Waste not, EPA Want not: New Waste Twist for OCS

Authored By: Stan Millan 

I. The Location

           The oil and gas activity in the Outer Continental Shelf (OCS), internationally recognized as the United States continental shelf,[1] is this focus of this essay. As the domain of Federal waters and submerged lands 200 nautical miles offshore, the OCS is not under state ownership or jurisdiction, except to the extent authorized under the Outer Continental Shelf Lands Act (OCSLA).[2] Most affected coastal states have OCS jurisdiction only up to nine nautical miles from the baseline of the territorial sea (shoreline). It is, among other things, subject of marine habitat, and to oil spills, leasing, pollution, and to alternate energy and oil and gas exploration and development. As such, it is vital to the U.S. economy. Though the Federal Bureau of Ocean and Energy Management (BOEM) wields the primary authority over this OCS area, other agencies have a role, such as the United States Coast Guard (“USCG”) on marine safety, pollution, and oil spills, and EPA on air pollution.[3]

II. The New Regulatory Regime

           Both marine vessels and onshore facilities generate waste. However, until now, governmental agencies involved in the management of waste treated land-based facilities far differently than vessels.  Land based facilities, when generating hazardous waste, have the more onerous requirements. Though vessels are assigned similar responsibilities, marine management responsibilities have recently begun to further align with the requirements of land lubbers.

           This raises complexities and delays for the offshore energy industry, where there are multiple parties (lessors, operators, contracts, subcontracts, etc.), hurricane threats, and less recycling options for waste offshore.

           Offshore waste includes operational waste resulting not only from the exploration and production of oil and gas (Beville waste exempt from the Resource Conservation and Recovery Act (“RCRA”)),[4] but also vessel waste from spent solvents, paint waste, lead based ship scrapings, used oil, universal waste, toxic waste, and so forth. The latter wastes are subject to RCRA, but the United States Coast Guard has mostly regulated these marine offshore wastes until they arrive onshore.

           Until recently, marine offshore vessels and oil platforms were content with having their operational hazardous waste streams transported onshore by service vessels to U.S. Coast Guard (USCG) designated and privately contracted for reception facilities.[5] The waste accumulated therefrom was tested, classified, manifested, and re-transported by trucks to transfer facilities and/or re-transported, to state or federally licensed treatment, storage, and disposal facilities (TSDF). Recently, the U.S. Environmental Protection Agency (EPA) exercised its authority in requiring the official point of generation to commence at the offshore vessels, yet this change seems to produce little environmental benefit and much confusion. Moreover, this transition, which has cost the industry millions, was not the product of regulation, formal guidance, or formal rulemaking, but rather an ad hoc (but not isolated) administrative enforcement action.[6]

III. RCRA

           To begin, the RCRA has spawned various duties for generators (those whose act or process creates discarded material) of hazardous waste, used oil and universal waste. (See appendix). Hazardous waste is discarded material that is either: (1) generator determined as characteristically hazardous waste (ignitable, corrosive, reactive, or toxic by a special “TCLP” test);  or (2) expressly regarded as hazardous waste by the EPA’s hazardous waste lists.[7] Further complications stemming from the RCRA’s enactment are the complex rules for obtaining an EPA hazardous waste identification number, calendaring, monthly counting and dating requirements, drum labelling, testing requirements, storage requirements, manifesting requirements, training, and pre-transport and transportation requirements. The more hazardous waste (or even a small amount of acutely hazardous waste on EPA’s P and F regulatory lists, e.g., pesticides) generated by a generator per month, the more management regulations apply for a larger sized generator.

           Most vessels (except oil platforms) possess limited space to properly store hazardous waste, e.g., drilling ships, service, and supply boats. Additionally, the generators have been tasked to comply with containment procedures, which require the labeling of waste with the corresponding waste type and date in which it is generated. Since storage is normally limited from ninety to one hundred and eighty days, vessels must undertake frequent transshipments of their waste onshore, which increases the risk of marine accidents.

           Next, prior to the RCRA’s enactment, the generation site on land is the contiguous site at which hazardous waste is generated.[8] By removing the onshore point option, a point of generation now means either the longitude or latitude where a mobile vessel generates its waste. That would imply a vessel as it travels obtaining numerous identification numbers from EPA. That could be unwieldy. A more appealing alternative is the drilling block area in the Outer Continental Shelf, which allows more movement before a vessel must obtain an additional identification number.

           Usually, there is no testing laboratory on vessels for their waste, as they relied upon onshore reception facilities. Now they may need to rely more on their process knowledge for waste classification. That judgement can be an environmental surprise waiting to happen. There is also much duplication of rules if vessels have dual agencies for waste regulation. Delays and confusion are the often result.

