Land, Liberty, and Pipelines

The Battle Over CO2 Transportation in South Dakota

In a sharp critique of the proposed CO2 pipeline, Rep. Jon Hansen (R-Dells Rapids) labeled the project "a boondoggle of inflationary debt spending" on Tuesday evening, highlighting concerns over fiscal responsibility.

BROOKINGS, SD:

South Dakota witnessed its first-ever debate on eminent domain reform at the Dacotah Bank Event Center on Tuesday evening. The event, hosted by the Republican Women's Federation and The Dakota Scout, was a well-attended gathering that emphasized property rights and responsible development.

Moderator Sarah Frankenstein guided the debate between Elizabeth Burns-Thompson, representing Navigator CO2 Pipeline, and Dell Rapids lawmaker Jon Hansen, who stood firm in representing landowners. The debate was not just about a pipeline; it was a reflection of broader struggles between government intervention and individual rights.

The key issues at the heart of the debate were:

• Surveys, Safety, and Environmental Impacts: The need for rigorous scrutiny and adherence to safety standards.

• Eminent Domain vs. Voluntary Easement: A battle between government authority and the rights of property owners.

• Prosperity: The promise of economic growth must be weighed against potential risks and principles of sound fiscal management.

• Long-term Viability of Ethanol Use: A critical examination of sustainable energy solutions that align with responsible stewardship.

This debate underscores the ongoing tension between those who advocate for unchecked government control and those who fight for limited government, individual rights, and responsible management. It's a battle that resonates not just in South Dakota but across the nation, reflecting values that resonate with many Americans.

By Breeauna Sagdal, Policy Analyst and Journalist for America Mission

Photo: Summit Carbon Solutions drilling on private property to survey for their proposed CO2 pipeline 

Surveying 

For several weeks, photos have been circulating across social media showing surveying work being done for the Summit Carbon Solutions pipeline. This surveying has allegedly included unlawful entry into homes and properties, as well as the destruction of crops.

Many are questioning how it's possible to conduct drilling on private property without consent, especially before the pipeline application has been approved by the South Dakota Public Utilities Commission.

During the debate, Rep. Hansen pointed to the passage of a 2017 policy that allows common carriers to survey private property. This policy permits the mapping and studying of lands in preparation for infrastructure development.

According to Elizabeth Burns-Thompson, Navigator CO2's vice president of government and public affairs, "geotechnical surveys" are necessary to properly conduct plume studies, Environmental Impact Studies, and identify areas that could lead to ruptures in the pipe.

Summit Carbon Solutions has taken legal action against 120 landowners, seeking survey rights and protection orders to "conduct surveying unmolested." However, neither Summit nor Navigator has submitted an Environmental Impact Study, despite urgent requests from lawmakers. Furthermore, neither company has made a clear or exact route publicly available.

Navigator has carried out a plume study, but the company is withholding it from the public and refusing to share it with anyone who hasn't first signed a Non-Disclosure Agreement (NDA).

Historically, such surveys and studies were mandated by the National Environmental Policy Act (NEPA). For example, in the case of the now-defunct Keystone pipeline, designed to reduce America's reliance on "dirty" crude from Venezuela, these studies took years to complete and review.

Recent changes to NEPA have introduced the possibility of categorical exclusions for designated green infrastructure. Under the Biden Administration's aggressive measures to combat climate change, initiatives like "Climate-Smart Commodities" and carbon sequestration seem to fall under this category of excluded infrastructure, which would typically require an Environmental Impact Study.

The shift in policy and the categorical exclusions for certain green initiatives have led to a new landscape in environmental regulation. This change is particularly evident in the development of "Climate-Smart Commodities," where the traditional requirement for Environmental Impact Studies seems to have been bypassed. The following excerpt from the Federal Register illustrates this new approach, where NEPA has not mandated Environmental Impact Studies from their private partners in the development of these commodities:

Corporation (CCC) (15 U.S.C. 714-7141) to support the development of markets and production of agricultural commodities using agricultural (farming, ranching, or forestry) production practices that reduce greenhouse gas emissions or sequester carbon. NRCS is administering the Partnerships for Climate-Smart Commodities on behalf of CCC.

The environmental impacts of the Partnerships for Climate-Smart Commodities funding opportunity have been considered in a manner consistent with the provisions of the National Environmental Policy Act (NEPA), as amended (42 U.S.C. 4321-4347), the regulations of the Council on Environmental Quality (40 CFR parts 1500-1508), and the NRCS regulations for compliance with NEPA (7 CFR part 650). A draft PEA has been prepared and based on this analysis, NRCS has preliminarily determined there will not be a significant impact to the human environment. As a result, an Environmental Impact Statement (EIS) has not been initiated (40 CFR 1501.6).

