The fossil fuel sector should not expect broad investment certainty or sweeping regulatory relief in light of an executive order expediting infrastructure permitting during the coronavirus pandemic, but the order could help some specific projects mired in legal and permitting battles, market observers said.

The overall problems facing oil, gas and coal companies during the pandemic are related to declining demand, not supply, which observers said will limit the executive order's ability to help the sector. The order is also predicated on the national emergency declaration Trump issued in response to the coronavirus, a temporary designation that could be lifted in the coming months depending on the nation's pandemic response.

President Donald Trump granted agencies an "uncertain permitting power" that is unlikely to significantly affect major infrastructure projects, said Kenny Stein, policy director for the free-market think tank Institute for Energy Research. While the order could benefit smaller, less expensive projects, such as new wells sited on federal lands, current market conditions may deter companies from moving forward on such proposals, he said.

"We look very favorably on any efforts to streamline some of the permitting and regulatory processes that slow these projects down," Stein said. "I think part of the problem here is that because this EO is being done based on emergency authorities, what happens when the coronavirus ends?"

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The order, which was issued June 4, instructed federal agencies to expedite permitting for infrastructure projects in light of what it described as an economic crisis brought on by the coronavirus pandemic. The order was aimed at bolstering the weakened economy and bringing Americans out of unemployment by paving a way for the development and construction of facilities, including energy projects.

Trump essentially gave agencies "marching orders" to determine what projects they could accelerate in the near-term and solve any impediments to doing so, according to Christine Tezak, a managing director for the research firm ClearView Energy Partners LLC. However, these orders could improve the prospects only for projects needing near-term help, Tezak said, noting that she "wouldn't define that as providing incremental, industry-wide certainty."

Still, some major oil and gas projects could benefit. Tezak pointed to TC Energy Corp.'s Keystone XL oil pipeline, Dominion Energy Inc.-led Atlantic Coast gas project and EQM Midstream Partners LP-backed Mountain Valley pipeline, all of which were affected by recent court decisions. The courts prevented the U.S. Army Corps of Engineers from issuing its Nationwide Permit 12 program for pipeline projects due to an Endangered Species Act violation. Trump's executive order may push the Army Corps to quickly address this violation and move forward with the permitting process for these pipelines, Tezak said.

"We think the focus of the executive order is on projects that could be complete by the time there's an administration change," Tezak said. "Even if there is litigation, even if the permit is found out after the fact to be flawed, it's often harder to pull a permit from a project that's in service compared to one that is not."

While the president has broad authority during an emergency, the executive order is unlikely to resolve legal setbacks pertaining to the Nationwide Permit 12 program, according to a June 4 note from Washington Analysis LLC. The research firm maintained that the Atlantic Coast and Mountain Valley pipelines will likely see further delays.

"A nebulous connection to jump-starting the economy is far less persuasive and, arguably, only indirectly aided by waiving environmental requirements," according to the note.

Coal is least likely of the fossil fuels to benefit from faster permitting, a reflection of the sector's beleaguered state. Since the U.S. Department of the Interior first lifted an Obama-era coal leasing moratorium in March 2017, companies have withdrawn applications for 930 million tons of federal coal compared to the government selling nearly 83 million tons and receiving new requests for 80 million tons, E&E News reported March 3.

If the goal is to get new coal mining projects approved, the question for industry will be, "What projects?" according to Ben Nelson, lead coal analyst for Moody's Investors Service.

"Coal companies are not massively expanding mining capacity," Nelson said in a June 5 interview. "If the idea is that you could more quickly get a new mine approved, build it and put people to work … there aren't a lot of those existing in the first place."