US Appeals court vacates OCS leasing

A federal appeals court vacated the current Outer Continental Shelf leasing program on Apr. 17 and ordered the US Department of the Interior to rework the portions dealing with areas off Alaska.

Nick Snow
OGJ Washington Editor

WASHINGTON, DC, Apr. 20 -- A federal appeals court vacated the current Outer Continental Shelf leasing program on Apr. 17 and ordered the US Department of the Interior to rework the portions dealing with areas off Alaska.

The decision's full impact was not immediately clear. A spokeswoman for Us Interior Secretary Ken Salazar said DOI was reviewing the decision. "Secretary Salazar believes that we need a comprehensive approach to an offshore energy plan, based on sound information about our resources and extensive public input. That's why he has extended the public comment period 180 days and has held four regional meetings on the previous administration's proposed new 5-year OCS oil and gas plan," she said.

The decision by the US Appeals Court for the District of Columbia did not accept other parts of the petition by the Center for Biological Diversity, which argued that DOI should have considered potential climate change impacts in the 2007-12 federal leasing program. The court also rejected the group's arguments that the program violated provisions in the Endangered Species Act and the National Environmental Policy Act.

But the court's chief judge, David B. Sentelle, said in the opinion he wrote that DOI did not use sound science in expanding leasing areas in the Beaufort, Bering, and Chukchi Seas in the current program. Relying on a National Oceanic and Atmospheric Administration study of environmental impacts of offshore oil and gas activity on Alaskan coastal areas was not sufficient because proposed new leasing tracts were significantly farther offshore, he maintained.

More complete analysis
"Consequently, on remand, the secretary must first conduct a more complete comparative analysis of the environmental sensitivity of different areas of the [OCS] and must at least attempt to identify those areas whose environment and marine productivity are most and lease sensitive to OCS activity," Sentelle said.

"Though [DOI] may ultimately conclude as a result of this additional analysis that the shorelines of the Beaufort, Bering and Chukchi Seas are the areas that are most sensitive to OCS development, such a conclusion cannot be reached without considering the effects of development on areas of the OCS in addition to the shoreline," he continued.

Once DOI completes the new analysis, it will need to determine whether its reconsideration warrants exclusion of any proposed area in the leasing program, the opinion said. It said it would need to reassess the program's timing and locations to obtain a proper balance of the potentials for environmental damage, adverse coastal zone impacts, and potential oil and gas discoveries.

Judge Judith W. Rogers wrote a concurring opinion. Judge Douglas H. Ginsburg also heard the case.

Environmental organizations hailed the court's ruling. Sierra Club Lands Director Alan Manuel said on Apr. 17 that then-US President George W. Bush's "plan to drill in the sensitive Chukchi and Beaufort Seas ignored science. The plan didn't consider the serious threat drilling would pose to America's polar bears, whales, and walruses. We're pleased to see the court recognize that plans to drill overlooked very serious threats to marine mammals."

Sided with wildlife
"By vacating the existing 5-year plan, the court sided with the wildlife and Native Alaskans that depend on these waters for survival and put science back in the decision-making process. The Bush administration had laid at the feet of the oil industry vast areas of the Arctic Ocean that are critical to Alaska Native cultures and to species like the polar bear and bowhead whale," said David Dickson, Western Artic Oceans program director for the Alaska Wilderness League.

But the court's action also drew fire from government officials in Alaska and an oil and gas industry group. Gov. Sarah H. Palin said the decision came only 3 days after Alaskans had voiced their opinions on offshore drilling to Salazar at one of the secretary's four regional public meetings on a new proposed OCS plan.

"Unfortunately, while we have been struggling to persuade the Obama administration not to undo the opportunities for offshore drilling, an appeals court has stepped in at the bidding of short-sighted environmentalists and pre-empted the federal-state dialogue," she added.

US Sen. Lisa Murkowski (R-Alas.), the Energy and Natural Resources Committee's ranking minority member, said that she was disappointed in the court's decision "to the extent that this may now cause a further delay in the development of the oil and gas resources that America still requires to fuel its economy.

"Alaska's OCS is America's energy storehouse and it needs to be developed with sensitivity to climate change and marine life, but I am troubled that the groups behind this litigation are engaging in the too-familiar tactic of suing on every possible issue, no matter the legal merits. This is evidenced by five of the six claims, all related to endangered species and climate change, having been dismissed or denied," she continued.

The American Petroleum Institute said in a statement that it was reviewing the ruling's implications. "It would be a disservice to all Americans, and a devastating blow to the economy, if this decision were to delay further the development of vital oil and natural gas resources," it noted.

Contact Nick Snow at nicks@pennwell.com.

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