OFFSHORE PORTS AND TERMINALS

TUESDAY, JUNE 12, 1973

HOUSE OF REPRESENTATIVES,

COMMITTEE ON MERCHANT MARINE AND FISHERIES,

Washington, D.C. The committee met pursuant to call at 10:07 a.m., in room 1334, Longworth Office Building, the Honorable Leonor K. Sullivan (chairman of the committee), presiding.

The CHAIRMAN. This morning, the Committee on Merchant Marine and Fisheries begins a set of comprehensive hearings addressing the need for, and the various problems connected with, the construction and operation of deep water offshore ports and terminals, for the reception of our increasing oil imports. The purpose of these hearings it to consider the prospective advantages flowing from the construction of such terminals, as well as the disadvantages that may be present in transferring cargoes in ocean areas subject to the stresses of wind, water, and weather.

We have been hearing increasingly in recent years of problems facing our Nation in providing for an adequate energy supply. Various studies have been undertaken in the executive department, in the Congress, and in the private sector, seeking the most viable solutions for these problems. While the results of those studies differ in some respects, there is no disagreement among them as to the fact that in the next few years the energy demand in the United States will rise much more rapidly than the energy supply. Until new sources of energy not now available can be developed for future national use, it is obvious that we must continue to rely on the use of existing fossil fuels, the bulk of which is represented by oil.

I do not at this time intend to discuss other fuels or other methods of supplying our energy needs. Neither do I intend to address myself to methods whereby we can successfully depress the rapidly rising demand curve. I would like merely to point out that whatever successes we may accomplish in those areas for the immediate years ahead, we must continue to rely on oil.

The United States, which is still in the forefront of oil production, was once self-sufficient in its domestic oil supplies. That is no longer the case. In fact, the various studies indicate that within the next decade and a half, oil imports from foreign sources will be needed to supply approximately 35 percent of our energy needs, amounting to approximately 60 percent of the total oil consumed. Facing that problem, these hearings are designed to supply the committee with information concerning the prospective role that

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offshore ports and terminals should play in providing for the reception of approximately 15 million barrels per day of oil imports. Because of the economics involved and the threat to our balance of payments, it seems to be an almost foregone conclusion that if we intend to import this volume of oil, we must carefully consider the utilization of increasingly large tankers and provide for the accommodations which can handle them.

From a cost effective viewpoint, one of the most promising looking alternatives is the construction of offshore ports or some other offshore terminal system.

At the same time, we must not permit ourselves to ignore the potentially adverse impact that too large a dependence on offshore facilities may have on our existing port complexes.

Unintended dislocations and disruptions of present trade patterns might result in such losses to our present port areas as to substantially offset the economic benefits we expect to gain.

In addition, I believe that we must examine the impact of offshore terminals on our maritime shipbuilding program.

There appears to be decided promise that the establishment of offshore terminals, if properly handled, might substantially benefit the U. S. merchant marine and assist in restoring it to its rightful place among the maritime nations, resulting not only in a healthier merchant marine program, but also providing a more substantial base for our national security interests.

In addition to examining the potential impact of offshore ports on our national economic health and on the U. S. merchant marine, we must carefully consider the operational requirements of various offshore terminal designs so that we promote the best safety practices and provide the greatest possible protection of the marine environment from the damage that would result from less than adequate requirements for the transfer and transshipment of the oil cargoes from the offshore facilities to the destinations ashore.

In that regard, we must also consider the potential effect on the coastal areas through which this transshipment must necessarily occur and devise legislation which will best provide for shoreside involvement.

The hearing will begin with testimony from the various Federal departments and agencies with responsibilities affected by offshore ports.

Following the Federal agencies, we will receive testimony from various groups which have been active in preparing proposals for specific offshore terminals, from the representatives of State and local governments and port organizations, from various enterprises which will be affected by an offshore terminal program, and from the public generally, including those groups which are concerned with the potential environmental impact of these facilities.

There are now several bills pending in the Congress covering the general issue of offshore structures of various types, two of them, H.R. 5091 and H.R. 5898, before this committee. H.R. 5091 concerns offshore structures in general and provides for a certification mechanism whereby certain criteria are established and procedures are outlined through which the fullest possible protection of the

marine environment is made possible, before the construction or operation of any offshore structure may be undertaken.

