554 F.2d 1310 (5th Cir. 1977), 76-1561, Exxon Corp. v. Train

Docket Nº:76-1561 and 76-1697.
Citation:554 F.2d 1310
Party Name:EXXON CORPORATION, Petitioner, v. Russell E. TRAIN and Jack E. Ravan, Respondents.
Case Date:June 27, 1977
Court:United States Courts of Appeals, Court of Appeals for the Fifth Circuit
 
FREE EXCERPT

Page 1310

554 F.2d 1310 (5th Cir. 1977)

EXXON CORPORATION, Petitioner,

v.

Russell E. TRAIN and Jack E. Ravan, Respondents.

Nos. 76-1561 and 76-1697.

United States Court of Appeals, Fifth Circuit

June 27, 1977

Page 1311

Elliotte M. Harold, Jr., H. H. Hillyer, Jr., Joseph E. LeBlanc, Jr., Bernard J. Caillouet, New Orleans, La., for petitioner in both cases.

Russell E. Train, Adm., EPA, Washington, D. C., Jack E. Ravan, Reg. Adm., EPA, Atlanta, Ga., Peter R. Taft, Asst. Atty. Gen., Alfred T. Ghiorzi, Pol. Con. Sect., Lloyd S. Guerci, Land & Natural Resources Div., Dept. of Justice, Washington, D. C., for respondents in both cases.

Petitions for Review of an Order of the Environmental Protection Agency (Alabama Case).

Before MORGAN and RONEY, Circuit Judges, and KING, District Judge. [*]

LEWIS R. MORGAN, Circuit Judge:

This case presents the question whether the Environmental Protection Agency

Page 1312

(EPA) has authority under the Federal Water Pollution Control Act Amendments of 1972 ("the Act" or "the 1972 Amendments"), Pub.L. 92-500, 86 Stat. 816 et seq., 33 U.S.C. § 1251 et seq., to control the disposal of wastes into deep wells under certain circumstances. EPA does not argue that the 1972 Amendments grant it plenary authority to control groundwater pollution. 1 It argues only that, as an incident to its power to issue permits authorizing the discharge of pollutants into surface waters, it has the power to place conditions in such permits that limit the "associated" disposal of wastes into wells. We, however, are convinced that Congress did not grant EPA that power.

I. A BRIEF REVIEW OF THE 1972 AMENDMENTS.

As has been rehearsed in detail elsewhere, see generally E. I. duPont de Nemours & Co. v. Train, --- U.S. ----, ---- - ----, 97 S.Ct. 965, 968-973, 51 L.Ed.2d 204, 210-15 (1977); EPA v. State Water Resources Control Board, 426 U.S. 200, 202-209, 96 S.Ct. 2022, 2023-2027, 48 L.Ed.2d 578, 582-86 (1976), Congress enacted the 1972 Amendments with the declaration that, "it is the national goal that the discharge of pollutants into the navigable waters be eliminated by 1985." § 101(a)(1). 2 § 301(a) of the Act provides that, except as in compliance with enumerated sections of the Act, "the discharge of any pollutant by any person shall be unlawful." § 301(b) directs the Administrator of EPA to develop and promulgate "effluent limitations" setting forth restrictions on quantities, rates, and concentrations of chemical, physical, biological, and other constituents which may be discharged from existing point sources. These effluent limitations are to reflect the best practicable control technology currently available by July 1, 1977, § 301(b)(1) (A), and the best available technology by July 1, 1983, § 301(b)(2)(A).

These effluent limitations are transformed into obligations on individual dischargers by means of the National Pollutant Discharge Elimination System (NPDES). See EPA v. State Water Resources Control Board, supra, 426 U.S. at 203-06, 96 S.Ct. at 2024-2025, 48 L.Ed.2d at 583-84. § 402(a) authorizes the Administrator to issue permits (which have come to be called "NPDES permits") authorizing the discharge of pollutants if the discharge will meet the applicable effluent limitations. 3 § 402(b) states that the Administrator "shall" transfer the permit-issuing function to a state if he determines that the state permit program will meet certain prerequisites. Compliance by a discharger with a NPDES permit is deemed to be compliance with, inter alia, § 301(a). § 402(k). The basic scheme of the Act, then, is to prohibit the discharge of pollutants (§ 301(a)) unless the discharge is authorized by a NPDES permit issued by the Administrator (§ 402(a)) or a state (§ 402(b)) that incorporates generally applicable

Page 1313

limitations on the amount and character of pollutants discharged (§ 301(b)).

II. FACTS AND AGENCY PROCEEDINGS.

Exxon Corporation, petitioner here, operates a natural gas production facility near Flomaton, Alabama. At this facility natural gas and gas condensate from nearby fields are separated from the other substances with which they are found in nature, primarily hydrogen sulphide, carbon dioxide, and brine (produced water). In the separation process, waste water (including brine, cooling tower purge water, and boiler blowdown water) is produced.

