreed that there was no actual application even ever made.

[00:53:25] Speaker 02:
So that's a blank slate there.

[00:53:30] Speaker 02:
The idea that the state is hostile, that the state's regulatory process is somehow skewed is a very odd suggestion coming from a representative of a regulatory agency.

[00:53:42] Speaker 02:
The state, of course, will look at the record and the facts when they're presented to them.

[00:53:48] Speaker 02:
But more importantly, the Penny's case is an excellent example.

[00:53:52] Speaker 02:
After the 401 certificate was denied by the state of New Jersey, Penny still started condemnation actions in the state of New Jersey.

[00:54:00] Speaker 02:
There is nothing, nothing to stop Pembina from starting condemnation actions this afternoon, or even while this case is, even while we're talking here.

[00:54:12] Speaker 02:
This case, you know, so in terms of if the court, if there's some action by FERC or the court that absolutely takes away that ability, that's one thing, but without that ability being taken away, the fact that, well, they might not,

[00:54:28] Speaker 02:
Um, is not good enough to deprive particularly certainly doesn't part petitioners that are standing, which again was established when they filed the petitions.

[00:54:36] Speaker 02:
So the question is, is this case moot, or is it not right, it is not moot because the, the FERC has not met its burden of strong

[00:54:46] Speaker 02:
The bad conduct can't happen again.

[00:54:48] Speaker 02:
We don't know whether or not Pembina will condemn.

[00:54:53] Speaker 02:
And Pembina, again, refused to say that it would not, even if it canceled the project.

[00:55:00] Speaker 02:
And the case is right, because unlike the Divya case, the court was very clear that there was no current harm to the petitioners in that case.

[00:55:09] Speaker 02:
And therefore, they could put off deciding it to see what would ever happen.

[00:55:14] Speaker 02:
There is current harm here.

[00:55:17] Speaker 02:
FERC is trying to dance around it in so many ways.

[00:55:21] Speaker 02:
Its current harm is inflicted by a combination of FERC granting a certificate that they should not have granted and PEMBA refusing to say it will not exercise its rights under that certificate starting possibly tomorrow or even if it cancels the project.

[00:55:36] Speaker 02:
That's where the harm is coming from.

[00:55:42] Speaker 02:
Last one, obviously, eminent domain is not conditioned on anything.

[00:55:48] Speaker 02:
There's nothing they can do to condition eminent domain.

[00:55:52] Speaker 02:
Once that certificate is final, FERC's position is they can't do anything about eminent domain except perhaps in the circumstances of while their rehearing process is going on.

[00:56:05] Speaker 02:
FERC has conceded that, they have passed

[00:56:07] Speaker 02:
an order saying that we will stay certificates so that eminent domain is stayed during the hearing process.

[00:56:14] Speaker 02:
But after that, we have no authority to stay eminent domain.

[00:56:19] Speaker 02:
So the risk is real and Pembina is refusing to do anything to make that risk.

[00:56:28] Speaker 06:
Mr. Bender, let me just be clear.

[00:56:30] Speaker 06:
As far as you know, Pembina is refusing.

[00:56:33] Speaker 06:
We don't have

[00:56:35] Speaker 06:
a statement from Pembina in response to the gray briefs, your gray briefs, indication that certain conditions would be fine, right?

[00:56:47] Speaker 02:
No, Pembina did file a, after we submitted our brief and FERC submitted theirs, Pembina has filed a jointer in FERC's brief.

[00:56:57] Speaker 02:
Pembina certainly had the opportunity either to file its own brief.

[00:57:00] Speaker 02:
It simply said, us too.

[00:57:03] Speaker 06:
And so I'm sorry, let me be clear.

[00:57:05] Speaker 06:
And I understood in the gray brief, you're saying after you filed in July, a brief that assailed the, and this is outside of the context of the motion for abeyance.

[00:57:21] Speaker 06:
I thought it was some discussion of how the harm still exists because Pembina has the ability

[00:57:32] Speaker 06:
to continue to condemn beyond the life of the project, et cetera.

[00:57:39] Speaker 06:
And the suggestion being that if they did not have such authority, then you wouldn't have the harm and you'd be fine with that.

[00:57:51] Speaker 06:
You're saying Pembina indicated at some point after your briefing in this case that it was sticking by any previous

[00:58:02] Speaker 06:
representations about retaining its eminent domain authority under these circumstances?

[00:58:08] Speaker 02:
No, not quite, Your Honor.

[00:58:10] Speaker 02:
What I'm saying is that Pembina filed a jointer into FERC's merits brief.

[00:58:16] Speaker 02:
They didn't, which said nothing about them doing anything about eminent domain.

[00:58:21] Speaker 02:
They just said FERC's arguments are fine by us.

[00:58:23] Speaker 02:
We join in them.

[00:58:25] Speaker 02:
Thereafter, we filed a reply brief, which had all of the

[00:58:29] Speaker 02:
discussion in response to FERC's standing argument.

[00:58:33] Speaker 02:
But Pembina was perfectly free to file something at that point to say, hold on a second, or to contact landowners and say, let's put this case on the shelf.

[00:58:41] Speaker 02:
We've heard nothing from Pembina.

[00:58:45] Speaker 02:
That is all except for one last thing.

[00:58:50] Speaker 02:
FERC is very free with extensions.

[00:58:52] Speaker 02:
Our brief contains lots of examples where FERC is handing out extensions on a permit deadline to be in operation.

[00:59:00] Speaker 02:
including cases where it's the second or third or fourth extension.

[00:59:05] Speaker 02:
They just always extend per request, but they can't do that.

[00:59:09] Speaker 02:
As a matter of fact, I agree with counsel for FERC.

[00:59:11] Speaker 02:
They may not do that while this case is after they file the record in the case with the court, they have no jurisdiction over that certificate.

[00:59:18] Speaker 02:
They cannot extend it.

[00:59:24] Speaker 02:
They cannot stay it.

[00:59:25] Speaker 02:
They have no jurisdiction over it.

[00:59:27] Speaker 02:
The only one who has jurisdiction over that certificate is this court.

[00:59:32] Speaker 07:
All right, thank you, council.

[00:59:36] Speaker 07:
We will take the best disability issues under advisement and we will move on to issues related to purpose and benefits.

[00:59:47] Speaker 07:
Council for petitioners.

[00:59:49] Speaker 02:
Yes, your honor, thank you.

[00:59:51] Speaker 02:
getting to the merits of this case.

[00:59:54] Speaker 02:
This is truly the most absurd project FERC has ever green lighted.

[00:59:58] Speaker 02:
The purpose of the project or the concern of petitioners is FERC says it's okay for Pembina to take their property in order to ship Canadian gas from a terminal that actually has no customers.

[01:00:14] Speaker 02:
And this leads to four separate grounds that this court can vacate the certificate.

[01:00:19] Speaker 01:
Just so that I'm clear, you're calling it Canadian gas because the company that owns the gas is the parent is a Canadian, but the gas would physically originate in Oregon, right?

[01:00:34] Speaker 02:
The gas would physically originate in Canada, would come down the GMT pipeline from Canada,

[01:00:40] Speaker 02:
and then would enter the Pacific connector pipeline.

[01:00:43] Speaker 02:
The source of the gas is Canada.

[01:00:45] Speaker 02:
There are expert reports in the record that we submitted that FERC never mentioned or responded to saying because essentially because Canadian gas is cheaper, Canadian gas is economically what will be used plus the fact that Pembina is a Canadian corporation in the business of processing and transporting gas.

[01:01:07] Speaker 02:
It also makes sense for them to

[01:01:09] Speaker 02:
want to source the gas from Canada.

[01:01:11] Speaker 02:
In fact, they applied to Canada for permission to export 100% of the gas they would need for this project, and they applied to the Department of Energy for permission to import

[01:01:22] Speaker 02:
100% of the gas that they need for this project.

[01:01:26] Speaker 02:
They have those permits.

[01:01:27] Speaker 02:
They were very clear to the Canadian government.

[01:01:29] Speaker 02:
The Canadian government said, hold on a second.

[01:01:30] Speaker 02:
How do we know you're really going to be doing this?

[01:01:32] Speaker 02:
And they said, we intend to do everything possible to meet all of our needs for Jordan Cove from Canadian gas.

[01:01:42] Speaker 06:
So Mr. Bookbinder, I just want to be clear because I think I was not as focused as I needed to be in my preparation on this particular point.

[01:01:52] Speaker 06:
You're saying the gas originates in Canada, comes through some other pipeline, links up with this disputed pipeline, and then is exported back to Canada?

[01:02:05] Speaker 02:
No, exported, we assume, and Pemberton's business plan is to export to the Far East.

[01:02:12] Speaker 06:
Oh, to the Far East.

[01:02:13] Speaker 06:
Yes, ma'am.

[01:02:14] Speaker 06:
I see.

[01:02:15] Speaker 06:
So it starts in Canada, but eventually goes somewhere, but not in the US.

[01:02:19] Speaker 06:
It never ultimately resides in the US.

[01:02:22] Speaker 06:
Is that correct?

[01:02:23] Speaker 02:
FERC concedes that not one molecule of this gas will ever be used by any American consumer.

[01:02:30] Speaker 02:
All of it, 100% of the gas of this project is destined for export.

[01:02:35] Speaker 02:
And the record evidence is solely that this gas will come from Canada.

[01:02:39] Speaker 02:
And FERC

[01:02:41] Speaker 02:
has abandoned the idea that it, quote, will carry American gas.

[01:02:46] Speaker 02:
And in the Coastal Zone Management Act appeal to the Secretary of Interior, Interior said, hold on a second, we want to know something about this project.

[01:02:55] Speaker 02:
What gas is going to be carried in this pipeline?

[01:02:58] Speaker 02:
Is it going to carry any American gas?

[01:02:59] Speaker 02:
And Ferg said, we have no way of knowing that it'll ever carry American gas.

[01:03:04] Speaker 02:
In fact, that is a question we do not ask.

[01:03:08] Speaker 02:
But we gave them the answer.

[01:03:09] Speaker 02:
We gave expert reports.

[01:03:11] Speaker 02:
And the fact that Pemba has applied for and received permission from both Canada and the United States to supply 100% of the project's needs from Canada.

[01:03:23] Speaker 02:
That's why they're taking Americans' property to ship Canadian gas to the Far East.

[01:03:29] Speaker 06:
All right, so what is the import of that set of facts in terms of your legal argument?

[01:03:34] Speaker 06:
Are you then suggesting that section seven is not properly invoked?

[01:03:39] Speaker 06:
This is not an interstate commerce issue, or what do we do with that?

[01:03:44] Speaker 02:
There are four grounds, Your Honor.

[01:03:46] Speaker 02:
The first is, since you've raised the interstate issue,

[01:03:52] Speaker 02:
jump to those issues, which are as this court said in Oberlin, there are two questions we have about whether exported gas qualified or pipeline for exported gas qualifies to be to get a section seven certificate and the two grounds were one.

[01:04:10] Speaker 02:
The law of the District of Columbia Circuit is that exports are not in interstate commerce.

[01:04:15] Speaker 02:
And that was first decided in the border pipeline case in 1947.

[01:04:19] Speaker 02:
It was reaffirmed in the Distrigas case in 1974.

[01:04:23] Speaker 02:
Distrigas noting that between borderline and the time they wrote their opinion, the Federal Power Administration, FERC's predecessor, asked Congress 14 times to overrule border pipeline, and Congress didn't do so.

[01:04:40] Speaker 02:
What this court did in Oberlin was to say, you haven't explained, the petitioners have said that this is not an interstate commerce.

[01:04:48] Speaker 02:
Can you please explain it?

[01:04:51] Speaker 02:
They failed to explain that the Oberlin remand, the decision of this course remanding it back to FERC came long before FERC issued the certificate.

[01:05:00] Speaker 02:
And we were busy quoting and citing Oberlin all over the place and saying, can you explain how this is somehow an interstate commerce?

[01:05:08] Speaker 02:
And FERC has only a single explanation, which is, well, some of the gas could come from the United States and therefore it's an interstate commerce.

[01:05:17] Speaker 06:
The fact that the pipeline travels over states that the gas is transported through various states as opposed to other cases in which the gas might be sourced say from Texas and go right over to Mexico and so there's no other states you're saying that's not enough.

[01:05:35] Speaker 02:
In Oberlin, the gas was very clearly.

[01:05:37] Speaker 02:
The gas was produced in Ohio, crossing the border into Michigan, and then would be exported to Canada.

[01:05:44] Speaker 02:
That did not phase the court.

[01:05:47] Speaker 06:
Did the court in Oberlin send it back on background?

[01:05:51] Speaker 06:
I thought the court in Oberlin was focused on the public benefit or the public in both.

[01:05:57] Speaker 02:
Both.

[01:05:58] Speaker 02:
Both.

[01:05:58] Speaker 02:
Those were two separate grounds in Oberlin.

[01:06:01] Speaker 02:
OK.

[01:06:01] Speaker 02:
And the border pipeline case were, I believe,

[01:06:04] Speaker 02:
Yes, the gas oil originated in Texas, and that was precisely because of that.

[01:06:10] Speaker 02:
Because it was intrastate gas that FERC did not have jurisdiction over, they said, okay, we have jurisdiction over this because it's being exported under Section 7.

[01:06:20] Speaker 02:
We have jurisdiction under section seven because it's being exported.

[01:06:23] Speaker 02:
Regardless of the fact that it's intrastate gas, we can't regulate it because of that, but we can regulate it under section seven because it's exported.

[01:06:31] Speaker 02:
And the border pipeline case said, no, section seven does not cover exports.

[01:06:37] Speaker 06:
But border pipeline did not involve travel over multiple states.

[01:06:41] Speaker 06:
So what do you do with that factor in terms of your interstate commerce analysis?

[01:06:49] Speaker 02:
We looked at the Oberlin decision, which said, we have gas here moving from Ohio into Michigan and then exported.

[01:06:57] Speaker 02:
Can you please explain to us why this is an interstate commerce?

[01:07:01] Speaker 02:
And it simply isn't.

[01:07:03] Speaker 02:
I mean, border pipeline, they literally did not say a word about the fact that this, neither the court, the court didn't say a single word about the fact that this stuff is all being produced in Texas.

[01:07:15] Speaker 02:
They said, yes, it's being produced in Texas, but FERC is trying to claim

[01:07:19] Speaker 02:
Section 7 jurisdiction because it's exported.

[01:07:24] Speaker 06:
That's where it's... So can you move to the next... I think we have that point.

[01:07:28] Speaker 02:
You said there were four different... Yes.

[01:07:31] Speaker 02:
Well, Oberlin gives us a second basis for vacatur.

[01:07:37] Speaker 02:
And that has to do with whether or not exports produce public benefits.

[01:07:41] Speaker 02:
And it's

[01:07:42] Speaker 02:
Let's start with the Natural Gas Act itself.

[01:07:44] Speaker 02:
Section one of the natural gas says it is declared that the business of transporting and selling natural gas for ultimate distribution to the public is affected with a public interest.

[01:07:56] Speaker 02:
And more specifically in 1947, when Congress amended the natural gas to add an eminent domain provision, the problem that Congress addressed was state aid was producing the gas

[01:08:09] Speaker 02:
They wanted to send it to State C, but State B in the middle wouldn't give them, there was no public use under state law such that they could grant eminent domain authority.

[01:08:21] Speaker 02:
That was the problem and the Congress was very clear in the Senate Report 429 and the 80th Congress on page two.

[01:08:30] Speaker 02:
Very clearly, the operation of the pipeline would not be for the benefit of the public in those states crossed by the pipeline, but in which there is no distribution of natural gas by such line.

[01:08:43] Speaker 06:
If there's no- Mr. Bookbinder, that sort of line of reasoning seems to cut against the sort of statutory, clear interest of Congress in authorizing exports of gas.

[01:08:59] Speaker 06:
My understanding,

[01:09:00] Speaker 06:
was that the statute, maybe it's in section three, I'm not exactly sure, but there is a stated congressional interest in promoting exportation.

[01:09:11] Speaker 06:
So if the holding is as broad as, as long as this gas is being exported, there can't be a public benefit.

[01:09:21] Speaker 06:
I'm wondering how you reconcile that with Congress's interest in exporting this kind of process.

[01:09:29] Speaker 02:
Two answers to that, Your Honor.

[01:09:32] Speaker 02:
First is that very first sentence in the natural gas act that I just quoted, after it says there's a public interest in distributing natural gas to consumers in the United States, it goes, and there's a public interest in regulating that interstate and foreign

[01:09:52] Speaker 02:
and exported gas.

[01:09:53] Speaker 02:
There's a public interest in regulating both kinds, but the public interest is in specifically the distribution of gas.

[01:10:02] Speaker 02:
And more importantly, is it public interest section seven, the section seven deals with the interstate gas.

[01:10:11] Speaker 02:
And the reason why exports do not provide public benefits

[01:10:19] Speaker 02:
And FERC says, let me give you the one with the first reasons for why there are public benefits, which is, well, they said, first, there'll be distribution of gas, and then they they realized on rehearing that there was no distribution of gas, then they said, well, there's, this will increase production of gas.

[01:10:38] Speaker 02:
And we cite two things.

[01:10:40] Speaker 02:
One, that FERC's repeated statement in every LNG export terminal case saying, we do not see any basis for saying that an LNG terminal will increase production of natural gas.

[01:10:54] Speaker 02:
And our brief is chock full of quotes from FERC's findings in every other LNG terminal case.

[01:11:02] Speaker 02:
We have no evidence of that.

[01:11:03] Speaker 02:
any increase in production from Pell and G terminals.

[01:11:07] Speaker 06:
Mr. Brewinder, I'm sorry, I'm mindful of your time and I want to make sure I get in a couple of quick questions.

[01:11:14] Speaker 06:
I did find the section that I was talking about, Section 3C of the National Gas Act indicates that exportation and importation shall be deemed to be consistent with the public interest.

[01:11:28] Speaker 06:
So I'm trying to understand why your argument, first of all, is not how is it consistent to suggest that an export pipeline is not a public benefit given this statement in the law.

[01:11:42] Speaker 06:
That's point one.

[01:11:43] Speaker 06:
And then point two, I understood city of Oberlin, which you're relying on heavily for making this argument, is on remand after the courts sending it back and is currently being

[01:11:58] Speaker 06:
litigated in this court after that remand.

[01:12:03] Speaker 06:
So to Judge Rogers, very good points about process.

[01:12:08] Speaker 06:
Why shouldn't we be waiting to see what the City of Oberlin folks panel, whatever that panel is going to be, says about this issue?

[01:12:17] Speaker 02:
Because, Your Honor, the issue in Oberlin, first of all, FERC says even without the exported gas, we don't even need to include the exported gas.

