Coastal Zone Consistency Review of Exploration Plans and Development and Production Plans

DEPARTMENT OF THE INTERIOR

Minerals Management Service

30 CFR Part 250

RIN 1010-AC42

Coastal Zone Consistency Review of Exploration Plans and

Development and Production Plans

AGENCY: Minerals Management Service (MMS), Interior.

ACTION: Final rule.

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SUMMARY: This final rule amends regulations that specify how States

review Exploration Plans (EP) and Development and Production Plans

(DPP) for coastal zone consistency. The amended regulation clarifies

that a State coastal zone consistency review occurs under the authority

of the National Oceanic and Atmospheric Administration (NOAA)

regulations and that when MMS prepares a DPP environmental impact

statement (EIS), we will give the draft EIS to those States requiring

the draft EIS as necessary information to conduct a DPP consistency

review.

EFFECTIVE DATE: The rule is effective on November 1, 1999.

FOR FURTHER INFORMATION CONTACT: Maureen Bornholdt, Environmental

Assessment Branch, (703) 787-1656.

SUPPLEMENTARY INFORMATION: This rulemaking seeks to correct

discrepancies between MMS and NOAA regulations. We last revised our

current rules in 1988 for Outer Continental Shelf (OCS) plan submission

and approval. At that time, several statements concerning State coastal

zone consistency reviews were placed in our regulations alerting

lessees to the requirements that had to be met before we could approve

activities associated with an EP or a DPP. Since 1988, some of these

provisions conflict with the NOAA rules governing State coastal zone

consistency review of OCS plans. Thus, we are revising our regulations

to conform with the NOAA requirements.

Additionally, we believe it is in the interest of all parties for

States to have the best available information in evaluating the

consistency certification

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by applicants for a DPP under the State's coastal management program

and in making important coastal zone management (CZM) decisions.

Accordingly, when we prepare a DPP EIS, we will give the draft EIS to

those States requiring a DPP National Environmental Policy Act (NEPA)

document as necessary information that the State must receive before

consistency review can begin.

Background

Section 307(c)(3)(B) of the Coastal Zone Management Act (CZMA)

requires that lessees conduct activities described in OCS plans in a

manner consistent with enforceable policies of federally approved State

Coastal Management Programs (CMP). Consequently, any person submitting

an OCS plan to us must include a certificate of ``coastal zone

consistency,'' i.e., a certification that lessee activities are

consistent with the enforceable policies of CMP. Under section

307(c)(3)(B), Federal agencies cannot grant any Federal licenses or

permits for any activity in the OCS plan until the State concurs with,

or is conclusively presumed to concur with, the consistency

certification, or the Secretary of Commerce overrides the State's

consistency objection.

The CZMA requires three items for State consistency review: the OCS

plan, the consistency certification, and any necessary data and

information. Because many State CMPs describe information requirements

for assessing consistency, States must make copies of their CMP

available to help applicants identify necessary data and information.

NOAA also encourages applicants to discuss consistency information

needs with the State.

In addition to using CMP information requirements for OCS plan

review, NOAA has instructed States to use ``information received

pursuant to the Department of the Interior's operating regulations

governing (OCS) exploration, development and production'' to determine

consistency (15 CFR 930.77(a)). The State may ask for information in

addition to that required by Sec. 930.77, but such requests do not

extend the start of its consistency review (15 CFR 930.78). Consistency

review begins when the State receives a copy of the OCS plan,

consistency certification, and required necessary data and information

(15 CFR 930.78).

Changes to Our Regulations

We are revising our rules to start consistency review upon receipt

of the EP or DPP. This will comply with the NOAA requirement (15 CFR

930.77) to begin consistency review when the State receives the OCS

plan (the version that MMS deems submitted), the lessee's consistency

certification, and required necessary data and information. We are

adding this NOAA reference on starting consistency review to the

regulations found at 30 CFR 250.203(f) and 250.204(i).

Additionally, we are replacing the statement about the relationship

between the NEPA process and the State consistency review with one

describing when we will forward a draft EIS to the State CZM agency.

