Alert
Alert
11.06.14
The Environmental Protection Agency (EPA) and the U.S. Army Corps of Engineers (ACOE) have announced a new Nov. 14, 2014, deadline to submit comments to its much-debated redefinition of the term, “Waters of the United States,” which drives the scope of federal jurisdiction in numerous areas1. The extension, several related legal and regulatory developments since this proposed rule was published in April, and now the results of the election make this an opportune time to reassess the impact this redefinition will have on oil and gas operations and activities, during a period of extraordinary domestic growth.
The Clean Water Act (CWA), enacted in 1972, grants broad authority to EPA and the ACOE to exercise regulatory jurisdiction over the navigable waters of the United States, which the CWA defines simply as “waters of the United States.” EPA and the ACOE have implemented this authority, which defines the scope and extent of their power, in many subsequent rulemakings. The latest proposal was prompted largely in response to the Supreme Court’s 2006 decision in Rapanos v. United States 2, which EPA and others have criticized for muddying an already complex area of the law. EPA and the ACOE have proposed to change and replace the present definition of “waters of the United States” that governs the scope and application of several sets of regulations—12 in all—that these agencies have promulgated since the CWA was enacted, and all 12 regulations affect the operations of the oil and gas industry. Hence, these new rules, if adopted as proposed, will have a significant impact on the operations of the oil and gas industry, which is engaged, on a daily basis, in the exploration, development, production, transportation, refining, distribution and marketing of petroleum and petroleum products throughout the nation.3 For many of these activities, industry must secure state and federal permits under the CWA and its state-law counterparts. For example, EPA implements and oversees the CWA Section 402 permitting program (stormwater and NPDES pollution discharges); the CWA Section 311 oil and hazardous substance spill prohibition, prevention, and control program; the CWA Section 303 Water Quality Standards program; the CWA Section 401 state water quality certification program; and the oversight of the ACOE’s CWA Section 404 dredge and fill program. In addition, the ACOE is authorized to administer and enforce the CWA Section 404 dredge and fill permitting program, which is fundamental to most oil and gas production and pipeline operations. Moreover, activities regulated by these programs often are also regulated under the Endangered Species Act (ESA) and are therefore subject to the citizen suit provisions of the CWA and the ESA, which allow and even encourage enforcement by non-governmental parties.
The agencies interpret the term “waters” broadly to encompass not just the water itself but also the physical or geographic area where the water or water feature is located.4 Thus, the proposed redefinition of “waters of the U.S.” also establishes the geographic and physical boundaries in which oil and gas operations and activities will be subject to regulation under the Clean Water Act. By expanding the reach of the term, the agencies will effectively expand the scope of all twelve rules if the proposal is finalized in its current form.
This advisory also was published by Law360 on November 12, 2014.
The agencies use the term “water” and “waters” in the proposed rule in categorical reference to rivers, streams, ditches, wetlands, ponds, lakes, playas, and other types of natural or man-made aquatic systems. The agencies use the terms “waters” and “water bodies” interchangeably in this preamble. The terms do not refer solely to the water contained in these aquatic systems, but to the system as a whole, including associated chemical, physical, and biological features. See 79 FR 22188, at 22191, Footnote 3 (emphasis added).