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News Focus
Atlantic Drilling Dropped from Offshore Plan
The U.S. Department of Interior has dropped the prospect of Atlantic offshore oil and gas drilling from the proposed version of the next five-year plan for offshore leasing. Interior Secretary Sally Jewell, announcing the decision March 15, said it was a reaction in large part to opposition from communities in the southeastern United States fearful that oil development would conflict with fishing, tourism, and shipping activities. A draft version of the plan, covering the period from mid-2017 to mid-2022, was released in January 2015 with a provision for a lease sale in 2021 somewhere off the coasts of Virginia, North Carolina, South Carolina, and Georgia, as well as 10 more lease sales in the Gulf of Mexico and three in Alaskan waters. The draft version drew more than 1 million comments. Along with public reactions, U.S. military use of the southeastern offshore was a factor but not stressed by Jewell or Director Abigail Ross Hopper of the Bureau of Ocean Energy Management (BOEM), which wrote the plan. When the proposed plan is published in the Federal Register by BOEM, it will kick off a 90-day public comment period. Along with the plan, a draft programmatic environmental impact statement will be published and subject to a 45-day public comment period.
Arctic Exploration Possible There is no chance the Atlantic drilling plan will be added back into the five-year plan’s final version, Jewell said, noting that the planning system allows only for narrowing the lease list further, not expanding it.
The leasing plans for the Gulf of Mexico are relatively uncontroversial. Alaska is a different matter, because of environmental activist opposition to Arctic drilling and the high costs and tougher regulations for Arctic waters. The five-year plan includes provisions for one sale in Alaska’s Cook Inlet in 2021, one in the Beaufort Sea in 2020, and one in the Chukchi Sea in 2022. Some parts of the Beaufort and Chukchi seas are off-limits to exploration, and more could be put off limits or be given seasonal limits if the Interior Department is convinced of the environmental sensitivity of those areas, Jewell said. The department is soliciting public comment partly for that purpose—to elicit information about the need to protect more areas. Royal Dutch Shell Plc and Statoil ASA both gave up last year on the U.S. Arctic offshore. Only one offshore development prospect in the U.S. Arctic is continuing to advance through the permitting process as Hilcorp Alaska LLC edges toward trying to build a gravel island for drilling the Liberty field in a near-shore part of the Beaufort Sea. No leasing will occur off the Pacific Coast, especially because of opposition by California, Oregon, and Washington, Jewell said.
‘Standing Up to Big Oil’ Environmental activist groups hailed the decision on Atlantic drilling as the right thing to do. Oil and gas industry groups called it short-sighted. “By dropping the Atlantic from oil and gas leasing, the administration is standing up to Big Oil and protecting our
em • The Magazine for Environmental Managers • A&WMA • April 2016
News Focus
coastal communities that rightly fear a BP-style disaster,” said Rhea Suh, president of the Natural Resources Defense Council, in a statement released shortly before the Interior announcement.
and natural gas development,” said Randall Luthi, president of the National Ocean Industries Association, in a statement decrying the removal of the Atlantic leasing option from the five-year plan.
“Next, the president should finish the job, honor his historic climate agenda, and protect future generations by using his authority to permanently end the threat of drilling in the Atlantic and the Arctic,” said Suh, a former Interior official in the Obama administration. She didn’t explain how any president might have the authority to permanently end drilling anywhere.
When BOEM issued its draft proposal in 2015, the public comments filed by industry groups made it clear that they feared the Atlantic portion of the plan would be dropped out.
The administration’s relationship with oil companies, big or small, has been increasingly uncomfortable, possibly making it easy for Interior to shrug off any influence the industry might hope to have on exploration leasing.
Wishing for ‘Long-Term View’ While environmental groups look back to the Deepwater Horizon disaster of 2010 at a BP Plc drilling site in the Gulf of Mexico, industry groups point to other nations, such as Canada, developing their Atlantic offshore petroleum prospects. Industry groups also note the coexistence of thriving oil and gas development with tourism and fishing in the Gulf of Mexico.
