Energy and Environment Monitor

Kansas Supreme Court Decides Ownership of Coalbed Methane

Ownership of coalbed methane (“CBM”) is an important, unresolved issue that continues to plague oil and gas companies, coal companies and landowners alike. The law on this subject is developing in several states, including West Virginia and Kentucky, but is not yet settled.  In an opinion that may tangle the issue even more, the Supreme Court of Kansas recently addressed ownership of coalbed methane in an opinion that follows a pattern of awarding ownership of CBM to oil and gas owners in states where that industry historically has had a more substantial economic presence than coal. 

            In a decision entered on February 6, 2009, the Supreme Court of Kansas decided that the owner of a coal seam, severed and held separately from the oil and gas estate within the same property, does not own the coalbed methane (CBM) contained within the coal.  Not decided in the appeal is a separate claim for trespass by the coal owner against the oil and gas lessee. 

            From the late 19^th until the mid-20^th century, the area of southeast Kansas enjoyed a small but significant coal industry. Between 1924 and 1926 the predecessor to Central Natural Resources, Inc. secured deeds to coal in 16 separate tracts in Labette County in which the landowners conveyed “all coal without reference to quality or quantity . . . together with the right to mine and remove the same.”  No coal was ever mined from the tracts, nor did the coal owner attempt to drill for and recover the CBM.  The landowners separately leased oil and gas around 2000.  The oil and gas lessees secured permits and drilled into the target coal seam without notice to Central Natural Resources.  An action to quiet title and in trespass was filed by the coal owner, and the trial court awarded judgment to the defendant oil and gas company solely on the quiet title claim.  An interlocutory appeal was filed and granted by the Kansas Supreme Court, which upheld the trial court. 

            On appeal Central Natural Resources presented every legal theory in favor of CBM ownership by coal owners that have been accepted by the appellate courts in Pennsylvania, Alabama and Illinois.  The Kansas Supreme Court considered and rejected each theory of ownership. 

            The coal owner first  proposed that the court recognize that the first severance of a mineral from the fee estate, in this case coal, should be interpreted as including within the conveyance all substances contained within the coal.   The court rejected this approach calling it an “artificial rule of law” and held that if a coal deed included the CBM, it must do so based on the parties’ intent. 

            The court next considered Central Natural Resources argument that the deeds should be interpreted as creating a presumption manifesting the parties’ intent to convey the CBM with the coal.  The trial court had found the deeds to be unambiguous, but had nevertheless resorted to extrinsic evidence in the forms of treatises and appellate decisions from other states.  The Supreme Court did not expressly state whether the deeds were or were not ambiguous, but did find the ambiguity analysis historically accepted by Kansas courts to be useful in ascertaining the grantors’ intent.  Employing longstanding Kansas law, together with a statute that provides what interest in an estate is conveyed by deed, the court declined to accept those principles as creating a presumption that the CBM passed to the Central Natural Resources as the grantee under the 1920 era coal deeds. 

            Finally, in ascertaining the parties’ intent at the time of severance of coal from the fee estate, the court acknowledged that Kansas law requires it to place itself “as nearly as possible in the situation of the grantors and . . . determine as best it can the purpose of the grantors and the intentions they endeavored to convey.”  Notwithstanding its adoption of that temporal principle, the court declined to find that the parties impliedly intended to convey the CBM with the coal.  Accepting that the parties recognized that CBM in the 1920’s was a known hazard that exited within coal and coal mines, the court could not “divine that the grantors contemplated that the grantee could separately own and produce the CBM without exercising the right to mine and remove the coal.”  In short, the deeds passed ownership of coal, and not the CBM within it. 

            In reaching its decision, the Kansas Supreme Court systematically considered and rejected every argument that the coal owner advanced for its claim of ownership.  In holding that the oil and gas lessee owns the right to recover the CBM, it expressly did not have to reach the independent claim of trespass into the coal seam as this was not addressed by the parties in the motion for summary judgment.  Since CBM cannot be recovered without a physical occupation of the coal seam, and the entry into the coal seam was without the express or implied consent of the coal owner, the ultimate disposition of the trespass claim will determine whether commercial recovery of CBM in Kansas will be viable in the absence of the consent of coal owners. 

            The case is Central Natural Resources, Inc. v. Davis Operating Company, 288 Kan. 234, 201 P.3d 680 (2009).  For more information, contact Ken Tawney at 304 340-1189 or Blair Gardner at 304 340-1146.       

This article was authored by Blair M. Gardner, Jackson Kelly PLLC. For more information on the author see here.

States Privatizing Environmental Remediation

Based on a recent report, New Jersey appears to have become the poster child for a problem facing may state environmental regulatory agencies around the county, a backlog of contaminated sites that these agencies do not have the resources (personnel or financial) to address. For example, New Jersey reportedly has a backlog of more than 19,000 contaminated sites. In response to this problem, several states have recently taken steps to privatize portions of their state remediation programs in an effort to accelerate the site remediation process and reduce their backlogs. Connecticut, Massachusetts, and now New Jersey have all reportedly implemented such privatization programs. Although, the changes to these State remediation programs are reportedly similar, I’ll focus on a few aspects of the New Jersey privatization program that are of general interest. 

The Site Remediation Reform Act (“SRRA,” N.J.S.A. 58:10C-1 et seq) was signed into law on May 7, 2009. In certain cases, primary environmental investigation and cleanup oversight under SRRA will no longer be performed by the New Jersey Department of Environmental Protection (NJDEP), but will now be performed by a new class of environmental professional that has been created under SRRA: “Licensed Site Remediation Professionals (LSRPs). LSRPs will be licensed as such by a 13-member licensing board and will be subject to civil and criminal penalties for violations of SRRA. 

