Gulf Restoration Network v. Haaland
| Decision Date | 30 August 2022 |
| Docket Number | 20-5179 |
| Parties | GULF RESTORATION NETWORK, ET AL., APPELLANTS v. DEBRA A. HAALAND, IN HER OFFICIAL CAPACITY AS SECRETARY OF THE INTERIOR, ET AL., APPELLEES |
| Court | U.S. Court of Appeals — District of Columbia Circuit |
Argued January 10, 2022
Appeal from the United States District Court for the District of Columbia (No. 1:18-cv-01674)
Brettny E. Hardy argued the cause for appellants. With her on the briefs were Stephen D. Mashuda and Christopher D. Eaton.
Justin D. Heminger, Attorney, U.S. Department of Justice, argued the cause for federal appellees. With him on the brief were Todd Kim, Assistant Attorney General, and James A. Maysonett Attorney.
Steven J. Rosenbaum, Bradley K. Ervin, John C. Martin, Susan Mathiascheck, Charles J. Engel, III, and Nikesh Jindal were on the brief for appellees American Petroleum Institute and Chevron, U.S.A., Inc.
Before: WILKINS, KATSAS, and JACKSON, [*] Circuit Judges.
The Department of the Interior sells offshore leases to oil and gas companies for development. This case concerns the adequacy of an environmental impact statement prepared in connection with two lease sales held in 2018. We hold that Interior adequately considered the option of not leasing, reasonably refused to consider potential future regulatory changes, and unreasonably refused to consider possible deficiencies in environmental enforcement. Given the one shortcoming we have identified, we remand without vacatur.
The Outer Continental Shelf Lands Act (OCSLA) sets forth a procedural framework for oil and gas development in the Outer Continental Shelf, an area "between the outer seaward reaches of a state's jurisdiction and that of the United States." Ctr. for Biological Diversity v. U.S. Dep't of the Interior, 563 F.3d 466, 472 (D.C. Cir. 2009). In enacting the OCSLA, Congress declared that the Shelf "should be made available for expeditious and orderly development, subject to environmental safeguards." 43 U.S.C. § 1332(3).
The OCSLA establishes a four-stage process for development. First, Interior evaluates national energy needs to formulate a five-year plan of proposed lease sales. 43 U.S.C. § 1344(a). Next, Interior sells the leases to the highest responsible qualified bidders. Id. § 1337(a)(1). But a lease does not confer "an immediate or absolute right to explore for, develop, or produce oil or gas on the OCS; those activities require separate, subsequent federal authorization." Sec'y of the Interior v. California, 464 U.S. 312, 317 (1984). That comes at the third and fourth stages, when Interior reviews lessees' plans for exploration and then for development and production. 43 U.S.C. §§ 1340, 1351. During this process, Interior must prepare environmental impact statements (EISs) as necessary. See id. § 1344(b)(3).
The National Environmental Policy Act governs the preparation of EISs. NEPA establishes procedural requirements to ensure that the government gives "appropriate consideration" to environmental impacts before undertaking major actions. 42 U.S.C. § 4332(2)(B)-(C). It requires the government to "take a 'hard look' at the reasonably foreseeable impacts of a proposed major federal action." Indian River Cnty. v. U.S. Dep't of Transp., 945 F.3d 515, 533 (D.C. Cir. 2019) (cleaned up). NEPA also tasks the Council on Environmental Quality with promulgating implementing regulations. 42 U.S.C. § 4332(2)(B); Dep't of Transp. v. Pub. Citizen, 541 U.S. 752, 757 (2004). The statute requires that EISs consider "alternatives to the proposed action," 42 U.S.C. § 4332(2)(C)(iii), and a CEQ regulation clarifies that one such alternative must be the possibility of taking no action, 40 C.F.R. § 1502.14(c).
An agency can "meet its NEPA obligations in steps." W. Org. of Res. Councils v. Zinke, 892 F.3d 1234, 1237 (D.C. Cir. 2018). When "tiering" its EISs, the agency first publishes a programmatic EIS to assess "the broad environmental consequences attendant upon a wide-ranging federal program." Id. (cleaned up). It later issues "narrower EISs analyzing the incremental impacts of each specific action taken as part of a program." Id. at 1238. Supplements are required when the agency "makes substantial changes" to its program or "[t]here are significant new circumstances or information ... bearing on the proposed action or its impacts." 40 C.F.R. § 1502.9(d)(1).
This appeal concerns Lease Sales 250 and 251, which were among the 11 that Interior proposed in its five-year plan covering mid-2017 to mid-2022. Interior held the sales in 2018. They involve more than 150 million acres in the Gulf of Mexico.
