Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca9-13-70633/USCOURTS-ca9-13-70633-0/pdf.json

Parties Involved:
Alaska Eskimo Whaling Commission
Petitioner
ConocoPhillips
Respondent-Intervenor
Lisa P. Jackson
Respondent
Dennis J. McLerran
Respondent
Shell Gulf of Mexico, Inc.
Respondent-Intervenor
Shell Offshore, Inc.
Respondent-Intervenor
U.S. Environmental Protection Agency
Respondent

Document Text:

FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

ALASKA ESKIMO WHALING

COMMISSION,

Petitioner,

v.

U.S. ENVIRONMENTAL PROTECTION

AGENCY; LISA P. JACKSON,

Administrator; DENNIS J.

MCLERRAN, Region 10

Administrator,

Respondents,

SHELL OFFSHORE, INC.; SHELL GULF

OF MEXICO, INC.; CONOCOPHILLIPS

COMPANY,

Respondents-Intervenors.

No. 13-70633

OPINION

On Petition for Review of a Permit of the

Environmental Protection Agency

Argued and Submitted

May 13, 2015—Anchorage, Alaska

Filed June 29, 2015

Before: William C. Canby, Jr., Jay S. Bybee,

and Paul J. Watford, Circuit Judges.

Opinion by Judge Canby

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2 ALASKA ESKIMO WHALING COMM’N V. EPA

SUMMARY*

Environmental Law

The panel granted in part and denied in part a petition for

review brought by the Alaska Eskimo Whaling Commission,

challenging the Beaufort Permit issued by the U.S.

Environmental Protection Agency under the National

Pollutant Discharge Elimination System provisions of the

Clean Water Act, authorizing the discharge of oil and gas

exploration facilities of 13 waste streams into marine waters

of the Beaufort Sea in accordance with conditions set forth in

the Permit.

The panel granted the petition on one issue on which the

EPA admitted error in the record, and remanded to the EPA

for a determination regarding whether the discharge of noncontact cooling water (alone or in combination with other

authorized discharges) into the Beaufort Sea will cause

unreasonable degradation of the marine environment because

of the effect of such discharge on bowhead whales, including

deflection from their migratory paths.

 

The panel denied the petition in all other respects because

the EPA’s issuance of the Permit was otherwise supported by

the record evidence, did not reflect a failure to consider an

important respect of the problem, and was not otherwise

arbitrary or capricious.

* This summary constitutes no part of the opinion of the court. It has

been prepared by court staff for the convenience of the reader.

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ALASKA ESKIMO WHALING COMM’N V. EPA 3

COUNSEL

Christopher G. Winter (argued) and Layla Hughes, Crag Law

Center, Portland, Oregon, for Petitioner.

Daniel Pinkston (argued), United States Department of

Justice, Denver, Colorado; Sam Hirsch, Acting Assistant

Attorney General; Angeline Purdy, Environmental Defense

Section, Environment & Natural Resources Division, United

States Department of Justice, Washington, D.C.; KimberlyA.

Owens, Assistant Regional Counsel, United States

Environmental Protection Agency—Region 10, Seattle,

Washington, for Respondents.

Kyle W. Parker (argued), Sarah Bordelon, Crowell & Moring

LLP, Anchorage, Alaska; Cameron Leonard, Perkins Coie

LLP, Anchorage, Alaska, for Respondents-Intervenors Shell

Gulf of Mexico Inc. and Shell Offshore Inc.

Svend A. Brandt-Erichsen, Meline G. MacCurdy, Marten

Law PLLC, Seattle, Washington, for Respondent-Intervenor

ConocoPhillips Company.

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4 ALASKA ESKIMO WHALING COMM’N V. EPA

OPINION

CANBY, Senior Circuit Judge:

The Alaska Eskimo Whaling Commission (“AEWC”),

representing certain Alaska Native villages that engage in

subsistence hunting of bowhead whales, petitions for review

of the Beaufort Permit (“the Permit”) issued by the

Environmental Protection Agency under the National

Pollutant Discharge Elimination System (“NPDES”)

provisions of the Clean Water Act. The Permit authorizes the

discharge by oil and gas exploration facilities of 13 waste

streams into marine waters of the Beaufort Sea in accordance

with the effluent limitations, monitoring requirements, and

other conditions set forth in the Permit. AEWC does not seek

to have the Permit vacated, but asks us to remand it to the

EPA for further proceedings leading to additional restrictions

on discharges. We have jurisdiction to review the EPA’s

issuance of the Permit pursuant to 33 U.S.C. § 1369(b)(1)(F). 