Under SRRA, LSRPs will supervise site remediation activities largely independent of the NJDEP and the LSRPs will certify that the site meets New Jersey’s Technical Requirements for Site Remediation. Notably, the LSRP’s obligations under SRRA will change. Although, the LSRPs will still be hired by the entity responsible for remediation, in the future the LSRP will be responsible for protecting human health and the environment, which must take precedence over client preferences, discretionary sampling decisions, efficient billing, etc. 

It should be noted that New Jersey will no longer issue “No Further Action” (NFA) letters, except for those projects completed before the full phase-in of SRRA. Instead, the LSRP will file a Response Action Outcome (RAO) with the NJDEP. The RAOs are intended to be at least as reliable as NFA letters, and are subject to review and possible revocation for the first three years after issuance, as well as providing for re-openers. 

Under SRRA, the NJDEP will inspect submissions from LSRPs, but only generally at an undefined and likely much lower level of review. However, the NJDEP will be required to perform a higher level of review at those sites that may pose a significant threat to human health and the environment, may affect sensitive populations (i.e., daycare centers), or may involve environmental justice concerns. In addition, NJDEP may also have direct oversight of sites meeting the following criteria: 

·        Chromate contamination.

·        Multiple impacted sensitive natural resources.

·        PCBs, mercury, arsenic, or dioxin impacted surface water bodies.

·        Highest ranking priority in the New Jersey Spill Act. 

Finally, implementation of SRRA raises a number of questions and concerns going forward regarding the remediation of contaminated sites in New Jersey: 

·        Since, the “highest priority” for LSRPs is to protect human health and the environment, will LSRPs become more conservative in their approach and therefore, will remedial actions become more expensive to complete. Anecdotal evidence suggest that this has been the case in Ohio since implementation of their Voluntary Assistance Program (VAP). 

·        LSRPs will have obligations to disclose information and certain data directly to NJDEP about site conditions (even after the LSRP has been discharged). Therefore, how will this requirement affect the traditional relationship between an environmental consultant and their client? 

This article was authored by Greg Tieman, Acacia Environmental Group LLC. For more information on the author see here. 

WV Supreme Court Rejects Anti-Mining Group’s Attempt to Block Silo Construction

On June 9, 2009, the Supreme Court of Appeals of West Virginia issued a decision in favor of Goals Coal Company, thereby bringing to an end the efforts of the anti-mining group Coal River Mountain Watch to prevent the construction of a coal silo near Sundial, West Virginia. The hot-button issue in this case was whether or not Goals Coal Company could build a second coal silo within 300 feet of Marsh Creek Elementary School. The actual legal issue involved was a much narrower, and admittedly less sexy, boundary dispute.  

The disagreement centered on a map drawn in 1982 as part of an application for a surface mine permit. Mining began at the site prior to enactment of West Virginia’s Surface Mining Control and Reclamation Act (“SMCRA”). Once the surface mine program was implemented, it became necessary to permit existing operations. Thus, the map in question was created by a professional engineer and land surveyor to depict the area that was already disturbed, rather than depicting an area to be disturbed (as became the practice post-SMCRA). As was the custom in the early 80’s, the map delineated the permit boundaries by hand without the benefit of a survey. The 1:24,000 scale the map utilized is the scale Congress prefers for mine applications. To precisely distinguish the actual boundaries of the mine permit on the ground, permanent markers were placed along the perimeter of the mine area. These boundary markers were labeled on the hand-drawn map as the official boundary of the mine permit area.  

            In 2003, Goals Coal obtained a permit to build a coal storage silo within the boundaries of the mine area, but only several hundred feet from Marsh Creek Elementary. While SMCRA prohibits mine operations within 300 feet of public buildings, the statute contains an exemption which “grandfathers” in existing operations pre-dating its enactment. When Goals Coal submitted a proposal to build another silo in 2005, the Department of Environmental Protection (WV DEP) rejected the permit because they could not determine from the hand-drawn line on the 1982 mine permit map whether the silo would be within the permitted area. Goals Coal then resubmitted its silo proposal, this time relying on the permanent boundary markers to show that the proposed silo would clearly be within the permitted mine area. Based on the marker, DEP determined that the second silo actually fell within the permit boundary (though they ultimately refused to issue the permit for a different reason). 

           Upset that the new silo would be built within 300 feet of Marsh Creek Elementary, Coal River Mountain Watch (“CRMW”) appealed the WV DEP’s decision to the West Virginia Surface Mine Board, arguing that there was a conflict between the 1982 map and the marker. The Surface Mine Board affirmed the WV DEP’s decision to rely on both the drawn map and the permanent boundary markers in making its decision, based on the finding that overlaying the hand-drawn map with a surveyed map—the method utilized by CRMW to call into question the silo’s placement within the permit area—was an improper use of the maps.  

            CRMW next appealed to the Circuit Court of Kanawha County where the WV DEP’s decision to rely on both the drawn map and the permanent markers was again affirmed. CRMW made its final appeal to the West Virginia Supreme Court.  

            Seemingly aware of the emotional nature of the case, Justice Ketchum prefaced the Court’s opinion by making clear that the case involved the narrow legal issue of whether the Surface Coal Mining and Reclamation Act allows both original maps and boundary markers to be used to delineate the boundaries of a mine, and not whether it was the Court’s desired policy to see coal silos built near schools. The Court reiterated that it is not “a superlegislature commissioned to pass upon political, social, economic or scientific merits of statutes . . .” but is instead required to “enforce legislation unless it runs afoul of the State or Federal Constitutions.”  

