State of Montana sues Portland, Oregon over illegal fossil fuel terminal ordinance

State of Montana sues Portland, Oregon over illegal fossil fuel terminal ordinance

HELENA – On behalf of the State of Montana, Attorney General Austin Knudsen filed a lawsuit in federal court today challenging Portland, Oregon’s illegal policies that block the transportation of fuel through its borders and hinder the ability of Montana energy products to reach regional and international markets.

By limiting the supply of energy beyond its city limits, Portland’s ordinance dictates interstate and international trade policy, severs states throughout the west from fuel distribution streams, and is a violation of the United States Constitution and federal law.

“American energy independence, which is critical for our national security and economic well-being, depends on reliable infrastructure to move products to consumers. The Portland government is artificially and intentionally preventing new and expanded infrastructure in order achieve its politically motivated ‘climate action plan,’” Attorney General Knudsen said. “Further, Portland’s hypocritical policies kneecap Montana industries and workers from getting our energy products to market while trying to protect its own citizens from the consequences of its short-sighted actions.”

Starting in 2015, Portland enacted binding policies to block the transportation of fuel through its border that prohibit the construction or expansion of transportation infrastructure that could be used to transport fuel outside the region. The city later adopted and readopted zoning regulations to further this discriminatory purpose in 2016, 2019, and 2022.

Portland is a key transportation hub for energy distribution with a deep-water seaport, rail hub, truck distribution, and petroleum and natural gas pipelines, including the 400-mile Olympic Pipeline that connects Puget Sound refineries with a cluster of ten petroleum terminals in the city. The challenged policies and zoning regulations intentionally discriminate in favor of local users, unreasonably burden interstate commerce, interfere with intermodal and rail transportation, and serve no legitimate local purpose. Therefore, they violate the Dormant Commerce Clause, Foreign Commerce Clause, and Due Process Clause of the U.S. Constitution.

Portland’s government initially welcomed additional investment in new terminals that would enable oil and gas developed in Montana, North Dakota, and other states to reach markets in Asia via marine transportation but reversed course after political opposition. Following the opposition, the city designed its policies to accomplish a discriminatory goal: block infrastructure for international and interstate commerce while avoiding harm to local consumers and businesses.

The lawsuit asks the court to permanently prevent the city from taking further action to enforce or implement the fossil fuel terminal ordinance and related policies.

Other plaintiffs are the Western Energy Alliance, Pacific Propane Gas Association, Idaho Petroleum Marketers and Convenience Store Association, and Christensen, Inc.

To read the complaint, which was filed in the Portland Division of the U.S. District Court for the District of Oregon, click here.

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