Pipeline delays cost builder millions, risking contract loss

DES MOINES, Iowa (AP) — The completion of the Dakota Access oil pipeline has been delayed after the U.S. Army declined to grant an easement for the final few thousand feet under a Missouri River reservoir in North Dakota pending further study.

The Army Corps of Engineers isn't very sympathetic saying in court filings that the company knowingly began construction prior to receiving all necessary approvals "at its own risk."

Dakota Access attorney William Scherman said in a Nov. 15 document filed in U.S. District Court in Washington that further delay could "threaten the very survival" of the $3.8 billion privately funded project, which would carry North Dakota oil through the Dakotas and Iowa to a shipping point in Illinois.

Industry experts say the contracts likely have several target dates including project start date, in-service date and differing start dates for the nine shippers.

When Dakota Access signed on shippers in 2014, crude oil prices were at $95 a barrel, but they've averaged around $45 to $50 a barrel recently, which could be in incentive for some to use the delay as a reason to want to open up the terms for renegotiation.