CRMW argued that SMCRA’s definition of a permit area, characterized as an “area of land indicated on the approved map submitted by the operator with his application, which area of land…shall be readily identifiable by appropriate markers on the site” requires that only the lines on the map be used to define the on-the-ground permit area, rather than markers on the ground. 

 Showing judicial restraint, the Court interpreted the relevant SMCRA statute so that words were assigned their plain meaning and each section of the statute was considered to have importance to the overall meaning of the provision. In arriving at its decision, the Court also credited Congress with having enough common sense that it would not simultaneously require permit maps to be drawn on a miniscule scale (so small that a single pen stroke on a permit map represents 25 feet on the ground) and also mandate that SMCRA permit areas could only be determined by referencing the drawn permit maps and not the permanent boundary markers on the ground. Although the Court did not mention it in their decision, this result is also consistent with the common law of property disputes, which resorts to physical markers and monuments over written descriptions in deeds.    

This decision speaks well of the new Court. If it is an accurate representation of things to come, it portends a judicial era for West Virginia in which common sense and judicial restraint trump political agendas in our State’s highest Court.

This article was authored by Chris M. Hunter, Jackson Kelly PLLC. For more information on the author see here.

U.S. Supreme Court Confirms Traditional Interpretation of Clean Water Act

            In a decision much anticipated by both the business and environmental communities, the Supreme Court confirmed that the two permitting programs created under §402 and §404 of the Clean Water Act (CWA) operate independently of each other. Accordingly, a mine operator who has secured a dredge-and-fill §404 permit has no duty to receive a §402 NPDES permit for the same discharge. In its June 22 decision in Coeur Alaska, Inc. v. Southeast Alaska Conservation Council,¹ the Court upheld the U.S. Army Corps of Engineers in its issuance of a CWA §404 permit issued to a gold mining company to dispose of mill tailings into a lake in the Tongass National Forest. Justice Anthony Kennedy wrote the opinion of the Court that split in a 6-3 vote. 

            A subsidiary of Coeur d’Alene Mines proposed to re-open a gold mining operation that had been abandoned since 1928. Gold would be captured using froth flotation. It is a recovery system of chemical and mechanical separation by which the gold ore is crushed, the mixture liquefied in a heavy media bath, and the gold particles float to the top of a tank where they are captured in the froth and removed. The tailings are then piped to a location – normally a tailings pond – where the heavy material sinks to the bottom and the water re-captured in a closed loop system for reuse in the mill.  

            The particular problem for the mine is its location in an area inundated by wetlands. In its CWA §404 permitting, the company presented two options for evaluation by the Corps. One option would have constructed a tailings pond in wetlands with a “resulting pile [that] would rise twice as high as the Pentagon and cover three times as many acres.”² The placement of fill in the wetlands would have resulted in the permanent loss of that aquatic feature. The other option, and the one chosen by the Corps, allows Coeur Alaska to use a 23 acre lake to dispose the tailings, raises the lake bottom by almost 50 feet over the life of the mine, and then allows a more shallow lake to emerge as a wetlands feature upon the conclusion of the mining. Water from the tailings disposal would be treated by reverse osmosis to remove “all” pollutants before flowing into the stream that receives water from the lake where the tailings will be placed. 

            The environmentalists who attacked the Corps’ permitting decision argued, as they have in prior CWA litigation decided by the Fourth Circuit, that the Corps could not issue a permit for the disposal of waste.³ Instead, they argued that the mining operation’s discharge could have been permitted – if at all – by the EPA using the device of the CWA §402 NPDES permit. Unlike the litigation that has arisen in the Southern District of West Virginia, the Coeur Alaska permit involved a “new source performance standard” under Section 306(b) of the CWA. This section gives the EPA authority to regulate the amount of pollutants that certain categories of new sources may discharge into navigable waters. The challenge proposed that the existence of the NSPS standard for gold recovery using froth flotation under Section 306, which is a zero discharge standard, foreclosed the use of a §404 permit that would fill the lake with tailings. 

            The analysis of the statute is a difficult one. “Rather than address the tension between §§306 and 404, the regulations instead implement the statutory framework without elaboration on this point. Each of the two principal regulations . . . seems to stand on its own without reference to the other.”⁴ To frame its analysis the Court posed two questions. “The question of which agency has authority to consider whether to permit the slurry discharge is our beginning inquiry.”⁵ Second, “[i]n issuing the permit did the Corps act in violation of a statutory mandate so that the issuance was ‘not in accordance with law’?”⁶ 

            In addressing the first question, the Court began with the text of the CWA. The Court began with EPA’s permitting authority under §402 and found that EPA possessed authority under the section except as provided by §404. “Section 402 thus forbids the EPA from exercising permitting authority that is ‘provided [to the Corps] in’ §404.”⁷ The Court found that “if the Corps has authority to issue a permit for a discharge under §404, then the EPA lacks authority to do so under §402.”⁸ Not only did the Court find that the text of the CWA supported its interpretation, it found the joint EPA-Corps “fill rule” promulgated following the litigation of the Bragg case in 2000⁹, and upheld by the Fourth Circuit in Rivenburgh, expressed the agencies’ understanding about how the Act is intended to work. 

            The Court also observed how EPA and the Corps had interpreted the CWA in a more or less consistent fashion for three decades. This division of responsibility between the agencies reflects the fundamental distinction between the Corps 404 permit and the 402 permit issued by EPA or delegated to the states. The former permit has historically been employed to dispose of solid material with the intent of displacing the body of water into which it is placed. The latter permit is imposed on a waste stream that is intended to be assimilated into a body of water.  

