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Kunaknana v. United States Army Corps of Engineers

United States District Court, D. Alaska

May 27, 2014

SAM KUNAKNANA, et al., Plaintiffs,
v.
UNITED STATES ARMY CORPS OF ENGINEERS, et al., Defendants, and CONOCOPHILLIPS ALASKA, INC., et al., Intervenor-Defendants. CENTER FOR BIOLOGICAL DIVERSITY, Plaintiff,
v.
UNITED STATES ARMY CORPS OF ENGINEERS, et al., Defendants, and CONOCOPHILLIPS ALASKA, INC., et al., Intervenor-Defendants.

ORDER RE MOTIONS FOR SUMMARY JUDGMENT

SHARON L. GLEASON, District Judge.

Plaintiffs Sam Kunaknana, et al. ("Kunaknana Plaintiffs") and the Center for Biological Diversity ("CBD") filed separate lawsuits challenging Defendant U.S. Army Corps of Engineers'[1] decision to issue a permit to ConocoPhillips Alaska, Inc. to fill certain wetlands in the National Petroleum Reserve - Alaska ("NPR-A") in order to develop a drill site known as Colville Delta 5 ("CD-5").[2] In their complaints, Plaintiffs assert that the Corps' issuance of the permit violated the National Environmental Policy Act ("NEPA"), 42 U.S.C. §§ 4321-4327, and Section 404 of the Clean Water Act ("CWA"), 33 U.S.C. § 1344.[3] ConocoPhillips, the Arctic Slope Regional Corporation ("ASRC"), the State of Alaska, the North Slope Borough, and Kuukpik Corporation have joined both actions as Intervenor-Defendants in support of the Corps.[4] Kuukpik is the Alaska Native Claims Settlement Act village corporation for the Inupiat Eskimo Village of Nuiqsut.[5]

Challenges to agency decisions brought in this federal district court are resolved through summary judgment motions.[6] Pursuant to the Court's Order Establishing Joint Case Management and a Case Schedule, the summary judgment motions in the two lawsuits have been jointly managed.[7] Presently before the Court are CBD's and the Kunaknana Plaintiffs' Motions for Summary Judgment.[8] The Corps and Intervenor-Defendants have each filed a single response in opposition to both Plaintiffs' motions, [9] which also serves as a cross-motion for summary judgment, [10] and Plaintiffs have replied.[11] No party requested oral argument, and oral argument was not necessary to the Court's decision.

For the reasons discussed herein, CBD's action will be dismissed because CBD lacks standing. The Kunaknana Plaintiffs' Motion for Summary Judgment will be granted on their NEPA claim to the extent they assert that the Corps failed to provide a reasoned explanation in the record for its decision not to conduct a supplemental NEPA analysis. This Order does not determine whether a supplemental NEPA analysis is required, nor does it determine the appropriate remedy for the Corps' NEPA violation. This Order also does not resolve the Kunaknana Plaintiffs' CWA claim. Instead, the Court requests further briefing from the parties as to how this case should proceed at this juncture.

STATUTORY FRAMEWORK, FACTUAL BACKGROUND, AND PROCEDURAL HISTORY

I. Statutory and Regulatory Framework.

A. Section 404 of the Clean Water Act.

Congress enacted the CWA "to restore and maintain the chemical, physical, and biological integrity of the Nation's waters."[12] To achieve this goal, the CWA prohibits the discharge of any pollutant into navigable waters unless authorized by a permit.[13] "Navigable waters" includes certain wetlands, [14] such as the area in dispute here.

Section 404 of the CWA governs permitting for the discharge of dredged or fill material into navigable waters.[15] The Corps is responsible for issuing Section 404 permits, and it does so according to EPA's Section 404(b)(1) Guidelines.[16] Those guidelines state in relevant part: "[N]o discharge of dredged or fill material shall be permitted if there is a practicable alternative to the proposed discharge which would have less adverse impact on the aquatic ecosystem, so long as the alternative does not have other significant adverse environmental consequences."[17] This provision requires the Corps to select what the parties in this controversy refer to as the Least Environmentally Damaging Practicable Alternative, or "LEDPA."