In 1979, the Department of the Interior (DOI) expressed the view

that delaying the CZMA consistency process until after preparation of a

NEPA compliance document would not be consistent with congressional

intent. Specifically, in response to a comment suggesting a delay in

the CZMA process when an EIS is needed for a DPP, the 1979 preamble to

the current rule stated:

It is clear from the provisions of Section 25 of the Act that a

State's coastal zone consistency review is independent of the

National Environmental Policy Act review procedures, and the coastal

zone consistency review should be completed within the timeframe

specified in the Act and the implementing regulations. The

Environmental Report is designed to provide all the information

needed for the consistency review. To adopt the suggested procedure

would result in a delay that is contrary to the intent of Congress.

44 Fed. Reg. 53686 (Sept. 14, 1979).

DOI has reconsidered this position for two reasons. First, 19 years

of OCS program experience under the old rule have led us to conclude

that the lack of an EIS in a State's review of a CZMA consistency

certification has contributed to many State objections and a more

contentious process than necessary in developing our Nation's offshore

natural gas and oil. Accordingly, we have determined to support, to the

extent permitted by law, the States' efforts to obtain the best

reasonably available environmental information before making

consistency decisions under the CZMA.

Second, as a matter of law, the NEPA, CZMA, and OCS Lands Act

(OCSLA) do not expressly state their relationship to each other, and

the relationship (or lack of relationship) among these statutes is not

as clear as the preamble to the 1979 rulemaking asserts. The 1979

preamble statement relied upon certain statements in the legislative

history, not the statutory text. (See, e.g., H.R. REP. No. 590, 95th

Cong., 2d Sess. 167, reprinted in the 1978 U.S. CODE CONG. & ADMIN.

NEWS 1572, 1573.) While the CZMA, OCSLA, and NEPA processes have

somewhat different timeframes, we do not find in them any requirement

to achieve compliance with the separate mandates of those statutes in

any rigid order. The Secretary's general rulemaking authority in

Section 5 of the OCSLA, 43 U.S.C. 1334, provides considerable

discretion to administer the OCS program. The Solicitor's Office

advises that this authority gives the Secretary discretion to provide a

more flexible approach to achieving that compliance. Thus, the

Secretary may allow MMS to give a draft EIS to those States that

require a draft EIS before starting the DPP consistency review.

Therefore, we will give the draft EIS to those States that require

the DPP NEPA document as necessary information that must be received

before consistency review can begin. Any delay in beginning the DPP

consistency review until the draft EIS is available will not affect the

mandated 60-day timeframe for our decision on the DPP. When a DPP EIS

is prepared, OCSLA requires that we approve, disapprove, or require

modification of the DPP 60 days after the release of the final EIS.

Typically, there are about 8 to 9 months between the availability of

the draft and final EISs. We use this time period to solicit public

comment (written and oral) on the draft EIS, respond to comments, make

changes, and conduct internal reviews and other administrative matters

associated with the EIS production. This time interval would allow the

State sufficient time to complete its DPP consistency review (see the

chart following this paragraph). We want to make good science and

analysis available for states to use in making CZMA decisions. We can

further that effort by providing the State with the best available

information in order to concur with an applicant's DPP consistency

certification. It also helps us to base the OCS program on consensus,

not conflict, and to be good neighbors to the coastal States.

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Comments on the Rule

We received comments from nine groups including State Governments

and the offshore petroleum industry:

American Petroleum Institute

State of California

California Coastal Commission

Resources Agency of California

State of Florida

Department of Community Affairs

Office of the Governor

Chevron U.S.A. Production Company

State of North Carolina

Department of Environmental and Natural Resources

Phillips Petroleum Company

Texaco Exploration and Production Inc.

We considered the comments and have modified the final language as

appropriate.

