MSHA Update

On December 29, 2009, MSHA published a "direct final rule," revising 30 C.F.R. sections 50.10 and 100.4 (74 Fed. Reg. 68918). Section 50.10 deals with the immediate notification to MSHA at once without delay and within 15 minutes at MSHA's toll-free number, once the operator knows or should know that any accident has occurred. In the direct rule, MSHA divides section 50.10 into four subsections, instead of the current single paragraph. According to the preamble, new subsection (d) will now read "[a]ny other accident" so that, when an operator is cited under that new subsection, MSHA will know to propose a regular civil penalty assessment for such a violation without having to review the citation itself -- this is intended to make the penalty assessment process more efficient. New subsections (a), (b), and (c) address the three categories of accidents covered by section 5(a) of the MINER Act (i.e., death of an individual at the mine, or injury or entrapment of an individual at the mine, which has a reasonable potential to cause death). Violations alleged under one of those three subsections will, in turn, be penalized with the automatic mandatory assessments of no less than $5,000 and not more than $60,000 as mandated by the MINER Act. (The change to section 100.4 is simply the re-designation of the current text of section 100.5(f) -- spelling out the mandatory assessments -- to what will now be section 100.4(c).)

The direct final rule procedure is used from time to time by federal agencies, including MSHA, to quickly promulgate what are believed to be non-substantive and/or organizational rule amendments.  MSHA plans for its latest direct final rule to become effective on March 29, 2010 unless it receives any "significant adverse comments."  As defined in the preamble, "significant adverse comments" would be comments explaining (1) why the direct rule is inappropriate, including challenges to the rule's underlying premise or approach or (2) why the rule will be unacceptable without a change.

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Federal Court Grants Relief In 404 Permit Case

Ohio Valley Environmental Coalition v. United States Army Corp of Engineers, No. 3:08-cv-0979 (S.D. W. Va. Nov. 24, 2009).

A federal district court in the Southern District of West Virginia granted a limited stay of an order thereby allowing Fola Coal Company LLC to continue mining operations for 12 months using existing valley fills.  In its November 24, 2009 order, the court had remanded Fola's permit under Section 404 of the Clean Water Act (CWA), as well as a Section 404 permit held by Loadout, LLC and Coal River Mining, LLC.  Fola subsequently filed a motion for relief seeking a limited stay of the order as to the valley fills that had already been filled or partially filled pursuant to agreements with the plaintiffs and previous court orders.  The requested stay, Fola explained, merely extended the effect of those previous agreements and orders.  Fola also argued that a full remand of the permit at this point would result inevitably in worker layoffs and other negative economic consequences.  As indicated by a later-filed affidavit, a stay would allow Fola to continue its mining operations for 12 months.  Fola further observed that relief would be equitable because the permit had been remanded for procedural, rather than substantive, deficiencies.  Finally, Fola argued that neither the plaintiffs nor the environment would suffer from the requested relief because it only applied to complete or partially constructed valley fills rather than new ones and because their use would not interfere with the plaintiffs' ability to comment on the remanded permit. Fola also reminded the court that relief would be consistent with the court's previous decisions, as well as other decisions in the Southern District of West Virginia, which allowed exceptions to injunctions against the use of valley fills when the fill had already occurred. 

The plaintiffs did not oppose the motion.  Without delineating its reasons, the court noted the plaintiffs' consent to the motion and granted Fola's request to continue using the specified valley fills. 

On January 5, 2010, Loadout, LLC (Loadout) and Coal River Mining (Coal River), LLC also filed a motion for relief from the Order in which they sought permission to re-commence work at certain complete or partially constructed valley fills.  In contrast to their position on Fola's request for relief, the plaintiffs opposed Loadout and Coal River's motion. The plaintiffs and the defendants dispute the extent of the environmental harm that would be caused by Loadout and Coal River's use of certain partially constructed valley fills and also about the extent of the economic harm that would be caused by the denial of relief. 

On January 14, 2010, Loadout and Coal River moved for a Rule 54(b) certification of finality of the Order.  On January 22, 2010, they filed a motion to extend the time to file a notice of appeal.  The court granted both motions.  The court also extended a previously granted stay of the Order pending resolution of Loadout and Coal River's motion for relief.  The stay allows Loadout and Coal River to continue limited mining activities in accordance with any existing agreements between the parties and the court's previous opinions and orders but not to initiate new valley fills until the defects in its CWA § 404 permit were resolved.  As of January 28, 2010, Loadout and Coal River's motion for relief remained pending.