[01:12:27] Speaker 02:
take it out of the equation, we still are justified in issuing a certificate for public convenience and necessity.

[01:12:32] Speaker 06:
I understand, but it was sent back on this question.

[01:12:35] Speaker 06:
FERC has now filed, my understanding is, in that case, an extensive discussion of this very issue, the interaction between export pipelines and the public interest, and whether or not we can take into account in this case that statement

[01:12:56] Speaker 06:
that statement will be considered by a panel of this court in the context of that pending case.

[01:13:03] Speaker 06:
So under what circumstance should we go forward now and be making any pronouncements about this particular issue?

[01:13:11] Speaker 02:
Okay, two reasons, Your Honor.

[01:13:12] Speaker 02:
First of all, the export issue is an alternative argument that FERC puts forward.

[01:13:18] Speaker 02:
FERC says that the court never needs to get to the export argument.

[01:13:23] Speaker 06:
In Oberlin.

[01:13:24] Speaker 02:
Yes, they say that very clearly.

[01:13:26] Speaker 02:
We can justify it.

[01:13:28] Speaker 02:
The pipeline carried gas, both for export and domestic use.

[01:13:32] Speaker 02:
And FERC says just on the basis of the gas for domestic use, that justifies the pipeline.

[01:13:38] Speaker 02:
So we may never get to the point in Oberlin of this issue being decided.

[01:13:43] Speaker 02:
But more importantly, the issue in Oberlin, the issue may come down to

[01:13:50] Speaker 02:
Look, only some of the gas was being used here.

[01:13:53] Speaker 02:
That's really not an export pipeline.

[01:13:55] Speaker 02:
We have a pipeline where 100% of the gas is going for export.

[01:13:59] Speaker 02:
And as a policy matter, there are at least six LNG terminals in FERC's, forget the word, in FERC's pipeline now.

[01:14:12] Speaker 02:
They're going to be applying for permits to build pipelines to feed them.

[01:14:19] Speaker 02:
And we don't want the landowners down there, they don't want to wait to find out whether or not pipelines servicing LNG facilities specifically get eminent domain or not.

[01:14:31] Speaker 02:
And it will be years before any of those cases reach that court during which their property will be taken and destroyed.

[01:14:39] Speaker 02:
This is the court's opportunity to reach the issue of is a pipeline supplying an LNG facility

[01:14:48] Speaker 02:
does that get eminent to make?

[01:14:51] Speaker 01:
Can I ask a factual question to make sure I understand something?

[01:14:57] Speaker 01:
Is this pipeline that's the subject of this certificate order that we are reviewing, is it physically resident in any state other than Oregon, or does it begin in Oregon and end in Oregon?

[01:15:13] Speaker 02:
Yes, Your Honor, it begins at a

[01:15:16] Speaker 02:
interconnection with the GMT pipeline in eastern Oregon, and then would be built over to the coast of Oregon.

[01:15:22] Speaker 01:
And so part of the FERC's rationale is that because the pipeline interconnects with these other pipelines that bring gas from other states, this is an interstate project.

[01:15:43] Speaker 01:
right?

[01:15:43] Speaker 01:
That's part of FERC's rationale.

[01:15:46] Speaker 01:
But as you point out, there are no precedent agreements from any of those other pipelines or anyone else to demonstrate that the gas will actually be

[01:16:01] Speaker 01:
used from any other state, the only agreements we have are with respect to the Canadian gas, as you call it, right?

[01:16:12] Speaker 02:
Not quite, Your Honor.

[01:16:14] Speaker 02:
The precedent agreement that FERC relied on is not between the pipeline and any gas coming into it.

[01:16:20] Speaker 02:
It's between the pipeline and its sister company, the LNG terminal.

[01:16:25] Speaker 02:
It owns the terminal, that's right.

[01:16:27] Speaker 02:
There's no commitment as to gas.

[01:16:29] Speaker 02:
And all FERC is saying is, well, it's plugged into other pipelines that are plugged into other pipelines.

[01:16:37] Speaker 02:
If that suffices to bring it within interstate commerce, then there are 300,000 miles of interstate pipeline in the United States, virtually any pipeline.

[01:16:46] Speaker 01:
So if I understand your argument, there are at least four strikes against this project, just from the interstate

[01:16:58] Speaker 01:
jurisdictional public benefit analysis.

[01:17:01] Speaker 01:
One is that there's not a precedent agreement with any gas supply for this.

[01:17:09] Speaker 01:
The only precedent agreement is with the terminal that would accept the gas from the pipeline.

[01:17:16] Speaker 01:
B, there's no precedent agreement with any gas supply from another state.

[01:17:25] Speaker 01:
So it's not really an interstate pipeline in that sense.

[01:17:30] Speaker 01:
It's just presumably going to get gas from an interconnect that originates in Canada, which leads to strike three, which is that

[01:17:42] Speaker 01:
it's not even a pipeline to serve US produced gas, but Canadian gas.

[01:17:51] Speaker 01:
And then strike four is that all of the gas will be exported and so none of it will be used in the US.

[01:18:00] Speaker 01:
And so we have a situation where other than kind of the argument about ancillary economic benefits within the US jobs, et cetera,

[01:18:13] Speaker 01:
FERC is essentially kind of approving this and delegating taking authority for this private venture to be able to take private landowners land and kind of its supremacy clause authority to take state land for this pipeline.

[01:18:37] Speaker 01:
At least those four strikes against, right?

[01:18:40] Speaker 02:
Yes, and there are a couple more, Your Honor, just on that issue alone.

[01:18:44] Speaker 02:
The pipeline, FERC denied the same project in 2016, saying the pipeline had no contracts at all.

[01:18:55] Speaker 02:
So what Jordan Cove did, the pipeline then signed a contract with its sister company, The Terminal.

[01:19:02] Speaker 02:
The terminal has no customers.

[01:19:05] Speaker 02:
After eight years, they have to report, because they have DOE section three authorization to export gas, and they have to report to DOE every six months, what is their status of contracts to actually ship gas?

[01:19:18] Speaker 02:
And every six months for eight years, they've said, we don't have any such contracts.

[01:19:25] Speaker 06:
So- All right, but what is the rel- I understand that, but isn't FERC's point

[01:19:31] Speaker 06:
that it ordinarily doesn't evaluate public convenience and necessity on the basis of the end user and evaluating the extent to which the gas is going somewhere or whatnot.

[01:19:44] Speaker 06:
That as far as it's concerned, as long as there is a contract or series of contracts that covers the capacity, and that is lawful, binding, there it is, that's good enough.

[01:20:01] Speaker 06:
I mean, are you suggesting that Jordan Cove is not a customer, that there's something wrong with the contracts that it entered in this case?

[01:20:12] Speaker 06:
They're not enforceable agreements to buy the 90 some odd percent of gas?

[01:20:17] Speaker 02:
Your Honor, I would refer you to our 28J letter dealing with the case only decided a few months ago by this court, Environmental Defense Fund versus FERC, where the court vacated a permit for a functioning pipeline

[01:20:31] Speaker 02:
on the grounds that it relied on a single affiliate contract that was signed after it couldn't find any other customers.

[01:20:43] Speaker 06:
And wasn't there also some self-dealing in that case?

[01:20:49] Speaker 06:
Wasn't that the key?

[01:20:51] Speaker 02:
No, it was a single affiliate contract signed after they couldn't find any other customers.

[01:20:57] Speaker 02:
And there was no new demand for the gas, that their existing system met it all.

[01:21:02] Speaker 02:
And there was a ton of evidence on the other side that there's no new demand for this gas.

[01:21:08] Speaker 02:
Why are you doing this?

[01:21:09] Speaker 02:
We have something even worse.

[01:21:11] Speaker 02:
We have a single affiliate contract signed after FERC denied it on the grounds you don't have any contracts.

[01:21:19] Speaker 02:
where there's no demand for the gas.

[01:21:22] Speaker 06:
But didn't FERC also make a statement that it had found no indice of self-dealing?

[01:21:28] Speaker 06:
So let me just home in on that.

[01:21:30] Speaker 06:
That seemed to be different than what this court found significant in the case that you mentioned.

[01:21:37] Speaker 06:
So is there some evidence of self-dealing in this case?

[01:21:41] Speaker 06:
And if so, what is it?

[01:21:42] Speaker 06:
No, Your Honor.

[01:21:43] Speaker 06:
Companies, just because they're affiliates doesn't mean we have self-dealing, right?

[01:21:48] Speaker 02:
No, that is correct, your honor.

[01:21:50] Speaker 02:
It's all the other factors that point right at this being something that should not have approved.

[01:21:57] Speaker 02:
Again, as I ran through the other factors that the court looked at, the project was rejected because it had no contracts.

[01:22:04] Speaker 02:
It quickly signed a contract with its own affiliate.

[01:22:12] Speaker 02:
And here we have that

[01:22:14] Speaker 02:
The affiliate in the EDF case at least had customers.

[01:22:17] Speaker 02:
It was a gas company.

[01:22:18] Speaker 02:
It could sell the gas.

[01:22:19] Speaker 02:
This is a contract with an LNG terminal that has no customers.

[01:22:26] Speaker 06:
But it did pre-exist, right?

[01:22:28] Speaker 06:
It wasn't like that other case.

[01:22:29] Speaker 06:
I'm bad with case names.

[01:22:31] Speaker 06:
So it wasn't like the case in which it was created for this purpose, right?

[01:22:37] Speaker 02:
No, it was not created for this purpose.

[01:22:39] Speaker 02:
This is a single project.

[01:22:40] Speaker 02:
The LNG terminal and the pipeline are a single project.

[01:22:44] Speaker 02:
And the idea that they would ship, their terminal has no customers, you could build a pipeline, they can exercise eminent domain for a pipeline that if built would go to a place that has no use for the gas.

[01:22:58] Speaker 02:
It's simply, it's a complete dead end.

[01:23:00] Speaker 02:
It's a pipeline to nowhere.

[01:23:01] Speaker 06:
Well, we don't know that it doesn't have.

[01:23:03] Speaker 06:
Burke says we don't have to look at where it's going ultimately in this sense, right?

[01:23:09] Speaker 06:
We don't know what's gonna happen to it.

[01:23:11] Speaker 02:
Uh, no, that's not quite your honor.

[01:23:13] Speaker 02:
They said we don't care where it goes, but they, but the terminal has said every six months, the department of energy, most recently on the first of this month, no contracts.

[01:23:25] Speaker 02:
We have no place to no, no market for this gas.

[01:23:28] Speaker 02:
So there can't be market demand.

[01:23:30] Speaker 02:
All right.

[01:23:31] Speaker 02:
So Mr. Bookbinder, what's the remedy?

[01:23:32] Speaker 06:
Are you saying that?

[01:23:34] Speaker 06:
FERC that the entire certificate has to be canceled on this basis, or that FERC needs to look into more to determine these factors.

[01:23:46] Speaker 06:
It has to care, and it has to investigate, and it has to say something about where it's going and whatnot.

[01:23:53] Speaker 02:
Your Honor, vacatur is, as I said, there are four separate grounds for vacatur.

[01:23:57] Speaker 02:
And the first one is that

[01:24:02] Speaker 02:
the same grounds as existed in EDF versus Spire.

[01:24:05] Speaker 02:
There's no demand.

[01:24:07] Speaker 02:
It was this single affiliate contract, et cetera, et cetera.

[01:24:11] Speaker 02:
Secondly, in EDF versus FERC, the court said, look, you balanced the harms of the project, the adverse impacts against the supposed benefits in a single conclusory statement.

[01:24:24] Speaker 02:
And that's exactly what they did in this case.

[01:24:26] Speaker 02:
And our 28-J quotes the language in that case

[01:24:30] Speaker 02:
points out what Ferck said in this case.

[01:24:32] Speaker 02:
It is the exact same ipsidixit, a statement without any sort of analysis or stuff saying, here are some benefits, and we know some bad things will happen, and we find the benefits outweigh the bad things.

[01:24:43] Speaker 02:
And that's all they did.

[01:24:44] Speaker 02:
And that, the EDF court said, was a separate ground from vacatur itself.

[01:24:50] Speaker 02:
But then we get to the interstate nature of the pipeline, and then the export pipeline, and the fact that the benefits

[01:24:59] Speaker 02:
The general economic benefits themselves are not cognizable under the Natural Gas Act.

[01:25:06] Speaker 02:
That's the idea that there's general economic benefits.

[01:25:11] Speaker 02:
That's the Natural Gas Act was not passed as a jobs act.

[01:25:15] Speaker 02:
And what you say about general economic benefits goes for any infrastructure project.

[01:25:21] Speaker 01:
Just to cut to the chase because of time, I think if I understood Judge Jackson's question correctly, it's the same one that I had, which is that, are you saying that we should vacate the certificate order and remand and FERC can kind of reconsider whether to grant the certificate or whether

[01:25:50] Speaker 01:
we vacate and say that on this record, there is no kind of set of circumstances where FERC could reasonably grant the certificate.

[01:26:05] Speaker 01:
And we say that so that essentially for the pipeline to get a certificate, they would have to like start over.

[01:26:15] Speaker 01:
They couldn't just ask FERC to kind of reconsider on remand.

[01:26:20] Speaker 01:
And if you're asking for the latter, what's your authority for us doing that?

[01:26:26] Speaker 01:
But maybe that's not Judge Jackson's question.

[01:26:29] Speaker 01:
That's part of my question.

[01:26:31] Speaker 06:
That was part of my question.

[01:26:33] Speaker 06:
There's a third option, which is remanding without vacant or that we just remand to say you haven't explained enough about what it is that motivated your view of the need for this pipeline or the

[01:26:50] Speaker 06:
export circumstances or whatever.

[01:26:52] Speaker 06:
So can you respond to judge?

[01:26:54] Speaker 02:
Yes, the vacatur is, I'm gonna accept it.

[01:26:58] Speaker 02:
I'm gonna say vacatur is warranted, whether that you remand it or not to FERC.

[01:27:04] Speaker 02:
Vacatur is completely warranted here.

[01:27:07] Speaker 02:
There's no possibility of a public benefit.

[01:27:09] Speaker 02:
The record is very clear that the only economic benefits from this pipeline would accrue from constructing it.

[01:27:17] Speaker 02:
There's no distribution of gas, there's no increased production, the production all comes from Canada.

[01:27:24] Speaker 02:
And there's, and the, what Rick, Chairman Glick said, for example, we're building transportation capacity, that's a benefit.

[01:27:32] Speaker 02:
And Chairman Glick said, it's a matter of fact, in the remand decision of the Oberlin case,

[01:27:38] Speaker 02:
where they advanced the exact same rationale.

[01:27:41] Speaker 02:
He said, if the benefit of new pipeline capacity is that it will provide new pipeline capacity, then the commission's assessment of need is little more than a circular check the box exercise.

[01:27:52] Speaker 02:
And that's in his dissent in the Oberlin remand decision.

[01:27:57] Speaker 02:
And it also, so there's really no benefit from a project that has no customers, no possibility of customers being supplied entirely with Canadian gas.

[01:28:08] Speaker 02:
The only benefit that will be recognized is let's buy some people's property, tear it up, build a pipeline.

[01:28:15] Speaker 02:
That's it.

[01:28:17] Speaker 02:
That's the only possible scenario and we're going to get some jobs out of this and that's a general economic benefit and as a result, this certificate is justified.

[01:28:26] Speaker 02:
That is not.

[01:28:29] Speaker 02:
I don't think that this can be rehabilitated, but if you remand it to FERC, if you vacate it, so the threat to landowners is gone and remanded to FERC, I can understand why the court would go in that direction.

[01:28:45] Speaker 02:
I don't believe that's warranted because this record is so clear that this is a utterly absurd project.

[01:28:54] Speaker 02:
but vacating and remanding is also something that we would, you know, the landowners would be very happy with that result.

[01:29:02] Speaker 02:
They can breathe a little bit easier.

[01:29:04] Speaker 07:
All right.

[01:29:04] Speaker 07:
Why don't we hear from Council for FERC?

[01:29:11] Speaker 05:
Thank you, Your Honor.

[01:29:14] Speaker 05:
I think that there are at least three aspects of this particular issue that need to be clarified.

[01:29:22] Speaker 05:
So if the court will entertain it, I think the three issues are, first, the factual interstate issue.

[01:29:30] Speaker 05:
I mean, this is an interstate gas pipeline that is transporting gas out of the Rocky Mountain region to Oregon.

[01:29:38] Speaker 05:
The second is the kind of statutory issue that Judge Jackson was bringing up between section three and section seven and how the commission

[01:29:47] Speaker 05:
It does the analysis under section three informs the commission's determinations under section seven.

[01:29:55] Speaker 05:
And the third is the impact of the recent cases on on this particular case that that would be the impact of Oberlin and of the environmental defense funds fire case.

[01:30:07] Speaker 05:
So let me start with the first issue, the Canadian gas issue.

[01:30:11] Speaker 05:
The commission has not ever conceded and does not now concede that this pipeline is solely to transport Canadian gas.

[01:30:21] Speaker 05:
The record is clear that the commission was finding that this pipeline, the Pacific connector pipeline is designed to transport gas

[01:30:35] Speaker 05:
either from or both from Western Canada and also from the Rocky Mountain production area.

[01:30:42] Speaker 05:
In the rehearing order, paragraph 41- Is all of that within Oregon?

[01:30:49] Speaker 05:
The pipeline itself is within Oregon, but it- No, no, the Rocky Mountain.

[01:30:55] Speaker 05:
Oh, no, sorry.

[01:30:55] Speaker 05:
No, no, it's not.

[01:30:58] Speaker 05:
Where is- Like Wyoming, Colorado, the Rocky Mountain production area.

[01:31:06] Speaker 07:
And the record is clear on that?

[01:31:09] Speaker 05:
Yes, yes.

[01:31:11] Speaker 07:
So I read FERC to be referring, and maybe I misread, to the fact that bringing this, we're calling Canadian gas, would, among other things, provide, what shall I say, gas that could be used within the United States

[01:31:35] Speaker 07:
and you couldn't tell necessarily whether it was going to be, you know, Colorado gas or Canadian gas that's used on Project X, but then ultimately, whatever the volume that came from Canada, that same volume was going to be exported, but the gas itself might be a mixture or not.

[01:32:01] Speaker 07:
Was that FERC thinking?

[01:32:04] Speaker 05:
I think that's right, Your Honor.

[01:32:05] Speaker 05:
I want to make sure I understand what you're saying.

[01:32:10] Speaker 07:
In other words, it's not that there's a straight line from Canada to the Far East.

[01:32:19] Speaker 05:
Right.

[01:32:20] Speaker 05:
That's right, Your Honor.

[01:32:21] Speaker 05:
Right, but you can't trace a particular gas molecule in a straight line from Canada to the Far East or from the Rocky Mountain production area to the Far East for that matter.