Future Leasing Plans A future administration could revise offshore leasing plans, but the process is a slow one, taking at least a year-and-a-half and potentially subject to litigation from opponents. For the next administration, regardless of political party, the simplest strategy would be to start planning for a 2022-2027 fiveyear plan. Congress also could step in to mandate changes, although it hasn’t succeeded in doing so in recent years amid the political stalemate between President Barack Obama and congressional Republicans.
For More Information The proposed five-year plan for offshore oil and gas leasing for 2017–2022 is available online at http://src.bna.com/dk9. —By Alan Kovski, Bloomberg BNA
“By not taking the long-term view, the administration sells U.S. consumers short. Instead, they have determined they are content to let the rest of world lead in Atlantic offshore oil
A&WMA Buyers Guide
Tap into the incredible network of the Air & Waste Management Association with the A&WMA Buyers Guide. Powered by MultiView, the Guide is the premier search tool for environmental professionals. Find the suppliers you need, within the network of the association you trust. Start your search today at awma.org.
em • The Magazine for Environmental Managers • A&WMA • April 2016
News Focus
Supreme Court Asked to Review Mercury Rule Remand Order A coalition of 20 states wants the U.S. Supreme Court to review a lower court’s decision to leave the Mercury and Air Toxics Standards (MATS) rule in place while the U.S. Environmental Protection Agency (EPA) addresses a legal flaw in its rulemaking process (Michigan vs. EPA, U.S., No. 15-1152, 3/14/16).
The states are seeking vacatur of the MATS rule, which they said was issued outside of the EPA’s statutory authority, because the agency has not completed a valid “appropriate and necessary” determination, as Congress required it to do before actually regulating (Michigan vs. EPA, 135 S. Ct. 2699, 2015 BL 207163, 80 ERC 1577 (2015)).
The state coalition, led by Michigan Attorney General Bill Schuette (R), petitioned the Supreme Court to consider whether a reviewing court can leave an unlawful rule in place if a regulatory agency promulgated that regulation without any statutory authority.
States Cite Circuit Split
While the agency is expected to issue a rule by mid-April to fix the legal flaw in the MATS rule, the states said the issue should be reviewed by the Supreme Court, because it is of “exceptional importance” given the exclusive jurisdiction of the U.S. Court of Appeals for the District of Columbia Circuit over many agency regulations. The petition represents the latest effort by states to overturn the 2012 MATS rule, which the agency estimated to cost the power sector $9.6 billion per year. The request comes less than two weeks after Chief Justice John Roberts, Jr., rejected a stay application filed by the same states, which had sought to block implementation and enforcement of the mercury standards.
The petition, filed March 14 and obtained by Bloomberg BNA March 16, specifically challenges a December decision by the D.C. Circuit to leave the MATS rule (RIN 2060–AP52, RIN 2060-AR31) in place while the EPA addresses the Michigan vs. EPA ruling (White Stallion Energy Ctr. LLC vs. EPA, D.C. Cir., No. 12-1100, 12/15/15). The D.C. Circuit in 1993 established a two-factor test for deciding whether to vacate an agency regulation or action on remand. Under that two-part test, the court considers the seriousness of the legal flaw in the decision and the disruptive consequences of vacating a decision only to have it later be reissued (Allied-Signal Inc. vs. U.S. Nuclear Regulatory Comm’n, 988 F.2d 146, 300 U.S. App. D.C. 198 (D.C. Cir. 1993)). However, the states said the D.C. Circuit’s decision to remand MATS back to EPA without vacatur conflicts with a similar decision made by the Fifth and Eight Circuits, establishing a circuit split that the Supreme Court should address.
EPA Working on Supplemental Rule EPA is working on a supplemental rulemaking to address the Supreme Court’s 2015 holding that the agency erred when it determined it was “appropriate and necessary” to regulate power plant emissions under Section 112 without considering cost.
