U.S. EPA's top air pollution official said today that the agency is close to an agreement with Royal Dutch Shell PLC over an air permit for the oil giant's Arctic drilling project, which has faced years of setbacks.
Shell was planning to start drilling exploratory wells this summer until a ruling by EPA's Environmental Appeals Board sent the project's air permit back to federal regulators.
The company, which has spent more than $3.5 billion over the past five years on leases and development, decided to wait another year. Yesterday, it unveiled its plan to start drilling as many as three wells in the Chukchi Sea in July 2012 (see related story).
Gina McCarthy, the head of EPA's Office of Air and Radiation, told members of the House Energy and Commerce Committee this morning that the agency isn't standing in the way. An agreement is close, she said, echoing optimistic statements earlier this week by Shell executives after a series of high-level meetings with officials from EPA and the White House.
"I believe that we are very close to a strong permit that will allow them to have actually three drilling operations going on in the Arctic in a way that is protective of public health and consistent with current law," McCarthy told the Energy and Power Subcommittee.
House Republicans are drafting a bill to let outer continental shelf projects skip the Environmental Appeals Board and clear up the questions that the review panel raised about Shell's project. At a time when Congress is fixated on rising gas prices, they argue that EPA -- and the rest of the Obama administration -- is stopping the development of domestic oil resources.
The legislation from Rep. Cory Gardner (R-Colo.) would spare companies from showing that their drilling projects wouldn't hurt air quality off the shoreline.
McCarthy criticized that proposal today, saying that sparing drilling fleets from the need to control their pollution could harm the health of boaters, fishermen and people on cruise ships. Environmental officials from California and Delaware agreed, telling lawmakers that the Gardner bill could hurt air quality if the federal government were to allow drilling projects in the federal waters of the Atlantic and Pacific.
At the moment, EPA is reviewing nine outer continental shelf permits. Energy and Commerce Chairman Fred Upton (R-Mich.) compared the review process to the overly complicated machines drawn by cartoonist Rube Goldberg.
"Because of this byzantine system of permits, reviews and appeals -- supposedly in the name of environmental stewardship -- we are continuing to import more oil from countries that don't like us, many of them with environmental standards much lower than our own," he said in a statement.
Rep. Henry Waxman of California, the committee's top Democrat, said he agrees that Shell's permitting process has gone on too long. He said he could agree on a bill to address Shell's concerns, but he and other Democrats don't want to weaken health protections.
"I refuse to believe that we can't address some of the specific problems Shell points to without creating much bigger problems elsewhere," he said.