Policy & Enforcement Briefing: Keystone XL, Arctic Drilling, Gulf of Mexico Lease Sale, Coal Mines Cleanup

TransCanada Corp said it would undertake a $600 million expansion and extension of the Keystone XL oil pipeline, a move designed to show its commitment to the project despite delays. The plan would increase output capacity for the oil sands crude to 830,000 barrels a day from 700,000, Reuters reports.

Companies interested in drilling in Canada’s Arctic waters will need to show their ability to sink a relief well in the same drilling season to cope with possible well blowouts, despite requests from oil companies that it be waived, Canada’s National Energy Board said in closing their review of the Macondo blowout in the Gulf. Drillers also must demonstrate that their operations, equipment and systems meet stringent safety standards, Reuters reports.

U.S. Senator Lisa Murkowski (R-Alaska) announced language in the 2012 Interior spending bill that seeks to transfer authority over air emissions from offshore activity in the Arctic from the EPA to the Interior Department. The change makes the permitting process in Alaska, which in the case of Shell has taken more than five years, similar to the process in the Gulf of Mexico where the Interior oversees permits, on average, in the space of a few months.

The Department of the Interior’s Bureau of Ocean Energy Management said that the Western Gulf of Mexico Oil and Gas Lease Sale 218 attracted $337,688,341in high bids, and the sum of all bids received totaled $712,725,998. ConocoPhillips submitted the highest bid of $103,200,000 for Keathley Canyon, Block 95.

Nearly half a billion dollars in Abandon Land Mine grants will be released tribes and states in 2012, the Interior Department and Office of Surface Mining Reclamation and Enforcement (OSM) announced. This year’s funding – a $90 million increase over last year – comes from coal receipts and is distributed through a mandated formula under the Surface Mining Control and Reclamation Act (SMCRA). Wyoming leads states with $150 million in ALM grants, and the Navajo Nation  will receive $7.2 million.

Cement and building materials producer CalPortland Company (CPC), agreed to pay a $1.4 million penalty to resolve alleged violations of the Clean Air Act at its cement plant in Mojave, Calif., the EPA and the Department of Justice (DOJ) said. In addition to the penalty, CPC will spend an estimated $1.3 million on pollution controls that reduce emissions of nitrogen oxides (NOx) and sulfur dioxide (SO2). The measures are expected to reduce pollution each year from the plant by at least 1,200 tons of NOx and 360 tons of sulfur dioxide SO2, the EPA said.

The EPA, the DOJ, and the State of Illinois announced a Clean Water Act (CWA) settlement with the Metropolitan Water Reclamation District of Greater Chicago (MWRD) to resolve claims that untreated sewer discharges were released into area waterways during flood and wet weather events. Under the settlement, MWRD has also agreed to pay a civil penalty of $675,000, and develop a multi-year project to build infrastructure that will increase its capacity to handle wet weather events and overflow discharges.

The EPA ordered the Monte Vista Water Company in Douglas, AZ, to reduce arsenic levels in their drinking water system or face penalties of up to $37,500 per day for each violation. The order requires the system, serving about 150 residents, to create a schedule to comply with the federal Safe Drinking Water Act’s arsenic standard of 10 parts per billion. The EPA said it does not anticipate collecting penalties from Monte Vista, but added that statewide approximately 80 small water purveyors are currently out of compliance with a variety of drinking water standards.