We deny in great part AEWC’s petition, but we grant on one

issue on which the EPA has admitted an error in the record:

we remand to the EPA for a determination regarding whether

the discharge of non-contact cooling water (alone or in

combination with other authorized discharges) into the

Beaufort Sea will cause unreasonable degradation of the

marine environment, 40 C.F.R. § 125.121(e), because of the

effect of such discharge on bowhead whales, including

deflection from their migratory paths. We deny the petition in

all other respects.

I. Background

Following the 2011 expiration of the 2006 Arctic NPDES

general permit for offshore oil and gas exploration, the EPA

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ALASKA ESKIMO WHALING COMM’N V. EPA 5

replaced that permit with two separate general permits for

exploration discharges: one for the Beaufort Sea and one for

the Chuckchi Sea. Only the Beaufort Permit is the subject of

this appeal. The Permit allows discharges only in connection

with oil exploration; actual oil development and offshore

production are not within the Permit.

In January 2012, the EPA issued for public review and

comment a draft of the Beaufort Permit. During the threemonth comment period, public meetings were held and

testimony was taken in communities, including the Nuiqsut

Community, on the North Slope and in Anchorage. AEWC

and several other organizations also submitted to the EPA

extensive written comments on the draft Permit.

In October 2012, the EPA issued the Permit (Permit No.

AKG282100) pursuant to Sections 402 and 403 of the Clean

Water Act, 33 U.S.C. §§ 1342, 1343. The Permit authorizes

the discharge of 13 waste streams1“in accordance with the

effluent limitations, monitoring requirements, and other

 

1

 The permitted discharges are numbered and described as follows:

001 Water-Based Drilling Fluids and Drill Cuttings

002 Deck Drainage

003 Sanitary Wastes

004 Domestic Wastes

005 Desalination Unit Wastes

006 Blowout Preventer Fluid

007 Boiler Blowdown

008 Fire Control System Test Water

009 Non-contact Cooling Water

010 Uncontaminated Ballast Water

011 Bilge Water

012 Excess Cement Slurry

013 Muds, Cuttings, Cement at the Seafloor

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6 ALASKA ESKIMO WHALING COMM’N V. EPA

conditions” set forth therein, and it is effective from

November 28, 2012 through November 27, 2017. The Permit

includes one limitation and one monitoring requirement

relevant to the issues on appeal. First, the Permit imposes a

seasonal limitation on Discharge 001 (water-based drilling

fluids and drill cuttings), prohibiting all such discharge

“during fall bowhead whale hunting in the Beaufort Sea by

the Nuiqsut and Kaktovik communities.” Second, the Permit

requires permittees to monitor “to the maximum extent

possible” for possible deflection of marine mammals when

discharging Discharge 001 and Discharge 009 (non-contact

cooling water). The Permit provides that it may be modified

or revoked “if, on the basis of any new data, the Director or

DEC determines that continued discharges may cause

unreasonable degradation of the marine environment.”

AEWC now appeals, arguing that the EPA failed to

consider adequatelythe extent to which discharges authorized

under the Permit will interfere with subsistence uses of the

Beaufort Sea, particularly the subsistence communities’ fall

hunt for bowhead whales. AEWC contends that the permitted

discharges will divert the whales far from their normal

seasonal migratory routes, making the hunting of them less

productive and far more dangerous. AEWC challenges the

EPA’s failure to include in the Permit the following two sets

of restrictions: first, a total prohibition (“zero discharge

restriction”) on the discharge of six of the thirteen authorized

waste streams: drilling fluids and cuttings (No. 001), sanitary

and domestic waste (Nos. 003, 004), ballast water (No. 010),

bilge water (No. 011), and certain muds, cuttings, cement at

the seafloor (No. 013); and second, a prohibition during the

fall bowhead hunting season of the discharge of an additional

five waste streams: non-contact cooling water (No. 009) and,

if not brought within the zero discharge restriction, sanitary

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ALASKA ESKIMO WHALING COMM’N V. EPA 7

and domestic waste (Nos. 003, 004), bilge water (No. 011),

and certain muds, cuttings, cement at the seafloor (No. 013).

“Challenges to EPA actions under section 509(b) of the

Clean Water Act, 33 U.S.C. § 1369(b), are reviewed under

the arbitrary and capricious standard of the Administrative

Procedure Act.” Akiak Native Cmty. v. EPA, 625 F.3d 1162,

1165 (9th Cir. 2010). Under this deferential standard of

review, we “‘will not vacate an agency’s decision unless it

has [1] relied on factors which Congress had not intended it

to consider, [2] entirely failed to consider an important aspect

of the problem, [3] offered an explanation for its decision that

runs counter to the evidence before the agency, or [4] is so

implausible that it could not be ascribed to a difference in

view or the product of agency expertise.’” Id. (quoting Nat’l

Ass’n of Home Builders v. Defenders of Wildlife, 551 U.S.

