On October 8, 2013, US Rep. Fred Upton (R-MI), chair of the US House Energy and Commerce Committee, and US Rep. Gene Green (D-TX) introduced to the US House of Representatives the North American Energy Infrastructure Act, a bipartisan bill seeking to establish a more efficient approval process for cross-border energy infrastructure and, specifically, oil and gas pipelines and electric transmission lines. The bill states that a “fair and standardized approval process for cross-border energy projects will help bring certainty to the regulatory process, encourage investment in job-creating energy infrastructure and facilitate trade with our Canadian and Mexican allies.” The bill particularly seeks to remove barriers to the construction of cross-border energy infrastructure and to promote North American energy independence.

According to the bill, the North American Infrastructure Act:

  • Consolidates and standardizes the cross-border approval process for oil pipelines, natural gas pipelines, and electric transmission lines, replacing and superseding the current processes that have been created in an ad hoc fashion through multiple Executive Orders.
  • Will not waive any environmental laws but will decouple the cross-border determination from the NEPA review process. Applicable environmental laws and permits would still be required but not for the purpose of determining whether a project should be allowed to cross the international borders of the U.S.
  • Instructs that all applications for cross-border oil pipelines will be handled by the Department of Commerce, natural gas pipelines by the Federal Energy Regulatory Commission, and electric transmission lines by the Department of Energy.
  • Requires agencies to approve cross-border applications within 120 days of submission unless they determine the project is not in the national security interest of the U.S.
  • Specifies that existing projects do not need further approvals, including new or revised Presidential Permits, for modifications such as reversal of flow direction, volume expansion or adjustments to maintain flow or in cases of changes in ownership.
  • Removes the unnecessary requirement for natural gas pipelines that would cross U.S. borders into Canada or Mexico to receive approval from the Department of Energy.
  • Has an effective date of July 1, 2015 and specifically addresses how currently pending applications shall be handled.”

See proposed North American Infrastructure Act.

For more information about this Legal Update, please contact Dallas Parker, Jose Valera, Pablo Ferrante or Gabriel J. Salinas.