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Court rejects Shell air permits appeal 9th Circuit Court upholds Environmental Appeals Board decision in appeal against air quality permits for Noble Discoverer drillship Alan Bailey Petroleum News
The U.S. Court of Appeals for the 9th Circuit has rejected an appeal against the Environmental Protection Agency’s approval of air quality permits for the Noble Discover, the drillship that Shell is using for exploratory drilling in the Alaska Arctic outer continental shelf. Shell is using the Noble Discoverer primarily for drilling in the Chukchi Sea, although the company had obtained two air quality permits for the vessel: one for the Chukchi Sea and one for the Beaufort Sea.
In a Dec. 26 decision the 9th Circuit court upheld both of the permits.
The EPA issued the Noble Discoverer’s air permits in September 2011. The permits were major Prevention of Significant Deterioration permits, rather than minor permits of a type that had previously run aground in litigation.
The Native Village of Point Hope and a group of environmental organizations subsequently appealed to the Environmental Appeals Board over the issue of the permits. And, after the Appeals Board turned down the appeal in January 2012, the appeal moved to the 9th Circuit Court.
Two questions The court case essentially revolved around two questions: whether vessels in the fleet supporting the drilling vessel should be required to have best available emissions control technology when operating within 25 miles of the drillship, and whether the EPA was correct in allowing a 500-meter zone around the drillship to be excluded from ambient air quality requirements.
Under the terms of the Clean Air Act a stationary industrial emissions source needs to use best available technology to minimize air emissions. And a drillship, moored on site for a drilling operation, is clearly a stationary emissions source. It also appears clear that a support vessel attached to the drillship during a drilling operation is also part of the stationary source.
But the statute is ambiguous regarding whether support vessels, freely moving but operating within 25 miles of the drillship, are also part of the stationary source, and hence subject to the need for best available emissions technology. The EPA had included emissions from the support fleet as part of a determination that Shell needed a major air permit for the Noble Discoverer, but the agency had not viewed mobile vessels of the support fleet as part of the drilling stationary source.
The 9th Circuit court said that it defers to the EPA’s “reasonable construction of the statute,” as also adopted by the Environmental Appeals Board, that the best available technology requirements do not apply to support vessels not attached to the drillship.
Exclusion zone The question of the 500-meter zone around the drillship relates to the application of the Clean Air Act on land, where air quality standards typically apply outside the perimeter fence of an industrial facility. Agreeing that considering the gunwales of the drillship as the facility’s “fence” to be unreasonable, the EPA had granted a request by Shell that a 500-meter exclusion zone imposed by the U.S. Coast Guard around the vessel should not be subject to ambient air quality requirements.
The court has agreed with EPA’s position on this, saying that, because the public is barred from entry to the exclusion zone, the perimeter of the exclusion zone performs a similar function to the perimeter fence of a land-based facility. EPA regulations define ambient air as the portion of the atmosphere, external to buildings, to which the general public has access, the court said in its Dec. 26 decision document.
The 9th Circuit Court is still considering a similar appeal against the air quality permit for the Kulluk, the floating drilling platform that Shell is using for exploratory drilling in the Beaufort Sea. Shell was able to proceed with its Arctic drilling operations using the Noble Discoverer and the Kulluk in the summer of 2012 while the air quality permit appeals were in progress. The company drilled one top-hole section of a well in the Chukchi Sea and one top hole in the Beaufort.
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