644, 658 (2007) (internal quotation marks omitted)).

II. The Error in the Record

Along with the Permit, the EPA issued three documents

that, taken together, explain the bases for the EPA’s

permitting decision: (1) its Response to Comments, which

includes the EPA’s responses to all comments it received;

(2) its Ocean Discharge Criteria Evaluation, issued “to review

the discharges authorized under [the Permit] and evaluate

their potential [to] cause unreasonable degradation of the

marine environment[,]”; and (3) its Environmental Justice

Analysis in support of the Permit. In its response to a

comment requesting a seasonal restriction on the discharge of

non-contact cooling water and related chemicals, sanitaryand

domestic wastes, and bilge water, “because these waste

streams risk deflecting bowhead whales from their migratory

paths,” the EPA stated that it “concluded that non-contact

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8 ALASKA ESKIMO WHALING COMM’N V. EPA

cooling water will not result in an unreasonable degradation

to the marine environment due to the permit restrictions and

monitoring requirements placed on this discharge and

because temperature is expected to dissipate and achieve

complete mixing within 100 meters of the discharge

location.” Similarly, in the Ocean Discharge Criteria

Evaluation, the EPA stated that it used a model to evaluate

the dilution of all the drilling-related effluents associated with

each of the discharges authorized by the Beaufort general

permit, and that “[t]he predicted dilution for th[e] worst-case

scenario was approximately 600:1 at 100 meters from the

discharge point.”

On the eve of oral argument, the EPA filed with this court

a letter in which it candidly acknowledged its discovery of a

misstatement in the record and in its brief. In its letter, the

EPA reported that the modeling it cited in support of its

statements that the temperature of cooling water would

dissipate and mix within 100 meters of discharge, and that all

discharges would dilute to a ratio of 600:1 within 100 meters

of discharge, in fact did not include non-contact cooling water

in the model. That model was for drilling-related effluents,

not cooling water. EPA’s letter further stated that cooling

water was included in other modeling that applied to a wide

range of discharges. An attachment to the letter contained a

table (“Table 6”) that included a list of numbers and figures

for the temperature effects at various cooling water

discharges.

Under the controlling rule for the review of administrative

agency actions, “a reviewing court, in dealing with a

determination or judgment which an administrative agency

alone is authorized to make, must judge the propriety of such

action solely by the grounds invoked by the agency. If those

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ALASKA ESKIMO WHALING COMM’N V. EPA 9

grounds are inadequate or improper, the court is powerless to

affirm the administrative action by substituting what it

considers to be a more adequate or proper basis.” SEC v.

Chenery Corp. (Chenery II), 332 U.S. 194, 196 (1947). We

must remand rather than combing the record for evidence on

which the agency may have relied. Id.

Here, neither the EPA’s letter and its attachment, nor the

EPA’s representations at oral argument, explained the import

of the agency’s error. In addition to the table in its

attachment, the letter discusses a list of other figures and

tables in the Further Excerpts of Record. These figures and

tables are no substitute for the agency’s on-the-record

explanation of what the evidence showed and how that

evidence supports its ultimate conclusions. The EPA’s

erroneous statement that cooling water would be mixed and

diluted to a ratio of 600:1 suggested that this level of mixing

and dilution was unlikely to change the behavior of bowhead

whales. We are unable to extract a similar conclusion from

the figures supplied or referred to in the EPA’s letter. With

the record in this posture, we cannot properly answer the

question whether the EPA’s error affected its decision. We

conclude, therefore, that the error in the record to which the

EPA drew our attention requires remand to address the issue

involved.

We remand to the EPA to reconsider, in light of its

acknowledged error, its determination that discharge of noncontact cooling water (alone or along with other authorized

discharges) will not cause unreasonable degradation of the

marine environment, and to identify evidence in the record

sufficient to support its reconsidered decision concerning the

possible effect, or non-effect, of the discharge of non-contact

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10 ALASKA ESKIMO WHALING COMM’N V. EPA

cooling water on the bowhead whale migration and

subsistence hunting season in the Beaufort Sea.

For the reasons and in the manner discussed below, we

deny the petition for review in all other respects.

