EPA Defends Rules for Drilling Vessel Emissions

(CN) - Conservationists complained in the 9th Circuit that the Environmental Protection Agency is ignoring emissions from drill-support vessels in the Arctic.

A group of nine organizations, led by Resisting Environmental Destruction on Indigenous Lands (Redoil), are seeking relief an EPA appeals board refused to review two permits issued to Shell Gulf of Mexico and Shell Offshore.

The permit allows air pollution emissions from oil and gas exploration drilling by Shell's Noble Discoverer drillship and a support fleet of icebreakers, oil-spill-response vessels, and supply ships in the Chukchi Sea.

But Redoil and fellow opponents say that support vessels are not subject to a key component of the Clean Air Act's Prevention of Significant Deterioration program. Because the Discoverer's support vessels do not face the best available control technology (BACT), conservationists say that more than 90 percent of the daily pollution created by Shell's drilling activities could escape required controls.

They want support vessels to face the same rigorous Clean Air Act standards placed on pollution-producing equipment known as Outer Continental Shelf (OCS) sources.

Treating them differently allegedly contradicts Section 328 of the Clean Air Act. "EPA's position that support vessels operating with 25 miles of the drillship should be subject to some requirements typically reserved for stationary sources (source impact analysis and PSD increments) but not others (BACT) not only defies the agency's claim that support vessels - as mobile sources - are subject to less regulation, it is also inconsistent with the language of section 328 and irrational," according to a June 4 brief Earthjustice filed with the 9th Circuit.

But Justice Department attorney Daniel Pinkston pointed out at a hearing Tuesday that the EPA analysis is entitled to deference.

"That's important because what we have here in Section 328 is an ambiguous statute," Pinkston told a three-judge panel in Anchorage.

"EPA has applied a regulation interpreting Section 328 that it promulgated 20 years ago next week as a matter of fact, and what was done in this permit is a pretty straightforward application of that regulatory determination of whether or not, or how you count, air emissions from the associated fleet when you're looking at the OCS source," he added.

"The Clean Air Act has this very basic distinction between stationary sources and mobile sources," Pinkston also said.

Judge Carlos Bea forced Earthjustice to admit that "the statute does not directly define vessels as OCS sources."

Earthjustice attorney Colin O'Brien insisted, however, that this does not mean "that vessels are spared from the obligation to apply best available control technology."

"This all flows from the fact that the definition of OCS source says that emissions from support vessels, whether attached or operating within 25 miles - shall be considered direct emissions from the OCS source," O'Brien said.

Bea interrupted: "I thought we agreed on one thing: That these OCS ships were not OCS sources under the statute, specifically. You're saying, if you interpret these other sections of the statute, you'll see that they are. But that kind of gives away the argument that this statute is somewhat ambiguous."

O'Brien noted, however, "that Section 328's use of the phrase 'direct emissions' is unambiguous."

Justice M. Margaret McKeown also said that the language was clearly ambiguous

"If you have a facility and its emissions include the related or ancillary vessels, how do we now fit that back into, in your view, the best available technology statute," she asked.

O'Brien noted the regulatory reason why there should not be different levels of control for the Discoverer and the service ships.

"Only truly large sources get regulated under the PSD program," O'Brien said, abbreviating Prevention of Significant Deterioration. "However, the legislative history reflects that Congress wasn't just concerned with the drill ship; it was concerned with the totality of emissions from the drill ships and the vessels working together."

The United States split its argument at the hearing with Shell, which intervened in the dispute.

Shell attorney Kathleen Sullivan emphasized how Judge Bea had "dispatched" the initial argument from Earthjustice that claimed the statute was unambiguous.

"Because, as Judge Bea pointed out earlier, if Congress had wanted to apply all aspects of the PSD program to the associated vessels that are not tied up, it simply would have defined OCS source as including associated vessels," said Sullivan, an attorney with Quinn Emanuel Urquhart & Sullivan. "It did not. If Congress had said an associated vessel is an OCS source or is part of an OCS source then statute would have been unambiguous but it does not do that.

Calling it "the Rosetta Stone of the case," Sullivan pointed out that "the direct emissions clause precisely does not define vessels that are servicing or associated with an OCS source either as an OCS source or as part of an OCS source."

Judge Michael Daly Hawkins sat on the panel as well but stayed fairly quiet in the hearing.

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