The 4th Circuit panel chided the Fish and Wildlife Service for failing to properly survey the density of rusty-patched bumblebee nests that would be affected by the pipeline.

Dominion Energy’s hopes for resuming construction of the Atlantic Coast Pipeline have run into a new obstacle erected by a federal appeals court panel in Richmond that threw out a federal permit on Friday because it failed to adequately protect endangered or threatened species in the path of the 605-mile project.

The 4th U.S. Circuit Court of Appeals vacated a permit that the U.S. Fish and Wildlife Service issued last year just 19 days after the same court blocked the agency’s previous finding that the massive natural gas pipeline would not jeopardize the viability of four endangered or threatened species.

A three-judge panel, in a 50-page opinion written by Chief Judge Roger L. Gregory, took note of the federal agency’s quick action and warned, “In fast-tracking its decisions, the agency appears to have lost sight of its mandate under the [Endangered Species Act]: ‘to protect and conserve endangered and threatened species and their habitats.’ ”

Gregory ruled that the agency’s biological opinion and accompanying incidental take statement — a reference to species killed or harmed as a result of construction — were “arbitrary and capricious” by failing to show how the pipeline would not jeopardize the survival of an endangered bumblebee population in Bath County or freshwater mussels in three West Virginia rivers and their tributaries.

The ruling also concluded that the reissued permit failed to establish “enforceable take limits” for an endangered bat species in Virginia and West Virginia and threatened crustaceans that live in underground limestone karst formations in the Shenandoah Valley.

Dominion spokesman Aaron Ruby responded, “Based on the clear direction provided by the court in today’s opinion, we expect FERC and the Fish and Wildlife Service will be able to immediately begin working to correct the issues identified by the court.”

“Once the new Biological Opinion and Incidental Take Statement are issued, we will seek the necessary approval from the Federal Energy Regulatory Commission to resume construction,” Ruby said. “We’re confident we remain on track to complete the project by late 2021.”

He also said the project had “taken extraordinary care to protect sensitive species and will continue doing so as we work with the agency to complete the additional analysis required by the court.”

A series of adverse rulings by the 4th Circuit on federal permits for the project prompted the pipeline company, led by Dominion, to change its construction plans earlier this year.

The company suspended work in December after the 4th Circuit issued a stay on the biological opinion for the entire length of the pipeline, not just the 100 miles or so that Dominion contends would affect endangered or threatened species addressed in the permit.

If the Fish and Wildlife Service were to issue a new permit, Dominion has said it would begin building the pipeline from Buckingham County to the southeastern Virginia coast, connecting it to Hampton Roads and extending it through eastern North Carolina.

The company plans to build a natural gas compressor station at Union Hill in Buckingham under a state air pollution permit that environmental groups also have appealed to the 4th Circuit.

Separately, Dominion and its partners have petitioned the U.S. Supreme Court to review another opinion by the same federal appeals panel last December that threw out a U.S. Forest Service permit to allow the pipeline to cross beneath the Appalachian Trail between Augusta and Nelson counties. In its petition to the high court, the pipeline company called the Forest Service decision “part of a pattern of decisions by the Fourth Circuit ... finding fault after fault in the arduous approval process for pipelines.”

If the pipeline company and Forest Service were to prevail at the Supreme Court, Dominion has said it would begin building the pipeline through western Virginia, across the Blue Ridge Mountains and into Buckingham.

However, the Southern Environmental Law Center said the latest 4th Circuit decision is further evidence that the pipeline, now estimated to cost up to $7.5 billion, should not be built “because there is no clear path forward to construct the pipeline on its current route.”

The law center also faulted the Fish and Wildlife Service for its handling of the permit process for protecting endangered and threatened species.

“In its rush to help this pipeline company, the agency failed to protect species on the brink of extinction,” said Patrick Hunter, an attorney for the Charlottesville-based law center, which represents three environmental organizations in the appeal. “This pipeline would blast through some of the last populations of these rare animals.”

The 4th Circuit panel — including Judges James A. Wynn Jr. and Stephanie D. Thacker — also rebuked the Fish and Wildlife Service for its haste in assessing the pipeline’s effect on endangered or threatened species, particularly the rusty-patched bumblebee, whose populations the ruling said “have plummeted by nearly 90 percent” in the past two decades.

The agency found that the pipeline would result in some harm to the bee population in Bath County, both by crushing worker and queen bees and damaging the foraging habitat for overwintering colonies, but would not be likely “to negatively impact the fitness or survival of the population.”

In the panel ruling, Gregory said the agency had failed to properly survey the density of the rusty-patched bumblebee nests that would be harmed by the project.

“In fact, the agency made a point of avoiding surveys in order to ‘fast-track’ pipeline authorization,” he wrote.

Gregory cited an internal agency email message that said it would not require or seek “surveys that interfered with the applicant’s project schedule since these are priority fast-track projects.”

He also faulted the agency for not addressing how projected destruction of rusty-patched bumblebee nests “are reasonable in light of the known and documented record of severely declining [bee] populations.”

“The agency has also ignored significant evidence that undermines the reasonableness of its estimates — evidence that the agency itself has gathered — and has instead chosen to rely on one bee expert’s ‘wild guess,’ ” Gregory wrote.

The opinion also finds the Fish and Wildlife Service failed to comply with the law’s requirements in its assessment of likely harm to the clubshell mussel, particularly in a tributary of the Monongahela River in West Virginia; the Indiana bat; and the Madison Cave isopod.

The Sierra Club, one of the three organizations that had appealed the 2018 biological opinion and incidental take statement, said the energy companies behind the pipeline are paying the price for rushing the federal permitting processes.

“We have said all along that many of the [pipeline’s] permits were issued in flawed, rushed processes, and time after time, the courts have agreed,” said Sierra Club attorney Nathan Matthews in a statement.

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