B. National Environmental Policy Act.

NEPA declares "a national policy... to promote efforts which will prevent or eliminate damage to the environment."[18] It is a procedural statute, designed to achieve its stated policy "by focusing Government and public attention on the environmental effects of proposed agency action, " thereby ensuring "that the agency will not act on incomplete information, only to regret its decision after it is too late to correct, " and that "the public and other government agencies [can] react to the effects of a proposed action at a meaningful time."[19] Regulations promulgated by the Council on Environmental Quality ("CEQ") provide guidance on the application of NEPA.

NEPA requires federal agencies to prepare an environmental impact statement ("EIS") for all "major Federal actions significantly affecting the quality of the human environment."[20] In an EIS, an agency must take "a hard look' at the potential environmental consequences of [its] proposed action."[21] It must also "study, develop, and describe appropriate alternatives to recommended courses of action in any proposal which involves unresolved conflicts concerning alternative uses of available resources."[22] Under CEQ regulations, "[a] cooperating agency may adopt without recirculating the [EIS] of a lead agency when, after an independent review of the statement, the cooperating agency concludes that its comments and suggestions have been satisfied."[23]

In view of NEPA's purpose to ensure fully informed decision-making, "an agency that has prepared [or adopted] an EIS cannot simply rest on the original document. The agency must be alert to new information that may alter the results of its original environmental analysis, and continue to take a hard look at the environmental effects of [its] planned action....'"[24] CEQ regulations require the agency to prepare a supplemental EIS ("SEIS") if (1) "[t]he agency makes substantial changes in the proposed action that are relevant to environmental concerns"; or (2) "[t]here are significant new circumstances or information relevant to environmental concerns and bearing on the proposed action or its impacts."[25] CEQ guidelines provide that "[a]s a rule of thumb, ... EISs that are more than 5 years old should be carefully reexamined to determine if the[se] criteria... compel preparation of an EIS supplement."[26] The agency "must make a reasoned decision whether an SEIS is required, " and if it decides an SEIS is not required, it must document that decision in the record.[27]

II. Factual Background.

A. The NPR-A, the Colville River Delta, and the City of Nuiqsut.

Established in 1923, the NPR-A on Alaska's North Slope is "the largest single unit of public land in the United States and covers 23.6 million acres. It is also an important habitat for vegetation, fish, and wildlife."[28] In a 1980 appropriations bill, Congress directed the Secretary of the Interior to conduct "an expeditious program of competitive leasing of oil and gas in the [NPR-A]."[29] Presently, the Bureau of Land Management ("BLM") administers the NPR-A.

In the eastern half of the NPR-A, the Colville River flows east along the southern boundary and then north along the eastern boundary, eventually making its way through a large delta before emptying into the Beaufort Sea.[30] That delta, aptly termed the Colville River Delta, covers approximately 250 square miles[31] and "is relatively flat, tundra-covered terrain, with local relief produced by a complex network of lakes interspersed with low-lying ridges and channels."[32] It is the largest delta in northern Alaska, draining 29% of the North Slope.[33] It is an area "recognized internationally for its biological diversity and richness" and "regionally for its importance to fish, wildlife, and subsistence resources."[34]

The City of Nuiqsut is one of only two permanent population centers within the Colville River Delta.[35] Approximately 500 people live in Nuiqsut, which is located on the west bank of the Nigliq Channel of the Colville River, roughly 15-20 miles from the Beaufort Sea.[36] The eastern boundary of the NPR-A is located just west of the Nigliq Channel, and Nuiqsut is just inside that boundary.[37] "To this day, the Inupiat people of Nuiqsut have a subsistence-based economy, with caribou, moose, birds, fish, seals and bowhead whales as primary food sources."[38]

B. The Alpine Oil Field and the 2004 Alpine Satellites EIS.

In the winter of 1994-1995, ARCO Alaska and its partners discovered the Alpine oil field in the Colville River Delta.[39] In 1998, the Corps issued a permit to ARCO to fill 98.4 acres in order to construct two drill pads, CD-1 and CD-2, as well as the Alpine Central Processing Facility ("ACPF"), located at CD-1.[40] CD-1 and CD-2 are east of the Nigliq Channel but west of the Colville River mainstem and outside of the NPR-A.[41] A pipeline and road connects CD-2 to CD-1, and CD-1 is connected via pipeline to the Trans-Alaska Pipeline that is further to the east.[42] CD-1 and CD-2 are both approximately eight miles north of Nuiqsut.[43]

