Get Oil Out! Inc. v. Exxon Corp.

• Decision Date: 22 November 1978
• Docket Number: No. 75-3635,75-3635
• Citation: 586 F.2d 726
• Parties: Page 726 586 F.2d 726 12 ERC 1695, 9 Envtl. L. Rep. 20,038 GET OIL OUT! INC. et al., Appellants, v. EXXON CORPORATION et al., Appellees. United States Court of Appeals, Ninth Circuit
• Court: U.S. Court of Appeals — Ninth Circuit

Page 726

586 F.2d 726

12 ERC 1695, 9 Envtl. L. Rep. 20,038

GET OIL OUT! INC. et al., Appellants v EXXON CORPORATION et al., Appellees.

No. 75-3635.

United States Court of Appeals Ninth Circuit.

Nov. 22, 1978.

John M. Sink, Santa Barbara, Cal., for appellants.

Edward J. Shawaker, Atty., Washington, D. C., Philip K. Verleger, Los Angeles, Cal., Denatus Januta, Deputy Atty. Gen. (argued), San Francisco, Cal., for appellees.

Appeal from the United States District Court for the Central District of California.

Before KENNEDY and HUG, Circuit Judges, and JAMESON, ^* District Judge.

KENNEDY, Circuit Judge:

This appeal requires a determination of whether certain off-shore facilities used to develop oil reserves lying beneath the ocean floor are "deepwater ports" as defined by the Deepwater Port Act of 1974, 33 U.S.C. § 1501 Et seq. (1976). Get Oil Out! Inc. (GOO), a nonprofit California corporation, brought this action against the defendant oil companies to enjoin construction of the facilities in question until the defendants secured a license as provided by the Deepwater Port Act. The plaintiff also alleged that the environmental impact statement filed for the project was inadequate. The district court denied a preliminary injunction and granted summary judgment for the defendants on both issues. On appeal GOO does not contest the trial court's ruling that the environmental statement was adequate, but it does contend that the district court erred in ruling that the facilities proposed by the defendants are not regulated by the Act. We agree with the district court that the Deepwater Port Act does not apply to the facilities in question, and we affirm its judgment.

The installations at issue are proposed in connection with development of oil and gas reserves of off-shore lands covered by seventeen leases from the Department of Interior to the defendants Exxon Corporation, Shell Oil Company, and Standard Oil Company of California. Granted by authority of the Outer Continental Shelf Lands Act (OCS Lands Act), 43 U.S.C. §§ 1331-1343 (1970 & Supp. V 1975), the leases cover 83,037 acres of off-shore lands beyond the three-mile territorial limit of the State of California. The lands are located about twenty miles off the coast from the City of Santa Barbara.

In 1970 the lands were combined, with the approval of the United States Geological Survey (USGS), in an operating unit called the Santa Ynez Unit. Exxon, the major leaseowner, was designated as Unit Operator, with responsibility for managing and developing the unit lands. Exploratory drilling in the Santa Ynez Unit disclosed oil fields estimated by the USGS to contain reserves of 730 million to 1.1 billion barrels of oil, approximately one-fifth to one-third of the remaining crude oil reserves in the State of California and adjacent federal lands. The unit agreement required Exxon to submit to the USGS a plan for development of the fields, which Exxon did in April 1971. The USGS prepared an environmental impact statement evaluating Exxon's plan, and in August 1974 the Department of Interior approved the development plan and statement.

The development plan requires construction of a drilling platform approximately five miles off shore, from which twenty-eight wells can be slant drilled. The issue in this appeal, however, involves not the drilling platform but proposals for additional installations which would receive and store the oil and gas immediately after its production and facilitate its further shipment for refining. Two alternatives are contained in the development plan the off-shore terminal, also referred to as Marine Loading Terminal or MLT, and the near-shore terminal. Appellant contends that the Deepwater Port Act would apply to whichever proposal is adopted. ¹

The off-shore terminal, or MLT, presents the more difficult question on the appeal, and we therefore describe its design in detail. The MLT would be located 3.2 miles off shore, near the drilling platform. Oil and gas would flow from the drilling platform to a point below the MLT by a pipeline on the ocean floor. As proposed, the MLT facility consists of a single stem of connected equipment and mechanisms of diverse uses, rising from the ocean floor to the surface, and a floating vessel for treatment and storage. An installation called a base rests on the ocean floor. A universal joint is attached to the base, and from the joint a tubular riser extends upward to a point, still below the surface, where it meets with a mechanism called a fluid swivel. Degassed crude oil flows from the pipeline at the base through the tubular riser to the fluid swivel. From there the crude is conducted to the surface and to the floating storage and treatment vessel by means of a flexible hose, supported by small buoys. A mooring buoy on the water's surface is attached by a steel chain to a subsurface anchor swivel, which in turn is fixed in place by a chain and other connections to the fluid swivel and tubular riser installations. Thus the mooring buoy has downward extending equipment that joins the mechanisms rising from the base. The floating vessel ties to the mooring buoy. Small tankers, with a maximum size of 30,000 deadweight tons (dwt), secure alongside the vessel (and, it appears, to the mooring buoy also) to receive delivery of the oil for transport to refineries. The base and the upward structures it supports, the mooring buoy and the downward attachments that join it to the base supported equipment, and the floating vessel all comprise the MLT.