[01:32:30] Speaker 05:
Once the gas molecules go into the pipeline system, all of these molecules are fungible and you can't tag one or two of them to determine exactly where it goes.

[01:32:42] Speaker 01:
You don't dispute that there was never any precedent agreement

[01:32:48] Speaker 01:
with this pipeline and any supply from the Rocky Mountain region, right.

[01:33:01] Speaker 05:
That's technically right, Your Honor, but there was a precedent agreement for 96% of the pipeline's capacity.

[01:33:09] Speaker 05:
Here, the terminal has committed in a binding agreement, as Judge Jackson pointed out, a binding enforceable agreement that it will be using 96% capacity.

[01:33:20] Speaker 01:
I understand that, but you're making the argument that this pipeline has the capability of receiving gas from the Rocky Mountain region.

[01:33:30] Speaker 01:
Yes.

[01:33:31] Speaker 01:
but there's nothing in the record saying that anyone with that gas wants to use this pipeline for that purpose.

[01:33:42] Speaker 05:
Oh, no, actually, your honor, at the in the authorization order, paragraph 85 JA 37, the commission describes benefits to Rocky Mountain gas producers.

[01:33:56] Speaker 05:
And it quotes some comments by a gas producer in western Colorado, saying that it would benefit from having the pipeline capacity available, and that it could access additional markets because of this pipeline.

[01:34:11] Speaker 05:
So there is record evidence supporting the Rocky Mountain production, the benefits to the Rocky Mountain production area.

[01:34:19] Speaker 05:
I also want to clarify that the Pacific Connector did hold an open season for this pipeline capacity, and it did receive another competitive bid for the capacity.

[01:34:31] Speaker 05:
It did reject that bid.

[01:34:33] Speaker 05:
It found the bid was not credit worthy, and it instead chose the Jordan Cove bid.

[01:34:38] Speaker 05:
But the bidder did challenge that rejection, and that's all described in the authorization order.

[01:34:43] Speaker 05:
at paragraph 66 to 80.

[01:34:46] Speaker 05:
That's at JA 28 to 34.

[01:34:48] Speaker 05:
So there was various evidence of demand for this pipeline capacity.

[01:34:54] Speaker 05:
I also want to just clarify to make sure we're all on the same page that the

[01:35:00] Speaker 05:
the demand for the terminal is not before the court.

[01:35:05] Speaker 05:
That was decided by the Department of Energy.

[01:35:08] Speaker 05:
And it determined that exports to the Far East, that pipeline exports were in the national interest, that they would produce domestic benefits or that they were not inconsistent with the public interest under Natural Gas Act section three.

[01:35:26] Speaker 05:
That's not challenged by the petitioners.

[01:35:28] Speaker 05:
It's just a pipeline that's at issue.

[01:35:30] Speaker 06:
Right.

[01:35:30] Speaker 06:
So let me try to understand.

[01:35:34] Speaker 06:
Because it felt a little bit, in my view, under these circumstances, like FERC was sort of throwing up its hands in a particular way.

[01:35:41] Speaker 06:
And that is that it says, you know, the domestic benefits.

[01:35:50] Speaker 06:
I guess I'm trying to understand for the purpose of Section 7,

[01:35:55] Speaker 06:
Does there need to be a showing of domestic or foreign benefit in terms of market need?

[01:36:02] Speaker 06:
And if so, what showing was made in this situation?

[01:36:06] Speaker 06:
I feel like FERC is saying there's really no need to evaluate domestic need because the gas is going to be exported.

[01:36:14] Speaker 06:
And we don't evaluate foreign need because that's in the bailiwick of DOE.

[01:36:21] Speaker 06:
under section three, sort of in the same line of what you were just saying, we're not focused on what's gonna happen at the terminal from then on.

[01:36:31] Speaker 06:
So what is the public benefit that is accruing from the construction and operation of this pipeline that is going to ultimately export the gas?

[01:36:50] Speaker 05:
Thanks, Your Honor.

[01:36:51] Speaker 05:
I think I understand the question conceptually.

[01:36:54] Speaker 05:
I guess one logistical background point is that the gas exports have been approved by Department of Energy.

[01:37:04] Speaker 05:
They're originating from this terminal at Jordan Cove.

[01:37:08] Speaker 05:
Now, without the pipeline, that terminal can't function.

[01:37:12] Speaker 05:
So I think that that is important background for how

[01:37:18] Speaker 05:
sections three and section seven of the Natural Gas Act interrelate.

[01:37:25] Speaker 05:
The commission here said that Department of Energy has made this public interest finding under section three, and that finding informs the commission's determination under section seven that the pipeline is required by the present or future public convenience and necessity.

[01:37:47] Speaker 05:
While the Department of Energy's decision is not dispositive, if you consider it as a whole, if the commission were precluded from considering the Section 3 authorization and making it Section 7 determination, that would eviscerate Congress's intent in Section 3.

[01:38:08] Speaker 05:
Right.

[01:38:09] Speaker 06:
So can I just say, I'm not saying you're precluded.

[01:38:12] Speaker 06:
It's a factor.

[01:38:13] Speaker 06:
You can consider it.

[01:38:15] Speaker 06:
But how does that

[01:38:17] Speaker 06:
interact with Section 7's requirement of some evaluation of what I understood to be domestic public need.

[01:38:28] Speaker 06:
Maybe I'm wrong about that.

[01:38:29] Speaker 06:
So you can address as evaluated by market demand.

[01:38:39] Speaker 06:
So fine, you can take into account the DOE's

[01:38:45] Speaker 06:
assessment that this is going to be exported, all that's fine.

[01:38:48] Speaker 06:
But does that totally then eradicate any other considerations about domestic need or benefit?

[01:38:59] Speaker 05:
OK, got it, Your Honor.

[01:39:00] Speaker 05:
No, no, it does not.

[01:39:02] Speaker 05:
So the commission here made specific findings of domestic benefits.

[01:39:08] Speaker 05:
And they're in two categories.

[01:39:10] Speaker 05:
One is kind of the broader set of domestic benefits.

[01:39:15] Speaker 05:
primarily at rehearing orders, rehearing order paragraphs 40 through 42, JA 225.

[01:39:22] Speaker 05:
And that's where the commission discusses how transportation service generally provides public benefits.

[01:39:30] Speaker 05:
It helps develop the gas market, adds transportation options for producers, shippers, consumers, strengthens the economy, supports domestic jobs.

[01:39:41] Speaker 05:
And they also, the commission also talked about how

[01:39:43] Speaker 05:
Gas markets are dynamic with supply and demand fluctuating locally and regionally on a constant basis.

[01:39:51] Speaker 05:
And of course, we have seen very recently how these fluctuations in response to the pandemic, in response to extreme weather, like how these fluctuations affect

[01:40:04] Speaker 05:
everyone globally and here in this country.

[01:40:07] Speaker 05:
So the Commission has all of this in mind.

[01:40:10] Speaker 05:
Now more specific to this case, the Commission did find that this particular pipeline would provide additional capacity to transport gas out of the Rocky Mountain region.

[01:40:20] Speaker 05:
So that's that authorization order paragraph.

[01:40:23] Speaker 05:
where the commission is quoting that gas producer from Colorado and also where the commission is quoting that an applicant statement that they cannot meet the gas supply needs of the Jordan Cove terminal without accessing Rocky Mountain supplies through the Ruby Mountain pipeline.

[01:40:43] Speaker 05:
It's possible that the applicant would have, you know,

[01:40:48] Speaker 05:
It would respond to fluctuations in market prices and changes in supply and demand.

[01:40:55] Speaker 05:
And there may be times when the gas is supplied, it's coming from Canada, but it is also true that the commission found that the Rocky Mountain production region in the United States would receive benefits from this particular pipeline.

[01:41:15] Speaker 06:
All right.

[01:41:16] Speaker 06:
And you're saying the commission doesn't have to focus on market need in the form of domestic usage of the gas.

[01:41:33] Speaker 05:
Yes, that's right, your honor.

[01:41:35] Speaker 05:
Certainly domestic usage would be a benefit to the public here.

[01:41:41] Speaker 05:
I think because of section three and because of Congress's determination in section one that, as Mr. Bookbinder was pointing out, that the transportation of natural gas and the sale of natural gas in interstate and foreign commerce is necessary in a public interest.

[01:42:00] Speaker 05:
That forms part of the commission's need analysis.

[01:42:05] Speaker 05:
All right.

[01:42:06] Speaker 06:
So is this getting into your second?

[01:42:07] Speaker 06:
You had three issues.

[01:42:10] Speaker 06:
three versus section seven was the next one.

[01:42:13] Speaker 06:
Can we?

[01:42:14] Speaker 06:
That's right.

[01:42:15] Speaker 05:
Yes.

[01:42:17] Speaker 05:
Yes.

[01:42:18] Speaker 05:
I think that's where.

[01:42:19] Speaker 05:
Well, I want to make clear that the commission isn't saying that the Department of Energy's determination is dispositive of the section seven issue, like that's not the commission's position, but it does inform the agency's

[01:42:40] Speaker 05:
Conclusions and as to these factors as to how the Commission considers like what goes into this public benefits analysis that that's a matter uniquely within the Commission's expertise and knowledge and it should be granted on deference and how it administers the section seven pipeline determination.

[01:43:02] Speaker 06:
All right, so moving to Mr. Bookbinder says, and your third point is about the impact of the recent cases.

[01:43:08] Speaker 06:
He points to cases that he says indicate that it is the law of the circuit that a single precedent agreement with an affiliated company is not gonna cut it for the demonstration of the need for the pipeline.

[01:43:27] Speaker 06:
Why is he wrong about that?

[01:43:30] Speaker 05:
I think Mr. Bookbinder is overly relying on the Environmental Defense Fund case and taking that out of context a bit.

[01:43:39] Speaker 05:
I think Judge Jackson, as you pointed out, the Environmental Defense Fund case did turn on the fact that the petitioners there specifically identified plausible evidence of self-dealing according to the court.

[01:43:54] Speaker 05:
And the court found that the commission had failed to address that evidence of self-dealing.

[01:43:59] Speaker 05:
So that was also a very different kind of contract.

[01:44:04] Speaker 05:
It was a precedent agreement between a pipeline and an affiliate that had captive retail customers.

[01:44:11] Speaker 05:
It wasn't this case, which involves, of course, an export terminal and a pipeline supplying that terminal.

[01:44:19] Speaker 05:
And also,

[01:44:22] Speaker 05:
The other case, City of Oberlin is also instructive because the court in Oberlin found that the commission could put precedent agreements with affiliates on the same footing as non-affiliate precedent agreements, so long as there's no evidence of self-dealing.

[01:44:39] Speaker 05:
So that's the situation here.

[01:44:41] Speaker 06:
But what about, in Oberlin, a lot of the precedent agreements were for domestic use.

[01:44:48] Speaker 06:
What about precedent agreements with a single affiliate that are

[01:44:52] Speaker 06:
destined for export, for, I mean, aren't we in yet another category that isn't quite Oberlin or EDF because of that?

[01:45:04] Speaker 05:
Maybe, Your Honor, that's possible.

[01:45:07] Speaker 05:
Right, so it is a precedent agreement with a single company that is affiliated, but

[01:45:15] Speaker 05:
I mean, let's just take a step back and look at this logistically.

[01:45:18] Speaker 05:
This pipeline is carrying gas interstate.

[01:45:23] Speaker 05:
And I think there's no real dispute that this is an interstate pipeline.

[01:45:27] Speaker 05:
If I can just back up just to Maryland versus Louisiana, 451 U.S.

[01:45:31] Speaker 05:
725.

[01:45:33] Speaker 05:
Gas crossing a state at any stage of its movement to the ultimate consumer is an interstate commerce during the entire journey.

[01:45:40] Speaker 05:
cited by the Commission in its authorization order, paragraph 48, JA 20.

[01:45:46] Speaker 05:
So here we have the gas being transported interstate within the United States.

[01:45:52] Speaker 05:
This precedent agreement is for transportation within the United States entirely.

[01:45:56] Speaker 05:
the gas is being carried over the pipeline.

[01:46:00] Speaker 05:
It's going to a terminal where it stops.

[01:46:04] Speaker 05:
It's being liquefied at the terminal.

[01:46:06] Speaker 05:
It's being stored and then loaded onto LNG cargo ships to be carried elsewhere.

[01:46:12] Speaker 05:
But this is an interstate transportation of gas that is entirely within the United States, which is

[01:46:23] Speaker 05:
different from the precedent agreements in Oberlin where they were actually agreements to bring the gas off the nexus pipeline to, I believe, Canada.

[01:46:37] Speaker 05:
So it's just a very different set of circumstances, different kind of pipeline logistically and different kind of precedent agreement.

[01:46:47] Speaker 05:
But in any event, this is all the gas here.

[01:46:51] Speaker 05:
is all interstate before it reaches this terminal for eventual export.

[01:46:56] Speaker 05:
And as you pointed out, Judge Jackson.

[01:46:58] Speaker 01:
The distinction that you're making with City of Oberlin, was that made by the commission, or is this something you are making now in your brief and that argument?

[01:47:19] Speaker 05:
I'm not sure to what degree it was in the commission order, to be honest, Your Honor.

[01:47:27] Speaker 05:
We certainly discussed Oberlin in the orders on review, but I think I'm just trying to draw the factual distinction for Your Honor's background purposes.

[01:47:45] Speaker 05:
I would like to say the one other thing.

[01:47:51] Speaker 05:
Mr. Bookbinder focuses on border pipeline, and I think that case is completely an apposite.

[01:47:56] Speaker 05:
I think it would not be reasonable to hold that a 230-mile pipeline that's carrying gas that's originating from outside of Oregon

[01:48:08] Speaker 05:
and is transporting gas within the United States is somehow a section three export pipeline.

[01:48:14] Speaker 05:
I'm not sure the petitioners made a clear argument that this pipeline should be authorized under section three rather than section seven, but the commission did explain that although it does authorize border crossing pipelines under section three, these are typically facilities that are just several hundred feet of pipeline.

[01:48:35] Speaker 05:
like extending from a border to a meter.

[01:48:37] Speaker 05:
But that's not what we have here.

[01:48:39] Speaker 05:
You know, we have a 230-mile pipeline that's bringing gas from different states to a point in Oregon.

[01:48:45] Speaker 06:
The fact that it is... Can I just quickly ask you, because part of the standard of review here is for us to think about whether FERC has said enough in its orders to actually justify this pipeline.

[01:49:04] Speaker 06:
And you've said a lot of things here today that seem slightly different or more fulsome than what FERC actually says in its order.

[01:49:16] Speaker 06:
And so I'm wondering whether we should send it back for a more comprehensive, at least a more comprehensive explanation.

[01:49:29] Speaker 06:
So for example, when I look at what FERC says in

[01:49:33] Speaker 06:
the city of Oberlin pending remand brief, when they talk about exportation and the section three, section seven intersection, there's a lot more there than in this particular case.

[01:49:47] Speaker 06:
And when you pointed to paragraph 40, J8-225, it just sort of seems like a boilerplate discussion of domestic benefits without really drilling down on

[01:50:00] Speaker 06:
things like you just indicated, which is, you know, if this is ending at a terminal and it's being liquefied and it's being put on ships, there will be jobs because of that set of circumstances that would not have otherwise existed or whatever.

[01:50:16] Speaker 06:
FERC doesn't seem to really give us the details about the domestic benefits in the way that you have.

[01:50:24] Speaker 06:
So why shouldn't we send it back for that?

[01:50:30] Speaker 05:
Well, your honor, I think it's it's it's certainly within the court's discretion to send us back for additional explanation if it believes that's appropriate.

[01:50:38] Speaker 05:
I do think that the commission did provide this explanation.

[01:50:41] Speaker 05:
I think it's not just paragraph 40 is it's it's paragraphs 40 through 42.

[01:50:48] Speaker 05:
At least paragraphs 40 to 42.

[01:50:52] Speaker 05:
And perhaps also authorization order paragraph 85, JA 37.

[01:50:57] Speaker 05:
I think it's all there in the orders.

[01:51:02] Speaker 05:
You know.

[01:51:03] Speaker 07:
I wonder too whether or not it's appropriate for us to consider the discussion that went on in connection with the EIS and the final EIS.

[01:51:19] Speaker 05:
I'm sorry, what, Judge Rogers, which discussion are you referring to?

[01:51:25] Speaker 07:
I'm referring to the discussion in terms of the issues that were presented to the commission, how it responded in adopting the final EIS.

[01:51:40] Speaker 07:
If that's outside of the... Judge Jackson's question.

[01:51:47] Speaker 07:
I agree with your citation to those additional paragraphs, and I think there's more.

[01:51:54] Speaker 07:
But I also wonder, and I just don't know the answer, when we look at the certificate order and the rehearing order, when they reference the final EIS, is it appropriate for the court to take into account

[01:52:13] Speaker 07:
also the discussion, response, explanation that went on during that process as well.

[01:52:21] Speaker 07:
So we're looking for detail.

[01:52:24] Speaker 05:
Yes.

[01:52:26] Speaker 05:
Yes, Your Honor.

[01:52:27] Speaker 05:
Yes.

[01:52:27] Speaker 05:
If you're looking for detail, absolutely.

[01:52:29] Speaker 05:
Yes.

[01:52:29] Speaker 05:
I mean, the references to the final EIS and any discussion in the final EIS, of course, that is, I think all the details are in the orders and in the record.

[01:52:42] Speaker 07:
And I gather some of the petitioner's objections here, for example, are to the 15 years of suffering and the continued suffering that the landowners experience.

[01:53:00] Speaker 07:
And FERC responds by saying, we've adopted this approach and this approach focuses on

[01:53:12] Speaker 07:
the environmental harms or the economic harms, not individual landowner, quote, harms, which FERC acknowledges exist here while noting that there were negotiations between landowners and the pipeline about location and mitigation, et cetera.

[01:53:38] Speaker 07:
So what I'm getting at

[01:53:44] Speaker 07:
We have cases that say if the path of the commission or the path of the agency is clear, that's enough.

[01:53:51] Speaker 07:
In other cases, we say, no, we want more of an explanation.

[01:53:57] Speaker 07:
And we've remanded for FERC.

[01:54:02] Speaker 07:
Here, there are some summary statements, but they follow paragraphs

[01:54:12] Speaker 07:
going into more detail.

[01:54:16] Speaker 07:
And I'm wondering how you see this case as between where we have fulsome explanation going on for, you know, paragraph, paragraph, paragraph, paragraph, and FERC uses words that courts like as distinct from what I'll describe as regulatory terms that are sufficient in and of themselves

[01:54:43] Speaker 07:
under our standard of review.

[01:54:44] Speaker 07:
And where do you see this coming or falling?

[01:54:52] Speaker 05:
Well, I think the commission's explanations are adequate.

