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Energy and Environment Monitor

Federal Court in Pennsylvania Declines to Require Accumulation of Emissions from Non-Contiguous Compressor Stations for CAA Permitting

March 11, 2015

By: Robert G. McLusky

A federal court in Pennsylvania has ruled that a series of gas compressors used to move gas from wells to larger transmission lines need not be considered a single “source” of air pollution.  See Citizens for Pennsylvania’s Future v. Ultra Resources, Inc., No. 4: 11-cv-1360.  If the eight compressors had been considered a single “source,” then they would likely have been subjected to stricter controls and permitting requirements for “major sources.” 

Penn Future, a citizen group, sued Ultra Resources under the Clean Air Act, claiming that Ultra had constructed a “major source” of nitrogen oxide (NOx) emissions without obtaining a New Source Review permit from state authorities.  Ultra had, instead, obtained 8 individual permits from PADEP. 

PADEP’s air program defines a “stationary source” of air pollution as a “facility” or structure that emits a regulated pollutant.  “Facility” is defined as a source of air pollution “located on one or more contiguous or adjacent properties which is owned or operated by the same person under common control.”  Penn Future argued that the compressors were all controlled by Ultra, and that the test for “adjacency” should be one of functional interrelatedness rather than precise physical proximity.  The Court disagreed, ruling that the plain meaning of “adjacent” required that the compressor stations had to be on physically contiguous tracts in order to be adjacent. 

The Court relied in part on a similar decision of the Sixth Circuit in Summit Petroleum v. EPA, 690 F.3d 733 (6th Cir. 2012).  See Oil and Gas Win Big in Sixth Circuit on Title V Source Determinations,” Jackson Kelly Energy & Environment Monitor, August 15, 2012.  This was significant because the linear distance between the stations was not great. 

Finally, the Court also ruled that Ultra would prevail even if the test of “adjacency” included a criterion for functional interrelatedness.  The Court noted that the stations were all operated independently to bring gas from different well pad groupings to a transmission line and were not connected to one another.

This article was authored by Robert G. McLusky, Jackson Kelly PLLC.

 

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