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Fourth Circuit Upholds Maryland's Denial of Water Quality Certification
for Proposed Liquefied Natural Gas Terminal

AES Sparrows Point LNG, LLC v. Wilson, 2009 WL 4981233 (4th Cir. 2009)

The Fourth Circuit dismissed a petition for review that challenged Maryland's denial of a request for water quality certification under § 401(a)(1) of the Clean Water Act, 33 U.S.C. § 1341(a)(1) (CWA), for a proposed large-scale liquefied natural gas (LNG) marine import terminal and pipeline project.  The project had raised three areas of environmental concern: dredging within the Baltimore Harbor, which could potentially decrease oxygen levels; the processing of dredged material at the terminal; and the construction of the pipeline in sensitive environments.  Maryland had denied the Petitioners' request for § 401(a)(1) water quality certification on the basis that it was unable to conclude that the project would be carried out in compliance with state water quality standards.

In upholding the denial, the Fourth Circuit examined three major issues.  First, the Court of Appeals held that Maryland had explicitly waived any claim of sovereign immunity through the language in its decision denying the certification request.

Second, the court upheld the Army Corps' of Engineers interpretation of when the one-year waiver period for granting or denying § 401(a)(1) certification requests begins.  Petitioners argued that Maryland's denial was not within CWA's one-year waiver period; they argued that the one-year period begins at the time of either receiving the request for certification, or of any subsequent submissions of additional information.  The court disagreed, upholding the Corps' interpretation that CWA's one-year waiver period began when the Corps issued a public notice that the companies had submitted a valid request for certification.  The court concluded that Petitioners had failed to establish a basis for disturbing the Corps' determination that Maryland had not waived its right to grant or deny the § 401(a)(1) Certification Request. 

Finally, the court held that the State's denial of the certification was not arbitrary and capricious.  Maryland relied on four independent and alternative grounds for its denial, including that the dredging required to accommodate the LNG tankers would create additional deep water areas where dissolved oxygen levels would fail to meet Maryland water quality standards.  Based on this dredging justification, the court upheld the denial of the § 401(a)(1) Certification Request, offering no opinion on the other bases for Maryland's denial.  The Fourth Circuit added that Maryland had not exceeded its authority under the CWA, because the channel depth needed by the project would affect the flow of water in those areas.  The State had examined the relevant data pertaining to the effect on water quality in the areas of the proposed deep channel dredging and had articulated a satisfactory explanation for its denial on that basis sufficient to pass muster under the narrow arbitrary and capricious standard of review.

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EPA Adds Electric Power Generation and Other Industries to List of Facilities that Will Be Subject to Forthcoming CERCLA Financial Responsibility Regulations

On January 6, the Environmental Protection Agency (EPA) published a notice in the Federal Register that certain classes of facilities within three industries will likely be the subject of future EPA regulations imposing financial responsibility requirements under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA).  The identified industries are chemical manufacturing, petroleum and coal products, and electric power generation.  The January 6 notice comes almost six months after an earlier notice from EPA identifying classes of facilities within the hard rock mining industry as facing the same fate -- the hard rock mining financial responsibility regulations are expected to come out this spring.

The financial responsibility requirement stems from section 108(b) of CERCLA, codified at 42 U.S.C. § 9608(b), which directs EPA to establish regulations requiring evidence of financial responsibility from certain classes of facilities that produce, transport, treat, store, or dispose of hazardous substances, as that term is defined in CERCLA.  Despite a congressional deadline that passed 25 years ago to establish such regulations, EPA has never issued any; it is doing so now as a result of litigation directing it to fulfill its statutory obligation.

According to the January 6 notice, EPA's risk evaluation in identifying the latest classes of facilities that will be the subject of future financial responsibility rulemaking took into consideration a number of factors, including: (1) amounts of hazardous substances released into the environment; (2) toxicity of the released hazardous substances; (3) the existence and proximity of potential receptors; (4) historical contamination; (5) whether the cause of historical contamination still exists; (6) experiences from federal clean-up programs; (7) projected costs of clean-up programs; and (8) corporate structures and potential for bankruptcy. 

EPA also reviewed data on hazardous waste generation from the biennial report prepared pursuant to the Resource Conservation and Recovery Act (RCRA) and data from the Toxics Release Inventory (TRI), a database of almost 650 chemicals and chemical categories managed at over 23,000 facilities.  Although additional industries were considered by EPA for financial responsibility rulemaking, two of the three identified industries "chemical manufacturing and petroleum and coal products" emerged based on an agency ranking system, while the third, electric power generation, was identified based on EPA's own subjective evaluation, including the consequences of the release of coal ash from the Tennessee Valley Authority's Kingston Plant in December 2008.

By this notice, EPA has invited comments on why certain classes of facilities that operate within the three identified industries should or should not be subject to financial responsibility regulations under CERCLA, supporting documentation or information about such facilities, and information to guide the agency's decisions on what the financial responsibility requirements should be.  EPA also gave notice that it will continue to study classes of facilities in other industries for future financial responsibility rulemaking, including the following industries: waste management and remediation; recycling of products containing hazardous substances; wood product manufacturing; fabricated metal products; and electronics.