[01:54:57] Speaker 05:
They're sufficient in this case to support its findings of a need for the project.

[01:55:05] Speaker 05:
And I think that, you know, it's clear from the record evidence and from the

[01:55:12] Speaker 05:
commission's explanations that this is a pipeline that does have market need.

[01:55:19] Speaker 07:
I mean, there was this other competitive bid for the- Let me just- What I understand the landowners to be saying is FERC never took into account the harms we're suffering.

[01:55:32] Speaker 07:
All right?

[01:55:33] Speaker 07:
And what I see FERC saying in part, this is my view, not the way FERC exactly said it, is we acknowledge that there are harms.

[01:55:44] Speaker 07:
All right, building this project itself contemplates harms, no matter where we put it.

[01:55:52] Speaker 07:
And so the pipeline has negotiated with landowners, come up with these mitigation measures.

[01:55:59] Speaker 07:
And given what our task is, we have addressed both the environmental and the economic issues.

[01:56:08] Speaker 07:
And that's our mission under our authorization statute.

[01:56:13] Speaker 07:
as to what we're doing.

[01:56:15] Speaker 07:
It is not to provide what I'll call this sort of, it's easy to speak of it this way, like a compensatory relief to landowners who are suffering harms.

[01:56:30] Speaker 07:
So when I read the landowners brief, that's what they say, it's inadequate.

[01:56:38] Speaker 07:
But Ferck says,

[01:56:40] Speaker 07:
Certainly it's not inadequate as to the environmental, although we'll get to the greenhouse gas in another moment, but that they don't have to address, you know, Mr. Brown's concern he can't plant trees.

[01:56:54] Speaker 07:
Mrs. Jones is concerned she can't sell her property and a loss of value.

[01:56:59] Speaker 07:
That's not within FERC's responsibility.

[01:57:03] Speaker 07:
As FERC has defined it and this court has affirmed,

[01:57:10] Speaker 07:
So I'm just trying to understand what you understand the deficiency that the landowners raise, because when I read their brief, it's fairly short.

[01:57:23] Speaker 07:
And they say two things, harms to landowners and the environment and inadequate.

[01:57:30] Speaker 07:
And I think if you read these things, there's so much about the environment, whether you agree with FERC or not, they did discuss it.

[01:57:37] Speaker 07:
But they don't talk individually about these individual landowner harms.

[01:57:42] Speaker 07:
They just acknowledge that they exist.

[01:57:48] Speaker 05:
I think I understand the concern here.

[01:57:50] Speaker 05:
I mean, the commission does consider landowner harms, potential landowner harms as part of the economic test under a certificate policy statement.

[01:58:03] Speaker 05:
Of course, the certificate policy statement itself is under review at the commission and the commission may decide to

[01:58:14] Speaker 05:
alter the statement.

[01:58:15] Speaker 07:
I understand, but we're stuck with the one listed here.

[01:58:19] Speaker 05:
Yes.

[01:58:20] Speaker 05:
So it factored in.

[01:58:21] Speaker 05:
It did factor into the commission's decision-making.

[01:58:23] Speaker 05:
And that was in the step one, the balancing of adverse impacts against public benefits.

[01:58:31] Speaker 05:
And the commission did find, as Judge Rogers, I think you alluded to, it did find a paragraph 89 of the authorization order, for example, JA40,

[01:58:41] Speaker 05:
that the pipeline engaged in public outreach, it worked with stakeholders, and they developed reroutes where appropriate to minimize impacts on landowners.

[01:58:51] Speaker 05:
So that all factored into the commission's decision making.

[01:58:55] Speaker 05:
Now, as to the specific concerns that individual landowners have about

[01:59:03] Speaker 05:
planting nut trees in a particular location or these specific desires that the landowners have for their properties.

[01:59:13] Speaker 05:
I don't think that's for the commission to adjudicate.

[01:59:18] Speaker 05:
That's what I'm getting at here.

[01:59:19] Speaker 07:
In other words, to the extent they acknowledge these harms, it's in the record, mostly in the consideration of the final EIS.

[01:59:33] Speaker 07:
But on a remand, I just wonder what would FERC say, literally.

[01:59:41] Speaker 07:
I mean, it understands that, and I totally emphasize with landowners who see their property values decreasing and their lifelong dreams destroyed.

[01:59:53] Speaker 07:
All right, don't get me wrong.

[01:59:57] Speaker 07:
But given what FERC's mission is under the statute,

[02:00:03] Speaker 07:
FERC doesn't have the authority to provide the type of relief they apparently want, other than seeking to have either FERC or the court set aside the authorization.

[02:00:18] Speaker 05:
I think that's right, your honor.

[02:00:19] Speaker 05:
I think as part of the EIS process, the commission can always work and it can direct pipeline reroutes, which it frequently does.

[02:00:29] Speaker 05:
It does frequently direct pipelines to reroute around certain landowners' property if there's a specific concern.

[02:00:38] Speaker 05:
So there is that forum.

[02:00:42] Speaker 05:
There is that option before the agency.

[02:00:48] Speaker 05:
But as to the specific eminent domain, of course, you know, an eminent domain case that happens in district court, state court, and that's outside the purview of the agency.

[02:01:01] Speaker 05:
So yes, the agency has certain authorities and it can order a reroute, but beyond that, you know, it can't

[02:01:10] Speaker 05:
As you were pointing out, Judge Rogers, it can't direct that landowners be compensated the difference between fair market value and assessed value, for example.

[02:01:19] Speaker 05:
That's not within the agency's power.

[02:01:22] Speaker 07:
So I don't want to redo this part, but one of the things I wondered is, suppose under the current certificate order, and given the concerns that the landowners have, suppose the project

[02:01:40] Speaker 07:
owner decides to exercise eminent domain on property it doesn't own.

[02:01:50] Speaker 07:
Can the landowner go to the commission and seek an order adjudicating that the project owner is in contempt

[02:02:08] Speaker 07:
not contempt, but violating the certificate order and get some relief that way.

[02:02:15] Speaker 05:
I just want to make sure I understand.

[02:02:19] Speaker 05:
So in your... I'm trying to understand here.

[02:02:21] Speaker 07:
Assume

[02:02:24] Speaker 07:
For purposes of my question, the project owner says, as long as we hold this in advance, we're not going to exercise eminent domain.

[02:02:33] Speaker 07:
In three months from now, the project owner goes back to Oregon.

[02:02:38] Speaker 07:
Oregon grants it the permit.

[02:02:40] Speaker 07:
Everything's looking great.

[02:02:43] Speaker 07:
And so the project owner exercises eminent domain.

[02:02:50] Speaker 07:
could a landowner at that point go back to the commission and say, I don't know what the process is.

[02:02:58] Speaker 07:
And I'm really asking you, or would they have to come to court and ask the court, I guess in the district court to find that there's been a violation of the certificate order?

[02:03:12] Speaker 07:
I mean, I assume you go back to FERC first just for exhaustion purposes, but is there any process that's available there?

[02:03:21] Speaker 05:
I think there is process available, Your Honor.

[02:03:23] Speaker 05:
I don't think this situation has ever arisen before, but I think what would happen is the landowner would make its arguments to the district court.

[02:03:36] Speaker 05:
It certainly could argue to the district court.

[02:03:39] Speaker 07:
I mean, the district court would say, have you discussed this with the agency?

[02:03:42] Speaker 07:
You know, exhaustion.

[02:03:43] Speaker 07:
So that's why I said, go back to the agency and say, look,

[02:03:47] Speaker 07:
You know, your certificate order was premised on the fact that everything was in a band.

[02:03:51] Speaker 07:
Project owners weren't going to do anything.

[02:03:54] Speaker 07:
Well, now three months later, they're doing all these things.

[02:03:58] Speaker 05:
I think the commission always has the authority to stay the certificate so long as the orders are not under review by this court.

[02:04:08] Speaker 07:
Assume it's not here or this court remanded it so that the commission could take action.

[02:04:16] Speaker 07:
Does the commission have the authority to fine, impose fines for violations of its certificate order?

[02:04:25] Speaker 07:
Or is that just not part of the regulatory scheme?

[02:04:28] Speaker 05:
I'm not aware of that.

[02:04:29] Speaker 05:
I'm not aware of the agency.

[02:04:31] Speaker 07:
What relief would a landowner get in that circumstance?

[02:04:35] Speaker 07:
FERC would simply tell the project owner you're violating the certificate order.

[02:04:41] Speaker 07:
And what would happen?

[02:04:42] Speaker 05:
Right.

[02:04:42] Speaker 05:
I think the commission could always stay or it could withdraw the certificate order if it, if, you know, circumstances were so extreme.

[02:04:49] Speaker 05:
I think that that authority would lie with the commission.

[02:04:54] Speaker 05:
I mean, and that would be a pretty extreme remedy.

[02:04:57] Speaker 05:
I mean, this is multi-billion dollar project.

[02:05:00] Speaker 07:
Well, I'm trying to understand what the landowner does.

[02:05:02] Speaker 07:
I mean, this court has been concerned about that.

[02:05:05] Speaker 07:
And indeed, we had an in-bank case expressing our concern about how landowner complaints are handled.

[02:05:14] Speaker 07:
So I'm just wondering here, the commission proceeded on certain assumptions and assurances by the project owner.

[02:05:22] Speaker 07:
And it turns out,

[02:05:24] Speaker 07:
those circumstances have changed.

[02:05:28] Speaker 07:
So the basis for the certificate order is now, I don't know, in doubt question.

[02:05:34] Speaker 07:
I mean, what does FERC have any sort of authority?

[02:05:37] Speaker 05:
I think it's just the authority over the certificate itself, which is a pretty powerful remedy.

[02:05:45] Speaker 07:
It could issue an order directing the project owner to stop

[02:05:53] Speaker 07:
the eminent domain or go to the district court where the eminent domain proceeding is pending?

[02:06:00] Speaker 05:
Well, I don't think you would have the authority to prevent an applicant from seeking relief in the district court, but it could take action on a certificate.

[02:06:12] Speaker 05:
It could order a stay, it could invalidate the entire certificate, it could attach additional conditions on the certificate.

[02:06:19] Speaker 05:
I mean, these are the usual tools within the

[02:06:22] Speaker 05:
the agency's toolkit.

[02:06:25] Speaker 07:
I mean, I don't think that- I'm assuming here that the agency was convinced that the project owner was speaking in good faith, that it wasn't going to do all these things that the landowners were concerned about absent in getting the state permits.

[02:06:48] Speaker 05:
Well, in that circumstance,

[02:06:54] Speaker 05:
If the applicant got the state permits and had not committed to not do eminent domain, I'm sorry, I'm not being articulate.

[02:07:08] Speaker 05:
If the applicant makes a commitment that is not gonna proceed with eminent domain while it doesn't have the state authorizations,

[02:07:21] Speaker 05:
then that's one thing.

[02:07:23] Speaker 05:
And if it gets those state authorizations, then I would think it's entitled to proceed on the certificate orders.

[02:07:29] Speaker 05:
I mean, of course, if the applicant makes a commitment, it's not going to proceed on eminent domain at all, period, then that's a different situation.

[02:07:40] Speaker 07:
Well, FERC didn't have that before it, as I understand it.

[02:07:44] Speaker 05:
That's right.

[02:07:44] Speaker 05:
It wasn't before the commission.

[02:07:46] Speaker 05:
So this is all complete speculation on my part, I have to say.

[02:07:50] Speaker 07:
No, no, no, I know.

[02:07:50] Speaker 07:
I'm sorry to put you on the spot, and I'll just cease my questions.

[02:07:55] Speaker 05:
It's all right, Your Honor.

[02:07:56] Speaker 07:
You knew something about that.

[02:07:57] Speaker 07:
OK, thank you.

[02:07:58] Speaker 07:
Any further questions?

[02:08:02] Speaker 07:
Ah, thank you.

[02:08:04] Speaker 07:
All right, well, why don't we hear from petitioners in reply?

[02:08:09] Speaker 02:
Your Honor, I'm going to be very brief.

[02:08:11] Speaker 02:
First of all, in response to your question, all we have is a valid certificate and Pembina's promise that until we decide to start condemnation, we're not going to start condemnation.

[02:08:23] Speaker 02:
FERC has no jurisdiction to touch that certificate right now.

[02:08:27] Speaker 02:
It can't do anything with that certificate and there's nothing

[02:08:30] Speaker 02:
that a district court can do.

[02:08:31] Speaker 02:
The district court looks at it and says, this is a valid certificate.

[02:08:35] Speaker 02:
Pembina made a commitment not to start condemnation until it decided to start condemnation.

[02:08:39] Speaker 02:
They're starting condemnation, condemned.

[02:08:42] Speaker 02:
That's it.

[02:08:43] Speaker 02:
There's no, FERC can't do anything, and the district court can't do anything if Pembina simply changes its mind.

[02:08:49] Speaker 02:
That's the problem.

[02:08:51] Speaker 02:
OK, let's, on the other issue.

[02:08:54] Speaker 07:
And it's too late to file a petition for rehearing?

[02:08:59] Speaker 02:
A rehearing of Pembus?

[02:09:01] Speaker 07:
Well, I mean, the assumption that I, my question was that FERC proceeded in good faith based on a good faith acceptance of the good faith statement by the project owner.

[02:09:15] Speaker 07:
Now it turns out that things haven't turned out that way.

[02:09:20] Speaker 02:
Your honor, I'm not sure I understand what the good face statement that Pembina made that FERC relied on.

[02:09:24] Speaker 07:
And we're not going to do this so long as we hold this in abeyance, and we're not even sure we're going forward with this project at this point.

[02:09:31] Speaker 07:
And in any event, we understand we'd have to get the state permits.

[02:09:35] Speaker 02:
That statement came long after the FERC's process was done.

[02:09:40] Speaker 02:
They'd issued the certificate, they'd reheard it, and they'd sent it to this court.

[02:09:43] Speaker 02:
It was being briefed in this court.

[02:09:47] Speaker 02:
FERC didn't rely on that statement at all.

[02:09:50] Speaker 02:
Zero.

[02:09:51] Speaker 02:
Literally, their process was over and closed for months before, maybe even more than a year before Pemba made this completely voluntary statement.

[02:10:01] Speaker 02:
And today they have no, so they didn't rely on it in any way, shape and form.

[02:10:06] Speaker 02:
And today they have no authority to do anything to amend or change that certificate period.

[02:10:12] Speaker 02:
And if Pembina goes to district court, they have a valid FERC certificate that the district court has to honor.

[02:10:19] Speaker 02:
And our brief is chock full of cases where district court's saying, hey, condemnation, if you have any problems with the certificate, your job is to go to the relevant court of appeals.

[02:10:29] Speaker 02:
Our job is simply to do condemnation.

[02:10:31] Speaker 02:
If the certificate's valid, Pembina promised them until they started doing it.

[02:10:35] Speaker 02:
Well, they started doing it.

[02:10:38] Speaker 02:
So I'd just like to go down quickly on a couple of things.

[02:10:42] Speaker 02:
First of all, Judge Wilkins, it's the pipeline coming down from Canada has no on ramps.

[02:10:49] Speaker 02:
No gas comes onto that pipeline until it gets to the junction in Oregon where the Pacific connector will go one way and there is a pipeline, the Ruby pipeline that comes in from the Rocky Mountains.

[02:11:02] Speaker 02:
The problem is FERC has said repeatedly,

[02:11:06] Speaker 02:
that what Furkan said is that the applicant can't, not that the applicant needs the gas, but the applicant meet the quote purpose of the project.

[02:11:15] Speaker 02:
And the applicant, as we say in our brief, the applicant defined the purpose as using Canadian and US gas.

[02:11:23] Speaker 02:
They're correct.

[02:11:23] Speaker 02:
You can't meet the purpose of the project, but there's no obligation, zero, to use a molecule of US gas, none whatsoever, and all of the evidence in the record is- Mr. Bookfinder, can I just say, I understood Ms.

[02:11:38] Speaker 06:
Chu's point and FERC's statement about benefit to be the possibility

[02:11:45] Speaker 06:
right, that you're building an infrastructure, a pipeline that now will provide the possibility for gas producers in the Rocky Mountains to merge their gas.

[02:11:58] Speaker 06:
I don't understand that it's necessary at this point to establish that they've already lined those people up.

[02:12:06] Speaker 06:
We have some evidence in the record that there are individuals who say, yeah, if this were built, that would give me the opportunity to sell my gas through this pipeline and generate revenue.

[02:12:19] Speaker 06:
So I'm concerned about the suggestion that we don't have a benefit, a foreseeable benefit from the construction of this pipeline domestically unless

[02:12:32] Speaker 06:
We already have people who have committed to using this pipeline in the way that you're suggesting.

[02:12:39] Speaker 02:
Two things, Your Honor.

[02:12:41] Speaker 02:
It can't transport US gas if all the gas in the project is going to be coming from Canada.

[02:12:46] Speaker 06:
So the fact that they dispute that let's assume let's assume they're they're correct that

[02:12:54] Speaker 06:
This pipeline will provide the opportunity for US gas coming from the Rocky Mountains to be merged with the Canadian gas and then ultimately exported.

[02:13:06] Speaker 06:
Assuming that to begin with, my question is, do we have to have the people on record

[02:13:12] Speaker 06:
with a contract saying I'm going to use this pipeline domestically to put my gas in, or is it enough that FERC says this will create access?

[02:13:23] Speaker 06:
I don't quite have the language here, but that this will create access.

[02:13:27] Speaker 06:
Why isn't that a significant domestic benefit?

[02:13:33] Speaker 06:
The potential.

[02:13:34] Speaker 02:
Oh, FERC has never issued a certificate on the grounds that maybe someday in the future, some unknown entity will use the facility.

[02:13:44] Speaker 06:
No, no, no.

[02:13:45] Speaker 06:
That's part of it.

[02:13:46] Speaker 06:
Right.

[02:13:47] Speaker 06:
We do have we have a terminal that has said we are going to buy this gas or we're going to we're going to use this gas and they're going to use it for export.

[02:13:58] Speaker 06:
No one disputes that that's the case.

[02:14:00] Speaker 06:
We have those contracts.

[02:14:02] Speaker 06:
All right.

[02:14:03] Speaker 06:
And Congress has said that such an exportation arrangement is in itself presumptively a public benefit.

[02:14:12] Speaker 06:
But FERC says, okay, in addition to that, we see that the creation of this pipeline will open up or provide access for domestic exporters to merge their gas and then ultimately it will go to the terminal.

[02:14:32] Speaker 06:
So my question to you is, why do we need anything more than at least this terminal saying we are going to export this gas and the possibility that domestic gas will be funneled into the same pipeline?

[02:14:49] Speaker 02:
Given that FERC has never issued a certificate based on the possibility that at some point in the future, somebody will use that pipeline,

[02:14:59] Speaker 06:
We know the terminal is using the pipeline.