Conflicts with Another Ruling The states also argued that the D.C. Circuit’s decision to remand without vacatur conflicts with the 2015 Michigan vs. EPA ruling.
em • The Magazine for Environmental Managers • A&WMA • April 2016
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News Focus
In light of EPA’s position in this case— that its lack of authority to regulate poses no obstacle to its continued imposition of regulations—this type of unlawful agency action is capable of repetition. – States per petition for a writ of certiorari in Michigan vs. EPA
“Agency action, taken without authority, cannot be left in place to have the effect of binding law,” the states said. “But here, EPA refused to retract and the D.C. Circuit refused to vacate EPA’s regulation, even after this Court held that EPA had overstepped its authority.” The states acknowledged that EPA will likely argue that the legal question will become moot if the agency issues a rule that reaffirms its “appropriate and necessary finding.” However, the states argued that the issue won’t be moot, because the situation is likely to occur again but evades judicial review.
regulations—this type of unlawful agency action is capable of repetition,” the states argued. EPA’s press office didn’t immediately respond to a request for comment on the states’ petition. The federal government’s response to the Supreme Court is due April 15, according to the court’s website.
For More Information
The petition for a writ of certiorari in Michigan vs. EPA is available online at http://src.bna.com/dmJ. —By Patrick Ambrosio, Bloomberg BNA
“In light of EPA’s position in this case—that its lack of authority to regulate poses no obstacle to its continued imposition of
News Focus is compiled from the current edition of Environment Reporter, published by the Bureau of National Affairs Inc. (Bloomberg BNA). For more information, visit www.bna.com.
In Next Month’s Issue… COP-21: Insights from the Paris Climate Conference The May issue will comprise unique stakeholder insights from the COP-21 meeting that was held in Paris in December 2015. Also look for… EPA Research Highlights Etcetera Washington Report Canadian Report …as well as a preview of the 2016 A&WMA Annual Conference
em • The Magazine for Environmental Managers • A&WMA • April 2016
Atlantic Drilling Dropped from Offshore Plan
The U.S. Department of Interior has dropped the prospect of Atlantic offshore oil and gas drilling from the proposed version of the next five-year plan for offshore leasing. Interior Secretary Sally Jewell, announcing the decision March 15, said it was a reaction in large part to opposition from communities in the southeastern United States fearful that oil development would conflict with fishing, tourism, and shipping activities. A draft version of the plan, covering the period from mid-2017 to mid-2022, was released in January 2015 with a provision for a lease sale in 2021 somewhere off the coasts of Virginia, North Carolina, South Carolina, and Georgia, as well as 10 more lease sales in the Gulf of Mexico and three in Alaskan waters. The draft version drew more than 1 million comments. Along with public reactions, U.S. military use of the southeastern offshore was a factor but not stressed by Jewell or Director Abigail Ross Hopper of the Bureau of Ocean Energy Management (BOEM), which wrote the plan. When the proposed plan is published in the Federal Register by BOEM, it will kick off a 90-day public comment period. Along with the plan, a draft programmatic environmental impact statement will be published and subject to a 45-day public comment period.
Arctic Exploration Possible There is no chance the Atlantic drilling plan will be added back into the five-year plan’s final version, Jewell said, noting that the planning system allows only for narrowing the lease list further, not expanding it.
The leasing plans for the Gulf of Mexico are relatively uncontroversial. Alaska is a different matter, because of environmental activist opposition to Arctic drilling and the high costs and tougher regulations for Arctic waters. The five-year plan includes provisions for one sale in Alaska’s Cook Inlet in 2021, one in the Beaufort Sea in 2020, and one in the Chukchi Sea in 2022. Some parts of the Beaufort and Chukchi seas are off-limits to exploration, and more could be put off limits or be given seasonal limits if the Interior Department is convinced of the environmental sensitivity of those areas, Jewell said. The department is soliciting public comment partly for that purpose—to elicit information about the need to protect more areas. Royal Dutch Shell Plc and Statoil ASA both gave up last year on the U.S. Arctic offshore. Only one offshore development prospect in the U.S. Arctic is continuing to advance through the permitting process as Hilcorp Alaska LLC edges toward trying to build a gravel island for drilling the Liberty field in a near-shore part of the Beaufort Sea. No leasing will occur off the Pacific Coast, especially because of opposition by California, Oregon, and Washington, Jewell said.