            The second question – whether the Corps acted in accordance with law – was a more extended discussion in which the Court examined the agencies regulations at issue, as well as an interpretative memorandum that both had relied upon. As a fallback position, the environmentalists had urged the Court to consider whether both permits might apply to the type of discharge at issue. The Court had ordered briefing on the topic. “The parties agree, however, that a two-permit regime is contrary to the statute and the regulations. We conclude that this is correct. A two-permit regime would cause confusion, delay, expense, and uncertainty in the permitting process.”¹⁰ 

        Although the opinion reinforces similar conclusions that the Fourth Circuit has reached in CWA cases involving fills, the Court offered additional conclusions that are supportive of the historical division of permitting responsibilities between the agencies. For example, it found that the Corps is required in the first instance to determine its jurisdiction over the discharge of fill, not EPA. It also found that the “EPA’s function is different, in regulating fill, from its function in regulating other pollutants . . . Section 404 assigns the EPA two tasks in regard to fill material. First, the EPA must write guidelines for the Corps to follow in determining whether to permit a discharge of fill material. CWA §404(b); 33 U. S. C. §1344(b). Second, the Act gives the EPA authority to “prohibit” any decision by the Corps to issue a permit for a particular disposal site.”¹¹ This last observation may impose some restraint on EPA in its “review” of Corps permitting decisions. 

            As reassuring as the decision is, it must be observed that the Court’s decision now shifts the debate back to Congress. Nothing in the opinion restrains Congress from changing the CWA to impose the restrictions on fill that the environmental challengers sought. At least one bill now before Congress would define fill in a way to preclude excess spoil from coal mining to be included within the definition.¹² Until Congress so acts, however, the ability of courts to interpret the CWA to preclude mining related fills in jurisdictional waters has been restricted decisively. 

            For additional information about Coeur Alaska, Inc. v. Southeast Alaska Conservation Council, contact Bob McLusky at 304 340-1381 or Blair Gardner at 304 340-1146. 

_____________________________

1 _ U.S. _, No. 07-984, together with No. 07-990, Alaska v. Southeast Alaska Conservation Council, et al.

2 Opinion at 5.

3 Kentuckians for the Commonwealth v. Rivenburgh, 317 F.3d 425 (4^th Cir. 2003).

4 Opinion at 18.

5 Opinion at 9.

6 Opinion at 13.

7 Opinion at 10.

8 Id.

9 WVCA v. Bragg, 248 F.3d 275 (4^th Cir. 2001).

¹⁰ Opinion at 23.

¹¹ Opinion at 10.

12 S. 696.

This article was authored by Blair M. Gardner, Jackson Kelly PLLC. For more information on the author see here.

Fourth Circuit Declines to Stay Mandate in Latest Mountaintop Mining Case

             In February 2009, a Fourth Circuit panel reversed two orders issued by District Court Judge Robert C. Chambers in the case of Ohio Valley Environmental Coalition, et al. v. United States Army Corps of Engineers, et al., Case No. 3:05-cv-00784 (S.D. W.Va.). See Ohio Valley Environmental Coalition, et al. v. Aracoma Coal Company, 556 F.3d 177 (4th Cir. 2009). The plaintiff, OVEC, subsequently moved for reconsideration en banc, which had the effect of delaying issuance of the Fourth Circuit mandate. Without issuance of the mandate, the Fourth Circuit’s February ruling does not take effect.  

On May 29, 2009 the Fourth Circuit denied the motion for rehearing. However, before the mandate issued, OVEC moved for a stay of the mandate pending submission to the U.S. Supreme Court of a petition for certiorari. By order of June 16, however, the Fourth Circuit denied the motion for a stay of the mandate. The mandate will now issue on June 24, 2009 unless stayed by the United States Supreme Court.   

This article was authored by Robert G. McLusky, Jackson Kelly PLLC. For more information on the author see here.

U.S. EPA Reforms IRIS Process

On May 21, 2009, U.S. EPA Administrator Lisa P. Jackson announced reforms to the agency’s Integrated Risk Information System (IRIS). IRIS is an electronic database that provides information on human health effects that may result from exposure to chemical substances in air, water, and land both from contaminated sites and from products.  

U.S. EPA’s National Center for Environmental Assessment (NCEA) within the Office of Research and Development (ORD) maintains and prepares the database. Government and private entities in the United States and around the world use IRIS to help characterize public health risks of chemical substances in a site-specific situation and support risk-management decisions designed to protect public health. In West Virginia, for example, IRIS is used in risk-management decisions under the West Virginia Voluntary Remediation and Redevelopment Program. Other examples of risk management decisions relying upon IRIS include: deciding how much of a substance a company may discharge into a river, which substances may be stored at a hazardous waste disposal facility, and to what extent a hazardous waste site must be cleaned up; setting permit levels for discharge, storage, or transport; establishing levels for air emissions; and determining allowable levels of contamination in drinking water. 

The reforms announced May 21, 2009, reverse changes to the IRIS process, including procedures formalized by the Bush EPA in an April 10, 2008, memorandum that U.S. EPA Administrator Jackson criticized as “reduc[ing] the transparency, timeliness, and scientific integrity of the IRIS process.” Administrator Jackson promised that the new process would be “more transparent and timely” and would also “ensure the highest level of scientific integrity.” While EPA will consider the scientific input of experts at other agencies and White House offices, EPA will manage the process and have “final responsibility” for the content of all IRIS assessments. The process will include the opportunity for public comment and rely on open and independent external peer review. EPA will provide a response to comments. The assessment development process will be shortened to 23 months and for fiscal year 2010, EPA resources for the IRIS program will be increased. President Obama’s 2010 fiscal year budget includes a request for an additional $5 million and 10 full-time equivalent employees for the IRIS program. 