[02:15:02] Speaker 06:
The terminal says we're using the pipeline, we have a precedent agreement, 98% of the gas, we're going to use it when it comes to us and export it.

[02:15:12] Speaker 06:
That's a done deal.

[02:15:15] Speaker 06:
My question is with respect to your argument about domestic usage.

[02:15:20] Speaker 06:
I mean, I get your point that if all of the gas was originating in Canada, going to the terminal and being exported, one might question whether this had any domestic benefit.

[02:15:35] Speaker 02:
saying that someone may use it from the Rocky Mountains based on a couple of letters that oil and gas producers signed saying, yes, we could use this at some point in the future.

[02:15:44] Speaker 02:
That's not a basis for issuing a certificate of public convenience.

[02:15:48] Speaker 02:
And FERC has never, ever done that.

[02:15:50] Speaker 02:
They want proof that this would be

[02:15:56] Speaker 02:
I'm truly stunned that the idea that, hey, we may use that pipeline, you know, a few years from now, whenever they stop with the Canadian gas, you know, who knows when that'll happen.

[02:16:06] Speaker 02:
But let me turn away from that to the export issue.

[02:16:10] Speaker 02:
And as we said, the terminal has no contracts for anybody.

[02:16:13] Speaker 02:
And if there was ever a time for FERC to look behind, which they refused to do, they said, don't look behind contracts.

[02:16:21] Speaker 02:
We never look behind contracts.

[02:16:22] Speaker 02:
We can't look behind contracts.

[02:16:24] Speaker 02:
And that was exactly what this court said in EDF versus FERC.

[02:16:27] Speaker 02:
you can't stick your head in the sand like an ostrich.

[02:16:30] Speaker 02:
You have to actually look at the facts concerning that contract.

[02:16:34] Speaker 02:
And when it's with a buyer who has no customers, there's no justification.

[02:16:38] Speaker 06:
Are those cases different precisely because they're talking about the potential of the gas being used in the domestic market?

[02:16:45] Speaker 06:
I'm trying to reconcile all of these different factors.

[02:16:48] Speaker 06:
And I'm suddenly feeling as though we may actually have a different animal here, which is

[02:16:55] Speaker 06:
you know, precisely for the reasons that you point out that this 100% of this gas is going to be exported.

[02:17:03] Speaker 06:
And so I don't know that the cases in which FERC is in which the court is concerned about the use the market demand domestically actually even apply in a real way in this situation.

[02:17:17] Speaker 06:
We have 100% of this gas going overseas.

[02:17:21] Speaker 06:
Everybody knows that.

[02:17:23] Speaker 06:
And we have a binding contract with the terminal that says we are going to liquefy the gas and use it for that purpose.

[02:17:31] Speaker 06:
So cases that talk about domestic need and whether or not there's really a market in St.

[02:17:37] Speaker 06:
Louis don't seem quite to fit because they're not addressed to this unique pipeline circumstance.

[02:17:47] Speaker 02:
No, Your Honor, this unique pipeline circumstance has far less justification than any of those pipelines.

[02:17:54] Speaker 02:
So let me go to the export issue and the benefits of export.

[02:17:59] Speaker 02:
The Section 3 argument that FERC says Section 3 is important, DOE has found these things, and therefore we can incorporate or even rely on DOE's finding.

[02:18:09] Speaker 06:
Can I just say, Mr. Buchanan, why doesn't that cut exactly against what you just said?

[02:18:16] Speaker 06:
Rather than FERC being on its own evaluating the domestic market in St.

[02:18:23] Speaker 06:
Louis or whatever, we have another agency that has signed off and certified on the export circumstance.

[02:18:31] Speaker 06:
So we don't have to worry that the gas is going to get to the terminal and just sit there and never be used and not be important.

[02:18:40] Speaker 06:
DOE has said we have authorized this terminal to export.

[02:18:44] Speaker 06:
We have a, we've created now an actual arrangement where the gas is going to leave the United States pursuant to section three check.

[02:18:54] Speaker 06:
So I think we should be, we should be relieved by that.

[02:18:57] Speaker 06:
Like this is a better situation than the ordinary section seven determination in terms of the gas being used and presumably needed.

[02:19:08] Speaker 02:
Your honor, that's not what DOE said.

[02:19:10] Speaker 02:
DOE simply said, if you want to export this commodity of gas, that's fine.

[02:19:16] Speaker 02:
It's in the public interest to export gas.

[02:19:19] Speaker 02:
They didn't say that there are buyers for it.

[02:19:23] Speaker 02:
They specifically say, in fact, in the writer, we don't anticipate that there are, we don't make any findings or anticipate that they're going to be buyers for all of the LNG that we're authorizing.

[02:19:33] Speaker 06:
So let me hypothesize if they had said that in this case.

[02:19:36] Speaker 06:
Different case, hypothetical.

[02:19:38] Speaker 06:
DOE does say, we see the buyers, we have the letters, we know it's going overseas to a particular place.

[02:19:47] Speaker 06:
Does that alleviate your concern about public necessity in this situation?

[02:19:53] Speaker 02:
No, it does not because section three, which is what DOE is operating under and which FERC relied on here,

[02:20:01] Speaker 02:
The one distinction, the one difference between section three and section seven is that section three does not grant eminent domain authority.

[02:20:11] Speaker 02:
The district gas case from this circuit said, hey, section three is the same as section seven.

[02:20:19] Speaker 02:
You can apply all the exact same conditions and modifications and orders under section three as you do under section seven.

[02:20:26] Speaker 06:
All right, so your argument, using that distinction,

[02:20:30] Speaker 06:
is merely that an arrangement for the exportation of gas is unlawful.

[02:20:37] Speaker 06:
You cannot take land.

[02:20:40] Speaker 06:
You cannot create a pipeline exercising your eminent domain authority if the gas is going to be wholly exported.

[02:20:48] Speaker 06:
Is that the bottom line?

[02:20:50] Speaker 02:
Yes, that is absolutely correct.

[02:20:51] Speaker 02:
You can't use eminent domain for export.

[02:20:53] Speaker 02:
And I want to read to you what FERC said in its certificate order.

[02:20:59] Speaker 02:
which is we view DOE's approval of Jordan Cove's application to export LNG to free trade agreement nations as sufficient evidence of market demand.

[02:21:10] Speaker 02:
In other words, we're letting DOE say simply because it's okay for people to sell natural gas.

[02:21:17] Speaker 02:
It's not gonna be bad for the United States.

[02:21:19] Speaker 02:
It's in the public interest to sell natural gas, but that's good enough.

[02:21:23] Speaker 06:
And so ultimately, I appreciate this because this is very helpful and clarifying.

[02:21:28] Speaker 06:
You cannot use eminent domain for export, even though Congress has made clear in section three that exportation is a good thing.

[02:21:37] Speaker 06:
It's a public benefit.

[02:21:39] Speaker 06:
I guess we're basically weighing the potential people who are in the gas industry in the Rocky Mountains and could use this pipeline for export against the interests of the landowners for whom

[02:21:53] Speaker 06:
the land is taken.

[02:21:54] Speaker 06:
Is that sort of where it comes down at the end of the day in terms of assessing public benefit?

[02:22:00] Speaker 02:
No, because in 2016, when they denied the certificate for this project, the same thing, Pacific Connector said, look, DOE approved this, and you should rely on it.

[02:22:13] Speaker 02:
And the 2016 certificate denial, which is that 154 FERC 611190 paragraph 40,

[02:22:24] Speaker 02:
Pacific Connector is essentially asking the Commission to rely on DOE's finding that authorization of the commodity export with the public interest as sufficient to support a finding by the Commission that the Pacific Connector pipeline is required by the public convenience and necessity.

[02:22:43] Speaker 02:
The commission has not previously found a proposed pipeline to be required by the public convenience and necessity under NGA Section 7 on the basis of a DOE finding under NGA 3.

[02:22:56] Speaker 02:
All right.

[02:22:57] Speaker 07:
So yes, excuse me.

[02:22:58] Speaker 07:
Finish your answer, if you will.

[02:23:00] Speaker 02:
I mean, in 2016, they said, you should rely on Section 3.

[02:23:05] Speaker 02:
The DOE funding is conclusive.

[02:23:07] Speaker 02:
And they say that here.

[02:23:08] Speaker 02:
They said it there.

[02:23:11] Speaker 02:
FERC rejected that.

[02:23:14] Speaker 02:
And yet FERC accepts it now and says, this is sufficient.

[02:23:18] Speaker 02:
This is sufficient.

[02:23:20] Speaker 07:
Anything further?

[02:23:22] Speaker 02:
No, Your Honor.

[02:23:26] Speaker 02:
Thank you.

[02:23:28] Speaker 07:
Any questions by my colleagues?

[02:23:31] Speaker 02:
No.

[02:23:31] Speaker 07:
Thank you.

[02:23:32] Speaker 07:
Thank you.

[02:23:34] Speaker 07:
All right.

[02:23:34] Speaker 07:
We will move on to the National Historic Preservation Act issues.

[02:23:42] Speaker 07:
Council for petitioners.

[02:23:45] Speaker 03:
should be.

[02:23:46] Speaker 03:
Thank you.

[02:23:48] Speaker 03:
May it please the court and counsel Philip Thonis on behalf of the state of Oregon and its agencies.

[02:23:54] Speaker 03:
In enacting the Natural Gas Act, Congress expressly preserved the state's authority to conduct Clean Water Act and Coastal Zone Management Act review of a proposed gas project.

[02:24:05] Speaker 03:
Those statutes in turn both require that an applicant for a federal license or permit, including FERC authorizations under sections three and seven, first demonstrate compliance with the CWA and CZMA.

[02:24:19] Speaker 03:
Indeed, Congress made clear in the text of each of those statutes that no license or permit shall be granted until the certification that is required under the CWA or CZMA has been obtained or has been waived by the state.

[02:24:35] Speaker 03:
In this case, it is undisputed that Pembina has not received Clean Water Act or Coastal Zone Management Act approval from the state of Oregon.

[02:24:44] Speaker 07:
So you're challenging conditional certificates.

[02:24:49] Speaker 07:
That is correct your honor at FERC has no authority to issue such a certificate.

[02:24:55] Speaker 03:
Well, and I would, I would qualify that statement by saying that the state does not take the position that FERC may not issue.

[02:25:04] Speaker 03:
natural gas act certificate that is conditioned on future compliance with state or federal regulations or statutes in under any circumstances.

[02:25:15] Speaker 03:
Our argument here is that the state of Oregon, specifically the Oregon Department of Environmental Quality, the agency that is tasked with administering Clean Water Act requirements within the state of Oregon,

[02:25:28] Speaker 03:
has identified activities authorized by FERC's Natural Gas Act authorization to Pembina that may result in discharges to the navigable waters within the state of Oregon, thereby triggering, as this court explained in the Delaware Riverkeeper case, that would thereby trigger the Clean Water Act's sequencing requirement that Congress clearly enacted in section 401 of the CWA.

[02:25:56] Speaker 01:
What is the evidence in the record that any such activity could result in those discharges other than argument in your brief?

[02:26:09] Speaker 01:
Where is there evidence in the record that that could happen given the condition that was cited by council for FERC earlier in the argument that

[02:26:24] Speaker 01:
no activity could take place that would, I think, disturb the ground or something to that effect.

[02:26:32] Speaker 03:
Great.

[02:26:33] Speaker 03:
Thank you, Judge Wilkins.

[02:26:34] Speaker 03:
So environmental condition 11 does state that Pembina is prohibited from engaging in construction activities or other ground disturbing activities, including tree felling, until it has received all applicable requirements, including Clean Water Act and Coastal Zone Management Act requirements.

[02:26:53] Speaker 03:
However, in DEQ's view, there are other activities that are not covered by environmental condition 11 that the project could engage in, and specifically on page 390 of the joint appendix in Pembina's right-of-way management plans.

[02:27:14] Speaker 03:
This would be the right-of-way for the pipeline route.

[02:27:17] Speaker 03:
that the project could start engaging in activities, including road surfacing and brushing and limbing that would fall short of tree felling, but that in DEQ's view, and again, to recall the language of the Clean Water Act, may result in discharges to navigable waters.

[02:27:39] Speaker 03:
So that is the state's concern is that

[02:27:43] Speaker 03:
Despite the prohibitions contained in environmental condition 11 Pembina may still be able to engage in activities that may result in discharges to navigable waters and that is the scenario that that is the argument that this court said was lacking in Delaware Riverkeeper which was a

[02:28:04] Speaker 03:
an argument pointing out what activity was authorized by FERC certificate that would then trigger the Clean Water Act sequencing requirement.

[02:28:14] Speaker 03:
And here the state of Oregon is relying on those activities.

[02:28:18] Speaker 01:
It's a factual matter.

[02:28:22] Speaker 01:
You point to this plan.

[02:28:26] Speaker 01:
And you say, well, given this plan, this could happen.

[02:28:29] Speaker 01:
But I guess what I'm trying to get at as a factual matter

[02:28:33] Speaker 01:
Was there evidence presented before FERC that that's the way that that could happen under this plan?

[02:28:43] Speaker 01:
And how did FERC respond to that evidence or that argument if it was made?

[02:28:52] Speaker 03:
So, as I guess to answer the factual question, the state is not aware of any act that the project has has in fact engaged in any of that activity, which of course ties back into the long discussion we've had regarding the projects.

[02:29:08] Speaker 03:
current uh pause on its plan but the state did raise that argument to FERC um in particularly in the state's request for rehearing and FERC's response was simply to cite the Delaware Riverkeeper case for the general proposition that in some circumstances it is allowed to issue natural gas act certificates that are conditioned on future compliance with the Clean Water Act but that doesn't answer the state's specific concern here which is again that

[02:29:38] Speaker 03:
Despite the prohibitions contained in environmental condition 11, M&M may still be able to engage in activities that may result in discharges without, and this is the real problem, without having obtained a section 401 permit from the state of Oregon.

[02:29:59] Speaker 08:
All right, anything further?

[02:30:00] Speaker 03:
No, unless the court has other questions on the conditional certificate argument that

[02:30:07] Speaker 03:
That is our position.

[02:30:09] Speaker 07:
Okay.

[02:30:11] Speaker 07:
Any further questions from my colleagues?

[02:30:14] Speaker 03:
No.

[02:30:15] Speaker 07:
All right.

[02:30:17] Speaker 07:
Council for FERC.

[02:30:19] Speaker 05:
Thank you, Your Honor.

[02:30:20] Speaker 05:
Two points in response to Council for Oregon's position.

[02:30:24] Speaker 05:
Oregon's concerns are really speculative in nature.

[02:30:29] Speaker 05:
The page in the joint appendix that

[02:30:34] Speaker 05:
Councils referring to talks about potential activities prior to construction, such as road surfacing, brushing and limbing.

[02:30:45] Speaker 05:
And without any evidence in the record, I mean, there's no other evidence in the record relating to these activities.

[02:30:53] Speaker 05:
I mean, these activities sound like

[02:30:55] Speaker 05:
ground disturbing and tree felling activities that are actually prohibited by the environmental conditions under the certificate order.

[02:31:03] Speaker 05:
So I don't think there's any indication in the record that Oregon's concerns are actually imminent or concrete.

[02:31:12] Speaker 05:
And the second point is that the injury that the state is alleging here, the sequencing requirements of the Clean Water Act and the Coastal Zone Management Act, these are exactly the types of procedural injuries that the Delaware Department of Natural Resources brought in the case that was

[02:31:33] Speaker 05:
held in abeyance.

[02:31:35] Speaker 05:
I'm sorry, the case was dismissed for lack of standing.

[02:31:38] Speaker 05:
That's 558 Fed 3rd, 575.

[02:31:41] Speaker 05:
This court's decision of 2009.

[02:31:44] Speaker 05:
And the court found there was just no concrete harm there.

[02:31:50] Speaker 05:
It's a procedural injury.

[02:31:52] Speaker 06:
Are we back to standing?

[02:31:54] Speaker 06:
I'm trying to understand where we are.

[02:31:56] Speaker 05:
I'm sorry, Your Honor.

[02:31:57] Speaker 05:
I didn't mean to bring us back to issue one.

[02:32:00] Speaker 06:
It's OK.

[02:32:00] Speaker 06:
But we were at just disability to begin with.

[02:32:03] Speaker 06:
And I'm trying to understand whether FERC considered any pre-construction activities.

[02:32:12] Speaker 06:
I know that its conditions relate to the actual construction of the pipeline.

[02:32:17] Speaker 06:
That's not happening.

[02:32:19] Speaker 06:
Fine.

[02:32:20] Speaker 06:
But my understanding was that there was a certification that nevertheless allows for the recipient of companies to start clearing, et cetera, et cetera.

[02:32:35] Speaker 06:
Did FERC consider that when it determined that it was gonna issue the certification or not?

[02:32:43] Speaker 05:
I think it did, Your Honor.

[02:32:44] Speaker 05:
And just to clarify, I brought up standing because the response to Oregon's argument is both jurisdictional standing and then on the merits.

[02:32:55] Speaker 05:
I think the Commission's answer was that it had

[02:32:58] Speaker 05:
you know, the conditional authorization is permitted by the court and that these particular conditions actually bar the harms that Oregon is concerned about.

[02:33:13] Speaker 06:
But can we home in then on the conditions?

[02:33:16] Speaker 06:
Because I didn't see anything about pre-construction, clearing, et cetera.

[02:33:21] Speaker 06:
I thought they said no construction can happen.

[02:33:26] Speaker 06:
And so maybe if you could point us in the record to the conditions that prevent the kinds of potential discharges that petitioners are pointing to.

[02:33:38] Speaker 05:
Right, so environmental condition 11 is that JA 133.

[02:33:48] Speaker 05:
That condition says that the pipeline has to receive written authorization from the agency before commencing construction.

[02:33:57] Speaker 05:
And that does not specifically say pre-construction activities, but it includes as one of the items that the pipeline is precluded from doing is tree felling or ground disturbing activities.

[02:34:13] Speaker 05:
Ground disturbing activities is really a broad, you know, it's a very broad range of activities.

[02:34:19] Speaker 06:
I see.

[02:34:19] Speaker 06:
So this is really just about interpretation of the conditions then, because you seem to suggest that the kinds of activities that petitioners are worried about are included in your conditions such that Delaware Riverkeeper applies in full and we have no problem.

[02:34:41] Speaker 06:
Is that your position?

[02:34:42] Speaker 06:
That's right, Your Honor.

[02:34:44] Speaker 06:
Okay, so when on rebuttal I'll ask petitioners council whether he reads these conditions in the same way.

[02:34:53] Speaker 05:
Right, right, Your Honor, and I think, you know, in addition there's there's no.