Before the sales, Interior prepared three EISs. First, it issued a programmatic EIS addressing the environmental impacts of the five-year plan. Second, it issued a narrower "multisale" EIS addressing the impacts of leasing in the Gulf. Third, it issued a supplemental EIS specific to the two lease sales at issue.
After the sales, three environmental groups asserted that the supplemental EIS did not comply with NEPA. They sued Interior and the Bureau of Ocean Energy Management (BOEM), the component agency within Interior that had prepared the EISs. They argued that BOEM failed to assess a true "no action" alternative because it had assumed that energy development would occur sooner or later, even if Lease Sales 250 or 251 did not. They also argued that BOEM had unreasonably assumed two rules for protecting the environment would remain in effect, despite the possibility of future modifications. Finally, they argued that BOEM had unreasonably assumed all such rules would be effectively enforced, despite a report suggesting otherwise. The American Petroleum Institute and Chevron U.S.A. Inc. intervened in support of Interior.
The district court granted summary judgment to Interior. In upholding BOEM's "no action" analysis, it found the Bureau had reasonably assumed that development was inevitable. Gulf Restoration Network v. Bernhardt, 456 F.Supp.3d 81, 97-99 (D.D.C. 2020). The court concluded that BOEM did not need to consider whether the existing rules would change. Id. at 100. And it accepted BOEM's assumption that Interior would adequately enforce its rules. Id. at 100-02. The environmental groups now appeal.
Courts review agency compliance with NEPA through the Administrative Procedure Act. Sierra Club v. FERC, 867 F.3d 1357, 1367 (D.C. Cir. 2017). The district court thus sat as an appellate tribunal, reviewing BOEM's decision under the familiar APA standards. Am. Bioscience, Inc. v. Thompson, 269 F.3d 1077, 1083 (D.C. Cir. 2001). We, in turn, apply the same standards. Rempfer v. Sharfstein, 583 F.3d 860, 864-65 (D.C. Cir. 2009).
Under the APA, we ask whether agency action is "arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law." 5 U.S.C. § 706(2)(A). This review is "highly deferential" to the agency. Defs. of Wildlife v. Jewell, 815 F.3d 1, 9 (D.C. Cir. 2016) (cleaned up). In particular, we "give deference to agency judgments as to how best to prepare an EIS," Indian River Cnty., 945 F.3d at 533, so long as the EIS "contains sufficient discussion of the relevant issues and opposing viewpoints" and "the agency's decision is fully-informed and well-considered," Nevada v. Dep't of Energy, 457 F.3d 78, 93 (D.C. Cir. 2006) (cleaned up).
We first consider whether BOEM adequately considered a "no action" alternative in the supplemental EIS.
In preparing an EIS, an agency must evaluate the "reasonable alternatives to a contemplated action." Food &Water Watch v. FERC, 28 F.4th 277, 282 (D.C. Cir. 2022) (cleaned up). These alternatives must include the possibility of taking no action. 40 C.F.R. § 1502.14(c).
In the supplemental EIS, BOEM assessed environmental impacts on the assumption that future lease sales would occur in the Gulf even if one such sale were cancelled. Given that assumption the Bureau concluded the cancellation of one proposed lease sale "would not significantly change the environmental impacts" of development in the Shelf. J.A. 904.
This analysis was not arbitrary. Interior has a statutory obligation to make the Shelf available for development to meet national energy needs. 43 U.S.C. §§ 1332(3), 1334(a). Moreover, record evidence showed that the Gulf compares favorably to other parts of the Shelf in terms of development opportunities, infrastructure readiness, and industry interest. Thus, Interior's five-year plan proposed that all but one of its lease sales would take place in the Gulf. So BOEM reasonably concluded that the cancellation of a single lease sale would only postpone development in the region.
BOEM also reasonably concluded that such a cancellation would not materially change overall environmental impacts. It explained that these impacts turn on the aggregate amount of leasing in the long run. A typical lease runs for 50 years, and BOEM projected impacts over a 70-year timeframe. At this scale, any single sale would make "only a small ... contribution" to overall activity in the Shelf. J.A. 550. And a one- or two-year delay in development would have little effect on overall environmental impacts.
The environmental groups argue that BOEM failed to consider a true "no action" alternative because it assumed future lease sales would occur. They also argue that it was arbitrary for BOEM to predict that the postponement of a lease sale would not significantly affect the environment. We reject both arguments.
The environmental groups argue that a true "no action" alternative would involve the cancellation of all future planned leases. We agree that BOEM needed to consider that alternative, but we think it did. In the programmatic EIS BOEM considered the effect of...
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