           These rules may not seem all that complex to a reader, but even on land they are not simple. Nevertheless, a generator who violates these rules faces sanctions from the EPA or other parties, including administrative, orders, penalties, judicial penalty/injunctions, or criminal.

IV. The Debate:

           The EPA, which has no direct role under OCSLA except for regulating air emissions offshore, has expressed that RCRA does not distinguish between land and water.[9] Since OCSLA makes its waters and seabed mostly federalized, the EPA purports to possess authority over the area under other federal environmental laws. Yet there is little enabled in EPA statutes or rules that supports this notion. For example, RCRA defines a facility as, “...all contiguous land, other appurtenances...on land, used for treating, storing, or disposing of hazardous waste or for managing hazardous secondary material”[10]

           This is quite an ambiguity to include water as RCRA land. Clarification was once given by EPA as follows: “...For marine vessels, the point at which hazardous waste is typically considered ‘generated’ is the point when the vessel reaches a port or dock located in United States waters and hazardous waste are physically ‘offloaded’ and removed from the vessel to a shore facility.”[11] This is our original point that marine vessels are accustomed to.

           EPA did change their conclusion in 2018 as to oil platforms, but these are normally long termed, permanently affixed to the sea bottom and are not mobile vessels.[12] Of course, vessels are often temporarily fixed onto a well or oil platform while in service.

           With the complexities of the informal change to the vessel is the point of generation, EPA is missing the point of harmony between RCRA and OCSLA and other laws. RCRA Section 6905(b) requires the EPA to integrate RCRA with other congressional acts that EPA has a role in. EPA does have an express role on vessel discharges and emissions, and reception facility regulations, under the MARPOL rules or Act to Prevent Pollution from Ships.[13]

V. Conclusion:

           EPA has some discretion in interpreting its statutes and rules it administers, but it cannot do so secretly. The Chevron Doctrine allows agencies to reasonably interpret ambiguous parts of their enabling statutes.[14] It seems arguable that the RCRA statute is plain enough with the harmony required to continue the pre-2018 regulatory regime. This integration allows RCRA to play out on land while USCG rules offshore. It may take litigation or a new administration to curtail the above changes. An offshore RCRA vessel guide for proactive reader review with private counsel is provided in the appendix for the rough OCS waters ahead.[15]

Click here to view: Appendix

[1] 43 USC §1231 et seq. (2018).

[2] 43 USC §1333(B)(2018). Affected coastal states civil and criminal laws are on their extended boundaries, the law of the U.S. in the OCS seabed.

[3] 40 CFR Part 55 (2022).

[4] 42 USC §§6901 et seq. (2018).

[5] 33 CFR §§151 and 153 (2022).

[6] The writer has several years of experience in negotiating for the marine industry and with the EPA on these changes and enforcement cases. The cases in question were settled administratively and are not reported cases. Details are considered confidential but EPA administrative docket numbers can be provided.

[7] 40 CFR §261 (2022).

[8]  40 CFR §260.10 (2022) for “facility”.

[9] Conversations between this writer and EPA Region VI enforcement officials in Spring 2022.

[10] 40 CFR § 261.10 (2022).

[11] WIN/Informed RCRA Subtitle C(March 21, 2005), p. 22. www.epa.gov/sites/default/files/2016-3/documents/win-informed.pdf. Last visited October 6, 2023. See https://www.dco.uscg.mil/OCSNCOE/Support-Vessels/Types-of-OSVs/ or .../ Mobile-Offshore-Drilling Units/Types-of-MODUs/ for pictures of vessels involved.

[12] RCRA On-Line Number 14889. Barnes Johnson 2017-05-18 Memo on Application of RCRA to Offshore Oil Platforms. https://rcrapublic.epa.gov/files/14889.pdf Last visited October 6, 2023.

[13] 33 USC §§1901-1905 (2018).

[14]  467 U.S. 837 (1984). However, the Court in Sackett v. EPA, 143 S. Ct. 2355 (2023), seems to have ignored Chevron when Congress was not clear on EPA authority over wetlands. In W.VA. v. EPA, 142 S. Ct. 2587 (2022), the Court ignored Chevron when a “major question doctrine” issue arose over a clear statutory statement of EPA authority over air pollution. These cases may imperil EPA, as Chevron involved two steps in determining the meaning of a statute,

1.) when a statute is plain go no further; and 2.) calling for agency deference when a statute is ambiguous.  Without  a step two, ambiguity  may remove agency deferential interpretation authority.    Chevron is also being judicially challenged. See Looper Bright Enterprises v. Raimondo et al., Sup. Ct. Docket 22-451.

[15] *By Stan Millan, SJD, adjunct professor of law at Loyola College of Law, and member of several state bars (including Louisiana). He is in private practice.