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OMB Extends Review of EPA's Proposed Coal Ash Regulations Additional 30 Days

The Office of Management and Budget's (OMB) Office of Information and Regulatory Affairs (OIRA) has extended its review of the Environmental Protection Agency's (EPA) proposed standards for management of coal combustion residuals -- coal ash -- generated by commercial power producers.  EPA submitted its proposal to OIRA on October 16, 2009.  Executive Order 12866 requires OIRA to complete its review within 90 days but also allows a one-time extension of up to 30 days.  As the original review period on EPA's coal ash standards drew to a close, OIRA extended its review.

OMB's review of the proposal has gathered attention because of the volume of meetings it has held with stakeholders. http://online.wsj.com/article/SB126300256672322625.html

EPA announced on December 17 that it would not meet Administrator Lisa Jackson's deadline of making a regulatory decision on coal ash by the end of 2009 due to the "complexity of the analysis." http://yosemite.epa.gov/opa/admpress.nsf/0/85D3578E15C80DB98525768F006A097B

The proposed rule is now expected to issue in mid-February.

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WVDEP Finalizes Marcellus Shale Guidance Document

On January 8, the West Virginia Department of Environmental Protection (WVDEP) released a guidance document and permit addendum to better manage water use and disposal by the oil and gas industry when drilling in the Marcellus Shale formation. 

http://www.dep.wv.gov/oil-and-gas/GI/Documents/Marcellus%20Guidance%201-8-10%20Final.pdf

The document is intended to facilitate compliance with applicable statutory and regulatory requirements and to generally minimize negative environmental impacts associated with these activities, by promoting the use of necessary best management practices.  It was developed to assist well operators in planning for the drilling and operation of wells and the associated need to either dispose of or reuse large water volume fracture treatment wastes. 

Among other things, the guidance document addresses water use or withdrawal, storm water, site construction, and water disposal.  It emphasizes the need for well operators to be diligent about protecting the state's waters and directs well operators to a guidance tool on the WVDEP's website to be used to determine whether a body of water can sustain the proposed withdrawal.  The document does not mandate a specific form of disposal, but rather discusses the various methods of treating and disposing of frac fluids, and encourages operators to seriously consider all of the available options.

In addition to this guidance, the Office of Oil and Gas (OOG) is requiring companies to submit additional information through an addendum to permit applications for this type of activity. 

http://www.dep.wv.gov/oil-and-gas/GI/Documents/Permit%20Addendum%20F%5b1%5d.pdf

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Surface Coal Mining Update

Status of Enhanced EPA Clean Water Act Permitting Review for Coal Mining Projects

In September 2009, EPA identified 79 surface coal mining projects that it determined required further, detailed environmental review of their pending CWA permit applications under enhanced procedures announced in a June 11, 2009 memorandum of understanding between EPA, the Department of the Interior, and the U.S. Army Corps of Engineers.  [December 2009 EMLF news alert, 'Surface Coal Mining Updates']. 

On January 6, 2010, the Army Corps approved the permit for Patriot Coal Corporation's mountaintop mine, a day after EPA announced that it supported issuance of the permit.  http://www.reuters.com/article/idUSN0623651720100106?type=marketsNews

The permit, for the Hobet 45 mine in Lincoln County, WV, is the second of these permits to be approved since EPA's September announcement.  As with the first such permit, for a Buckingham Coal Co. mine in Ohio, EPA made its recommendation after "extensive discussions between EPA and the company resulted in additional significant protections against environmental impacts," according to an EPA press release announcing the Agency's support.  http://tinyurl.com/y9er7r5

The announcement claims that the redesigned proposal would "eliminate nearly 50 percent of stream impacts, reduce anticipated stream contamination, and protect public health."   According to EPA, the Hobet 45 operation is expected to employ 460 United Mine Workers of America miners. 

EPA also announced that the Agency and the Mingo Logan Mining Company, an Arch Coal subsidiary, had jointly requested an extension of a court-ordered deadline to continue discussions to determine if a revised mining plan can be developed for the Spruce No. 1 mine, to ensure it complies with the Clean Water Act.  The court, which oversees citizen suit litigation involving the mine, granted the extension until early March. 

To date, permit applications in seven of the 79 projects identified by EPA as requiring further environmental review have been withdrawn by their applicants.   EPA review is underway for two others. 

http://www.epa.gov/owow/wetlands/guidance/mining-projects.html

On December 21, 2009, Senator Robert C. Byrd of West Virginia met with EPA Administrator Lisa Jackson, at her request, to discuss 'the difficult issues affecting the mining industry,' and 'specifically asked for 'the EPA, in conjunction with the other regulatory agencies, the coal industry, and unions to develop a clear set of parameters for issuing mining permits.''

http://byrd.senate.gov/mediacenter/view_article.cfm?ID=569 

Immediately following EPA's announced support for the Hobet 45 mine, Sen. Byrd applauded the decision, as well as the continued discussions over the Spruce No. 1 mine. 

http://byrd.senate.gov/mediacenter/view_article.cfm?ID=574

Byrd also announced that EPA, the Army Corps, and the West Virginia Department of Environmental Protection will begin hosting regular meetings with interested coal companies to "clarify the technical details and requirements associated with the processing of permit plans to federal and state laws."  The first such meeting was scheduled for January 12, 2010 in Charleston, WV. 