H.R. 5898 takes a different tack, in that it relates to offshore port and terminal facilities only and provides for the circumstances under which permits for the construction, operation, and maintenance of such facilities may be issued.

The two bills will be used as vehicles for consideration of the overall problem, but in my opinion, neither bill, standing alone, will meet our overall needs.

[The bills referred to follow:]

[H.R. 5091, 93d Cong., first sess.]

A BILL To amend the Marine Protection, Research, and Sanctuaries Act of 1972, and for other purposes

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That the Marine Protection, Research, and Sanctuaries Act of 1972 is amended by adding at the end thereof the following new title:

"TITLE IV-SITING, CONSTRUCTION, AND OPERATION OF CERTAIN STRUCTURES IN OFF-SHORE COASTAL WATERS

"FINDINGS AND PURPOSE

"SEC. 401. (a) The Congress finds—

"(1) that the construction and operation of large-scale offshore structures, both fixed and floating, designed to be used as ports, terminals, powerplants, airports, research platforms. or for other purposes, are presently planned;

"(2) that there is a nationwide need to oversee the planning, construction, and operation of such facilities to prevent damage to the offshore coastal waters of the United States and the resources therein. including but not limited to, fish, shellfish, and wildlife, marine and coastal resources, and recreational and scenic values, which waters and resources are hereafter in this title referred to as the 'marine environment'; and

(3) that the planned development of such facilities involves and affects interstate and foreign commerce, fisheries and wildlife, and navigation and will affect United States citizens and the marine environment over a broad geographical area.

"(b) The purpose of this title is to provide for the fullest possible protection of the marine environment in order to prevent an unacceptably adverse impact from the construction and operation of such facilities by authorizing and directing the Secretary of Commerce to issue a certification that in respect to any structure all possible precautions have been taken to protect the marine environment, or to deny such certification if the facility is adjudged by the Secretary to pose an unreasonable threat to the integrity of the marine environment.

"DEFINITIONS

"SEC. 402. For the purposes of this title the term— "(a) 'Secretary' means the Secretary of Commerce.

"(b) 'Structure' means any artificial island or other stationary structure, either fixed or floating, located in the offshore coastal waters of the United States and which is intended for use, or used, as a port, terminal, powerplant, airport, or research platform, or for any other purpose: Provided, That it does not mean structures designed and used for exploring for, developing, removing, or transporting resources from those waters or from the seabed or the subsoil thereof beneath those waters.

"(c) 'Person' means any private person, individual, association, corporation, or entity, or any officer, employee, agent, department, agency, or instrumentality of the Federal Government, of any State or local unit of government.

"(d) 'Offshore coastal waters of the United States' means the high seas beyond the territorial seas of the United States, superjacent to the 'Continental Shelf' of the United States, as the latter term is defined in article I of the Convention on the Continental Shelf (15 U.S.T. 471; TIAS 5578).

"CERTIFICATION

"SEC. 403. (a) No person shall construct or operate a structure until the Secretary shall have certified that the activity involved will not result in an unacceptably adverse impact on the marine environment, and that all possible precautions have been taken to minimize any adverse impact that may result. Certification shall relate to site selection, method and type of construction, and operation of the structure.

(b) The Secretary may give certification, after an adjudication on the record, in accordance with the requirements of subchapter 11, chapter 5, title 5, United States Code, to any such structure upon a showing by the applicant therefor that neither the location, the construction, nor the operation of the proposed structure will pose an unreasonable threat to the integrity of the marine environment, and that all possible precautions have been taken to minimize any adverse impact that may result. Such hearing may be combined with any other required hearing and the Secretary shall coordinate his procedures with those of other involved agencies. The applicant shall submit reasonably detailed plans of the structure at least two years prior to the expected date of the beginning of construction: Provided, That as to those structures which are not in the construction phase on the effective date of this title but nonetheless will reach the construction phase at any time within two years of the effective date, the applicant shall submit plans to the Secretary as soon as possible after this title goes into effect. The Secretary shall establish a reasonable fee to be paid by the applicant sufficient to cover the administrative costs incurred in evaluating an application for certification.

