Shoring Up Liquid Natural Gas

EPA Asked to Defend Its Flip-Flop on Ventura LNG Project

by Ethan Stewart

The long road toward final approval of the liquid natural gas
(LNG) facility proposed for construction off the Ventura coast
became even bumpier last week when Congress began asking tough
questions about the Environmental Protection Agency’s (EPA)
controversial stance on the project. In one of the first offensive
moves of the newly Democratic-led Congress, Representative Henry
Waxman of Los Angeles — the recently appointed head of the House
Committee on Oversight and Government Reform — sent a letter to EPA
Administrator Stephen Johnson. Waxman demanded an explanation for
the agency’s flip-flop frtom mistrust to support of BHP Billiton’s
Cabrillo Port Project. Citing his committee’s edict to “investigate
unusual and potentially suspect agency actions,” Waxman requested
an analysis “that provides a factual and legal basis for the EPA’s
reversal on the project,” as well as copies of all corresptondence
between the EPA’s Washington office and its Central California
branch regarding the reversal.

Cries of foul began in July 2005 when the EPA sent a letter to
the Coast Guard explaining the agency’s position that the proposed
project — which would create an estimated 484 tons of
smog-producing chemicals — would not be required to provide offsets
for the air quality infractions it would create. That’s because,
the EPA argued, it would be sited in an area near the Channel
Islands that does not mandate offsets for air quality violations
due to a mid-1980s militarily-motivated loophole. The ruling came
as a shock to opponents of the project, as the EPA had clearly
stated in three prior letters sent to both BHP Billiton and the
County of Ventura that Cabrillo Port fell under the jurisdiction of
the Ventura County Air Pollution Control District and, as such,
would need to comply with the offsets mandated in the county’s
code.

From the beginning, BHP publicly argued that the proposed port,
being a sort of island itself, should fall under Channel Islands
jurisdiction, despite the fact that it would be 14 miles from the
Ventura shoreline and 21 miles from the closest of the Channel
Islands. For at least two years, the EPA soundly rejected BHP’s
reasoning. In one letter to the Coast Guard, the agency stated that
BHP’s pleading had “not changed our position on the applicability
of the [Ventura County Air Pollution Control] District rules … And
we plan to follow up with BHP Billiton on our request to provide
air emission offsets.” But less than one year and some $1.8 million
in BHP lobbying dough later, the EPA dramatically changed its
tune.

Shortly thereafter, the Santa Barbara-based Environmental
Defense Center (EDC) filed a Freedom of Information Act request to
uncover the facts behind the EPA’s reversal of opinion. They
discovered a bevy of emails and other exchanges between the EPA
headquarters in Washington, its 9th District office in California,
the White House, and BHP. The letters reveal that the regional EPA
office received pressure to rethink its stance on the air quality
application from several key players, most notably the White House
Task Force on Energy Project Streamlining. From these documents and
other research, Karen Kraus, the attorney for the EDC, concluded,
“The EPA has no legal standing for this reversal.” These documents
also prompted Waxman’s letter to the EPA, as well as a unanimous
vote by the board of the Ventura County Air Pollution Control
District in November 2006 to express to the EPA their opinion that
the Cabrillo Port project without a doubt falls within their
jurisdiction.

The EPA, which had until January 24 to respond to Waxman and
until February 13 to hand over all related correspondence, as of
press time had yet to respond to his committee’s concerns. The EPA
official overseeing BHP’s air quality application regretfully
declined to comment due to organizational policy. In the same vein,
BHP spokesperson Kathy Hann commented simply, “His [Waxman’s]
letter was addressed to the EPA, so I suggest you contact them
about the matter.”

The Cabrillo Port project remains in limbo, as Coast Guard
officials stopped the clock on the application process last year so
they would have ample time to examine the various safety and air
quality issues associated with an offshore LNG facility and the
piping of highly explosive natural gas ashore. The EPA’s stance
cannot become official until the Coast Guard weighs in, which is
expected to happen no sooner than late February. Meanwhile, the
California Coastal Commission’s hearing on the Cabrillo Port
project will take place in Santa Barbara this April.