ELR Citation: ELR 20037
No(s). s. 93-3310 et al (6th Cir. Sep 28, 1995)

The court upholds the U.S. Environmental Protection Agency's (EPA's) Federal Water Pollution Control Act (FWPCA) effluent limitations for the offshore oil and gas industry. The court first rejects industry petitioners' challenge to EPA's selection of improved gas flotation in its best available technology economically achievable (BAT) standards and new source performance standards (NSPS) for limiting oil and grease in "produced water." Industry petitioners failed to prove their claim that improved gas flotation does not remove dissolved oil. They also failed to prove that EPA violated the FWPCA or the Administrative Procedure Act by using a method that measures the content in produced water of dispersed oil, which gas flotation allegedly cannot remove, and grease and dissolved oil, which it can. EPA's decision to use the method was reasonable and based on reliable data. The court next holds that EPA reasonably decided that insufficient evidence exists to regulate radioactive pollutants in produced water. Also, EPA acted within its statutory authority in not requiring zero discharge of produced waters through reinjection. Environmental group petitioners' contention that economic, energy, and nonwater quality environmental impacts are less important than achieving zero discharge merely reflects their disagreement on a policy level, and the court may not substitute that judgment for EPA's.

The court turns to challenges to EPA's BAT, NSPS, and best conventional pollutant control technology (BCT) standard for drilling fluids and drill cuttings. These standards require dischargers within three nautical miles from shore in the Gulf of Mexico and California waters to transport drilling fluids and drill cuttings to shore by barge and to dispose of the discharge in landfills. The court rejects industry petitioners' challenge to EPA's calculation of the BCT cost-effectiveness test. Although EPA may have erred in classifying drill cuttings as total suspended solids for EPA's BCT standards, BAT and NSPS for drill cuttings require the same technological control of drill cuttings as BCT. Furthermore, the Agency is not precluded from regulating drill cuttings as an indicator for oil and grease. The court rejects industry petitioners' challenge to the BAT and NSPS levels for drilling fluids and cuttings, because they failed to show that zero discharge does not achieve any additional environmental benefit. The court upholds EPA's determination on waste volume and landfill capacity for drilling fluids and cuttings in the Gulf of Mexico, because EPA made its decision after considering all the options environmental group petitioners raised and after weighing the benefits and drawbacks of those options. The court also upholds EPA's rejection of the zero discharge option for drilling wastes in California beyond the three-mile limit. Weighing all the factors, EPA determined that the increased air emissions from barging the drilling wastes to the California coast vastly outweighed the benefit of a zero discharge limitation beyond three miles from shore. In addition, the court upholds EPA's decision to reject zero discharge of drilling wastes in Alaska. EPA carefully examined the possibility of requiring reinjection of drilling wastes in Alaska and rejected this option because of geologic concerns and the large amount of space required for reinjection technologies.

Turning to challenges to EPA's zero discharge limitation for "produced sand," the court holds that a manufacturer of a sandwashing technique lacks standing to file a petition for review. The court, however, addresses the merits of the issue because the parties have fully briefed the issue. The court notes that the amount of produced sand is so minimal and irregular that existing barges that transport barrels of product or that service the offshore platforms are capable of carrying the produced sand to shore. Also, EPA considered the possible higher cost of disposing of produced sand that contains radionuclides, EPA relied on scientific data from several sources in formulating technology standards for produced sand, and data EPA collected shows that sand-washing technologies are not as reliable as petitioners claim.

Counsel for Petitioners
Jeffrey C. Conrad
BP America, Inc.
200 Public Sq., 39-4555-E, Cleveland OH 44114
(216) 586-8068

Counsel for Respondent
Timothy Burns
Environment and Natural Resources Division
U.S. Department of Justice, Washington DC 20530
(202) 514-2000

Before: BOGGS and BATCHELDER, Circuit Judges; ALDRICH, District Judge.^*