Several industries in the United States are expanding the use of injecting captured carbon dioxide (CO2) into deep underground wells (or geologic formations). The impetus of this carbon capture and sequestration (CCS) process is to reduce the amount of CO2— an important greenhouse gas produced by power plants and other large industrial facilities— from reaching the atmosphere. Historically, the U.S. Environmental Protection Agency (EPA) has issued permits for CO2 injection wells, known as Class VI wells, used for injection and geologic sequestration of CO2. In some instances, however, the EPA delegates authority to states, known as primacy, to administer underground injection programs and issue Class VI permits.[1]
Environmental Groups File Lawsuit Against EPA Decision
On January 5, 2024, the EPA approved the State of Louisiana’s application for primacy over its Underground Injection Control (UIC) program to include Class VI wells under the Safe Drinking Water Act (SDWA).[2] Shortly thereafter, multiple environmental groups filed suit in the U.S. Fifth Circuit to challenge the EPA’s grant, seeking a complete reversal.[3] The environmental groups allege Louisiana’s permitting plan for the Class VI wells is less developed and less strict than the EPA’s program. The EPA maintains that Louisiana’s permitting program is compatible with federal requirements.[4] In the EPA’s final rule, the EPA details the process by which the two schemes were compared and the measures the State of Louisiana agreed to implement environmental justice safeguards that the environmental groups had raised concern about during the public notice and comment period.[5] As of this writing, the only step taken to forward the litigation has been the environmental groups’ initial filing petitioning the 5th Circuit to review the EPA’s decision.
Implications for Future State Primacy Applications and Carbon Capture Projects
Currently, Louisiana is one of only three states that have been granted primacy (the other states being Wyoming and North Dakota). Once granted primacy, a state is responsible for the day-to-day administration of the program, such as issuing permits, monitoring compliance with regulations, and enforcement of actions in the event of violations. With primacy, the primary CCUS overseer shifts from the EPA to the Louisiana Department of Natural Resources (LDNR). Under the LDNR, the permitting process is expected to be faster than if the EPA retained permitting control.[6] Under SDWA, however, the EPA retains oversight and enforcement authority over all delegated UIC programs. It is expected that primacy grants will likely lead to faster permitting for sequestration projects. In Louisiana’s case, applications currently comprise a third of all EPA Class VI applications, so their transfer should reduce the EPA’s backlog as well as shorten the permitting timeline for remaining applicants.[7] Currently, Arizona, West Virginia, and Texas have pending primacy applications with the EPA.
*Law Clerk Isabelle Rowan contributed to this article.
References
[1] Class VI Carbon Sequestration Wells: Permitting and State Program Primacy 10 (Congressional Research Service, April 16, 2024) Class VI Carbon Sequestration Wells: Permitting and State Program Primacy (congress.gov).
[2] State of Louisiana Underground Injection Control Program; Class VI Primacy, 89 Fed. Reg. 4 (January 5, 2024) (to be codified at 40 C.F.R. pt. 147).
[3] Petition for Review, Deep South Center for Environmental Justice et al. v. United States Env’t Prot. Agency, No. 24-60084 (5th Cir. Feb. 20, 2024).
[4] Id.
[5] State of Louisiana Underground Injection Control Program; Class VI Primacy, 89 Fed. Reg. 4 (January 5, 2024) (to be codified at 40 C.F.R. pt. 147).
[6] Jim White, The Race for Carbon Solutions Gains Momentum with Louisiana’s ‘Primacy’ Ruling, NAPE, Summer 2024, at 53.
[7] Carolyn Nuyen, Louisiana Class VI Well Primacy Bodes Well for CCUS Projects in State and Across U.S., factset (January 24, 2024), https://insight.factset.com/louisiana-class-vi-well-primacy-bodes-well-for-ccus-projects-in-state-and-across-u.s.
Amy Duplantis Gautreaux is an oil and gas attorney with extensive experience representing upstream energy companies operating in Louisiana. With a focus on title examination, drafting, and interpreting contractual provisions in oil and gas and related contracts, Amy has handled complex multi-Parish projects offshore and in various oil and gas formations and fields throughout Louisiana. She is also skilled in analyzing HBP titles involving complicated mineral servitude and mineral royalty ownership interests. Amy has worked as an abstractor and landman in South Louisiana, which provides a unique perspective from which to advise Louisiana oil and gas clients.
Amy is admitted to practice in Louisiana and Texas and is affiliated with the Louisiana State Bar Association, Lafayette Parish Bar Association, and various professional landmen associations, including the American Association of Professional Landmen (AAPL), Lafayette Association of Professional Landmen (LAPL), Baton Rouge Association of Professional Landmen (BRAPL), and Houston Association of Professional Landmen (HAPL). She has been recognized by The Best Lawyers: Ones to Watch – Oil and Gas Law in 2021 and named a Rising Star in Energy & Natural Resources by Louisiana Super Lawyers in 2017-2018.