Before the development of the draft IRIS assessment for each chemical on the proposed agenda, EPA will conduct a scientific literature search and initiate a data call-in. For the scientific literature search, ORD will appoint a chemical manager for each chemical on the proposed agenda, and that chemical manager will then direct an EPA contractor to conduct and complete a comprehensive search of the scientific literature for the chemical. The results of that literature search will be posted on EPA’s web site. After the completion of the literature search for each chemical, EPA will publish a Federal Register notice notifying the public of the availability of the completed literature search on the IRIS web site. The notice will invite the public and other agencies to submit additional scientific information on the chemical and request information on new research that may be planned, underway, or in press.  

After the literature search and data call-in are complete, EPA will begin development of the IRIS human health assessment. All IRIS human health assessments will undergo “rigorous, open, independent external peer review”. IRIS assessments considered being of major importance or high profile may be selected for peer review by panels of experts convened by EPA’s Science Advisory Board or by the National Academy of Sciences. 

IRIS assessments are to be developed under a 7-step process. This seven-step process is expected to be completed within approximately 2 years from the Step 1 start date. Because of their complexity, large scientific literature base, or high profile, some IRIS assessments may take longer than 2 years.  

·        Step 1 – Development of Draft IRIS Toxicological Review: EPA develops and completes a draft IRIS Toxicological Review. An ORD assessment team will assess the data and the scientific literature and any information submitted as a result of the data call-in and develop a draft assessment for the chemical being assessed. The draft assessment will summarize potentially important health effects, information on potential modes of action, and information about potentially susceptible populations. The draft assessment will include a quantitative assessment, including application of certain factors, default approaches, mode of action information, and dose-response modeling. The draft assessment will also identify potential uncertainties that impact the qualitative and quantitative aspects of the assessment. The development and completion of the draft IRIS Toxicological Review is expected to take 345 days. 

·        Step 2 – Internal EPA Review: Once the draft IRIS Toxicological Review has been developed, ORD submits it for internal EPA review. Scientists from EPA programs and regions review the draft Toxicological Review and identify any scientific issues to determine the level of peer review, needed panel member disciplines, and the scope of the review. Internal EPA review is expected to take 60 days. 

·        Step 3 – Interagency Science Consultation: Following the internal EPA review, EPA initiates an Interagency Science Consultation on the draft IRIS Toxicological Review. EPA sends the draft IRIS Toxicological Review and draft external peer review charge to other federal agencies and White House offices for a science consultation. This science consultation is managed and coordinated by EPA. All written comments received during the Interagency Science Consultation become part of the record. Following receipt of written comments, ORD revises the draft assessment documents as appropriate, and science questions that arise may be included as part of a charge question to the peer review panel.  

·        Step 4 – External Peer Review, Public Review and Comment, and Public Listening Session: After the Interagency Science Consultation, EPA initiates an independent external peer review of the draft IRIS Toxicological Review, releases the draft IRIS Toxicological Review for public review and comment, and holds a public listening session. The external peer review, public review and comment, and public listening session are all announced in the Federal Register and are expected to take 105 days. EPA recently announced a listening session for the draft Toxicological Review of Pentachlorophenol (74 Fed. Reg. 27317; June 9, 2009), and a listening session and peer review workshop for the draft Toxicological Review of 1, 4-Dioxan (74 Fed. Reg. 27313; June 9, 2009). 

·        Step 5 – Revisions, IRIS Summary, and Response to Comments: Following the external peer review, public review and comment, and public listening session, ORD evaluates the report of the external peer review panel and all public comments. ORD revises the draft IRIS Toxicological Review, as appropriate, and develops the IRIS Summary. ORD also develops a disposition of peer reviewer and public comments and provides these as an appendix to the IRIS Toxicological Review. The revision process and response to comments is expected to take 60 days but the length of the process may depend on the complexity of the IRIS Toxicological Review and complexity and number of comments. 

·        Step 6 – Final Internal EPA Review and EPA-led Interagency Science Discussion:  After development of the final drafts of the IRIS Toxicological Review and IRIS Summary and response to comments, ORD sends the final drafts of the IRIS Toxicological Review and IRIS Summary for final internal EPA review. This review is intended as a final check-in with Agency program and regions. Concurrent with the internal EPA review, EPA provides other agencies and White House offices with a final draft of the IRIS Summary and Toxicological Review and appendix describing disposition of peer review and public comments. Other agency and White House office scientists may provide written scientific feedback. EPA also hosts a meeting with other agencies and White House offices to discuss any scientific issues related to the final draft of the IRIS Summary and Toxicological Review and appendix. All written comments by other agencies and White House offices are documented in the record. Step 6 is expected to take 45 days. 

·        Step 7 – Completion of IRIS Toxicological Review and IRIS Summary:  EPA completes the IRIS Toxicological Review and IRIS Summary. Step 7 is expected to take 30 days. 