If the provisions and purposes of the Deepwater Act are to be reasonably construed with the statutes directing the Secretary of Interior to make provision for the development of oil and gas resources of the outer continental shelf beyond the territorial limit, we think it necessary to conclude that the MLT is not controlled by the Deepwater Port Act. We commence with a discussion of the Outer Continental Shelf Lands Act under which the Department of Interior acted in granting and regulating the oil and gas leases involved in the case.

The federal government has the right and responsibility to develop oil and gas reserves beyond the three-mile territorial limit on the lands of the outer continental shelf. Submerged Lands Act, 43 U.S.C. §§ 1301-1315 (1970); Outer Continental Shelf Lands Act, 43 U.S.C. §§ 1331-1343 (1970 & Supp. V 1975). The Secretary's duty is not limited to disposing of the government's proprietary ownership interest in outer continental shelf minerals. He has broad authority to prescribe rules binding on the operations of any lessee, for the protection of the natural resources of the outer continental shelf. 43 U.S.C. § 1334(a) (1). The statute provides that the jurisdiction of the federal law and the Secretary's authority applies

to the subsoil and seabed of the outer Continental Shelf and to all artificial islands and fixed structures which may be erected thereon for the purpose of exploring for, developing, removing, and transporting resources therefrom, to the same extent as if the outer Continental Shelf were an area of exclusive Federal jurisdiction located within a State.

43 U.S.C. § 1333(a)(1). Cf. Rodrigue v. Aetna Casualty & Surety Co., 395 U.S. 352, 355, 89 S.Ct. 1835, 23 L.Ed.2d 360 (1969) (purpose of OCS Lands Act was to define a body of law applicable to seabed and subsoil of OCS and to fixed structures, such as drilling platforms thereon). The Secretary has promulgated regulations governing most aspects of the operation of OCS leases. See 30 C.F.R., Part 250 (1977) (Oil and Gas and Sulphur Operations in the Outer Continental Shelf). He has approved plans for transportation of oil from OCS leases by pipeline to shore and then by tanker to refineries, See 30 C.F.R. § 250.18(c)(1977), and the record shows that he has also approved oil shipments by barge from drilling platforms to shore. The Secretary is also charged under the OCS Lands Act with the responsibility for "conserving marine life, recreational potential, and aesthetic values, as well as the reserves of gas and oil." Union Oil Co. v. Morton, 512 F.2d 743, 749 (9th Cir. 1975); Gulf Oil Co. v. Morton, 493 F.2d 141, 144-46 (9th Cir. 1973) (interpreting 43 U.S.C. § 1334(a)(1)). These matters of statutory concern were considered extensively in the development plan and the environmental impact statement submitted to the Secretary and approved by him. Contrary to the arguments of appellants there will not be a serious gap in regulation with regard to the environmental and navigational safety elements of oil transportation from the OCS leases if the Deepwater Port Act is held inapplicable to such facilities.

Construction and operation of the MLT is an integral part of the facility for developing the mineral resources here in question. If the Deepwater Port Act were to apply to it, then other federal agencies and state officials could frustrate the Department of Interior's objective in executing the leases. It may be true, as the State of California argues, that an MLT is only one of several ways to transport oil from OCS leases, and thus the plaintiff's interpretation of the Deepwater Port Act might not thwart completely the Interior Department's goals. However, we see no mandate in the Deepwater Port Act for the degree of frustration which such an interpretation would entail. We do not accept an interpretation of the Deepwater Port Act which would render provisions of the OCS Lands Act ineffective. It is our obligation to so construe federal statutes so that they are consistent with each other, as by this means congressional intent can be given its fullest expression. "(W)hen two statutes are capable of co-existence, it is the duty of the courts . . . to regard each as effective." Radzanower v. Touche Ross & Co., 426 U.S. 148, 155, 96 S.Ct. 1989, 1993, 48 L.Ed.2d 540 (1976), Quoting Morton v. Mancari, 417 U.S. 535, 551, 94 S.Ct. 2474, 41 L.Ed.2d 290 (1974).

The...