[02:34:59] Speaker 05:
evidence that the concerns that Oregon is expressing about these pre-construction activities that these actually will occur.

[02:35:08] Speaker 05:
I mean, it's all, it is really speculative.

[02:35:12] Speaker 05:
So there's nothing else in the record that I'm aware of about the road surfacing apart from that one page.

[02:35:18] Speaker 06:
But can I ask, can we even isolate that?

[02:35:21] Speaker 06:
All right, so let's assume hypothetically that the conditions don't cover it.

[02:35:26] Speaker 06:
I'm not sure I understand the work of your eminence argument to dispel their claim that the fact that you have issued a certificate that does not cover all potential discharge circumstances is unlawful.

[02:35:46] Speaker 06:
I don't know what work eminence does.

[02:35:48] Speaker 06:
You issued the certificate.

[02:35:50] Speaker 06:
It's already there.

[02:35:51] Speaker 06:
And in my hypothetical, the certificate says construction cannot happen unless you get state certification.

[02:36:01] Speaker 06:
And by construction, we mean just actually building the pipeline.

[02:36:06] Speaker 06:
You can go ahead and do everything you want to up until that point.

[02:36:11] Speaker 06:
All right.

[02:36:11] Speaker 06:
This is my hypothetical.

[02:36:13] Speaker 06:
All right.

[02:36:13] Speaker 06:
So in that situation, why does it matter

[02:36:18] Speaker 06:
that the company says we're on pause or that, you know, there's no construction anytime soon.

[02:36:25] Speaker 06:
What petitioner is saying is that you've now unlawfully issued a certificate that allows for discharges to occur under a circumstance in which we have a law that says you're not allowed to do that.

[02:36:43] Speaker 06:
What is eminence doing there?

[02:36:45] Speaker 05:
OK, I understand, Your Honor.

[02:36:47] Speaker 05:
Well, first, I think the eminence really goes to the standing argument.

[02:36:51] Speaker 05:
So it's really standing.

[02:36:52] Speaker 05:
But it's also a little bit on the merits.

[02:36:55] Speaker 05:
I mean, it's the fact that there's no evidence about the connection between the potential discharges into the waters of the state and any of the potential activities, like road surfacing.

[02:37:10] Speaker 05:
There's nothing else in the record about how road surfing might result in

[02:37:15] Speaker 06:
Right, but isn't that his point exactly?

[02:37:17] Speaker 06:
It would be on FERC to develop the record to determine whether discharges could happen from other things and either cover it or not in their certificate.

[02:37:28] Speaker 06:
So it's not the petitioner's burden to point out every circumstance in which discharges could happen, right?

[02:37:36] Speaker 05:
Right, right, right.

[02:37:37] Speaker 05:
No, you're right, Your Honor.

[02:37:39] Speaker 05:
In your hypothetical, yes, I understand.

[02:37:41] Speaker 05:
And our answer here is that the conditions do cover these.

[02:37:44] Speaker 05:
OK, so that's the answer.

[02:37:46] Speaker 08:
All right, so let's hear from Petitioner.

[02:37:49] Speaker 08:
Do the conditions cover it?

[02:37:54] Speaker 03:
No, Your Honor, they don't.

[02:37:55] Speaker 03:
And this brings up the interpretive point that Judge Jackson raised.

[02:38:00] Speaker 03:
If Pembina reads the condition

[02:38:04] Speaker 03:
narrowly environmental condition 11 and decides that hey road surfacing isn't covered because it's not construction and we don't think it's ground disturbing and we're not cutting down any trees and we can go ahead and engage in this activity but the problem is like Judge Jackson pointed out we don't know if that activity may result in discharges to the waters of the US.

[02:38:27] Speaker 03:
that's possible that it might, and the proper forum for determining that is in Pembina's Section 401 application in front of the Oregon Department of Environmental Quality.

[02:38:37] Speaker 06:
All right, so what's the remedy and what's the holding of this court under those circumstances?

[02:38:42] Speaker 06:
We have an ambiguous condition, right?

[02:38:45] Speaker 06:
It could or could not cover activities that you say would cause discharges

[02:38:50] Speaker 06:
And yet you appear to want this court to hold that the certificate and that the certification, the authorization by FERC is therefore unlawful because it might allow.

[02:39:04] Speaker 08:
Is that your holding?

[02:39:08] Speaker 04:
Correct.

[02:39:09] Speaker 07:
The question going back to Judge Wilkins is, did you present these arguments to the commission that condition 11 was ambiguous and that it left open the possibility of unauthorized discharge?

[02:39:26] Speaker 04:
Yes.

[02:39:26] Speaker 07:
And did you, on rehearing, say that condition 11 was still ambiguous?

[02:39:33] Speaker 03:
Yes, Your Honor.

[02:39:34] Speaker 03:
The state pointed to the- Why?

[02:39:38] Speaker 07:
That's what I don't understand.

[02:39:39] Speaker 03:
I'm sorry, I didn't.

[02:39:43] Speaker 07:
What should FERC have said in the condition, so you don't think it would be ambiguous.

[02:39:51] Speaker 03:
Well, I guess this gets to a more fundamental problem that the state believes that the Clean Water Act

[02:39:58] Speaker 03:
process should as a matter of practice always be done before FERC is issuing.

[02:40:05] Speaker 07:
We understand that, but I'm asking you now, your argument is that that hasn't happened and we're afraid of activities like tree felling, road clearing, discharges.

[02:40:22] Speaker 03:
Correct.

[02:40:22] Speaker 07:
Where did you say to FERC condition 11 doesn't reach those things?

[02:40:28] Speaker 03:
In the state's request for rehearing, the state pointed, and I'm sorry, I don't have the precise record site, but in the state of Oregon's request for rehearing, the state pointed to the activities that we then cited in our brief to this court, such as road surfacing and brushing and liming.

[02:40:44] Speaker 07:
I know, but the problem I'm getting at is of course there can be road surfacing.

[02:40:49] Speaker 07:
Of course there can be tree felling.

[02:40:52] Speaker 07:
But why is any of this likely to happen given the nature of the certificate that says you can't go ahead until you get these state certificates?

[02:41:08] Speaker 07:
That's why I asked you specifically, what language is missing from the condition or another condition?

[02:41:18] Speaker 07:
clarify what you posit as ambiguity.

[02:41:26] Speaker 03:
So if the environmental condition 11 said the project is prohibited from engaging in any activity

[02:41:34] Speaker 03:
that may result in discharges.

[02:41:36] Speaker 03:
So basically any activity that would fall under section 401, that would be better than the way it's currently written, but that still brings up the problem.

[02:41:44] Speaker 07:
Did you ask FERC to put that language in the condition or a condition?

[02:41:50] Speaker 03:
Not that precise language, no.

[02:41:52] Speaker 07:
No, that's my point.

[02:41:54] Speaker 07:
And that, let me ask you then, suppose the project owner starts felling trees.

[02:42:02] Speaker 07:
What can, and before it has its permit, state permit, what can the state do?

[02:42:11] Speaker 07:
Can it go to state court and get an injunction?

[02:42:17] Speaker 03:
I'm not sure, Your Honor.

[02:42:19] Speaker 03:
If the project.

[02:42:20] Speaker 07:
Well, why couldn't it?

[02:42:22] Speaker 03:
I guess it could.

[02:42:23] Speaker 08:
If you're felling trees and you don't have a permit.

[02:42:30] Speaker 03:
But the project's response at that point would, I assume, would be that we're not doing anything.

[02:42:35] Speaker 03:
Well, felling trees would be covered in environmental condition 11.

[02:42:38] Speaker 03:
So at that point, the state would go to FERC.

[02:42:42] Speaker 07:
How about grounds, grounds disturbance?

[02:42:46] Speaker 03:
That would be the same if the state believed that the project was.

[02:42:51] Speaker 03:
Right.

[02:42:51] Speaker 03:
But our point is that there are things that the project could do that wouldn't qualify.

[02:42:57] Speaker 03:
I know.

[02:42:57] Speaker 07:
It could do all kinds of things.

[02:42:59] Speaker 07:
And FERC is trying to write conditions that are broad enough to cover what parties have brought to its attention.

[02:43:10] Speaker 08:
So it says you can't do these things.

[02:43:15] Speaker 07:
And you can't expect for it to put a condition that you can't do anything that the state agency in Oregon says you can't do.

[02:43:26] Speaker 03:
Well, yes, but the Congress also, part of the sequencing requirement in the Clean Water Act is that Congress contemplated that any condition that is a part of the Section 401 permit itself is also incorporated into the license or permit that required the Section 401 permit in the first place.

[02:43:47] Speaker 07:
I thought your concern was that there had been pre-certificate authorizations

[02:43:55] Speaker 07:
And that the state was concerned that the project owner would rely on those in going ahead, hypothetically, maybe someday, discharging into Argonne's waters.

[02:44:15] Speaker 03:
That's correct.

[02:44:17] Speaker 03:
That is the concern.

[02:44:18] Speaker 03:
And that those discharges would have no Section 401 oversight.

[02:44:23] Speaker 08:
OK.

[02:44:25] Speaker 08:
Anything further?

[02:44:31] Speaker 06:
Can I just ask one other question?

[02:44:32] Speaker 06:
I'm trying to understand the extent to which this particular point, the point of look at paragraph 11, I think it's ambiguous.

[02:44:43] Speaker 06:
It can allow for these kinds of activities.

[02:44:46] Speaker 06:
Was that point raised with FERC below?

[02:44:51] Speaker 03:
Yes, in Oregon's request for rehearing, again, I apologize.

[02:44:54] Speaker 07:
What did it say specifically?

[02:44:57] Speaker 03:
Essentially what we said in our brief to this court, which is that- No, I wanted you to say it's in the petition for rehearing.

[02:45:04] Speaker 07:
FERC didn't have your brief, it had your petition for rehearing.

[02:45:07] Speaker 07:
Right, and we made the same argument that we made here, which is that these are- But I tell you what, counsel, will you submit something that shows us specifically where in your petition for rehearing you said that

[02:45:19] Speaker 07:
Condition 11 was ambiguous and should be revised to say X, Y, and Z. Of course.

[02:45:27] Speaker 07:
Thank you.

[02:45:29] Speaker 07:
Any further questions?

[02:45:32] Speaker 07:
All right, thank you.

[02:45:35] Speaker 08:
So where are we here?

[02:45:41] Speaker 01:
Council for FERC.

[02:45:43] Speaker 01:
Are the only thing left, right?

[02:45:45] Speaker 07:
No, I think Council for FERC gets to speak.

[02:45:50] Speaker 06:
Well, that was on, Judge Rogers, wasn't that, didn't we already have a round on this?

[02:45:58] Speaker 06:
Oh, did we?

[02:45:59] Speaker 06:
I believe so.

[02:46:00] Speaker 01:
That was the rebuttal on that point.

[02:46:01] Speaker 07:
Thank you very much.

[02:46:03] Speaker 07:
Moving on to the NEPA issues.

[02:46:05] Speaker 08:
Council for Petitioners.

[02:46:12] Speaker 08:
Oops, you're on mute, sir.

[02:46:14] Speaker 00:
I apologize.

[02:46:15] Speaker 00:
And my video camera just crapped out, so I'm trying to get the,

[02:46:20] Speaker 07:
Watch your language.

[02:46:21] Speaker 07:
We can see you.

[02:46:22] Speaker 00:
I apologize.

[02:46:25] Speaker 00:
So good afternoon, your honors.

[02:46:26] Speaker 00:
Nathan Matthews on behalf of petitioners.

[02:46:31] Speaker 00:
FERC's NEPA analysis was deeply flawed.

[02:46:35] Speaker 00:
Some of those flaws are so egregious that I don't plan to discuss them unless this court has specific questions.

[02:46:42] Speaker 00:
For example, the rejection of an alternative that would only use waste heat.

[02:46:46] Speaker 00:
And I'll put aviation in that category for today.

[02:46:49] Speaker 00:
I had planned to focus on greenhouse gases and the no action alternative, but I want to make a quick note about the tribes NEPA claim about cultural resources.

[02:47:00] Speaker 00:
The tribes had standing to bring these claims at the time the petition was filed.

[02:47:04] Speaker 00:
Their standing was clear from the record as FERC recognized that the pipeline would potentially impact cultural resources.

[02:47:10] Speaker 07:
Why is it clear from the record council?

[02:47:12] Speaker 07:
And by that I mean the tribes know where they're located.

[02:47:17] Speaker 07:
You may know where they're located.

[02:47:19] Speaker 07:
I don't know where they're located.

[02:47:22] Speaker 07:
And I don't know where the grounds that they're concerned about are located.

[02:47:28] Speaker 07:
And in situations where something may be obvious and where Article III is not a matter that's been previously raised, this court has allowed the filing of affidavits to indicate why standing is demonstrated here.

[02:47:50] Speaker 07:
How about doing that here?

[02:47:52] Speaker 00:
I believe that would be possible here.

[02:47:54] Speaker 07:
Because your piece has a paragraph in it, where if there were affidavits to support it, it seems to me you would show standing.

[02:48:02] Speaker 00:
Well, I'd like to clarify that I don't actually represent the tribes.

[02:48:05] Speaker 07:
Who represents the tribes?

[02:48:06] Speaker 07:
You said you just wanted to talk about the tribes.

[02:48:11] Speaker 07:
Are you representing the tribes or not?

[02:48:14] Speaker 00:
For purposes of the NEPA argument, I represent the tribes.

[02:48:17] Speaker 00:
I did not author the tribes briefs.

[02:48:18] Speaker 00:
But for purposes of oral argument, we designated one attorney to speak on all NEPA issues.

[02:48:23] Speaker 07:
So why not ask the tribes to submit affidavits?

[02:48:28] Speaker 00:
That would be a fine course of action.

[02:48:30] Speaker 00:
Also in the record, like at JA 636, FERC recognized that the pipeline crosses territory that was historically significant to the tribes.

[02:48:40] Speaker 00:
FERC chose to include the tribes

[02:48:42] Speaker 00:
in the incomplete NHPA process.

[02:48:44] Speaker 00:
So it was apparent to FERC throughout the proceeding and in the record that the tribes were potentially injured by this proceeding.

[02:48:51] Speaker 07:
Understand FERC is not required to consider Article III.

[02:48:58] Speaker 00:
I agree, Your Honor.

[02:48:59] Speaker 00:
And if the Court has concerns about the tribes standing, I think that asking for the tribes to submit additional information on that would be one way to remedy that situation.

[02:49:09] Speaker 07:
You can see the American Library case.

[02:49:12] Speaker 00:
Yes, your honor.

[02:49:16] Speaker 00:
Moving on to the other issues of greenhouse gases and the no action alternative, NEPA requires a hard look at greenhouse gas emissions, their significance and the severity of their impacts.

[02:49:28] Speaker 00:
But FERC concedes that here it made no determination on these issues.

[02:49:32] Speaker 00:
FERC mistakenly argued that it lacked the tools to do so.

[02:49:36] Speaker 00:
The failure to evaluate significance mattered and affected FERC's decision-making.

[02:49:41] Speaker 00:
In the rehearing order of JA 328, FERC explains that the reason FERC does not require mitigation of greenhouse gas emissions is because FERC does not know whether those emissions are significant.

[02:49:53] Speaker 00:
And thus, in FERC's view, FERC didn't know what level of mitigation would be warranted.

[02:49:58] Speaker 00:
But FERC was wrong to claim that there was no way to evaluate the significance of greenhouse gas emissions.

[02:50:02] Speaker 00:
FERC had multiple options.

[02:50:05] Speaker 00:
One option would have been to measure the project's emissions against Oregon's emission reduction targets.

[02:50:10] Speaker 07:
Oh, they gave a response to that.

[02:50:13] Speaker 00:
FERC gave two reasons why it said that Oregon's target was not informative here, both of which were arbitrary.

[02:50:21] Speaker 00:
First, FERC's orders claimed that Oregon's targets are not backed by any enforcement authority.

[02:50:25] Speaker 00:
And that's wrong, as our reefs explain, but also FERC never explains why that would be relevant anyway.

[02:50:32] Speaker 00:
The question before FERC is whether a project that emits 2 million tons of greenhouse gases per year is something to worry about.

[02:50:39] Speaker 00:
And Oregon's targets provide a benchmark for that, regardless of any implementing authority.

[02:50:44] Speaker 00:
Perhaps for that reason, FERC doesn't defend that rationale in its brief.

[02:50:47] Speaker 00:
That's just in FERC's orders.

[02:50:49] Speaker 00:
The other response FERC gave was to say that the Oregon targets are not specific to the gas industry.

[02:50:54] Speaker 00:
And to claim that a meaningful analysis on these facts required such specificity is absurd.

[02:51:02] Speaker 00:
Oregon wants to reduce its statewide emissions by 75% down to 14 million tons per year.

[02:51:08] Speaker 00:
And as Oregon explained, if 2 million tons of that, 15% of the budget is consumed just by this new project, it'll be burdensome, if not impossible, for Oregon to meet this goal.

[02:51:21] Speaker 07:
Well, let me ask you, in light of our recent decisions, are we not bound to send this back to FERC?

[02:51:30] Speaker 00:
Yes, Your Honor.

[02:51:31] Speaker 00:
One way or another, what Ferck did here is wrong.

[02:51:33] Speaker 07:
Hesitated.

[02:51:35] Speaker 00:
No, I mean, this court's recent decision identified that there are other ways Ferck could have approached it.

[02:51:44] Speaker 07:
And we re-handed.

[02:51:46] Speaker 00:
Yes, Your Honor.

[02:51:47] Speaker 07:
And basically rejected the type of analysis Ferck has given here.

[02:51:52] Speaker 00:
Yes, Your Honor.

[02:51:54] Speaker 00:
The difference between this case and the Vecinos Peraldenas de la Comunidad Gostera case is that here,

[02:52:00] Speaker 00:
FERC did have an option that was not available in the Vicino's case.

[02:52:03] Speaker 00:
Texas doesn't have any state emission reduction targets.

[02:52:06] Speaker 00:
And FERC has, in many proceedings over the years, said, if only we had a state emission target to compare this against, then we could do something useful.

[02:52:13] Speaker 07:
Where have they said that?

[02:52:15] Speaker 00:
We collect those cases in our brief, both the opening and the reply, where FERC has said that comparison with state emission reduction targets

[02:52:28] Speaker 00:
would be a reasonable appropriate way to evaluate the significance of greenhouse gas emissions.

[02:52:33] Speaker 07:
And so here it looked at Oregon's standards.

[02:52:38] Speaker 07:
It didn't say gee we wish you had any standard.

[02:52:43] Speaker 00:
Right here when FERC finally had a chance to put its money where its mouth was and do the thing that it had been telling us for years it wished it could do

[02:52:50] Speaker 00:
FERC invented these two new reasons about, well, this standard isn't enforceable or, well, this standard isn't specific to the gas industry.