III. Adherence to Statutory Criteria

The Clean Water Act requires the EPA to promulgate

guidelines for determining degradation of marine waters,

which shall address several considerations listed in the

statute. 33 U.S.C. § 1343(c)(1)(A)–(G). AEWC argues that

the EPA erred in failing to base its decision on two of these

considerations, “the effect of disposal[] of pollutants on

esthetic, recreation, and economic values,” id.

§ 1343(c)(1)(C), and “the effect on alternate uses of the

oceans, such as mineral exploitation and scientific study,” id.

§ 1343(c)(1)(G).

AEWC’s argument misses the mark. The organic statute

sets forth the considerations that EPA was to follow when

promulgating its own regulations, not the criteria that EPA

must apply to each permitting decision it makes. AEWC

disclaims any Chevron-style challenge to EPA’s regulations

under the statute. Thus, we are tasked only with deciding

whether EPA’s application of its regulatory criteria to the

permitting decision challenged here was arbitrary or

capricious.

IV. Adherence to Regulatory Criteria

The remainder of AEWC’s arguments challenge the

EPA’s consideration of the record evidence in light of the

regulatory requirements for the issuance of NPDES permits,

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ALASKA ESKIMO WHALING COMM’N V. EPA 11

40 C.F.R. § 125.123, and the “unreasonable degradation”

criteria set out in the implementing regulations, 40 C.F.R.

§ 125.122.

A

The EPA issued the Permit under paragraph (a) of

40 C.F.R. § 125.123, which provides in pertinent part:

(a) If the director on the basis of available

information . . . determines prior to permit

issuance that the discharge will not cause

unreasonable degradation of the marine

environment after application of any

necessary conditions specified in

§ 125.123(d), he may issue an NPDES permit

containing such conditions.

The EPA did not purport to act under paragraph (c), which

provides in pertinent part:

(c) If the director has insufficient information

to determine prior to permit issuance that

there will be no unreasonable degradation of

the marine environment . . . there shall be no

discharge of pollutants into the marine

environment unless the director on the basis

of available information . . . determines that:

(1) Such discharge will not cause

irreparable harm to the marine

environment during the period in which

monitoring is undertaken, and

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12 ALASKA ESKIMO WHALING COMM’N V. EPA

(2) There are no reasonable alternatives to

the on-site disposal of these materials, and

(3) The discharge will be in compliance

with all permit conditions established

pursuant to paragraph (d) of this section.

Paragraph (d) then provides certain conditions that are

mandatory for permits issued pursuant to paragraph (c),

including a monitoring program to assess the impact of the

discharge on aquatic life, and a clause providing for

revocation of the permit if the director determines at any time

that continued discharges may cause unreasonable

degradation of the marine environment.

Proceeding under paragraph (a), the director determined

on the basis of available information that the discharge would

not cause unreasonable degradation of the marine

environment after the monitoring condition and cancellation

clause of paragraph (d) were added to the Permit. EPA

accordingly issued the Permit.

AEWC argues that, because the EPA applied two

conditions specified in paragraph (d), the EPA somehow

became subject to paragraph (c) and its requirement that the

director determine that there were no reasonable alternatives

to on-site disposal of materials. This contention, however,

simply is not what the regulations provide. The director was

free to impose two conditions specified in paragraph (d), as

paragraph (a) authorized. Nothing in the regulations provides

that proceeding in such a manner somehow converts a

paragraph (a) proceeding to a paragraph (c) proceeding.

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ALASKA ESKIMO WHALING COMM’N V. EPA 13

Accordingly, should the EPA determine on remand that

available information still supports its determination that

discharges will not cause unreasonable degradation of the

marine environment, there is no error in its decision to

proceed under subsection (a). If, however, the EPA

determines on remand that the record does not contain

sufficient “available information” to support its determination

that “the discharge[s] will not cause unreasonable degradation

of the marine environment after application of any necessary

conditions specified in § 125.123(d),” 40 C.F.R.

§ 125.123(a), its issuance of the Permit pursuant to subsection

(a) cannot stand, and it will be obliged to proceed under

subsection (c) and conduct the alternatives analysis and meet

the other requirements for permit determinations under that

subsection.

B

The main thrust of AEWC’s remaining arguments is that

the EPA’s decision regarding discharges other than noncontact cooling water was not adequately supported by the

evidence. AEWC also argues that the EPA did not provide a

rational explanation of how the monitoring program will

prevent conflicts with subsistence uses and that the EPA’s

reliance on the monitoring program is arbitrary and irrational. 

These arguments stress the EPA’s acknowledgment of record

evidence indicating the discharges may conflict with

subsistence uses.