Comments and Responses

In addition to the proposed changes in the regulations, we sought

comment on whether to apply the proposed language to pending DPP

applications. We decided not to apply the new rule retroactively. When

we published the proposal, the only MMS-pending DPP application (Destin

Dome 56 Unit Offshore Florida) had received a State consistency

objection (February 1998). The applicant had filed its consistency

appeal with the Secretary of Commerce in March 1998. The Department of

Commerce (DOC) has begun to compile and review the record in this

appeal. They have asked Federal agencies to submit comments for the

record and have scheduled a public hearing in September 1999. The

appeal's public record remains open until 30 days after the DOC public

hearing. MMS will publish the DPP draft EIS while the appeal record is

open, and we will forward a copy to DOC.

Comment: Several commenters expressed concern that the proposed

changes give the States up to 18 months, and perhaps longer, to

complete their consistency review.

Response: The CZMA controls and sets the deadlines and criteria for

consistency review through NOAA's implementing regulations, not the MMS

regulations. The NOAA consistency regulations set a 6-month deadline

for the State's consistency decision:

Concurrence by the State agency shall be conclusively presumed

in the absence of a State agency objection to the consistency

certification within six months following commencement of State

agency review. (15 CFR 930.79(b))

The NOAA consistency regulations determine when the CZMA clock

starts:

State agency review of the person's consistency certification

begins at the time the State agency receives a copy of the OCS plan,

consistency certification, and required necessary data and

information. (15 CFR 930.78)

The MMS regulations have incorporated the NOAA process in 30 CFR

250.204(i)

The [DPP] plan will be processed in accordance with the

regulations in this section and the regulations governing Federal

CZM consistency procedures (15 CFR part 930).

The new rule does not alter the CZMA/NOAA time requirements for

State consistency review.

Comment: Several commenters were concerned that the proposal will

cause delays in the OCS permitting and the consistency appeals process.

Response: When MMS prepares a DPP EIS, OCSLA requires that we

approve, disapprove, or require modification of the DPP 60 days after

the release of the final EIS. The new rule will not affect the mandated

60-day timeframe to issue our DPP decision. Regarding the comment about

delaying the consistency appeals process, one of our objectives of the

new rule is to decrease the number of State consistency objections

based on insufficient information. NOAA regulations found at 15 CFR 930

govern the consistency appeal process. The new rule does not alter and

cannot change the NOAA appeal process. Providing the draft EIS to

States amending their coastal program will ensure that those States

[[Page 53198]]

have a comprehensive analysis of the OCS plan's environmental impacts

to use in making their consistency decisions. Indeed, allowing States

to use the draft EIS' analysis may result in fewer consistency

objections, associated consistency appeals, and attendant delays.

Comment: Several commenters stated that the current process to

collect information for State consistency review purposes is adequate.

Response: The discretion for deciding what information is required

to determine consistency lies with the affected State. The new rule

will not change the current information collection process outlined in

the NOAA consistency regulations. Instead, the rule informs States and

OCS operators that MMS reconsidered the relationship between the NEPA

process and State consistency reviews, and we will give the draft EIS

to those States that require the DPP NEPA document as necessary

information that the State must receive before consistency review can

begin.

Comment: A commenter suggested that we provide the States with all

the comments on the draft EIS in addition to the draft EIS.

Response: We did not incorporate this suggestion into the final

rule. We will provide the State, upon request, a copy of the comments

on the draft EIS. The purpose of supplying information is to help the

State determine consistency through understanding how the proposed

project could affect coastal resources and uses. The draft EIS is our

primary source of environmental analytical information focusing on

impacts of the OCS project on the human, marine, and coastal

environments. The comments we receive on the draft EIS, while very

useful, are a critique of the proposal and the draft EIS and not an

environmental impact analysis. To obtain public comment on the OCS

proposal, the NOAA regulations require the States to comply with

certain public notice and comment requirements. Through those NOAA

processes, the States can acquire public opinions/concerns about the

OCS consistency review.

Comment: A commenter suggested that we apply the same requirement

to exploration plans.