"(c) The Secretary shall establish and apply criteria for reviewing and evaluating such structures, and in establishing or revising such criteria, shall consider, but is not limited in his consideration to, the following:

"(1) the need for siting such structure offshore;

"(2) the effect of such structure on human health and welfare, including esthetic and recreational values;

"(3) the effect of such structure on fish, plankton, shellfish, and wildlife resources;

"(4) the effect of such structure on the oceanographic currents or wave patterns and upon nearby shorelines and beaches;

"(5) the effect on alternate uses of the oceans and navigable waters, such as scientific study, fishing, and other living and nonliving resources exploitation;

"(6) the dangers to such structure occasioned by waves, winds, and weather and the steps which can be taken to protect against such dangers; "(7) the effect of such structure on navigation; and

"(8) such other considerations which the Secretary deems appropriate or necessary to fully evaluate any structure. In establishing criteria, the Secretary shall consult with Federal, State, and local officials and interested members of the general public, as may appear appropriate to the Secretary.

"(d) In reviewing applications for certification, the Secretary shall make provision for consultation with any Federal agency which has jurisdiction by law or special expertise with respect to any environmental impact involved. Comments of a substantive nature shall be incorporated as part of the certification.

"PUBLIC ACCESS TO INFORMATION

"SEC. 404. (a) Copies of any communications, documents, reports, or information received or sent by any applicant shall be made available to the public upon identifiable request, and at reasonable cost, unless such information may not be publicly released under the terms of subsection (b) of this section.

"(b) The Secretary shall not disclose information obtained by him under this Act which concerns or relates to a trade secret referred to in section

1905 of title 18, United States Code, except that such information may be disclosed

"(1) to other Federal Government departments, agencies, and officials for official use upon request;

"(2) to committees of Congress having jurisdiction over the subject matter to which the information relates;

"(3) in any judicial proceeding under a court order formulated to preserve the confidentiality of such information without impairing the proceedings;

"(4) to the public in order to protect their health and safety after notice and opportunity for comment in writing or for discussion in closed session within fifteen days by the party to which the information pertains (if the delay resulting from such notice and opportunity for comment would not be detrimental to the public health and safety). Nothing contained in this section shall be deemed to require the release of any information described by subsection (b) of section 552, title 5, United States Code, or which is otherwise protected by law from disclosure to the public.

"NAVIGATIONAL EFFECTS

"SEC. 405. (a) In evaluating the effect of any proposed structure on navigation, the Secretary shall consult with and obtain the views of the Secretary of the Department in which the Coast Guard is operating.

"(b) The Secretary of the Department in which the Coast Guard is operating shall have authority to promulgate and enforce such reasonable regulations with respect to lights and other warning devices, safety equipment, and other matters relating to the promotion of safety of life and property on structures referred to in section 303(b) or on the waters adjacent thereto, as he may deem necessary.

"(c) The Secretary of the Department in which the Coast Guard is operating may mark for the protection of navigation any such structure whenever the owner has failed suitably to mark the same in accordance with regulations issued hereunder, and the owner shall pay the cost thereof. Any person who shall fail or refuse to obey any of the lawful rules and regulations issued hereunder shall be guilty of a misdemeanor and shall be fined not more than $500 for each offense. Each day of the continuing violation shall constitute a separate offense.

"RELATIONSHIP TO OTHER LAWS

"SEC. 406. No action taken pursuant to this title shall relieve, exempt, or immunize any person from any other requirements imposed by Federal, State, or local laws, regulations, or ordinances, including, but not limited to, the National Environmental Policy Act of 1969, as amended.

"PENALTY

“SEC. 407. (a) Any person subject to the jurisdiction of the United States who, after the effective date of this title, begins to construct, constructs, or operates a structure without a certification as required herein shall be liable to a civil penalty of not more than $50,000, to be assessed by the Secretary. Each day of a continuing violation shall constitute a separate violation.

“(b) No penalty shall be assessed under this section until the person charged has been given notice and an opportunity to be heard. Upon failure of the offending person to pay an assessed penalty, the Attorney General, at the request of the Secretary, shall commence action in the appropriate district court of the United States to collect the penalty and to seek such other relief as may be appropriate.

**(c) The district courts of the United States shall have jurisdiction to enjoin the construction or operation, or both, of any structure which has not been certified as required by this title.

(d) The injunctive relief provided by this section shall not restrict any right which any person (or class of persons) may have under any statute or common law to seek enforcement of or compliance with any standard or limitation or to seek any other relief (including relief against the Secretary).