The reforms announced May 21, 2009, respond to criticism of the changes made to the IRIS process by the Bush EPA culminating in the April 10, 2008 memorandum. The 2008 process involved early involvement of other federal agencies and the public. In 2004, the White House directed EPA to begin routinely submitting draft assessments to the White House Office of Management and Budget (OMB) for review. Previously, the need for these reviews had been determined on a case-by-case basis. On April 10, 2008, EPA announced additional changes to the IRIS process which further involved OMB. This upset the scientific community because OMB’s staff is comprised mostly of policy analysts and economists. The 2008 IRIS process included asking other federal agencies whether an industrial chemical was critical to that agency’s mission. OMB then coordinated the agencies’ negotiations over “mission-critical” designations. If OMB and other agencies determined the chemicals in question to be “mission-critical,” then the other agencies had an opportunity to conduct their own research and to fill any identified data gaps or address any uncertainties. This prolonged the process and delayed the completion of IRIS assessments. Further, under the 2008 process, the communications during the consultations with other agencies and OMB were designated as “deliberative” and therefore not subject to a Freedom of Information Act request. The U.S. Government Accountability Office (GAO) was highly critical of an EPA’s 2008 IRIS process. In a May 21, 2008 report, GAO criticized the process as lacking transparency and limiting the credibility of IRIS assessments as well as placing the IRIS database at serious risk of becoming obsolete. GAO stated, “EPA has institutionalized a process that from the outset is estimated to take 6 to 8 years to complete.”  

For additional information on 2009 reforms to the IRIS process, contact Gale Lea Rubrecht at galelea@jacksonkelly.com or 304-340-1200. 

This article was authored by Gale Lea Rubrecht, Jackson Kelly PLLC. For more information on the author see here.

Global Climate Change Impacts in the United States

On June 16, 2009, the White House released the Global Climate Change Impacts in the United States report. The report was prepared by a consortium of experts from 13 U.S. government science agencies and from several major universities and research institutes. The report integrates scientific findings into a comprehensive view of what is known about climate change. Global, national, and regional impact assessments are provided.  

The report offers ten Key Findings.  

1.      Global warming is unequivocal and primarily human-induced. Global temperature has increased over the past 50 years. This observed increase is due primarily to human-induced emissions of heat-trapping gases. (p. 13)

2.      Climate changes are underway in the United States and are projected to grow. Climate-related changes are already observed in the United States and its coastal waters. These include increases in heavy downpours, rising temperature and sea level, rapidly retreating glaciers, thawing permafrost, lengthening growing seasons, lengthening ice-free seasons in the ocean and on lakes and rivers, earlier snowmelt, and alterations in river flows. These changes are projected to grow. (p. 27)

3.      Widespread climate-related impacts are occurring now and are expected to increase. Climate changes are already affecting water, energy, transportation, agriculture, ecosystems, and health. These impacts are different from region to region and will grow under project climate change. (p. 41-106, 107-152)

4.      Climate change will stress water resources. Water is an issue in every region, but the nature of the potential impacts varies. Drought, related to reduced precipitation, increased evaporation, and increased water loss from plants, is an important issue in many regions, especially in the West. Floods and water quality problems are likely to be amplified by climate change in most regions. Declines in mountain snowpack are important in the West and Alaska where snowpack provides vital natural water storage. (p. 41, 129, 135, 139)

5.      Crop and livestock production will be increasingly challenged.   Many crops show positive responses to elevated carbon dioxide and low levels of warming, but higher levels of warming often negatively affect growth and yields. Increased pests, water stress, diseases, and weather extremes will pose adaption challenges for crop and livestock production. (p. 71)

6.      Coastal areas are at increasing risk from sea-level rise and storm surge. Sea-level rise and storm surge place many U.S. coastal areas a increasing risk of erosion and flooding, especially along the Atlantic and Gulf Coasts, Pacific Islands, and parts of Alaska. Energy and transportation infrastructure and other property in coastal areas are very likely to be adversely affected. (p.111, 139, 145, 149)

7.      Risks to human health will increase. Harmful health impacts of climate change are related to increasing heat stress, waterborne diseases, poor air quality, extreme weather events, and diseases transmitted by insects and rodents. Reduced cold stress provides some benefits. Robust public health infrastructure can reduce the potential for negative impacts. (p. 89)

8.      Climate change will interact with social and environmental stresses. Climate change will combine with pollution, population growth, overuse of resources, urbanization, and other social, economic, and environmental stresses to create larger impacts than from any of these factors alone. (p. 99)

9.      Thresholds will be crossed, leading to large changes in climate and ecosystems. There are a variety of thresholds in the climate system and ecosystems. These thresholds determine, for example, the presence of sea ice and permafrost, and the survival of species, from fish to insect pests, with implications from society. With further climate change, the crossing of additional thresholds is expected. (p. 76, 82, 115, 137, 142)

10. Future climate change and its impacts depend on choices made today. The amount and rate of future climate change depend primarily on current and future human-caused emissions of heat-trapping gases and airborne particles. Responses involve reducing emissions to limit future warming, and adapting to the changes that are unavoidable. (p. 25, 29) 

Many global warming skeptics question the timing of the release of the report, as Congress is currently debating cap and trade legislation.  

Global warming critic, Geophysicist David Deming, associate professor of arts and science at the University of Oklahoma say it is a “scare report” that has little relation to reality.  

“This is not a work of science but an embarrassing episode for the authors and NOAA,” said meteorologist Joe D’Aleo, the former chairman of the American Meteorological Society’s Committee on Weather Analysis and Forecasting. Mr. D’Aleo said the report “starts out DAY ONE being wrong on many of its claims …They gave the administration the cover to push the unwise cap-and-tax agenda.” 

Jane Lubchenco of the National Oceanic and Atmospheric Administration told a press conference at the release the report is a “game-changer.” 

For additional information on climate change the following websites are available

www.globalchange.gov

www.icecap.us

http://climatedepot.com 

This article was excerpted from publically available information, and was authored by Joyce Gentry, Acacia Environmental Group LLC.  For more information on the author see here.