Response: Given that exploration activities are temporary and less

complicated than those associated with a normally 30-year development

and production project, the information and analysis requirements under

NOAA consistency and MMS operating regulations provide the State with a

sufficient basis on which to render a consistency decision. Therefore,

the final rule does not apply the requirement to EPs.

Comment: Several commenters stated that MMS should amend the

proposal to apply to all States instead of letting the States decide

what information is necessary for consistency review.

Response: As part of our NEPA process, we provide the DPP draft EIS

to all affected States and will continue to do so. However, our new

rule does not create CZMA consistency-related obligations. The CZMA

sets the criteria for consistency review through NOAA's implementing

regulations. If a State wants to obtain more information (the draft

EIS) before the consistency review starts, the State must comply with

NOAA's consistency regulations--in this case that means listing the

draft EIS as ``necessary data and information.'' The NOAA regulations

do not require listing the draft EIS if the State simply wanted the

draft EIS as ``supplemental'' information. Finally, some States may be

satisfied with the information they receive and may not choose to

require the draft EIS.

Comment: A commenter stated that current MMS regulations prevent

States from reviewing for consistency certain permits issued after a

plan's approval and suggested that MMS include these permitted

activities in either the OCS Plan or associated NEPA document making

those activities available for consistency review.

Response: NOAA's regulations preclude the States from reviewing

permits associated with a plan that already received State consistency

concurrence. The NOAA regulations state:

If the State agency issues a concurrence or is conclusively

presumed to concur with the person's consistency certification, the

person will not be required to submit additional consistency

certifications and supporting information for the State agency

review at the time Federal applications are actually filed for the

Federal licenses and permits to which such concurrence applies. (15

CFR 930.80)

The MMS regulations incorporate the NOAA exemption:

* * *APD's must conform to the activities described in detail in

the approved Exploration Plan and shall not be subject to a separate

State coastal zone consistency review. (30 CFR 250.203(p))

* * *All APD's and applications to install platforms and

structures, pipelines, and production equipment must conform to the

activities described in detail in the approved Development and

Production Plan and shall not be subject to a separate State coastal

zone consistency review. (30 CFR 250.204(t))

Briefly, OCS plans include:

the schedule for offshore activities (e.g.,

commencement and completion schedules, sequences for drilling wells

and installing facilities, and date of first production).

descriptions of any drilling vessels, platforms,

pipelines, or other facilities/operations (including location, size,

design, and safety and pollution-prevention features).

supporting information, including descriptions of

geological and geophysical data, air emissions, physical

oceanography, onsite flora and fauna, and quality, and other uses of

the area.

States review OCS plans to determine whether proposed activities

described in them will be conducted in a manner consistent with the

enforceable policies of approved coastal management programs. We are

prohibited from permitting OCS plan activities until the State concurs

with or is presumed to concur with the plan's consistency

certification. Because the OCS plan reviewed by the State for

consistency includes a description of proposed permitted activities,

the subsequently filed permits are already covered by the State's

consistency review.

Comment: A commenter suggested that Federal consistency

determinations should be included at each stage of the NEPA process.

States should be allowed to review for consistency each individual

stage of the NEPA process, especially when significant changes are made

to the project or analyses.

Response: NEPA documents do not trigger a consistency review. NEPA

documents analyze environmental impacts. They do not approve activities

by either the Government or the lessees. Nor do they approve licenses

or permits. However, MMS regulations provide that if the OCS plan

changes substantially (e.g., significantly changes the impacts that

were previously identified and evaluated; requires additional permits;

or proposes activities not previously identified and evaluated) after

the State's concurrence, the proposed revised OCS plan will be subject

to State consistency review.

Comment: A commenter expressed concern that delaying the State's

consistency decision until later in the DPP process would not give MMS

consistency-related information in a timely fashion and could result in

considerable NEPA-related delays.