In 2001, ARCO's successor, ConocoPhillips, announced the discovery of additional oil in the area to the west of Alpine, including areas within the NPR-A.[44] Thereafter, BLM initiated a review process pursuant to NEPA to assess the environmental impact of ConocoPhillips's proposal to develop five drill sites: CD-3 through CD-7.[45] ConocoPhillips proposed placing 20 to 30 wells on each of the five pads, transporting unprocessed three-phase fluid (i.e., oil, water, gas) to ACPF for processing, and then transporting processed oil to the Trans-Alaska Pipeline System.[46] The proposed CD-3 and CD-4 drill sites are located east of the Nigliq Channel and outside the NPR-A on land owned by the State of Alaska and Kuukpik, respectively.[47] CD-3 is to the north of CD-1 and CD-2, and CD-4 is to the south.[48] The proposed CD-5 drill site is to the west of CD-1 and CD-2, across the Nigliq Channel and within the northeastern boundary of the NPR-A.[49] The proposed CD-6 and CD-7 drill sites, which have not yet been developed, are even further to the west and within the NPR-A.[50]

The NEPA review process culminated in 2004 with the publication of the 2, 500-page Alpine Satellite Development Plan Final EIS ("Alpine Satellites EIS").[51] The EIS was prepared by BLM together with four cooperating entities: the Corps, EPA, U.S. Coast Guard, and State of Alaska.[52] The EIS analyzes six alternatives: ConocoPhillips's proposed action (Alternative A), conformance with existing NPR-A lease stipulations without exception (Alternative B), alternative access routes (Alternative C), roadless development (Alternative D), no action (Alternative E), and BLM's preferred alternative (Alternative F).[53]

Three of the EIS alternatives are relevant to this appeal. Alternative A includes construction of gravel roads and bridges "connect[ing] CD-4 through CD-7 to the existing Alpine Field road."[54] A proposed road would run from CD-2 west to CD-5 and would include a 1, 200-foot bridge over the Nigliq Channel and an 80-foot bridge across a lake to access CD-5.[55] Alternative F is similar to Alternative A with respect to CD-5, except that it would require that the bridge across the Nigliq Channel extend further and that the approach to the bridge provide for natural water flow.[56] In Alternative C-1, the proposed road to CD-5 would be shifted to the south, with a bridge crossing the Nigliq Channel at a location southwest of CD-4.[57]

In December 2004, the Corps issued a Section 404 permit to ConocoPhillips for CD-3 and CD-4 based on the Alpine Satellites EIS.[58]

C. The CD-5 Permitting Process.

i. 2005 Permit Application.

In September 2005, ConocoPhillips submitted an application to the Corps for a Section 404 permit to develop CD-5.[59] ConocoPhillips's proposal in this application was similar to Alternatives A and F in the Alpine Satellites EIS. ConocoPhillips proposed a 9.8-acre drill pad with up to 22 wells, a 4.2 mile gravel access road from CD-2 to CD-5, a 1, 250-foot bridge over the Nigliq Channel, and a shorter 80-foot bridge over a lake, with a total fill of 45.1 acres.[60] According to Lanston Chinn, CEO of Kuukpik, the Nuiqsut community "vehemently opposed" the proposed location of the Nigliq Channel bridge in the 2005 proposal "because of concerns about long term erosion, potential impacts on fish habitat, sedimentation and navigability of the Channel, and other potential impacts of the proposed bridge on the community."[61] Ultimately, in February 2008, ConocoPhillips asked the Corps to "suspend processing of the application for the CD 5 project while ConocoPhillips worked with the Native community to resolve project related issues."[62] The Corps closed the application file in May 2008.[63]

ii. Memorandum of Agreement Between Kuukpik and ConocoPhillips and 2009 Permit Application.

In December 2008, Kuukpik and ConocoPhillips entered into a Memorandum of Agreement ("MOA") in which ConocoPhillips agreed to certain terms designed to ameliorate the impacts of the CD-5 project on the people of Nuiqsut.[64] Specifically, ConocoPhillips agreed to, among other things, help fund construction of a road connecting Nuiqsut to CD-5, make annual payments to a mitigation fund, seek to improve its local and Native hire programs, and provide for enhanced consultation with the local community regarding future projects.[65] At the same time, in December 2008, ConocoPhillips resubmitted its permit application to the Corps.[66]

