REDOIL v. U.S. EPA

Dec 26: In the U.S. Court of Appeals, Ninth Circuit, Case No. 12-70518. On Petition for Review of an Order of the U.S. EPA Environmental Appeals Board. The case involves Shell Gulf of Mexico, Inc. and Shell Offshore, Inc. (collectively Shell); the purchased lease blocks in the Chukchi and Beaufort Seas off the North Slope of Alaska; and their plans for oil and gas exploration. Shell plans to conduct this exploration via its drillship, the Discoverer, along with an associated fleet of support vessels, including icebreakers, oil spill response vessels, and a supply ship. Shell applied for two Clean Air Act permits to emit pollutants in connection with its exploration activities. The EPA granted the permits, which were upheld in two administrative appeals to the EAB.

 

    Petitioners, Resisting Environmental Destruction on Indigenous Lands, an environmental organization, the Center for Biological Diversity (CBD), Natural Resources Defense Council (NRDC) and other environmental groups (collectively REDOIL), challenge the permits on the basis that they do not satisfy the Act's air permit requirements. Shell intervened to oppose REDOIL's petitions.

 

    According to a summary, the Appeals Court denied a petition for review, and upheld a decision of EPA granting two air permits authorizing exploratory drilling operations in the Arctic Ocean by a drillship and its associated fleet of support vessels. The panel upheld the EPA's statutory and regulatory interpretations. Specifically, the panel held that the Clean Air Act is ambiguous as to the applicability of the best available control emissions to support vessels not attached to an Outer Continental Shelf source, and concluded that under Chevron U.S.A., Inc. v. NRDC, Inc., 467 U.S. 837 (1984), deference that the EPA's construction of the statute was permissible and reasonable. The panel also held that the EPA's grant of a 500 meter ambient air exemption was not plainly erroneous or inconsistent with the EPA's regulations.

 

    The Appeals Court explained that since 1990, EPA has been responsible for regulating air pollution from offshore sources on the Outer Continental Shelf (OCS) under the Clean Air Act. The Appeals Court said, "We consider here whether the EPA's Environmental Appeals Board (EAB) properly upheld two air permits authorizing exploratory drilling operations in the Arctic Ocean by a drillship and its associated fleet of support vessels. The petition for review challenges two aspects of the permits: (1) the determination that support vessels, unlike the drillship itself, do not require the best available control technology (BACT) to control emissions; and (2) the exemption of the area within a 500-meter radius of the drillship from ambient air quality standards.

 

    "The application of BACT to support vessels requires us to reconcile conflicting provisions of the Act. In doing so, under Chevron U.S.A., Inc. v. NRDC, Inc., we defer to the EAB's reasonable interpretation of those provisions and related regulations. 467 U.S. 837 (1984). Likewise, we evaluate whether the EAB's decision on the ambient air boundary is a permissible application of the EPA's regulations. In both cases, we uphold the EPA's statutory and regulatory interpretations, and we deny the petition."

 

    Access the complete opinion (click here). [#Energy/OCS, #CA9]

 

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