In efforts to diligently involve the public, NRCS is making the draft EA and FONSI available for review and comment for 14 calendar days from the date of publication of this document in the Federal Register. NRCS will consider this input and determine whether there is any new information provided relevant to environmental concerns and bearing on the proposed action or its impacts that warrant supplementing or revising the draft PEA and FONSI. After the comment period, NRCS will issue either a Final EA and FONSI, 01 it will issue a Notice of Intent to prepare an Environmental Impact Statement.

- Terry Crosby

Despite heavy federal regulations, which were ironically pointed to as a form of fail-safe for landowners during the debate, clear regulatory gaps still exist, leaving room for potential disasters.

Elizabeth Burns-Thompson, Navigator CO2's vice president of government and public affairs, alluded to the Denbury pipeline rupture in Satartia, Mississippi, as being the company's failure. "These geotechnical surveys were not conducted on the pipeline in Satartia," Burns-Thompson stated, highlighting the importance of proper surveying.

However, the situation with the Denbury pipeline raises questions and concerns. It's unclear how Denbury was able to submit its pipeline proposal, and have it approved, without Environmental Impact Studies properly addressing geohazards. This lack of oversight seems to contradict the stringent regulations that are often cited as protective measures.

According to the government report, the Denbury pipeline, primarily used for enhanced oil recovery, ruptured after a landslide. This catastrophic failure underscores the vital importance of comprehensive geotechnical surveys and proper risk assessment.

PHMSA’s investigation into the incident revealed several contributing factors to the accident. These included, but were not limited to, "Denbury not addressing the risks of geohazards in its plans and procedures, underestimating the potential affected areas that could be impacted by a release in its CO2 dispersion model, and not notifying local responders to advise them of a potential failure."

The consequences of these oversights were tragically felt in the small town of Satartia, where out of a population of about 50 people, the report indicates that 45 were treated for injuries.

Eminent Domain Vs. Voluntary Easement

The currently proposed Summit and Navigator CO2 pipelines, which are set to run through five states for sequestration, are privately owned. This includes the CO2 they're proposing to transport.

Ownership of these pipelines is divided, with 80 percent of the Navigator CO2 being owned by Blackrock, 14 percent owned by the United Arab Emirate, and less than 2 percent owned by farmers and U.S. shareholders. This distribution of ownership raises questions about the interests being served by these projects.

Rep. Hansen has argued that a privately owned commodity, particularly one serving foreign interests, doesn't meet the legal requirements for common carrier status—or the use of eminent domain. This contention brings to light concerns about the balance between private interests and public rights.

Despite these concerns, current South Dakota Codified Law (SDCL) does not differentiate between private or public ownership when it comes to "common carrier" status. A bicameral contingent of lawmakers, although lacking enough votes to initiate a special session, are actively working to clarify this aspect of the law.

If the South Dakota Public Utilities Commission (PUC) approves the pipeline application, private corporations would be granted the same rights to use eminent domain as if they were a common carrier. This potential outcome has stirred debate and concern among landowners and legal experts.

Elizabeth Burns-Thompson, Navigator's vice president of government and public affairs, has stated that Navigator will do everything they can to obtain voluntary easements. However, she also acknowledged that "eminent domain is a function of the state," and did not rule out its use, saying, "No, I can't say tonight that we will not use eminent domain."

While Navigator's commitment to seeking voluntary easements offers some reassurance, the possibility of eminent domain looms large, adding an element of uncertainty to the situation. This potential use of eminent domain, coupled with the company's reluctance to rule it out entirely, raises further questions and concerns for landowners. It's not just the immediate acquisition of land that's at stake; other complex issues, such as insurance, are emerging as significant challenges in this multifaceted debate.

According to Rep. Hansen, the issue of insurance could become a significant challenge for landowners, even if they voluntarily agree to an easement.

The potential dangers associated with a containment breach in the pipelines are causing alarm among farmers and landowners. They are being warned that they may not be able to insure future crops or their homes due to the inherent risks involved. This concern extends beyond the immediate vicinity of the pipelines and could have broader implications for property values and land use.

Whether the easement is voluntary or constructed involuntarily via eminent domain, the presence of pipelines could lead to high monthly insurance premiums. In some cases, it might even result in future foreclosures, as insurance is a mandatory requirement for home loans.

Furthermore, the lack of transparency regarding the plume study, the exact route of the pipelines, and potential environmental impacts makes risk assessment nearly impossible for both landowners and insurance companies. Without this critical information, it's challenging to gauge the true extent of the risks involved.