In May 2009, the Corps issued a public notice regarding ConocoPhillips's resubmitted permit application for CD-5.[67] This 2009 application included several notable changes from ConocoPhillips's 2005 application. The new application proposed relocating the drill pad 1.3 miles to the west and increasing the road length from 4.2 to 6.3 miles, increasing the size of the drill pad from 9.8 to 11.7 acres in order to accommodate up to 33 wells, and moving the Nigliq Channel bridge three miles south to a location near CD-4.[68] The length of the Nigliq Channel bridge would be slightly longer-1, 405 feet.[69] Additionally, ConocoPhillips's 2009 application did not include the 80-foot bridge originally proposed; instead, it included a 317-foot bridge over a different lake and a 277-foot bridge across a creek.[70] The total amount of fill increased from the 45.1 acres proposed in 2005 to 62.1 acres.[71]

iii. 2010 Record of Decision and Administrative Appeal.

In February 2010, the Corps issued a Record of Decision ("2010 ROD") denying ConocoPhillips's 2009 CD-5 permit application based on the Corps' determination that ConocoPhillips had failed to demonstrate that its revised proposal was the LEDPA.[72] The Corps identified two alternatives that it determined would have less environmental impact than ConocoPhillips's proposal because they "minimize impacts to aquatic resources within the floodplain of the [Colville River Delta]."[73] The "key features" of both these alternatives was the use of a horizontal directional drilling ("HDD") pipeline crossing under the Nigliq Channel and the resultant elimination of the road and bridge across the Colville River Delta to join CD-5 to ConocoPhillips's existing Alpine infrastructure.[74] One alternative included a gravel air strip at CD-5, and the other included an eight-mile road to CD-5 from Nuiqsut.[75]

ConocoPhillips administratively appealed the 2010 ROD on numerous grounds.[76] In Appeal Reason 3, ConocoPhillips asserted the Corps' LEDPA determination was "arbitrary, capricious, ... [and] not supported by substantial evidence in the administrative record."[77] ConocoPhillips maintained that the record "does not support a finding that a three-phase HDD project design is a practicable alternative to [ConocoPhillips's] CD-5 proposal."[78]

In a decision dated December 2, 2010, a Corps Review Officer determined that "[m]any of the stated reasons in ConocoPhillips's [request for appeal] are without merit, however... several aspects of the [request for appeal] have merit, " including certain of ConocoPhillips's arguments concerning the practicability of the HDD design.[79] The Review Officer remanded the permit decision to the Corps District Engineer for "further clarification and evaluation."[80]

iv. 2011 Record of Decision.

Following the administrative remand, ConocoPhillips and other interested parties provided the Corps with considerable amounts of additional information on both the bridge and HDD alternatives.[81] ConocoPhillips also agreed to certain modifications to its 2009 proposal "to further minimize project impacts in the [Colville River Delta]" in order to address concerns raised by EPA and U.S. Fish & Wildlife Service ("USFWS").[82] These modifications included narrowing the road and bridge widths and adding a fourth bridge that would allow for the flow of flood waters.[83] The modifications reduced the total amount of fill from 62.1 acres to 58.5 acres.[84]

In December 2011, the Corps issued a Record of Decision ("2011 ROD") granting ConocoPhillips's 2009 permit application as modified. The Corps found, based on the additional information submitted following the administrative remand, that ConocoPhillips's bridge proposal as modified was the LEDPA, instead of the HDD approach.[85] With respect to NEPA, the Corps adopted the 2004 Alpine Satellites EIS.[86] The Corps concluded that an SEIS was not needed to evaluate ConocoPhillips's revised permit application because "there have not been substantial changes in the proposed action that are relevant to environmental concerns; and... there are not significant new circumstances or information relevant to environmental concerns and bearing on the proposal or impacts."[87] The 2011 ROD that issued the Section 404 permit is the final agency action.[88]

III. Procedural History.

On February 27, 2013, the Kunaknana Plaintiffs filed their lawsuit challenging the Corps' decision to issue ConocoPhillips the Section 404 permit for CD-5.[89] A few months later, on June 5, 2013, CBD filed its lawsuit.[90] The Court permitted ConocoPhillips, Kuukpik, ASRC, the North Slope Borough, and the State of Alaska to join both actions as Intervenor-Defendants in support of the Corps.[91] Each Intervenor-Defendant has a stake in the CD-5 project:

• Kuukpik owns the surface estate at the proposed CD-5 location and is the village corporation for Nuiqsut;[92]
• "ASRC holds the subsurface estate in the area of the proposed CD-5' production pad, and anticipates receiving production royalties once oil ...

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