Response: The new rule will not delay our NEPA process. Before we

prepare an EIS, we conduct ``scoping.'' Scoping identifies the extent

and significance of important environmental issues associated with a

proposed Federal action. During scoping, we ask the public; local,

State, and Federal agencies; and interested organizations or

individuals to identify issues, resources,

[[Page 53199]]

impacts, and any alternatives to the proposed action that the EIS

should address. Issues identified and ultimately analyzed in the impact

statement typically include those covered by the State's coastal

management program. We also include State CZM agencies in our scoping

process.

Comment: A commenter suggested that we clarify proposed language to

be sure that the OCS plan the State receives to begin its consistency

review is the version that MMS deems complete.

Response: The new rule makes that change.

Comment: A commenter suggested to change the language to require

MMS to send the final EIS.

Response: When MMS prepares a DPP EIS, OCSLA requires that we

approve, disapprove, or require modification of the DPP 60 days after

the release of the final EIS. State consistency review takes from 3 to

6 months. Therefore, starting consistency review upon the release of

the final EIS would violate the required deadline in OCSLA.

Procedural Matters

Federalism (Executive Order (E.O.) 12612)

According to E.O. 12612, the rule does not have significant

Federalism implications. A Federalism assessment is not required.

Takings Implications Assessment (E.O. 12630)

According to E.O. 12630, the rule does not have significant takings

implications. A Takings Implication Assessment is not required.

Regulatory Planning and Review (E.O. 12866)

This document is not a significant rule and is not subject to

review by the Office of Management and Budget under E.O. 12866.

(1) This rule will not have an effect of $100 million or more on

the economy. It will not adversely affect in a material way the

economy, productivity, competition, jobs, the environment, public

health or safety, or State, local, or tribal governments or

communities. The rule simply clarifies the authority of NOAA

regulations for State coastal zone consistency review. It also makes

available to those States requiring it, a copy of the draft DPP EIS

when MMS prepares one.

(2) This rule will not create a serious inconsistency or otherwise

interfere with an action taken or planned by another agency. There are

no new requirements in this rule. The rule simply clarifies existing

regulations.

(3) This rule does not alter the budgetary effects or entitlements,

grants, user fees, or loan programs or the rights or obligations of

their recipients. The clarifications contained in the rule do not

change existing regulations and therefore do not alter the budgetary

effects, grants, user fees etc.

(4) This rule does not raise novel legal or policy issues. The

clarifications in the rule are based on the longstanding legal

authority of the OCSLA, CZMA, NEPA and other laws. As previously stated

it clarifies the authority of NOAA regulations.

Civil Justice Reform (E.O. 12988)

According to E.O. 12988, the Office of the Solicitor has determined

that this rule does not unduly burden the judicial system and meets the

requirements of sections 3(a) and 3(b)(2) of the Order.

National Environmental Policy Act (NEPA)

This rule does not constitute a major Federal action significantly

affecting the quality of the human environment. A detailed statement

under the NEPA of 1969 is not required.

Paperwork Reduction Act (PRA) of 1995

The information collection requirements in subpart B remain

unchanged. The current information collection requirements of Subpart

B, Exploration and Development and Production Plans, have been approved

by OMB under 44 U.S.C. 3507 and assigned OMB control number 1010-0049.

Regulatory Flexibility Act

DOI certifies that this document will not have a significant

economic effect on a substantial number of small entities under the

Regulatory Flexibility Act (5 U.S.C. 601 et seq.).

The revision to the rule will clarify, but not change, the

requirements currently in place for OCS plan review and approval. The

changes make clear that NOAA regulations govern State coastal zone

consistency review of OCS plans submitted to us. There will be no

change to current procedures resulting from the amendment to the rule.

DOI has determined that these changes to the rule will not have a

significant effect on a substantial number of small entities. In

general, most entities that engage in offshore activities are not

considered small due to the technical and financial resources and

experience necessary to conduct such activities safely. However, those

lessees that are classified as small businesses will not be affected.

DOI also determined that there are no indirect effects of this

rulemaking on small entities that provide support for offshore

activities. Small government entities, such as small local governments

in an affected State's coastal zone, can participate in State coastal

zone review and can request that the Regional Supervisor provide copies

of plans. None of the proposed changes will affect this process.

