Friday, March 5, 2010

MacClarence v. EPA

Mar 4: In the U.S. Court of Appeals, Ninth Circuit, Case No. 07-72756. Bill MacClarence petitioned the court for a review of an order the U.S. EPA Administrator denying his request that the Agency object to the issuance of a Clean
Air Act Title V permit for pollutant-emitting activities at Gathering Center #1 (GC 1), an oil and gas processing facility in Prudhoe Bay. The Alaska Department of Environmental Conservation's (ADEC) granted the permit to British Petroleum Exploration (Alaska), Inc.'s (BP), which owns GC 1. The Appeals Court said that because the Administrator's denial of MacClarence's request "was not arbitrary or capricious, we deny the petition."
    By way of background, the Prudhoe Bay Unit (PBU) is located on the North Slope of Alaska and extends over 300 square miles. It consists of a series of oil and gas facilities, including thirty-eight drill sites or "well pads" and six production centers, as well as support facilities for PBU workers. GC 1 is one of the six production facilities at the PBU. BP owns approximately 26.35% to 50.7% of the facilities at the PBU, including GC 1, and operates all of the PBU facilities pursuant to an agreement with the other owners. The PBU facilities are engaged in a continuum of oil and gas refining activities, from drilling to sale. Well pads in the PBU pump "three-phase" crude oil from the tundra beneath the PBU facilities. This oil is transferred to the production centers, including GC 1, where it is separated into processed crude oil, water, and hydrocarbon gases. The processed crude oil is pumped from the production centers to the Trans-Alaska Pipeline for sale, while other facilities at the PBU dispose of or re-inject the by-products of the production process.
    MacClarence argues that the permit did not comply with the CAA because ADEC, in the final draft permit for GC 1, had not properly "aggregated" stationary sources of air pollution in the PBU. The Appeals Court indicates, "As the record for this case reveals, the aggregation of pollutant-emitting activities for the purposes of designating a "major source" or "major stationary source" is not a clear-cut task. Under the governing regulations, however, determinations regarding 'major sources' for purposes of issuing Title V permits and 'major stationary sources' for purposes of meeting PSD requirements involve the same analysis; the aggregated sources must belong to the same industrial grouping, be located on continuous or adjacent properties, and be under common control."
    The Appeals Court says in its ruling that "we do not decide whether MacClarence's substantive argument -- that the CAA requires all pollutant-emitting sources in the PBU to be aggregated for purposes of Title V and other substantive CAA provisions -- is correct. Rather, we consider only whether the EPA Administrator erred in determining that MacClarence failed to demonstrate, pursuant to 42 U.S.C. § 7661d(b)(2), that the final Title V permit for GC 1 did not comply with the CAA.
    The Appeals Court indicates that, in denying MacClarence's request, the Administrator reasoned that MacClarence (1) "failed to provide adequate information to support his claim that the entire PBU should be aggregated," and (2) "failed to demonstrate that the failure to aggregate all facilities within the PBU has led to a deficiency in the content of the permit." Therefore, the Appeals Court rules, "Because we conclude that we may properly uphold the Administrator's denial of MacClarence's petition on the basis of the first ground, we need not reach the second. . . the Administrator's conclusion that MacClarence "failed to provide adequate information to support his claim that the entire PBU should be aggregated" was not arbitrary or capricious. . .
    "Therefore, we conclude that the Administrator's determination that MacClarence did not demonstrate that the entire PBU should be aggregated did not constitute an impermissible interpretation of MacClarence's burden under 42 U.S.C. § 7661d(b)(2), to 'demonstrate' that ADEC's final Title V permit for BP's GC 1 did not comply with the CAA, nor was it arbitrary or capricious."
    Access the complete opinion (click here).