In states like California, where carbon credits will be offset by the pipeline's sequestration, there's currently a moratorium on CO2 pipeline development. This decision has been made due to related concerns, reflecting a broader apprehension about the potential impact of such projects.

It's also unknown if the USDA and the Biden administration are planning any workarounds for crop insurance. This uncertainty further complicates the situation for farmers and landowners, leaving them in a precarious position as they weigh the potential benefits and risks of the proposed pipelines.

Prosperity

CO2 pipelines and CCS (Carbon Capture and Storage) technologies are increasingly seen as the fossil fuel industry's last-ditch efforts to maintain production. The idea is to continue extracting and using fossil fuels, but mitigate the environmental impact by sequestering the emissions underground.

Navigator's vice president of government and public affairs, Elizabeth Burns-Thompson, explained that each commodity, such as corn, is already assigned a carbon index (C.I.). For example, corn has a C.I. of between 60-70 carbon credits. By utilizing corn-based ethanol from Midwestern plants and sequestering the carbon, the C.I. could be reduced by 30 points. Burns-Thompson framed this as a victory for the longevity of ethanol producers, enabling them to sell their products in net-zero markets like California, Oregon, and Washington.

However, Rep. Hansen was quick to challenge this perspective, highlighting that these states have recently passed laws aiming to phase out combustion engines by 2035, roughly coinciding with the projected operational date of the pipeline. He described the entire endeavor as "a boondoggle of inflationary debt spending," arguing that the true motivation behind the project is not free-market principles but rather the pursuit of 45Q tax credits.

Hansen further emphasized that there are more viable and sustainable alternatives available, such as methanol, on-site sequestration, renewable fuels, and simply allowing "the plant food to feed the plants." His remarks underscore a broader debate about the best path forward for energy production and environmental stewardship, raising questions about the long-term viability and wisdom of the proposed pipeline project.

Longevity 

At present, CO2 is transported primarily by rail and truck. The proposed pipeline, with its potential to reduce road traffic by an estimated half a million trucks annually, is seen by both proponents and opponents as a more efficient means of transportation. This shared understanding offers some common ground in a debate often marked by division.

Both sides also recognize the potential for economic prosperity and the sustained vitality of small towns. Many of the 120 farms currently embroiled in legal battles with Summit Carbon Solutions' pipeline project are integral to the local economy. They not only produce crops used in ethanol production but actively support renewable fuels through their operations.

Rep. Hansen emphasized the strong support for ethanol growers among South Dakotans. He suggested that more people would likely back the pipelines if the contentious issue of eminent domain were resolved.

Rep. Hansen's emphasis on the strong support for ethanol growers among South Dakotans is a testament to the shared values and interests that bind the community. He astutely pointed out that more people would likely back the pipelines if the contentious issue of eminent domain were resolved. However, the revelation that Navigator intends to use eminent domain adds another layer of complexity to the ongoing debate over the pipeline project.

In his final remarks, Hansen painted a vivid picture of the challenges facing Americans, who are already burdened by wasteful federal spending and inflation. Now, they are being told they will pay even more, this time with their cherished family farms. His words resonated with a sense of urgency and a call to action.

"We do not have to cave to the market regulators of California," Hansen declared, emphasizing the importance of autonomy and the rights of the individual. "Bottom line, do not take people's land without their consent."

Hansen concluded by quoting and underscoring the importance of South Dakota's State Motto. "Under God, The People Rule!" 

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Thank you for reading this insightful article by our W.C. Dispatch Contributor, Breeauna Sagdal. A dedicated journalist for America Mission and the editor of Dakota Leader, Breeauna's work sheds light on vital issues that matter to our readers. If you enjoyed this piece and wish to support more of her work, please consider sending her a tip. If you appreciate the conservative perspective and critical analysis provided by The W.C. Dispatch, don't forget to subscribe to our platform for regular updates and exclusive content tailored to your interests.

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Breeauna Sagdal is a former policy analyst who turned a love of the legislative process into a career in policy journalism. 

Passionate about local control, Sagdal has cultivated a readership based upon trusted reporting of state and local policies. With a firm belief that the "inside baseball," helps to empower informed voters, Sagdal launched The Dakota Leader in January of 2022 to cover each bill of South Dakota's 97th Legislative Session. Since then, The Dakota Leader has laid the foundation for transparency in government with original source reporting, while giving a voice to those who have been silenced by today's media apparatus.   
The Dakota Leader can be found at the Dakota Leader.com.