Obama Administration to Tighten Review of Appalachian Surface Mining

            The Obama Administration released a series of new policy documents on June 11, 2009 describing how surface coal mining will be regulated and permitted in Appalachia. These documents were also described in a conference call that the Administration conducted for the press (a transcript of the call is attached). Represented on the call were Nancy Sutley, Chair of the Council on Environmental Quality (CEQ); Bob Sussman, Senior Policy Counsel for the Environmental Protection Agency (EPA); David Hayes, Deputy Secretary of the Department of the Interior (DOI); and Terrence “Rock” Salt, Acting Assistant Secretary (Civil Works) for the Corps of Engineers (Corps). They characterized the Administration’s actions as designed to significantly reduce the “harmful environmental consequences of Appalachian surface coal mining operations, while ensuring that future mining remains consistent with federal law.”  

Among the documents released is a Memorandum of Understanding (MOU) signed by EPA, DOI and the Corps that outlines both short- and long-term policy changes affecting “Appalachian surface coal mining,” defined as mining techniques requiring permits under the Surface Mining Control and Reclamation Act (SMCRA) and § 404 of the Clean Water Act (CWA) in the states of Kentucky, Ohio, Pennsylvania, Tennessee, Virginia and West Virginia. A copy of the MOU is at http://www.jacksonkelly.com/jk/pdf/Final%20MTM%20MOU.PDF. 

The Administration also released other documents describing a procedure for enhanced review of procedures for 108 Clean Water Act § 404 permits that are currently under review by EPA and the Corps. One document lists the new procedures, and the other is a letter from EPA Administrator Lisa Jackson to the Corps listing the criteria that EPA will rely on for objecting to new permits. A copy of the EPA letter can be found here:

 http://www.jacksonkelly.com/jk/pdf/Final%20EPA%20MTM%20letter%20to%20Army.pdf

and the procedures document here:

http://www.jacksonkelly.com/jk/pdf/EPA-Corps%20MTM%20Permit%20Coordination%20Procedures.pdf 

EPA’s Sussman emphasized that the 42 permits already approved by the agency will not be revisited and will not be subject to the new review procedures.

The following is a brief summary of some of the major items contained in the MOU:

Short Term Actions under the Clean Water Act

(1)        Corps will issue a public notice within 30 days proposing to modify Nationwide Permit 21 to preclude its use in the Appalachian Region and seek public comment on the proposed action;

(2)        EPA, Corps, and the Fish & Wildlife Service (FWS) will develop guidance to “strengthen” the CWA § 401(b)(1) Guidelines;

(3)        EPA will improve and strengthen oversight of CWA 402 permits and water quality certifications under CWA § 401 ;

(4)        Corps and EPA, in consultation with FWS, will jointly issue guidance on how impacts to streams should be evaluated and how mitigation projects should be evaluated to compensate for losses of waters of the United States; and

(5)        EPA, in coordination with the Corps, will clarify the applicability of the CWA waste treatment exemption for treatment facilities constructed in waters of the United States to minimize temporary impacts of mining operations on streams. 

Short Term Actions under SMCRA 

(1)         The 1983 current stream buffer zone (SBZ) rule was never intended to prohibit valley fills, but in 1999 a federal district court relied on it to prohibit new fills. In 2008, OSM revised the rule to make clear that it does not prohibit fills. Anti-mining activists challenged the new rule in federal district court in Washington, D.C. and have claimed it suffers from a procedural defect. The Interior Department has AGREED with plaintiffs and have asked the court to vacate the new rule. OSM now claims that it wants to return to the 1983 SBZ rule and issue “guidance” clarifying the application of the 1983 SBZ rule provisions to further reduce stream impacts;

(2)        OSM will reevaluate its oversight of state permitting, state enforcement and regulatory activities under SMCRA; and

(3)        OSM will remove impediments to its ability to require correction of permit defects in SMCRA primacy states.

The MOU also includes the following long terms actions under both SMCRA and the CWA: 

Long Term Actions

(1)        New rulemakings under SMCRA, including the SBZ rule, and Approximate Original Contour (AOC) requirements;

(2)        Elimination of NWP 21 in connection with surface coal mining in the Appalachian Region in 2012; and

(3)        Revisions to how surface coal mining activities are evaluated, authorized and regulated under the CWA. 

This article was authored by Robert G. McLusky, Jackson Kelly PLLC. For more information on the author see here.

Desert Rock Energy Company LLC PSD Permit

Desert Rock Energy Company LLC, PSD Permit No. AZP 044-01; EPA Environmental Appeals Board, PSD Appeal Nos. 08-03, 08-044, 08-05 & 08-06. A major controversy erupted in the Southwest in late April when EPA’s Region 9 asked the agency’s Appeals Board (“EAB”) to remand the Prevention of Significant Deterioration (“PSD”) permit issued on July 31, 2008 for the Desert Rock Energy Company’s proposed coal-fired power plant to be located on the Navajo Reservation near Farmington, New Mexico. The Dine’ Power Authority, a Navajo enterprise, is participating in the project. Navajo Nation President Joe Shirley devoted much of his State of the Nation address to the topic because of the implications to tribal sovereignty and the trust relationship between the Navajo Nation, the largest Native American tribe in the United States. President Shirley described the project as the largest economic, environmental and energy project the Navajo Nation has ever undertaken and one that would help address chronically high unemployment as well as take advantage of the large coal deposits on the reservation. While the Bureau of Indian Affairs (“BIA”), a part of the Department of the Interior, oversees and administers many programs relating to Native Americans, the trust, or fiduciary responsibility applies to all departments and agencies of the Executive Branch, including the EPA. The Navajo Reservation is comprised of about 27,000 square miles in AZ, NM and UT with a population of more than 250,000 people. 