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Clean Air Act Updates

-- EPA Proposes New Ground-Level Ozone NAAQS Standards

On January 19, 2010, the Environmental Protection Agency (EPA) proposed new primary and secondary National Ambient Air Quality Standards (NAAQS) for ground-level ozone (75 Fed. Reg. 2938).  EPA's action arose from the reconsideration of a 2008 EPA rulemaking which set ground-level ozone NAAQS standards. 

Upon reconsideration, EPA proposes to set the 8-hour primary standard for O₃ at 0.060 to 0.070 parts per million (ppm) rather than 0.075, as set in the 2008 rulemaking.  EPA states that the lower standard will "provide increased protection for children and other 'at risk' populations."  EPA cites numerous O₃-related adverse health effects including respiratory symptoms, respiratory morbidity, possible cardiovascular-related morbidity, as well as total non-accidental and cardiopulmonary morbidity.

EPA proposes that the secondary standard should be a cumulative, seasonal standard, expressed as an annual index of the sum of weighted hourly concentrations, cumulated over 12 daylight hours per day (8 am to 8 pm) during the consecutive three-month period within the O₃ season with the maximum index value.  This standard would be set at a level within the range of 7 to 15 ppm-hour to protect against adverse O₃-related adverse impacts on vegetation and forested ecosystems.  The 2008 rulemaking had adopted a secondary standard identical to the primary standard.

EPA notes that both the primary and secondary standards it proposed in this rulemaking are consistent with the recommendations of the Clean Air Scientific Advisory Council and cites deviations from those recommendations in the 2008 rulemaking as one of the factors in the reconsideration of the 2008 rulemaking.

EPA will hold three public hearings on the proposed rule (February 2, 2010 in Arlington, VA, and Houston, TX, and February 4, 2010 in Sacramento, CA) and will accept comments through March 22, 2010.

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-- EPA Extends Deadline to Designate Nonattainment Areas for 2008 Ozone NAAQS

The Environmental Protection Agency (EPA) has extended by one year the deadline for designation of nonattainment areas for the 2008 ozone National Ambient Air Quality Standards (NAAQS) (75 Fed. Reg. 2936).  The new deadline is March 12, 2011.  After a NAAQS is revised, the Clean Air Act requires the Administrator to designate areas that are in nonattainment of that standard within two years.  The statute allows an extension of up to one year if the Administrator finds she has insufficient information to make the designation.

EPA explains that it intends to issue a new final ozone NAAQS rule, with standards different than those in the 2008 rulemaking, by August 31, 2010.  (See EPA Proposes New Ground-Level Ozone NAAQS Standards above for the substance of the proposed standards.)   Because of the uncertainty the newly proposed standards create regarding the validity of the 2008 ozone standards, EPA has determined that there is insufficient information at this time to promulgate designations of nonattainment under the 2008 ozone standards.

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Wind Power Update -- Maryland Federal Court Requires Proposed Wind Farm to Obtain Endangered Species Act Permit; Parties Reach Settlement to Allow Turbine Construction and Operation to Move Forward

On December 8, 2009, a Maryland federal district court judge ruled that a proposed wind energy project in Greenbrier County, West Virginia could not implement its full development plans and operate year-round without obtaining an Incidental Take Permit (ITP) from the U.S. Fish & Wildlife Service (FWS) due to potential future impacts to the endangered Indiana bat.  Animal Welfare Institute v. Beech Ridge Energy LLC, 2009 WL 4884520 (D. Md. Dec. 8, 2009).

Following an expedited proceeding in which the court consolidated the hearing on Plaintiffs' motion for a preliminary injunction with the merits, which included a four-day bench trial with testimony from bat biologists, the court found that it was certain that Indiana bats were present on the project site and that they were certain to be killed by the wind turbines.  Pursuant to the court's ruling, Invenergy is beginning the process to obtain an ITP from FWS.

In addition, the court entered a stipulated settlement among the parties on January 26, 2010 that altered various aspects of the December 8 ruling.  Specifically, the settlement allows for erection of all turbines that the company had planned for Phase I of the project in 2010 (some in different locations than originally planned) and full operation other than during nighttime hours between April 1 to November 15 (between half hour prior to sunset and quarter hour after sunrise) while the company works through the ITP process.