Partnering Facilitates SPR Pipeline EA

By: Hal Delaplane, NEPA Contact, Fossil Energy, Strategic Petroleum Reserve Program Office

In 23 years of developing the Strategic Petroleum Reserve (SPR), DOE has done many NEPA reviews of pipeline projects. These projects resulted in a network of 255 miles of crude oil pipelines, a marine terminal, and many miles of raw water and brine disposal pipelines in coastal Louisiana and Texas. Last year, DOE was involved in a private sector proposal for what probably would have been just another pipeline construction project – except that it precipitated some unusual NEPA process considerations concerning mitigation of adverse impacts.

While considering granting a lease of facilities that would directly result in a private pipeline construction project, DOE sought to facilitate the project while ensuring that significant impacts would not result. The solution was to integrate its NEPA process with the U.S. Army Corps of Engineers Section 404 permit process, in close cooperation with the host State and private applicant. This enabled DOE to accept a mitigation action plan that the applicant had negotiated with the State. Once the State indicated approval of the plan, in rapid succession DOE approved its EA and issued a mitigated Finding of No Significant Impact (FONSI), and the Corps of Engineers adopted DOE’s EA and issued a Section 404 permit that incorporated the mitgation commitments as permit conditions.

Government-Industry Partnership

To cut operating costs and generate revenue, DOE is commercializing its underused crude oil distribution facilities through government-industry arrangements for shared use. In 1997, after competitive bidding, DOE awarded a short-term lease of its Bayou Choctaw Pipeline in Louisiana to Shell Pipe Line Corporation after categorically excluding the action from further NEPA review. This pipeline, which DOE built in 1978, connects DOE’s St. James Marine Terminal, 63 miles up the Mississippi River from New Orleans, to the SPR Bayou Choctaw Facility, an underground salt dome petroleum storage facility 37 miles to the northwest of the marine terminal. 

Initially, Shell Pipe Line Corporation (renamed Equilon Enterprises LLC in 1998) anticipated connecting the Bayou Choctaw Pipeline with one or more third-party pipelines to provide commercial pipeline capability to Baton Rouge refiners located about 16 miles north of the SPR Bayou Choctaw Facility. This plan fell through, however, and Equilon subsequently proposed to construct a new underground crude oil pipeline from the Bayou Choctaw Facility to the Baton Rouge market: a 16-mile pipeline, 24 inches in diameter, to carry 100,000 barrels of oil per day. To allow recovery of the required capital investment, Equilon asked DOE to restructure its annual lease to a 10-year lease. Because DOE’s long-term leasing of the existing pipeline would result in the private party construction of a new pipeline, this new proposed action triggered the need for additional environmental review under NEPA. 

Interagency Coordination Was Key

In addition to having numerous water crossings (including crossing the 300-foot wide Intracoastal Waterway) that would require a Corps of Engineers Section 404 individual permit (Primer, above), the project as proposed would unavoidably involve floodplains and bottomland hardwoods. Bottomland hardwoods, a swamp forest ecosystem, are becoming scarce and fragmented regionally and nationally as a result of construction of highways, pipelines, and powerlines. 

DOE and Equilon discussed these concerns with State and Federal regulators and consulting agencies, first with the Corps of Engineers and Louisiana Department of Wildlife and Fisheries and then with the U.S. Fish and Wildlife Service. These discussions indicated that bottomland hardwoods removal would require compensatory wetlands mitigation. While an EA typically would be the appropriate level of NEPA review for a pipeline of this scale, the need for mitigation – over which DOE would not have control – could have precluded DOE’s issuing a FONSI.

A Section 404 Primer

Section 404 of the Federal Clean Water Act establishes a program to regulate the discharge of dredged and fill material into the waters of the United States, including wetlands. The U.S. Army Corps of Engineers and the U.S. Environmental Protection Agency jointly administer the program. The basic premise of the program is that no discharge of dredged or fill material can be permitted if a less damaging practicable alternative exists. Regulated activities are controlled through a permit process. For projects not likely to have potentially significant impacts, the Corps of Engineers may approve an application under a general permit. These are defined on a nationwide, regional, or state basis for particular categories of activities to expedite the permitting process. If a proposed activity is not covered by a general permit, an individual permit is required; usually, these are required for projects with potentially significant impacts.

Effective Integration of NEPA and Wetlands Protection Processes

Because a Section 404 permit can contain enforceable mitigation commitments, it made sense to fully integrate the DOE NEPA process with the Section 404 permit process. DOE and Equilon obtained the early assistance of the Louisiana Department of Wildlife and Fisheries and the U.S. Fish and Wildlife Service in identifying a preferred right-of-way for the new pipeline and developing a compensatory wetlands mitigation plan. DOE and the Corps of Engineers integrated their public involvement procedures and merged their respective NEPA and permit notification lists, effectively providing more comprehensive information to a larger set of stakeholders.

After DOE distributed an EA for pre-approval review and responded to State comments, Equilon quickly obtained approvals from the Louisiana Department of Wildlife and Fisheries and the U.S. Fish and Wildlife Service for the wetlands mitigation plan. The Corps of Engineers then added the mitigation plan to its permit terms and conditions. Based on the mitigation commitments, DOE issued the EA and a mitigated FONSI on September 1, 1998 (Environmental Assessment of Bayou Choctaw Pipeline Extension to Placid Refinery, Iberville and West Baton Rouge Parishes, Louisiana, DOE/EA-1251). The Corps of Engineers then adopted DOE’s EA and issued the Section 404 permit.

Mitigation Will Restore Environment

Construction began in September 1998 and ended in January 1999. Through careful planning, Equilon minimized tree removal so that only 37 acres of compensatory wetlands are required, far less than the maximum of 86 acres analyzed in the EA. The wetlands mitigation work will be accomplished near the right-of-way by restoring agricultural land (currently in sugarcane) as close as possible to its original state by planting cypress and other bottomland hardwood species. The project proponents are required to restore the new pipeline corridor to preconstruction elevations, so the buried pipeline will not interfere with floodplain functions and values.

Selected Project Chronology

February 1998

• DOE made NEPA determination and began EA preparation

March 1998

• Equilon submitted Section 404 permit application to Corps of Engineers
• DOE and Corps of Engineers agreed to integrate NEPA and permit processes

April 1998

• Corps of Engineers issued public notice of Section 404 permit application

May 1998

• U.S. Fish and Wildlife Service responded to Corps of Engineers public notice
• DOE published notice of floodplain and wetlands involvement

June 1998

• U.S. Fish and Wildlife Service responded to DOE floodplain/wetland notice
• Equilon obtained State approval of right-of-way and completed Section 404 permit application

July 1998

• DOE issued EA for pre-approval review
• U.S. Fish and Wildlife Service commented on the EA

August 1998

• Louisiana Departments of Environmental Quality and Wildlife and Fisheries commented on EA
• Louisiana Department of Wildlife and Fisheries approved compensatory wetland mitigation action plan; Corps of Engineers attached plan to permit application

September 1998

• DOE approved EA and issued mitigated FONSI
• Corps of Engineers adopted EA and issued Section 404 permit
• Applicant began construction

(additional concurrent State activities are not listed)

For more information on mitigated FONSIs, see questions 39 and 40 in "Forty Most Asked Questions Concerning CEQ’s Regulations" (46 FR 18026; March 23, 1981) amended, and 10 CFR 1021.322(b) and (e), and 1021.331(b). For more information on this project or the SPR Program, contact Hal Delaplane at hal.delaplane@hq.doe.gov or phone 202-586-4730.