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Shell Offshore, Inc.

03/30/2012

Case Number:OCS Appeal Nos. 11-05, 11-06 & 11-07
ELR Citation:42 ELR 41358

This decision addresses petitions for review that challenge an Outer Continental Shelf (“OCS”) Permit to Construct and Title V Air Quality Operating Permit (“Permit”) Region 10 (“Region”) of the U.S. Environmental Protection Agency (“EPA” or “Agency”) issued to Shell Offshore, Inc. (“Shell”). The Region issued the Permit on October 21, 2011, pursuant to Clean Air Act (“CAA or “Act”) section 328, 42 U.S.C. § 7627, and applicable regulations governing air emissions from OCS sources at 40 C.F.R. part 55, and pursuant to Title V of the CAA, 42 U.S.C. § 7661, and implementing regulations at 40 C.F.R. part 71, as well as applicable Alaska code and regulatory provisions. The Permit authorizes Shell to “construct and operate the Conical Drilling Unit Kulluk and associated air emission units and to conduct other air pollutant emitting activities” within Shell’s lease blocks in the Beaufort Sea off the North Slope of Alaska. The Permit also provides for the use of an associated fleet of support ships, including icebreakers, supply ships, and oil spill response vessels in addition to the Kulluk.

The Board received three petitions for review of the Permit. One petition was filed by Resisting Environmental Destruction of Indigenous Lands (“REDOIL”), Alaska Wilderness League, Center for Biological Diversity, Natural Resources Defense Council, Northern Alaska Environmental Center, Oceana, Pacific Environment, Sierra Club, and the Wilderness Society (collectively, “REDOIL Petitioners”). A second petition was filed by the Iñupiat Community of the Arctic Slope (“ICAS”). The third petition was filed by Mr. Daniel Lum.

The three petitions collectively raise seven issues for review: (1) Have Petitioners demonstrated that the Region clearly erred in establishing limitations to restrict the Kulluk drilling unit’s potential to emit? (2) Have REDOIL Petitioners demonstrated that the Region clearly erred in declining to require prevention of significant deterioration (“PSD”) increment consumption analyses for the Kulluk’s proposed emissions as part of the Title V permitting process? (3) Did REDOIL Petitioners raise below their contention that Shell’s ambient air quality analysis was flawed in that it failed to conform to applicable Agency guidance? (4) Have REDOIL Petitioners demonstrated that the Region clearly erred in its ambient air exemption determination? (5) Have Petitioners demonstrated that the Region failed to satisfy its obligation to consider environmental justice under Executive Order 12898 and comply with applicable Board precedent? (6) Has ICAS demonstrated that the Region clearly erred or abused its discretion in providing forty-six days to comment on the draft permit and in denying ICAS’s request for non-overlapping comment periods? (7) Has ICAS demonstrated that the Region clearly erred in its public hearing procedures or that any alleged procedural deficiencies otherwise warrant review?

Held: The Board denies review of the Permit. Petitioners have not met their burden of demonstrating that review is warranted on any of the grounds presented.