The Clean Water Act’s implementing regulations set out

ten criteria the EPA must consider in making its

determination of “whether a discharge will cause

unreasonable degradation of the marine environment.” 40

C.F.R. § 125.122(a)(1)-(10). AEWC’s challenge to the

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14 ALASKA ESKIMO WHALING COMM’N V. EPA

sufficiency of the EPA’s analysis of the record evidence in

light of the regulatory criteria focuses on the sixth and ninth

criteria: “[t]he potential impacts on human health through

direct and indirect pathways,” and “[s]uch other factors

relating to the effects of the discharge as may be appropriate.” 

40 C.F.R. § 125.122(a)(6), (9). The record is, however,

replete with evidence that the EPA heard and considered the

concerns raised by AEWC. The record evidence also reflects

the EPA’s consideration of the ocean discharge criteria in

making its determination that the authorized discharges

would not cause unreasonable degradation of the marine

environment, 40 C.F.R. § 125.122(a).

To the extent that AEWC takes issue with the EPA’s

factual findings other than those specifically related to the

effect of the discharge of non-contact cooling water on the

bowhead whale migration, those findings are supported by

the administrative record and are entitled to our deference. 

See Arkansas v. Oklahoma, 503 U.S. 91, 113 (1992)

(explaining that, when reviewing an agency’s adjudicative

action, the reviewing court “should not supplant the agency’s

findings merely by identifying alternative findings that could

be supported by substantial evidence”). EPA’s issuance of

the permit on the basis of those findings was not arbitrary or

capricious.

C

AEWC also argues that the EPA did not provide a rational

explanation of how the monitoring program will prevent

conflicts with subsistence uses and that the EPA’s reliance on

the monitoring program is arbitrary and irrational.

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ALASKA ESKIMO WHALING COMM’N V. EPA 15

The record contains a detailed description of the

monitoring program, including requirements for monthly

reports of effluent monitoring and testing, reports after

drilling is complete, and ongoing monitoring and reporting of

marine mammal deflections during discharges of drilling

fluids and cooling water. The EPA’s determination that the

reporting requirements under the monitoring program are

adequate was not unreasonable. See, e.g., Kern Cnty. Farm

Bureau v. Allen, 450 F.3d 1072, 1076 (9th Cir. 2006) (“The

arbitrary and capricious standard is ‘highly deferential,

presuming the agency action to be valid and [requires]

affirming the agency action if a reasonable basis exists for its

decision.’” (quoting Indep. Acceptance Co. v. California,

204 F.3d 1247, 1251 (9th Cir. 2000) (quotations and citations

omitted)). There is accordingly no basis for concluding that

the EPA’s design and implementation of the monitoring

program was arbitrary or capricious. This conclusion,

however, does not preclude the EPA from reassessing or

adjusting its monitoring program as necessary or appropriate

in light of its reconsidered decision of degradation of the

marine environment on remand.

D

AEWC contends that the EPA should bring its mitigation

measures in line with those that the National Marine Fisheries

Service (“NMFS”) adopted in an authorization it issued under

the Marine Mammal Protection Act and that are, in fact, the

same measures that AEWC and intervenors Shell Gulf of

Mexico and Shell Offshore Inc. agreed to in their 2012

Conflict Avoidance Agreement.

AEWC identifies no legal authority, and we find none, for

the proposition that either the NMFS determination under a

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16 ALASKA ESKIMO WHALING COMM’N V. EPA

different statute for a different purpose (prevention of noise

disruption of marine mammals) or the private Conflict

Avoidance Agreement between oil companies and the

AEWC, must or should be incorporated into the Permit

provisions. The NMFS concurred in EPA’s determination

that EPA’s planned action in issuing the Permit “may affect,

but is not likely to adversely affect” bowhead whales in the

Beaufort Sea. The EPA considered the Conflict Avoidance

Agreement, but it was not required to write the terms of that

private agreement into the Permit.

V. Conclusion

In sum, we grant in part the AEWC’s petition for review

and we remand this matter to the EPA to reconsider, in light

of its acknowledged error, its determination that discharge of

non-contact cooling water will not cause unreasonable

degradation of the marine environment, and to identify

evidence in the record sufficient to support its reconsidered

decision concerning the possible effect, or non-effect, of the

discharge of non-contact cooling water on the bowhead whale

migration and subsistence hunting season in the Beaufort Sea. 

We deny the petition in all other respects because the EPA’s

issuance of the Permit is otherwise supported by the record

evidence, does not reflect a failure to consider an important

aspect of the problem, and is not otherwise arbitrary or

capricious.

The parties shall bear their own costs on this appeal.

PETITION GRANTED IN PART; DENIED IN

PART; and REMANDED for further proceedings

consistent with this opinion.

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