In an important decision on August 7th related to the aggregation of air emissions in the oil and gas industry, the 6th Circuit Court of Appeals reversed a decision by the United States Environmental Protection Agency [EPA] which would have required Summit Petroleum Corporation to aggregate all air emission sources from various wells, pipelines, and a processing facility located in a 43 square mile area as a single source. The appeals court ruled that the EPA's contention that the company's natural gas sweetening plant and various sour gas production wells which fed into the plant together formed a single source of air emissions was contrary to the plain meaning of the term adjacent.
In a clear rebuke of this policy, the court stated, "Whether the distance between two facilities enables a given relationship to exist between them is immaterial to the concept of adjacency." The court ruled that the unambiguous nature of the term "adjacent" meant that the agency would be afforded no deference with regard to the interpretation of the term and that the plain meaning of the term would prevail. The court found that the distance between the sources in this case was substantial and could not meet a reasonable definition of adjacent.
CLICK HERE to read the full alert or access the court's decision.