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EPA Exemption for Shell Survives Federal Suit

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By TIM HULL OF COURTHOUSE NEWS SERVICE 15 August 2013

(CN) – A Shell drilling ship need not face federal air quality standards while it explores the Beaufort Sea off Alaska’s North Slope, the 9th Circuit ruled Thursday.

A host of environmental groups, including the Center for Biological Diversity and the Natural Resources Defense Council, had challenged a permit that the Environmental Protection Agency reasonably granted Shell Offshore in 2011, allowing the Kulluk ship to “construct, operate, and conduct ‘pollutant emitting activities'” in the Beaufort Sea.

The groups specifically objected to the EPA’s refusal to require Shell to monitor “increment standards” to ensure overall air quality within the Kulluk’s zone of influence during “preconstruction” activities. Under the agency’s Prevention of Significant Deterioration program, an increment “is a measure of how much of a pollutant can be added to the ambient air before the air quality will significantly deteriorate.”

Another element that drew protest from the groups was the permit’s exemption of a 500-meter radius surrounding the vessel from ambient air quality standards.

The agency’s Environmental Appeals Board (EAB) rejected both claims, finding that increment analysis is not required for such “temporary sources” of emissions.

Giving the EPA wide deference, a unanimous federal appeals panel affirmed Thursday. The three-judge panel found the federal statute governing air quality permits for temporary sources of emissions to be ambiguous and accepted the agency’s reading.

As for the ambient air quality exemption, the Anchorage-based appeals panel noted that it had decided a nearly identical case while the present appeal waited in line. In December’s REDOIL v. EPA, which involved many of the same plaintiffs and a similar challenge to permits issued to Shell’s drillship Discoverer, the 9th Circuit also bent to the agency and found the exemption “a permissible interpretation of its ambient air regulation and earlier letter ruling.”

“The EAB reasonably concluded that Shell need not analyze the Kulluk’s potential impact on increment before obtaining an oil exploration permit,” Judge N.R. Smith wrote for the panel.

“Similarly,” he added, “as we held in REDOIL, the EPA permissibly granted a 500-meter exemption to the Kulluk from ‘ambient air’ standards.”

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