Your comments are important. The Small Business and Agriculture

Regulatory Enforcement Ombudsman and 10 Regional Fairness Boards were

established to receive comments from small business about Federal

agency enforcement actions. The Ombudsman will annually evaluate the

enforcement activities and rate each agency's responsiveness to small

business. If you wish to comment on the enforcement actions of MMS,

call toll-free (888) 734-3247.

Small Business Regulatory Enforcement Fairness Act (SBREFA)

This rule is not a major rule under (5 U.S.C. 804(2)) SBREFA. This

rule:

(a) Does not have an annual effect on the economy of $100 million

or more.

(b) Will not cause a major increase in costs or prices for

consumers, individual industries, Federal, State, or local government

agencies, or geographic regions.

(c) Does not have significant adverse effects on competition,

employment, investment, productivity, innovation, or ability of U.S.-

based enterprises to compete with foreign-based enterprises.

Unfunded Mandate Reform Act (UMRA) of 1995

This rule does not impose an unfunded mandate on State, local, or

tribal governments or the private sector of more than $100 million per

year. The rule does not have a significant or unique effect on State,

local or tribal governments or the private sector. A statement

containing the information required by UMRA (2 U.S.C. 1531 et seq.) is

not required.

List of Subjects in 30 CFR Part 250

Continental shelf, Environmental impact statements, Environmental

protection, Government contracts, Incorporation by reference,

Investigations, Mineral royalties, Oil and gas development and

production, Oil and gas reserves, Penalties, Pipelines, Public lands--

mineral resources, Public lands--rights-of-way, Reporting and

recordkeeping requirements, Sulphur development and production, Sulphur

exploration, Surety bonds.

[[Page 53200]]

Dated: September 3, 1999.

Sylvia V. Baca,

Assistant Secretary, Land and Minerals Management.

For the reasons stated in the preamble, the Minerals Management

Service amends 30 CFR part 250 as follows:

PART 250--OIL AND GAS AND SULPHUR OPERATIONS IN THE OUTER

CONTINENTAL SHELF

1. The authority citation for part 250 continues to read as

follows:

Authority: 43 U.S.C. 1334.

2. In Sec. 250.203, paragraph (f) is revised to read as follows:

Sec. 250.203 Exploration Plan.

* * * * *

(f) Within 2 working days after we deem the Exploration Plan

submitted, the Regional Supervisor will send by receipted mail a copy

of the plan (except those portions exempt from disclosure under the

Freedom of Information Act and 43 CFR part 2) to the Governor or the

Governor's designated representative and the CZM agency of each

affected State. Consistency review begins when the State's CZM agency

receives a copy of the deemed submitted plan, consistency

certification, and required necessary data and information as directed

by 15 CFR 930.78.

* * * * *

3. In Sec. 250.204, paragraphs (i) and (j) are revised to read as

follows:

Sec. 250.204 Development and Production Plan.

* * * * *

(i) We will process the plan according to this section and 15 CFR

part 930. Accordingly, consistency review begins when the State's CZM

agency receives a copy of the deemed submitted plan, consistency

certification, and required necessary data and information as directed

by 15 CFR 930.78.

(j) The Regional Supervisor will evaluate the environmental impact

of the activities described in the Development and Production Plan

(DPP) and prepare the appropriate environmental documentation required

by the National Environmental Policy Act of 1969. At least once in each

planning area (other than the western and central Gulf of Mexico

planning areas), we will prepare an environmental impact statement

(EIS) and send copies of the draft EIS to the Governor of each affected

State and the executive of each affected local government that requests

a copy. Additionally, when we prepare a DPP EIS and when the State's

federally approved coastal management program requires a DPP NEPA

document for use in determining consistency, we will forward a copy of

the draft EIS to the State's CZM Agency. We will also make copies of

the draft EIS available to any appropriate Federal Agency, interstate

entity, and the public.

* * * * *

[FR Doc. 99-25499 Filed 9-30-99; 8:45 am]

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