[02:52:56] Speaker 07:
Well, from Oregon, from FERC's point of view, it's meaningless then.

[02:53:01] Speaker 07:
Either you want an enforceable standard or not.

[02:53:04] Speaker 07:
That's all I'm getting at is it gave some reasons.

[02:53:07] Speaker 07:
You may not agree with them.

[02:53:09] Speaker 07:
But why isn't an agency's concern about enforceability a non-arbitrary

[02:53:18] Speaker 07:
consideration.

[02:53:19] Speaker 00:
Because the question is whether FERC could decide the sense of scale.

[02:53:23] Speaker 00:
And so FERC never explained why enforceability is relevant.

[02:53:27] Speaker 00:
FERC could have said, well, Oregon has a standard, but they were adopted on Tuesday, and so we don't care.

[02:53:30] Speaker 07:
No, but I don't understand it.

[02:53:33] Speaker 07:
If Oregon says we want everybody to reduce emissions by 80% by next Monday, but it has no way to enforce it.

[02:53:43] Speaker 07:
Why would FERC think that that was a useful target?

[02:53:48] Speaker 07:
If FERC is under an obligation to do something to measure and reduce, that's all I'm getting at.

[02:53:59] Speaker 00:
Because FERC's position is that it simply has no way to decide what amount of greenhouse gases are a problem.

[02:54:05] Speaker 00:
Like when does a project's greenhouse gas emissions.

[02:54:08] Speaker 07:
It has no reasonable intellectually defensible

[02:54:16] Speaker 00:
That has been FERC's position, and our claim is that Oregon provides an answer.

[02:54:20] Speaker 00:
The Oregon legislature considered the problem and said, we are passing a statute that declares that this level of emissions is a problem.

[02:54:28] Speaker 07:
And how did Oregon's legislature say it was to be enforced?

[02:54:33] Speaker 00:
Oregon didn't create any new enforcement authority for this, but Oregon agencies have.

[02:54:38] Speaker 07:
How was this to be enforced?

[02:54:39] Speaker 00:
We cite in our briefs and include in the record an executive order directing Oregon agencies to use their pre-existing statutory authority to try and achieve this goal.

[02:54:49] Speaker 07:
To try to achieve this goal.

[02:54:53] Speaker 07:
So, you know, what's FERC supposed to do?

[02:54:55] Speaker 07:
I mean, all right, I get your point.

[02:54:57] Speaker 07:
All right.

[02:54:58] Speaker 07:
So there was a standard and FERC could have measured using that standard.

[02:55:03] Speaker 00:
Or alternately, if FERC decided, it actually provided non-arbitrary reasons in the record explaining why the Oregon standard wasn't good enough.

[02:55:10] Speaker 07:
So you're opposing a remand, all right?

[02:55:13] Speaker 07:
You want vacator?

[02:55:16] Speaker 00:
We do want vacator.

[02:55:18] Speaker 00:
We think that under the allied signal test, it's not sufficiently likely that FERC is going to be able to cure these deficiencies on remand.

[02:55:27] Speaker 07:
Well, under allied signal,

[02:55:29] Speaker 07:
Normally we remand without vacator where there's some indication that the agency may be able to meet its obligation.

[02:55:39] Speaker 07:
And here you're telling me, you know, Oregon has this standard and FERC could have used it.

[02:55:46] Speaker 07:
So why shouldn't we give FERC a chance to do that?

[02:55:51] Speaker 00:
Certainly, your honor.

[02:55:52] Speaker 00:
I think that the greenhouse gas claim in isolation may not have been enough under allied signal to have justified remand with vacatur.

[02:55:58] Speaker 00:
But the collection of errors here cast doubt as to whether on the whole on remand FERC would be able to re-approve the project.

[02:56:07] Speaker 00:
But our argument for vacatur is not solely hanging on the greenhouse gas argument.

[02:56:12] Speaker 06:
All right, so what other arguments do you have counsel, I mean you got a brush cast.

[02:56:17] Speaker 06:
There was one that you said I'm not going to address and I was a little curious as to right.

[02:56:24] Speaker 00:
I mean we.

[02:56:25] Speaker 00:
I'm just mindful of my time and there are more claims we're interested.

[02:56:30] Speaker 00:
Well, then the final point on the greenhouse gases is that even if FERC had concluded for non-arbitrary reasons that the Oregon targets weren't good enough, that wouldn't have let FERC off the hook for the underlying obligation to say something about the significance of greenhouse gases.

[02:56:45] Speaker 00:
And as a backstop, FERC does need to look at tools generally accepted in the scientific community, such as social cost of carbon, which is what this court dealt with in vicinos where they didn't also have the option of a state target.

[02:56:57] Speaker 00:
I'll just point out, we argued the vicinos

[02:57:01] Speaker 00:
a form of regulation 40 CFR 1522 claim in this case it's in the landowner and conservation groups opening brief at page 62.

[02:57:09] Speaker 00:
It's in the rehearing request at J721 to 22 but as in Visinos nowhere in the record did FERC or in the briefs did FERC address the regulation

[02:57:20] Speaker 00:
or its obligation to use, you know, perhaps imperfect, but still generally accepted methodologies to assess the significance of greenhouse gases.

[02:57:27] Speaker 06:
So if we disagree with you on that, or if we don't think it's enough for a vacater, what other things are there in this NEPA analysis that you find so objectionable that we have to vacate the entire thing?

[02:57:43] Speaker 00:
I think that the refusal to require the terminal to use a waste heat only design is so objectionable that it would require vacatur because it implicates how they're actually going to build the facility.

[02:57:56] Speaker 00:
So if they start building and then while they're doing the NEPA analysis on remand and then discover that actually a different design would have been more appropriate, that that's a problem that should be addressed

[02:58:12] Speaker 06:
Right, but where did that design idea come from?

[02:58:15] Speaker 06:
My understanding of the record was that the companies initially proposed it and then changed its mind.

[02:58:20] Speaker 06:
So fine.

[02:58:22] Speaker 06:
What is it that you say is objectionable about FERC's acceptance of the company's decision that a different alternative would be necessary?

[02:58:35] Speaker 00:
So the company is allowed to change its mind, but the company never even suggested, the company never suggested that the alternative was necessary.

[02:58:42] Speaker 00:
They just said we would prefer an alternative design.

[02:58:45] Speaker 00:
But it's not FERC's job to rubber stamp whatever the company wants.

[02:58:49] Speaker 00:
Under NEPA, FERC must do a rigorous exploration of all alternatives.

[02:58:53] Speaker 00:
And then under the Natural Gas Act, FERC has to decide which alternative best serves the public interest, regardless of whether that's a specific alternative that the company would have preferred.

[02:59:03] Speaker 00:
So here the company said that the design that would only use waste heat, not needing electricity from the grid, would be feasible.

[02:59:10] Speaker 00:
That's what they actually initially proposed.

[02:59:12] Speaker 00:
And that's what FERC addressed in the draft environmental impact statement.

[02:59:16] Speaker 07:
I thought there was a capacity issue as to what the terminal would be able to do.

[02:59:25] Speaker 00:
Burke asserted in the final environmental impact statement and the rehearing order that the terminal wouldn't be able to do it, but there is literally nothing in the record to support that statement.

[02:59:35] Speaker 07:
I thought it referenced specific percentages.

[02:59:41] Speaker 00:
I am not aware of anything in the record explaining why the terminal would be incapable of meeting its needs.

[02:59:48] Speaker 00:
solely from waste heat.

[02:59:50] Speaker 00:
And both the company and FERC thought that that design was feasible when they proposed it and considered it in the draft environmental impact statement.

[02:59:56] Speaker 00:
So there was an abrupt change in position from FERC and nothing to explain or even acknowledge that change in position.

[03:00:07] Speaker 06:
All right, what else?

[03:00:08] Speaker 06:
I think there's wildfires, there's thermal plumes.

[03:00:15] Speaker 06:
What else is supporting your view that

[03:00:18] Speaker 06:
we have to vacate this entire environmental index.

[03:00:23] Speaker 00:
So on the aviation and the thermal plumes, that's another issue where if the certificate isn't vacated and they're allowed to start construction, it may be too late to fix the problem by the time they finished a renewed analysis on remand.

[03:00:38] Speaker 00:
The terminal is directly across Coos Bay from the region's only airport.

[03:00:43] Speaker 00:
The Federal Aviation Administration has said that industrial facilities near airports are a problem.

[03:00:50] Speaker 00:
The terminal will burn a lot of gas, it creates this plume of hot exhaust and the rising air creates problems for planes during takeoff and landing.

[03:00:59] Speaker 00:
According to the FAA, such thermal plumes are quote incompatible with nearby airport operations.

[03:01:04] Speaker 00:
So FERC tried to pass the buck on this issue, first to the FAA.

[03:01:09] Speaker 00:
And the FAA said, no, we don't have any authority over thermal plumes from the terminal.

[03:01:13] Speaker 00:
Then FERC tried to pass it to the airport.

[03:01:15] Speaker 00:
But the airport and the runway are already there.

[03:01:19] Speaker 00:
They can't move out of the way.

[03:01:20] Speaker 00:
And there's nothing in the record that suggests that if the thermal plume proves to be a problem and it's dangerous to take off or land from this runway, that there's something the airport can do to work around it.

[03:01:31] Speaker 00:
So NEPA requires a hard look at that type of impact now before construction begins, but remand without vacancy would allow construction to begin before that issue is addressed.

[03:01:44] Speaker 06:
And is eminence an issue in this regard, right?

[03:01:49] Speaker 06:
As we determine whether or not to vacate, isn't the fact that there is no construction at issue relevant to that determination?

[03:02:00] Speaker 00:
Yes, it is your honor, but it cuts in favor of vacating the order here because under allied signal, you know you look at hardship to the other side.

[03:02:08] Speaker 00:
And here there's nothing to suggest that vacating would actually impose any burden on Pembina because they have said they don't even know you know they're non committal but they're saying they don't know whether they're going to proceed with the project so that they're not.

[03:02:22] Speaker 00:
This is unlike in the Vecino's case where the developers said, we really are ready to go now.

[03:02:27] Speaker 00:
Please don't vacate this proceeding because it'll disrupt our ability to get financing, et cetera.

[03:02:31] Speaker 00:
Here, Pembina isn't even showing up.

[03:02:32] Speaker 00:
So they aren't asserting that vacatur would impose any hardship on them.

[03:02:36] Speaker 00:
And I think that does factor into the Allied signal analysis.

[03:02:42] Speaker 08:
Wildfires?

[03:02:45] Speaker 00:
Unless you have your own specific questions about wildfire, I'm comfortable to rest on the briefs there.

[03:02:49] Speaker 07:
All right.

[03:02:51] Speaker 07:
Anything further?

[03:02:52] Speaker 00:
I'd like to briefly address no action.

[03:02:57] Speaker 00:
On the no action alternative, FERC arbitrarily declared that denial of this project would just shift rather than prevent environmental impacts because FERC claimed that some comparable project would be likely to take this project's place.

[03:03:11] Speaker 00:
That's factually and legally incorrect here.

[03:03:13] Speaker 00:
Factually, there's no support for the assumption that if this project is denied, some substitute would be proposed.

[03:03:20] Speaker 00:
There is no evidence of market demand or market support for the terminal.

[03:03:25] Speaker 00:
I want to respectfully amend one point that my colleagues said earlier today about the difference between the DOE authorization and the FERC authorization, which is that the burden of proof is flipped for DOE for section three.

[03:03:36] Speaker 00:
The DOE just says, are they worried that this project would be contrary to the public interest?

[03:03:42] Speaker 00:
And DOE makes no findings about market demand, about whether there are any potential customers.

[03:03:49] Speaker 00:
In the DOE's authorization here, JA 440, DOE says that they expect that a lot of the product that they authorize are actually never going to get built because there aren't customers for all of these projects.

[03:04:01] Speaker 00:
So DOE hasn't found that there's any market support for the terminal, nor has FERC.

[03:04:07] Speaker 00:
And without the terminal, there's no demand for the pipeline.

[03:04:09] Speaker 00:
So there's no support factually for FERC's assertion that, well, if we deny this project, somebody else is going to propose something similar.

[03:04:16] Speaker 00:
But legally, any substitute project would also require FERC approval.

[03:04:22] Speaker 00:
So the adverse impacts of a project like this, whether from this project or some substitute, are not inevitable.

[03:04:29] Speaker 00:
If the adverse impacts are a problem,

[03:04:31] Speaker 00:
FERC can prevent them by refusing to authorize both this project and any comparably harmful substitute.

[03:04:38] Speaker 00:
So that flawed no-action analysis matters because it skews FERC's decision-making.

[03:04:44] Speaker 00:
What FERC has said to decision-makers and to the public is that environmental harms aren't a reason to reject this project because the equivalent harms are going to occur anyway.

[03:04:54] Speaker 00:
And that is just plainly incorrect.

[03:04:57] Speaker 00:
So ultimately,

[03:04:59] Speaker 00:
FERC's treatment of the no action alternative exemplifies the problems with FERC's approach to the entire project.

[03:05:04] Speaker 00:
FERC has consistently downplayed its own role, positioning itself as at the mercy of markets or is able to defer to other authorities.

[03:05:13] Speaker 00:
But FERC is the lead regulator for these projects.

[03:05:16] Speaker 00:
FERC has greater authority and responsibility than anybody else in deciding whether and how these projects should proceed.

[03:05:23] Speaker 00:
So this court should vacate in remand so that FERC can exercise that authority consistent with FERC statutory obligations.

[03:05:30] Speaker 07:
All right.

[03:05:31] Speaker 07:
Any questions, my colleagues?

[03:05:35] Speaker 07:
No.

[03:05:35] Speaker 07:
All right.

[03:05:35] Speaker 07:
Let us hear from counsel for FERC.

[03:05:38] Speaker 05:
Thank you, Your Honor.

[03:05:40] Speaker 05:
Let me start with the Vecinos issue, that very recent decision.

[03:05:45] Speaker 05:
It's not applicable here.

[03:05:47] Speaker 05:
I understand that the petitioners raised that regulation in passing.

[03:05:52] Speaker 05:
It's 40 CFR section 1502.21.

[03:05:58] Speaker 05:
So it was raised in passing, but it's not the same situation as in Vecinos where

[03:06:08] Speaker 05:
the Commission didn't address an argument based on that particular regulation.

[03:06:12] Speaker 05:
The Commission made clear here is in the context of these orders and on the record before the agency,

[03:06:20] Speaker 05:
It could not make a meaningful determination about the significance of this particular project.

[03:06:26] Speaker 05:
It did do a significant amount of analysis relating to greenhouse gas emissions from this terminal and pipeline.

[03:06:32] Speaker 05:
The commission calculated the direct emissions.

[03:06:36] Speaker 05:
It also compared the

[03:06:38] Speaker 05:
the amount of emissions from the project to the emissions targets of Oregon.

[03:06:46] Speaker 05:
But it did find that the Oregon state reduction targets were not an objective benchmark that the agency, the federal agency, could objectively use to determine whether... That is in around JA 113.

[03:07:07] Speaker 05:
So it did, it looked at the Oregon standards.

[03:07:12] Speaker 05:
Yes.

[03:07:13] Speaker 05:
Yes, your honor.

[03:07:16] Speaker 05:
So beginning at JA 112, the commission has a discussion about greenhouse gas emissions.

[03:07:23] Speaker 05:
It first explains that at the time the order issued, the national emissions reduction targets under the EPA's clean power plan had actually been withdrawn.

[03:07:34] Speaker 05:
So those weren't available for use.

[03:07:36] Speaker 05:
And then it goes on at paragraph 260 to discuss the Oregon targets, which are to arrest the growth of Oregon's greenhouse gas emissions and reduce those emissions by 10% below 1990 levels by 2020 and 75% below 1990 levels by 2050.

[03:08:01] Speaker 05:
That's in paragraph 260.

[03:08:04] Speaker 05:
The commission, while these goals may be laudable, the commission did not find the state targets to be an objective benchmark that the agency could use in these circumstances.

[03:08:20] Speaker 06:
Did the commission say why, or did they just in 260 identify those benchmarks?

[03:08:25] Speaker 06:
In other words, did they critique Oregon in the way that you are now in this discussion?

[03:08:32] Speaker 05:
Yes, Your Honor.

[03:08:36] Speaker 05:
At paragraphs 261 and 262, that's where the agency does compare the emissions from the project to the Oregon goals.

[03:08:48] Speaker 05:
And it acknowledges that the project would make up, you know, 4.2% and 15.3%.

[03:08:56] Speaker 05:
of the 2020 and 2050 greenhouse gas goals.

[03:09:00] Speaker 05:
But then it goes on to say in paragraph 262 that the emissions goals are not the same as an objective determination that the greenhouse gas emissions from the projects will have a significant effect on climate change.

[03:09:16] Speaker 05:
And the commission also noted in footnote 559, the state itself took these emissions targets into account when it denied the authorization under the Coastal Zone Management Act.

[03:09:34] Speaker 05:
So, you know, it was entirely appropriate for the state to take its own emissions targets into account in its own decision making.

[03:09:42] Speaker 05:
regarding the permits for this project.

[03:09:46] Speaker 05:
But the commission determined that it just, it wasn't a meaningful benchmark for the federal agency to use.

[03:10:03] Speaker 07:
Okay.

[03:10:03] Speaker 07:
So let me just be clear that I understand what the state was saying here or that rather the commission was saying

[03:10:13] Speaker 07:
was where Oregon had these goals of emission reduction and FERC was able to measure the amount of emissions from the project.

[03:10:34] Speaker 07:
What's missing?

[03:10:38] Speaker 05:
I think what's missing is that while the state's goals may be laudable, they're not necessarily an objective indicator of what level of emissions is significant from a climate change perspective.

[03:10:54] Speaker 05:
I think that's what's underlying the finding here.

[03:11:03] Speaker 06:
Can you please address the no action alternatives

[03:11:06] Speaker 06:
argument that Mr. Matthews and the petitioners have put forward.

[03:11:11] Speaker 05:
Sure, Your Honor.

[03:11:13] Speaker 05:
I think that no action alternative analysis here is substantially identical to the Commission's analysis of the no action alternative in other pipeline cases.

[03:11:26] Speaker 05:
You know, I think it's

[03:11:29] Speaker 05:
At bottom, it's consideration of an alternative where the project doesn't get built, but the commission did also find that, you know, if this particular project didn't get built, you know, it was quite likely that other other project proponents would.

[03:11:46] Speaker 05:
come forward and propose a similar project, whether or not it's at Coon's Bay in Oregon, it could be elsewhere, but it did find that there was demand for this project and it would get built.