In designing the Flomaton facility, Exxon initially planned to dispose of this waste water by discharging part of it into surface holding pits from which it eventually would enter the Escambia River system, and by injecting the remainder into a formerly producing oil well about 5000 feet deep. Exxon applied to the appropriate Alabama authorities for permission to make the surface and well discharges. 4 After obtaining the required state certification, Exxon also applied to the Army Corps of Engineers for the certification then required from that agency for surface discharges.

While this latter application was pending, Congress enacted the 1972 Amendments, which transferred jurisdiction over Exxon's application from the Corps of Engineers to EPA. § 402(a)(5). Exxon submitted a revised application to EPA for a NPDES permit under the new Act. 5 Both the original and the revised applications were on Corps of Engineers forms headed, "Application for Permit to Discharge or Work in Navigable Waters and their Tributaries." Item 15 on both forms calls for the applicant to "(l)ist (the) volume of discharges or losses other than into navigable waters" and is followed by a list of the possible types of such discharges. On both forms, Exxon entered a figure next to the blank in this list for "underground disposal" indicating the expected volume of underground disposal from the Flomaton facility.

On February 25, 1974 the Regional Administrator for EPA Region IV issued Permit No. AL 0002445 to Exxon, authorizing "discharge from a facility located at FLOMATON, ALABAMA to receiving waters named AN UNNAMED TRIBUTARY TO HALL CREEK in accordance with effluent limitations, monitoring requirements and other conditions set forth" in other parts of the permit. Nothing in the permit purports either to authorize or to limit underground disposal.

After the Flomaton facility had been in operation for some time, Exxon found that excessive corrosion was occurring in the cooling water system. It determined that the addition of 30 parts per million of chromate to the cooling water would inhibit this corrosion. In addition, anticipating increased discharge volumes, Exxon proposed to begin using a second formerly producing well for disposal of waste water. 6 Exxon applied to the appropriate Alabama authority for permission to inject the chromate-bearing water into the first well and to begin operating the second disposal well. State authority to make these changes was granted. 7

Page 1314

At the same time, Exxon thought it appropriate to notify EPA Region IV of the changes in operation of the Flomaton facility. It did so in a letter dated January 22, 1975 that outlined the current and planned use of the disposal wells.

Five months later, by letter dated May 19, 1975, the Chief of the Water Enforcement Branch of the Enforcement Division of EPA Region IV replied to Exxon's letter by requesting further information about the operation of the disposal wells. The letter also expressed "curios(ity) as to why these disposal wells were not reported on the NPDES permit application prior to issuance of the permit," even though Exxon had completed the only apparently appropriate blank for well disposal on the NPDES application accepted by EPA.

Exxon answered this request by a letter dated August 15, 1975, which supplied technical information and analysis of the well disposal operation to EPA. On September 16, 1975 Exxon employees met with a group of EPA Region IV officials to review the Flomaton waste water disposal system. At this meeting the EPA officials asked Exxon what its position would be if EPA asserted jurisdiction over Exxon's subsurface disposal of waste water under the 1972 Amendments.

Exxon replied to this request by a letter dated October 28, 1975. In this letter Exxon stated its position that EPA did not have jurisdiction under the 1972 Amendments to regulate subsurface disposal, citing the recent case of United States v. GAF Corp., 389 F.Supp. 1379 (S.D.Tex.1975). See note 17 infra. At the same time, while reserving the right to contest the jurisdictional issue, Exxon requested modification of its NPDES permit to authorize subsurface disposal.

The Regional Administrator for Region IV replied by letter dated December 3, 1975. This letter stated that on the basis of the information already submitted by Exxon, "we have determined that your request to discharge plant wastewater to deep wells should be denied." 8 The Regional Administrator also stated that it was EPA's position that it did have jurisdiction to regulate subsurface disposal "in certain instances," referring to a decision on a matter of law rendered by the General Counsel of EPA pursuant to 40 C.F.R. § 125.36(m), see note 21 infra, to 40 C.F.R. § 125.26, see note 20 infra, and to §§ 301(a), 402, and 502(12) of the Act. The letter concluded by stating, "Based upon our decision to deny your request for subsurface disposal, you will be expected to continue discharging the plant wastewaters as per the NPDES permit and to comply with the terms and conditions thereof."

Page 1315

By letter dated December 19, 1975 Exxon submitted a request to EPA Region IV for a legal decision regarding EPA's jurisdiction over subsurface disposal and for an adjudicatory hearing on the denial of permit modification, pursuant to 40 C.F.R. § 125.36. EPA acknowledged receipt of the requests on December 29, 1975, but it did not act...

To continue reading

FREE SIGN UP