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EPA re-issuing OCS discharge permits Agency to issue new NPDES general Arctic permits in June; makes comparison between U.S., Norwegian offshore discharge regulation Alan Bailey Petroleum News
With the Environmental Protection Agency’s general permit for discharges into seawater from Arctic offshore exploration activities due to expire on June 26, the agency is in the process of developing new permits, with permit issue planned for late 2011 or early 2012. Companies such as Shell that wish to drill Arctic offshore exploration wells must ensure that discharges from drilling operations fall within the limits set by the permits.
Unlike EPA air emissions permits, which are issued on a case-by-case basis and which have become a major problem for Shell as the company tries to move ahead with its offshore Alaska exploration plans, there is what is termed a “general permit,” issued by EPA, for discharges into the water from Arctic exploration activities. A company can obtain an authorization to operate within the stipulations of a general permit without having to obtain an individual permit for a specific activity.
Issued in 2006 EPA issued the current general permit for the Arctic offshore in 2006, under the terms of the National Pollutant Discharge Elimination System, generally referred to as NPDES. This permit, which expires in June, only applies to exploration facilities, typically exploration drilling rigs, and covers the federal and state waters of the Beaufort Sea, the Chukchi Sea, the Hope basin and the northern Norton basin.
Rather than issuing a new general permit with the same geographic scope as the current permit, EPA proposes issuing separate general permits for the Beaufort and Chukchi seas. And, given that no other Arctic offshore areas are likely to be included within any OCS lease sale in the foreseeable future, the new general permits will not encompass any areas beyond those two seas.
In addition to considering the appropriate disposal of general wastewater and effluent from an offshore facility, the NPDES permit has to consider industrial waste streams such as drilling rock cuttings and used drilling fluids such as drilling mud.
Developing criteria Under the terms of the Clean Water Act, EPA has to develop permit waste discharge criteria that ensure that any permitted discharges will not unacceptably degrade ocean waters. And, according to an EPA status report, the agency is in the process of determining those criteria for the new Arctic general permits. An agency contractor is gathering traditional knowledge from residents in the North Slope communities of Point Lay, Barrow, Nuiqsut and Kaktovik, as part of the process for determining the discharge criteria, the status report says.
The agency plans to conduct workshops in Barrow and Anchorage in March and April, to review its preliminary findings, before sharing draft versions of the proposed general permits with North Slope tribal governments in May and June. EPA anticipates issuing draft permits for public review in July or August, with public hearings and informational meetings being held in September.
Presumably as a preamble to dialogue over the new permits, EPA has published an information sheet comparing the regulation of offshore industrial discharges in the United States and Norway. With an active oil and gas industry in the Arctic offshore and with a goal of zero discharges from petroleum-related activities, the Norwegian regulatory system has attracted considerable interest as a potential yardstick for responsible Arctic offshore development.
Similar objectives But, although the objectives of U.S. and Norwegian environmental regulations are broadly similar, there is some fuzziness around what exactly is meant by “zero discharges,” and the two countries have used distinctly different approaches to discharge management.
Norway has refined the meaning of its zero discharge policy by establishing a classification system for materials that might be discharged from an offshore operation and then requiring zero discharges of those materials considered environmentally hazardous. The country requires the use of the best available technology to control discharges and follows what is termed a “precautionary principle” in determining what discharges can be allowed, according to the EPA information sheet. Under a precautionary principle, regulators can use discretion to ban the discharge of a substance suspected of being environmentally harmful.
The Norwegian system requires offshore operators to classify chemicals used offshore as black, red, yellow or green, depending on the level of impact that the chemicals might have on the environment. Green category chemicals are specified on a list maintained by the Convention for the Protection of the Marine Environment of the North-East Atlantic and have been determined to be non-toxic.
Norway prohibits the discharge of any chemical with a red or black classification, and the harmful discharge of any chemical with a yellow or green classification, the EPA information sheet says.
Numerical limits In the United States, EPA’s NPDES regulations apply numerical limits to the discharge of pollutants, based on the technology available to control the pollutants, the EPA information sheet says. And an evaluation of discharge criteria must find that “the discharge will not cause unreasonable degradation of the marine environment,” the sheet says. Discharge restrictions are more stringent within state waters close to the coastline than on the federal outer continental shelf.
In terms of the general waste products of an offshore drilling operation, both the U.S. and the Norwegian rules result in the prohibition of the offshore discharge of any oil-based drilling fluid.
The United States allows the discharge of water based drilling fluids and associated drilling cuttings during exploration drilling, but the discharge of these materials during field development and production is banned in coastal waters, except in Alaska’s Cook Inlet. Numeric limits apply to all permitted discharges, with the discharge limits being based on toxicity testing of discharged materials.
Norway requires all chemicals used in drilling fluids and not classified as green to be tested for potential environmental impacts, with the black, red, yellow and green classification system used to determine what materials can be discharged. However, north of the 68th parallel only the discharge of mud and cuttings from the top portion of a well is allowed, with other waste having to be re-injected underground or barged to the shore. And no discharge of any cuttings from a drilling operation involving the use of oil-based drilling fluids is allowed north of the 68th parallel.
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