‘Standing Up to Big Oil’ Environmental activist groups hailed the decision on Atlantic drilling as the right thing to do. Oil and gas industry groups called it short-sighted. “By dropping the Atlantic from oil and gas leasing, the administration is standing up to Big Oil and protecting our
em • The Magazine for Environmental Managers • A&WMA • April 2016
News Focus
coastal communities that rightly fear a BP-style disaster,” said Rhea Suh, president of the Natural Resources Defense Council, in a statement released shortly before the Interior announcement.
and natural gas development,” said Randall Luthi, president of the National Ocean Industries Association, in a statement decrying the removal of the Atlantic leasing option from the five-year plan.
“Next, the president should finish the job, honor his historic climate agenda, and protect future generations by using his authority to permanently end the threat of drilling in the Atlantic and the Arctic,” said Suh, a former Interior official in the Obama administration. She didn’t explain how any president might have the authority to permanently end drilling anywhere.
When BOEM issued its draft proposal in 2015, the public comments filed by industry groups made it clear that they feared the Atlantic portion of the plan would be dropped out.
The administration’s relationship with oil companies, big or small, has been increasingly uncomfortable, possibly making it easy for Interior to shrug off any influence the industry might hope to have on exploration leasing.
Wishing for ‘Long-Term View’ While environmental groups look back to the Deepwater Horizon disaster of 2010 at a BP Plc drilling site in the Gulf of Mexico, industry groups point to other nations, such as Canada, developing their Atlantic offshore petroleum prospects. Industry groups also note the coexistence of thriving oil and gas development with tourism and fishing in the Gulf of Mexico.
Future Leasing Plans A future administration could revise offshore leasing plans, but the process is a slow one, taking at least a year-and-a-half and potentially subject to litigation from opponents. For the next administration, regardless of political party, the simplest strategy would be to start planning for a 2022-2027 fiveyear plan. Congress also could step in to mandate changes, although it hasn’t succeeded in doing so in recent years amid the political stalemate between President Barack Obama and congressional Republicans.
For More Information The proposed five-year plan for offshore oil and gas leasing for 2017–2022 is available online at http://src.bna.com/dk9. —By Alan Kovski, Bloomberg BNA
“By not taking the long-term view, the administration sells U.S. consumers short. Instead, they have determined they are content to let the rest of world lead in Atlantic offshore oil
A&WMA Buyers Guide
Tap into the incredible network of the Air & Waste Management Association with the A&WMA Buyers Guide. Powered by MultiView, the Guide is the premier search tool for environmental professionals. Find the suppliers you need, within the network of the association you trust. Start your search today at awma.org.
em • The Magazine for Environmental Managers • A&WMA • April 2016
News Focus
Supreme Court Asked to Review Mercury Rule Remand Order A coalition of 20 states wants the U.S. Supreme Court to review a lower court’s decision to leave the Mercury and Air Toxics Standards (MATS) rule in place while the U.S. Environmental Protection Agency (EPA) addresses a legal flaw in its rulemaking process (Michigan vs. EPA, U.S., No. 15-1152, 3/14/16).
The states are seeking vacatur of the MATS rule, which they said was issued outside of the EPA’s statutory authority, because the agency has not completed a valid “appropriate and necessary” determination, as Congress required it to do before actually regulating (Michigan vs. EPA, 135 S. Ct. 2699, 2015 BL 207163, 80 ERC 1577 (2015)).
The state coalition, led by Michigan Attorney General Bill Schuette (R), petitioned the Supreme Court to consider whether a reviewing court can leave an unlawful rule in place if a regulatory agency promulgated that regulation without any statutory authority.