The PSD Permit is the subject of four petitions for review currently before the EAB pursuant to 40 C.F.R. §124.19. The petitioners include some of the nation’s most prominent environmental groups including the Natural Resources Defense Council and the Sierra Club as well as the State of New Mexico. Responses to the Motion are due on June 11. The EAB noted that over 900 pages of legal argument have already been filed, and limited all responses to 50 double-spaced pages. 

The principal issues driving the decision to ask for the remand were: (1) the use of PM 10 as a surrogate to satisfy the PSD requirements for PM 2.5; (2) the consideration of integrated gasification combined cycle (IGCC) in the Best Available Control Technology (“BACT”) analysis; (3) the issuance of the final permit decision before completing the consultation under section 7(a)(2) (16 U.S.C.A. Section 1536(a)(2) of the Endangered Species Act (“ESA”); (4) the issuance of the final PSD permit decision before completing the case-by-case Maximum Achievable Control Technology (“MACT”) for hazardous air pollutants under Clean Air Act Section 112(g); and (5) the sufficiency of the additional impact analysis for the Desert Rock facility. An additional issue is whether the PSD permit must contain an emissions limit for carbon dioxide (CO2). Region 9 withdrew the portion of the PSD permit’s Response to Comments that explained the Region’s basis for not evaluating CO2 emissions in the BACT analysis. Region 9 sought comments on a revised Statement of Basis on this issue, which was published on January 22, 2009, with the comment period closing on March 25, 2009. 

As to PM10/PM2.5 surrogacy, EPA Administrator Sheila Jackson wrote to Earthjustice, counsel for some of the petitioners seeking review of the PSD permit, that EPA intends to publish a Notice of Proposed Rulemaking to repeal the “grandfathering” provision concerning the continued use of the PM10 Surrogacy Policy. (Exhibit A, Motion for Voluntary Remand). 

Concerning to the ESA consultation, the PSD permit was issued prior to the completion of the consultation. The ESA prohibits (Section 7(d)) any irretrievable commitment of resources prior to the completion of the consultation. In this case, the EPA had contended that it had retained authority to amend its permit as might be required depending on the outcome of the consultation. On February 26, 2009 the US Fish and Wildlife Service (“FWS”) advised the EPA of its view that atmospheric deposition of mercury “may be adversely affecting the endangered Colorado pikeminnow, as well as contributing to numerous fish consumption advisories in the Navajo Nation, Arizona, Colorado, Utah and New Mexico” and requested information and assistance from the EPA on issues relating to source-attribution of mercury and selenium. The FWS invited the EPA to review the Biological Assessment (presumably prepared by the BIA, the agency with which the FWS is in consultation, and invited the EPA to provide “any additional input relative to your expertise relative to the sources and deposition of mercury” (Letter, FWS to EPA. 2/26/09), Exhibit B, Motion for Remand). 

    This article was authored by Ronda L. Sandquist, Jackson Kelly PLLC. For more information on the author see here.

Oil & Gas Regulations Involving Pits and Impoundments

     The West Virginia Department of Environmental Protection (DEP), Division of Oil & Gas has provided the DEP Advisory Council with possible changes to their Title 35 CSR 4 regulations for oil and gas wells and other wells (i.e. UIC wells). Proposed regulation changes must be filed with the Advisory Council before proposing the regulations for comment by the general public/industry, which could occur as early as June of this year. 

Highlights of the proposed changes are provided below: 

Section 2.10 – Adds “Impoundment” to the definitions.

Comment - The new definition provides that wastes are not to be placed in an impoundment. 

Section 2.14 – Adds “Pit” to the definitions.

Comment – Specifically designates the pit to receive drilling wastes. 

Section 5.2.a.5 – Increases fee for well work and the special reclamation fee. 

Section 16.4.c. – Requires all pits and impoundments to have adequate freeboard; however in no case shall the freeboard be less than 2 feet. 

Section 16.4.d. – Requires all pits and impoundments to have a synthetic liner to prevent seepage or leakage. 

Section 21 – Adds a new section for construction of wastewater pits and freshwater impoundments with capacity greater than five thousand (5,000) barrels. 

Section 21.1 – Requires notice of construction of all pits and impoundments to be provided to Oil & Gas personnel prior to construction. 

Section 21.2.a. – Requires all pits and impoundments to be constructed in accordance with plans designed and certified by a West Virginia professional engineer. 

Section 21.2.c. - Requires all pits and impoundments to have a stable foundation during all phases of construction and be designed based on adequate and accurate information on the foundation conditions. 

Section 21.5. – States that no pits may be left permanent. Provides provisions for possibly leaving impoundments.  

Section 21.6.a. – Requires inspection and certification by the professional engineer that the pit has been constructed in accordance with the plan, prior to placement of fluid in the pit. 

Section 21.6.b. – Requires all pits containing fluid to be inspected every three days for the life of the pit by a company representative experienced in pit construction. The fact that the inspections have been performed must be certified by a company official on a monthly basis to Oil & Gas personnel.

     Many of these regulations are intended to codify the Oil & Gas Industry Guidance document dated March 13, 2009. These regulations, in their entirety, should be reviewed by anyone potentially affected by these changes. A copy of the draft regulations can be obtained by contacting bchambers@acaciaenvironmental.com.  

 

     This article was authored by William Chambers, Acacia Environmental Group LLC. For more information on the author see here.