Sierra Club v. Federal Energy Regulatory Commission

The D.C. Circuit Court of Appeals denied a petition for review of the Federal Energy Regulatory Commission’s (FERC’s) approval of a cross-border natural gas pipeline connecting the planned intrastate Saguaro Pipeline to a Mexican pipeline that would transport natural gas to an export terminal on the Gulf of California. The court rejected the petitioners’ arguments that FERC should have exercised jurisdiction over the intrastate pipeline under the Natural Gas Act and that approval of the project was arbitrary and capricious. The court also rejected the petitioners’ arguments that FERC violated NEPA. Citing the “substantial deference” owed to FERC’s choices in its NEPA review, the court found that FERC had not unreasonably constrained the alternatives it considered, had reasonably declined to consider upstream impacts of the intrastate pipeline as indirect effects of the cross-border pipeline, and was not required to conduct an environmental review of the intrastate pipeline as a “project-related nonjurisdictional facility” under FERC’s regulations.