States Cite Circuit Split
While the agency is expected to issue a rule by mid-April to fix the legal flaw in the MATS rule, the states said the issue should be reviewed by the Supreme Court, because it is of “exceptional importance” given the exclusive jurisdiction of the U.S. Court of Appeals for the District of Columbia Circuit over many agency regulations. The petition represents the latest effort by states to overturn the 2012 MATS rule, which the agency estimated to cost the power sector $9.6 billion per year. The request comes less than two weeks after Chief Justice John Roberts, Jr., rejected a stay application filed by the same states, which had sought to block implementation and enforcement of the mercury standards.
The petition, filed March 14 and obtained by Bloomberg BNA March 16, specifically challenges a December decision by the D.C. Circuit to leave the MATS rule (RIN 2060–AP52, RIN 2060-AR31) in place while the EPA addresses the Michigan vs. EPA ruling (White Stallion Energy Ctr. LLC vs. EPA, D.C. Cir., No. 12-1100, 12/15/15). The D.C. Circuit in 1993 established a two-factor test for deciding whether to vacate an agency regulation or action on remand. Under that two-part test, the court considers the seriousness of the legal flaw in the decision and the disruptive consequences of vacating a decision only to have it later be reissued (Allied-Signal Inc. vs. U.S. Nuclear Regulatory Comm’n, 988 F.2d 146, 300 U.S. App. D.C. 198 (D.C. Cir. 1993)). However, the states said the D.C. Circuit’s decision to remand MATS back to EPA without vacatur conflicts with a similar decision made by the Fifth and Eight Circuits, establishing a circuit split that the Supreme Court should address.
EPA Working on Supplemental Rule EPA is working on a supplemental rulemaking to address the Supreme Court’s 2015 holding that the agency erred when it determined it was “appropriate and necessary” to regulate power plant emissions under Section 112 without considering cost.
Conflicts with Another Ruling The states also argued that the D.C. Circuit’s decision to remand without vacatur conflicts with the 2015 Michigan vs. EPA ruling.
em • The Magazine for Environmental Managers • A&WMA • April 2016
‘‘
‘‘
News Focus
In light of EPA’s position in this case— that its lack of authority to regulate poses no obstacle to its continued imposition of regulations—this type of unlawful agency action is capable of repetition. – States per petition for a writ of certiorari in Michigan vs. EPA
“Agency action, taken without authority, cannot be left in place to have the effect of binding law,” the states said. “But here, EPA refused to retract and the D.C. Circuit refused to vacate EPA’s regulation, even after this Court held that EPA had overstepped its authority.” The states acknowledged that EPA will likely argue that the legal question will become moot if the agency issues a rule that reaffirms its “appropriate and necessary finding.” However, the states argued that the issue won’t be moot, because the situation is likely to occur again but evades judicial review.
regulations—this type of unlawful agency action is capable of repetition,” the states argued. EPA’s press office didn’t immediately respond to a request for comment on the states’ petition. The federal government’s response to the Supreme Court is due April 15, according to the court’s website.
For More Information
The petition for a writ of certiorari in Michigan vs. EPA is available online at http://src.bna.com/dmJ. —By Patrick Ambrosio, Bloomberg BNA
“In light of EPA’s position in this case—that its lack of authority to regulate poses no obstacle to its continued imposition of
News Focus is compiled from the current edition of Environment Reporter, published by the Bureau of National Affairs Inc. (Bloomberg BNA). For more information, visit www.bna.com.
In Next Month’s Issue… COP-21: Insights from the Paris Climate Conference The May issue will comprise unique stakeholder insights from the COP-21 meeting that was held in Paris in December 2015. Also look for… EPA Research Highlights Etcetera Washington Report Canadian Report …as well as a preview of the 2016 A&WMA Annual Conference
em • The Magazine for Environmental Managers • A&WMA • April 2016