[03:11:58] Speaker 06:
I think Judge Wilkins- Has this court ever accepted such a broad blanket unsubstantiated statement by FERC?

[03:12:08] Speaker 06:
My understanding of the no action alternative is that it really has to have some support

[03:12:16] Speaker 06:
In other words, you look at what the world would be like if this alternative was not in place and there's some evidence of that world.

[03:12:25] Speaker 06:
There's some analysis of the tons of gas that would get shipped anyway and how it was likely to happen and what the environmental impacts of the alternative world would be.

[03:12:40] Speaker 06:
Here, it appears we have like a sentence

[03:12:44] Speaker 06:
a speculative sentence that just says, well, because there's market demand as determined by DOE, even if that's true, okay, because that's the case, we find that the no action alternative would end up in the same place as we are today without anything more.

[03:13:07] Speaker 06:
And I've never seen a case in which that was posited by for

[03:13:13] Speaker 06:
used by FERC or endorsed by the court?

[03:13:19] Speaker 05:
Well, Your Honor, I think the court has endorsed the commission's no action alternative in other cases.

[03:13:24] Speaker 05:
Although, to be honest, I can't recall a specific case citation right now.

[03:13:29] Speaker 05:
But I think it's more than just that one sentence.

[03:13:32] Speaker 05:
The environmental impact statement does have a discussion of the no action alternative.

[03:13:37] Speaker 05:
It's a few paragraphs long.

[03:13:39] Speaker 05:
It's at JA 534 and 535.

[03:13:44] Speaker 06:
I may have looked at it.

[03:13:50] Speaker 06:
Let me see.

[03:13:51] Speaker 06:
I mean, I feel like I did not see what a substantiated assessment of what the world would look like in the absence of this project, right?

[03:14:07] Speaker 06:
I see.

[03:14:09] Speaker 06:
On page 535, given that the project is market driven, it is reasonable to expect that in the absence of a change in market demand, if this project isn't constructed, exports from other facilities may occur.

[03:14:28] Speaker 06:
Thus, although the environmental impacts associated with this project won't happen,

[03:14:37] Speaker 06:
Right?

[03:14:37] Speaker 06:
Impacts could occur at other locations.

[03:14:40] Speaker 06:
And then in the next paragraph it says, we do not consider the no action alternative further.

[03:14:47] Speaker 06:
It doesn't tell us how those other impacts could occur, what are the circumstances in which the gas would be transported in the absence of this.

[03:14:56] Speaker 06:
We have no other real detail or analysis about the world of exportation in the absence of this proposal.

[03:15:07] Speaker 06:
And I thought that's what no action alternative requires the agency to do.

[03:15:14] Speaker 05:
Well, Your Honor, I'm not sure of the level of detail to be honest that that is required under the case law because I think that this is a

[03:15:26] Speaker 05:
I think this is a full description of what happens.

[03:15:31] Speaker 05:
I mean, if the project isn't built, there are no environmental impacts, right?

[03:15:34] Speaker 07:
I think the question is, this court has endorsed repeatedly where these expert agencies opine on predictions.

[03:15:48] Speaker 07:
And what Judge Jackson is raising, as I understand it,

[03:15:51] Speaker 07:
Is it enough to say, look, there's so much money involved in what's going on here.

[03:15:58] Speaker 07:
And the Asian market is growing like crazy.

[03:16:04] Speaker 08:
So somebody is going to come here.

[03:16:09] Speaker 07:
Now, FERC doesn't say the Asian market is growing like crazy and that type of thing.

[03:16:17] Speaker 07:
So can we take judicial notice

[03:16:20] Speaker 07:
of these types of things.

[03:16:24] Speaker 07:
Because we all know it is growing.

[03:16:28] Speaker 07:
And this company has been doing this for how many years now?

[03:16:33] Speaker 07:
And maybe they'll decide it gets spent too much money and they don't want to go forward.

[03:16:40] Speaker 07:
But they're not building this pipeline for any non-pecuniary reason.

[03:16:52] Speaker 06:
This is coal hash business.

[03:16:54] Speaker 06:
And if I might, Judge Rogers, even if we could take judicial notice of the fact that there is a market for this, my understanding is the no action alternative requires the agency to go beyond that, because you could say that in pretty much every pipeline scenario.

[03:17:12] Speaker 06:
I mean, that's not really a finding.

[03:17:14] Speaker 06:
In the no action alternative world, you could always say,

[03:17:20] Speaker 06:
If this pipeline wasn't built, there would be no environmental impacts from this pipeline.

[03:17:27] Speaker 07:
Well, we don't need to debate among ourselves, but I don't see our cases.

[03:17:32] Speaker 07:
Having said that, we were talking about these expert predictions, but Judge Jackson may be right.

[03:17:39] Speaker 07:
But I just didn't see a case, and I'll look for one.

[03:17:43] Speaker 07:
But at any event, maybe this isn't enough.

[03:17:48] Speaker 05:
Well, Your Honor, I think the court has recognized that the agency as the administrator of this particular statute is entitled to make predictive judgments.

[03:17:59] Speaker 05:
The agency does have numerous gas pipeline cases before it at any given time and

[03:18:06] Speaker 05:
is aware of what's going on with the markets, the gas shortages, the demand in Asia.

[03:18:11] Speaker 05:
I think the court could take judicial notice of that.

[03:18:15] Speaker 07:
I guess then the question is, if it's going to do that sort of broad statement, doesn't it have to tell us something?

[03:18:25] Speaker 07:
And I can think of cases, I can't tell you a name, and you're probably familiar with them, where in these no action alternatives, the agency has gone to great lengths to explain

[03:18:37] Speaker 07:
the shortcomings of not doing anything, et cetera.

[03:18:41] Speaker 07:
Here, they didn't do that.

[03:18:43] Speaker 07:
So I'm wondering when we send it back, if we send it back on another issue, we can ask the agency to spell out.

[03:18:49] Speaker 05:
Oh, of course.

[03:18:53] Speaker 05:
Of course, the court could do that.

[03:18:54] Speaker 05:
But I think the past of the commission's reasoning is clear here, that maybe it didn't

[03:19:00] Speaker 05:
go through every single detail.

[03:19:02] Speaker 07:
Well, no detail.

[03:19:05] Speaker 07:
And you just said, we know something's coming.

[03:19:08] Speaker 07:
If you don't build it, someone else will.

[03:19:10] Speaker 05:
That's all I said.

[03:19:12] Speaker 05:
Right.

[03:19:12] Speaker 05:
And that's where the agency was relying on its expertise and its predictive judgment.

[03:19:16] Speaker 05:
But of course, it would be possible if the court desires more explanation.

[03:19:21] Speaker 05:
No, I understand that.

[03:19:22] Speaker 07:
But I thought Judge Jackson's question was getting to the legal point.

[03:19:27] Speaker 07:
is that legally sufficient?

[03:19:30] Speaker 07:
We've got lots of expertise out there, but that doesn't always suffice.

[03:19:36] Speaker 05:
I'm not aware of any case that would hold that explanation to be legally insufficient, taking it from the other side.

[03:19:43] Speaker 05:
Well, maybe there's never been such.

[03:19:48] Speaker 05:
That's entirely possible, Your Honor.

[03:19:49] Speaker 07:
All right, so we can look at the case law and see what's required.

[03:19:54] Speaker 07:
But you don't have any further.

[03:19:56] Speaker 07:
Although you have cited this now to the EIS.

[03:19:59] Speaker 05:
Right.

[03:19:59] Speaker 05:
No, I don't, Your Honor.

[03:20:01] Speaker 05:
Okay.

[03:20:02] Speaker 07:
All right.

[03:20:03] Speaker 07:
Anything further?

[03:20:04] Speaker 07:
Any questions for my colleagues?

[03:20:09] Speaker 07:
All right.

[03:20:10] Speaker 05:
We give petitioner.

[03:20:12] Speaker 05:
Oh, sorry, your honor.

[03:20:13] Speaker 05:
I'm sorry.

[03:20:13] Speaker 05:
Yes, did you?

[03:20:14] Speaker 05:
I'm sorry.

[03:20:14] Speaker 05:
Did you want me to just briefly address waste heat and thermal plumes?

[03:20:18] Speaker 05:
I think.

[03:20:18] Speaker 05:
Oh, sure.

[03:20:19] Speaker 05:
So I think Judge Rogers, you were right that, you know, I think there was a capacity issue here.

[03:20:25] Speaker 05:
The commission.

[03:20:29] Speaker 05:
The commission said that, you know, the terminal needs about 40 to 50 megawatts to operate and 24.4 megawatts would be supplied by waste heat, but the rest has to come from the local power grid.

[03:20:41] Speaker 05:
I think what petitioner doesn't explain is why it's preferable to have all of the heat, like why, you know, why

[03:20:49] Speaker 05:
better to have waste heat power the entire facility rather than have some of it come from the local power grid.

[03:20:58] Speaker 05:
So that's just not clear to me from what petitioners are arguing.

[03:21:01] Speaker 06:
We long held, Ms.

[03:21:02] Speaker 06:
Chu, that arbitrary and capricious review requires us to analyze whether the agency has provided a sufficient explanation for a change.

[03:21:14] Speaker 06:
So I understand the change came from the company.

[03:21:17] Speaker 06:
But according to Mr. Matthews in the record, it was initially posited that waste heat was going to be the source and that there was suddenly a new course of action that FERC never really acknowledged or explained.

[03:21:33] Speaker 06:
Is he wrong about that as a factual matter?

[03:21:36] Speaker 06:
And if so, where in the record does FERC explain the shift from the initial proposal regarding waste heat to what we have today?

[03:21:45] Speaker 05:
I don't think Mr. Matthews is wrong that it was initially proposed by the company and then the company changed his mind.

[03:21:51] Speaker 05:
But I don't think the requirement that the commission has to explain any course reversal, like that requirement applies to commission decisions.

[03:22:02] Speaker 05:
And I don't think that there is a course reversal in the commission's orders that has to be explained away here.

[03:22:10] Speaker 05:
So I think it is sufficient that the commission found this to be

[03:22:14] Speaker 06:
So you're saying the commission never passed on the initial proposal?

[03:22:17] Speaker 06:
It never agreed to or thought of, and maybe not as a final matter, but is that your point?

[03:22:27] Speaker 05:
I think so, your honor.

[03:22:28] Speaker 05:
And I'm sorry about this, that I don't recall if the agency actually ever passed on the initial proposal.

[03:22:37] Speaker 05:
But I'm pretty sure that,

[03:22:40] Speaker 06:
Well, we're many hours in, so you're excused.

[03:22:45] Speaker 06:
Thank you.

[03:22:47] Speaker 07:
I didn't stand in the breeze for any reference to it, but I haven't read every page of the record either.

[03:22:56] Speaker 05:
Okay, I don't think we did.

[03:22:58] Speaker 05:
And as the thermal plumes, the commission wasn't trying to pass the buck, but it but this court has recognized that the agency is entitled to to rely on the expertise of other other agencies and other parties and Right, but here the FAA didn't rely on the FAA, did it?

[03:23:18] Speaker 05:
Well, it did.

[03:23:18] Speaker 05:
It relied on the FAA.

[03:23:21] Speaker 05:
The FAA conducted aeronautical studies, and it found that the LNG terminal does not present a hazard.

[03:23:28] Speaker 05:
And that's at JA 106, paragraph 245 of the authorization order.

[03:23:33] Speaker 05:
But then there's also a 2015 FAA memorandum, which just simply said that airport operators should take potential thermal flumes into account.

[03:23:45] Speaker 05:
That's discussed at the rehearing order, paragraph 196, J8302.

[03:23:51] Speaker 07:
What was Ferg's view about this?

[03:23:54] Speaker 07:
Ferg's plumes are going to be coming up and they're going to be in the pathway of planes that are leaving and arriving at the airport.

[03:24:09] Speaker 05:
Well, no, not necessarily, Your Honor.

[03:24:11] Speaker 05:
I mean, I think Frick's view is that the aeronautical studies concluded, the FAA aeronautical studies concluded that there's no hazard, there's no specific hazard, but the potential for any thermal plumes, like the FAA said that that was highly dependent on specific factors relating to

[03:24:34] Speaker 05:
the proximity of any exhaust stacks to the airport flight path, the size and the speed of the aircraft, local weather patterns.

[03:24:41] Speaker 05:
These are all factors that are just uniquely within the airport's knowledge.

[03:24:46] Speaker 07:
So instead of going out runway two, they'll go out runway three.

[03:24:51] Speaker 05:
Right.

[03:24:51] Speaker 05:
Exactly.

[03:24:53] Speaker 05:
Exactly.

[03:24:53] Speaker 05:
And that's for the airport.

[03:24:55] Speaker 06:
I'm mindful of the time, but I'm looking at paragraph 245 on GA 106, and it says,

[03:25:02] Speaker 06:
that the FAA completed these aeronautical studies following the issuance of the final EIS.

[03:25:08] Speaker 06:
So tell me what, isn't that a little problematic to the extent that the EIS was already done?

[03:25:16] Speaker 06:
The agency could not have relied then on the aeronautical studies and didn't the agency err in issuing the certificate on the basis of an EIS that did not in fact rely on these aeronautical studies?

[03:25:30] Speaker 05:
Well, but the certificate order relied on the aeronautical studies and the EIS.

[03:25:34] Speaker 05:
Like both of those were complete by the time the order issued.

[03:25:39] Speaker 06:
I see.

[03:25:39] Speaker 06:
So the studies came into the certificate order?

[03:25:43] Speaker 06:
Yes.

[03:25:44] Speaker 06:
They had not been.

[03:25:45] Speaker 06:
Okay.

[03:25:46] Speaker 06:
I think that's right.

[03:25:47] Speaker 06:
Yes.

[03:25:47] Speaker 06:
Yes.

[03:25:48] Speaker 08:
Okay.

[03:25:49] Speaker 08:
Anything further?

[03:25:52] Speaker 08:
My colleagues, any questions?

[03:25:55] Speaker 09:
No.

[03:25:57] Speaker 07:
All right.

[03:26:00] Speaker 07:
Council for Petitioner, do we give you a couple of minutes here?

[03:26:04] Speaker 00:
Thank you, Your Honor, and thank you for hanging in on this very long day.

[03:26:09] Speaker 00:
On aviation, the FAA's aeronautical studies explicitly refused to consider thermal plumes.

[03:26:15] Speaker 00:
Many petitioners here asked the FAA to consider that, and the FAA said, no, that is someone else's problem.

[03:26:20] Speaker 00:
And the FAA memorandum says that it could be a problem for airports, like if the airport is planning an expansion, they should see if that expansion is going to bring them running into a thermal plume.

[03:26:28] Speaker 00:
Or the FAA said the permitting agencies, other than just the airport, also need to consider thermal plumes.

[03:26:35] Speaker 00:
On waste heat, I am confident that there is nothing in the record where FERC explains the basis for its statement that a waste heat only alternative would be infeasible.

[03:26:45] Speaker 00:
FERC doesn't just say that we're not adopting it, they say it would be infeasible, and that statement is unsupported.

[03:26:50] Speaker 07:
And I thought they went through the, I can go back, the percentages.

[03:26:54] Speaker 07:
In any event, okay, so no support for infeasibility.

[03:26:58] Speaker 07:
That's your point.

[03:27:00] Speaker 00:
On greenhouse gases, if FERC didn't like the idea of using the Oregon targets, FERC needed to do something else.

[03:27:07] Speaker 00:
That is the former CFR 1502.22 argument.

[03:27:11] Speaker 00:
But also, FERC criticizes the Oregon targets for not providing an objective determination.

[03:27:17] Speaker 00:
But there's never going to be an objective determination for significance.

[03:27:20] Speaker 00:
It requires the exercise of judgment.

[03:27:23] Speaker 00:
That's not unique to greenhouse gases.

[03:27:25] Speaker 00:
That's for everything.

[03:27:26] Speaker 00:
And if FERC didn't feel like it could make that judgment itself, it would have been appropriate for FERC to look to the judgment of the state.

[03:27:33] Speaker 00:
And FERC says, well, Oregon considered its targets in the CZMA denial.

[03:27:37] Speaker 00:
But there are issues uniquely within FERC's jurisdiction where FERC needs to consider greenhouse gases.

[03:27:41] Speaker 00:
FERC has to decide.

[03:27:42] Speaker 06:
Can I just ask you, Mr. Matthews, just quickly, I'm trying to isolate whether this is

[03:27:47] Speaker 06:
A blanket FERC policy because I've seen this happen in a couple of cases where FERC does not address the significance of greenhouse gases or does FERC do it sometime but it didn't do it here because of its concerns about Oregon's methodology in some way.

[03:28:06] Speaker 06:
Have you ever seen FERC?

[03:28:08] Speaker 06:
estimates.

[03:28:09] Speaker 00:
I am aware of only one case in which FERC reached a determination about the significance of greenhouse gases.

[03:28:15] Speaker 00:
That was the recent pipeline matter discussed in a footnote in FERC's brief and our reply, where that was such a small project that FERC said, here we're comfortable writing this off as de minimis and insignificant.

[03:28:26] Speaker 00:
I think it was like 20,000 tons as opposed to the 2 million tons we're looking at here.

[03:28:30] Speaker 07:
So it's only cited in footnotes, right?

[03:28:34] Speaker 00:
Yes, Your Honor, and it's post-decisional here.

[03:28:36] Speaker 00:
That came after the authorization here.

[03:28:38] Speaker 00:
I am not aware of any proceeding in which FERC has concluded that greenhouse gas emissions are significant or any proceeding other than that one where it wrote them off as de minimis, where FERC has said he would endorse the methodology for making the decision.

[03:28:53] Speaker 00:
It's not that FERC is always saying these are insignificant.

[03:28:57] Speaker 00:
It's that FERC is refusing to answer the question at all.

[03:29:00] Speaker 00:
And FERC gets to pick

[03:29:02] Speaker 00:
in the first instance, what methodology it uses.

[03:29:05] Speaker 00:
If it was me, I would probably use social cost of carbon.

[03:29:07] Speaker 00:
FERC doesn't like social cost of carbon.

[03:29:09] Speaker 00:
But FERC had said, well, we would like to use state targets.

[03:29:12] Speaker 00:
So sure, if that's what FERC has said it wants to use, it could start with those.

[03:29:16] Speaker 00:
But FERC can't just refuse to do anything.

[03:29:19] Speaker 00:
But that's, in our view, what FERC has done.

[03:29:21] Speaker 00:
And we're not aware of any other examples of FERC finding some other approach to the problem.

[03:29:26] Speaker 07:
All right.

[03:29:27] Speaker 07:
Thank you.

[03:29:27] Speaker 07:
Any further questions from my colleagues?

[03:29:31] Speaker 07:
All right, thank you council.

[03:29:32] Speaker 07:
All council will take the case under advisement.