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September 2008

Vol. 13, No. 39 Week of September 28, 2008

Impact of bruin listing still in limbo

Legal, regulatory tangle obscures potential effect of “threatened” designation for polar bears on Alaska’s resource industries

Stefan Milkowski

For Petroleum News

Four months after U.S. Interior Secretary Dirk Kempthorne listed the polar bear as “threatened” under the Endangered Species Act, the issue has become a legal and regulatory tangle, leaving the impact on Alaska's resource industries still unclear.

Industry groups, conservation organizations, and the State of Alaska have all filed legal challenges related to the listing, and the U.S. Fish and Wildlife Service and Department of the Interior are still considering how the listing should dovetail with existing protections and whether to designate certain areas as “critical habitat.”

While agency personnel say listings under the wildlife protection statute have rarely halted projects outright, Alaska leaders, including Gov. Sarah Palin, Sen. Ted Stevens, R-Alaska, and others, have strongly expressed concerns about this one’s potential impact on the state’s oil and gas industry.

Protecting the species

A listing under the ESA ordinarily triggers two main protections. Section 7 of the Act requires federal agencies to consult with the Fish and Wildlife Service before allowing any activity that may affect the threatened or endangered species. Section 9 prohibits the “take” of the species, a broad definition that includes the terms “harass” and “harm.”

Under Section 7, the responsible federal agency must show that the proposed activity is “not likely to jeopardize the continued existence” of the species. If that proves impossible, the Fish and Wildlife Service is required to suggest mitigation measures that would allow the project to proceed.

According to Fish and Wildlife in Alaska spokesman Bruce Woods, it's “very rare” to have a project stop dead because of an ESA listing, although the timing or scope of the project may change.

“The Endangered Species Act is not the almighty hammer that it’s often portrayed to be,” he said.

Nonetheless, many have expressed concerns about the listing. Palin, the Alaska Legislature, and Alaska’s congressional delegation all opposed the listing, arguing that it was not supported by scientific evidence and could harm the state’s economy.

“[The listing] will have a significant adverse impact on Alaska because additional regulation of the species and its habitat under the ESA will deter activities such as commercial fisheries, oil and gas exploration and development, transportation, and tourism within and off-shore of Alaska,” the state argued in a lawsuit filed against the listing.

In addition to any new requirements under the law, Natural Resources Commissioner Tom Irwin said the listing could pave the way for litigation aimed at stopping resource development.

“There’s always a threat, and now there’s a pathway,” he said.

The listing was complicated by the role of global climate change.

When Kempthorne announced the listing May 14, he identified the climate-related loss of summer Arctic sea ice as the main threat to the species. He made it clear that the listing was not intended to regulate the emission of greenhouse gases, but the state and others continued to express concerns that the listing could ultimately be used to halt projects based on their greenhouse emissions.

Protecting resource development

Concurrent with the listing, Kempthorne proposed a special rule governing its implementation that he said would “ensure the protection of the bear while allowing us to continue to develop our natural resources in the arctic region in an environmentally sound way.”

The rule, which was made effective immediately on an interim basis, would replace certain protections under the act with those already in place under the Marine Mammal Protection Act and the Convention on International Trade in Endangered Species, which Kempthorne claimed were generally stricter. Activities that were not expressly allowed or prohibited under marine mammal act protections still would be subject to Endangered Species Act requirements.

Fish and Wildlife is currently reviewing the special rule, which was proposed under Section 4(d) of the Endangered Species Act, and is expected to render a final ruling soon. A 60-day public comment period ended July 14.

In written comments, the state and industry groups generally supported the special rule, while conservation groups opposed it.

The Alaska Oil and Gas Association supported the rule, writing that “the oil and gas industries’ effects on the polar bear, as regulated under the MMPA, have no more than a negligible effect.” AOGA also warned that "duplicative" regulatory requirements would increase costs and cause delays for oil and gas projects.

The group also asked that Alaska projects be specifically exempted from Endangered Species Act requirements if their only potential impact is through the emission of greenhouse gases. (The state also asked for such a revision.)

The Marine Mammal Commission, an independent government agency charged with overseeing marine mammal protection measures, called for significant revisions to the special rule. The Commission claimed the rule as written would provide little additional protection, and it challenged the Service’s conclusion that existing protections under the Marine Mammal Protection Act and the Convention on International Trade in Endangered Species were sufficient to protect the species, noting that the protections had failed to keep the polar bear from becoming threatened.

The Commission also highlighted the different definitions of "take" under the Endangered Species Act and Marine Mammal Protection Act and questioned how an exemption for activities everywhere under federal jurisdiction “except Alaska” would treat offshore areas.

Designating critical habitat

Designation of critical habitat under the Endangered Species Act listing also could affect the scope of the impact on oil and gas development. The designation would extend certain protections from the animals themselves to the areas of critical habitat.

The Endangered Species Act allows the agency and Interior up to a year after a species is listed to designate critical habitat if that habitat is not “determinable” at the time of the listing.

According to Woods, it’s unclear whether the agency will list any areas as critical habitat.

“One of the problems we have is that much of the critical habitat as defined in the listing is sea ice, and the sea ice is ever-changing,” he said.

Wading through the courts

A number of lawsuits have been filed in opposition to the listing itself and the proposed special rule.

The state of Alaska sued Secretary Kempthorne on Aug. 4, claiming the listing decision was not based on the best available scientific data as required by law. The lawsuit seeks to overturn the decision.

On Aug. 27, the American Petroleum Institute, U.S. Chamber of Commerce, National Mining Association, and two other industry groups filed suit seeking to ensure that Alaska activities would not be subject to ESA requirements if their only impact on the bears is through the emission of greenhouse gases. The groups argue that because the threat is global, activities in Alaska shouldn't be subject to stricter requirements than those in the rest of the U.S., which are exempted from the requirements under the special rule.

The Center for Biological Diversity, the conservation group that originally petitioned the Fish and Wildlife Service to list the polar bear, is challenging the special rule on procedural and substantive grounds and seeking to have the bear listed as “endangered” rather than “threatened.”

Staff attorney Melissa Thrailkill said the group believes the listing should trigger the regulation of greenhouse gases, as well as stricter requirements for oil and gas operations.

“If we’re successful in our lawsuit, then yes, it’s definitely going to change the permitting regulations, and we think it should,” she said.

The group, along with Greenpeace and the Natural Resources Defense Council, also petitioned to intervene in the state’s lawsuit seeking to overturn the listing.

Safari Club International, a hunting group, has filed separate lawsuits seeking to reverse the import of polar bear trophies and to overturn the listing.

Aside from the litigation over the listing decision, the listing itself could strengthen legal challenges to specific development projects, according to Woods and others.

Meanwhile, the National Marine Fisheries Service, which administers the Endangered Species Act for most marine species, is also considering listing four species of ice-dependent seals. The Center for Biological Diversity is also seeking Endangered Species Act protection for walruses.






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