Environmental Quality Board

Agency background

A key component of this regulatory framework – temporary or permanent - is the need to define when a project is subject to mandatory environmental review.

The function of Minnesota’s Environmental Review Program is to provide information about future projects to avoid and minimize damage to Minnesota’s environmental resources caused by public and private actions. The program accomplishes this by requiring certain proposed projects to undergo review, following defined procedures, prior to obtaining needed approvals and permits. Environmental review provides an opportunity for both the public and decision makers to understand the potential for significant environmental effects from a project prior to the project moving forward.

The Minnesota Environmental Policy Act identifies environmental review as a requirement for any project that has the potential for significant environmental effects. The Environmental Quality Board, as administrator of the Environmental Review program, identifies in rule all project types for which environmental review is mandatory. These rules are referred to as the mandatory category rules, and define a threshold for when certain project types, based on the size or scope, may or will have the potential for significant environmental effects. If a project is one listed within the mandatory categories and meets or exceed the thresholds defined by the rules, then environmental review is required.

The mandatory categories can require one of two different levels or processes of review. The Environmental Assessment Worksheet (EAW) process is used to review a project that may have the potential for significant environmental effects. An Environmental Impact Statement (EIS) is the process for reviewing a project that does have the potential for significant environmental effects. The EIS has increased requirements for the level of information provided and analyzed as well as the amount of interaction required with the public. For example, an EIS must include evaluation of alternative scenarios of the proposed project in order to explore methods of reducing adverse environmental effects. Mandatory category thresholds are usually based on project size; EAW thresholds typically align with a smaller size project while an EIS is triggered by a larger project.

A project that meets a mandatory category threshold for an EAW may have the potential for significant environmental effects; it is the role of the environmental review process to identify if the project may lead to actual significant effects or if mitigation efforts and regulatory requirements can allow the project to proceed without the potential for significant environmental effects. If the EAW process identifies that the project does have the potential for significant environmental effects, then the project review will proceed to the EIS process to further analyze the effects from the project compared to potential alternatives.

The rules assign a unit of government – the Responsible Governmental Unit (RGU) – to conduct the review, following standardized public processes to disclose information about environmental effects and ways to minimize and avoid them.

Rationale

Establishing a new mandatory category or requirement for environmental review necessitates understanding the potential for significant environmental effects from a project; defining what size of project and at what phase of development needs review; and identifying an RGU to complete the review.

Draft statutory language: 116D.04 Subd. 16a.

Potential for significant environmental effects:

EQB staff believe that for the duration of a temporary regulatory framework it is appropriate to require an EAW for all gas development projects, recognizing that any projects of this type may have the potential for significant environmental effects. A gas development project may have the potential for significant environmental effects relating to air quality, land use, transportation, noise, and water quality.

Timing for environmental review and defining of gas projects:

Mandatory categories are written to ensure that a project proposer and responsible governmental unit understand what project action triggers environmental review. Construction, expansion, and development are common terms used within the rules to define the need for environmental review at a certain project phase.

The environmental review process needs to ensure that the impacts from a gas project can be properly evaluated prior to permitting, making the timing of the review and its tie to the triggering event important. For many mining or extractive projects, typically exploratory boring is completed to evaluate the subsurface extent of the natural resource that is intended to be extracted. In those cases, the initial exploration may not require environmental review; instead, review may not be required until a more complete mining project plan is needed. In these cases, the environmental impacts are tied much more to the overall project development rather than the initial exploration.

However, gas extraction projects work differently. The drilling of even an “exploratory” well for gas extraction is likely to result in a permanent location, from which the project developer will likely proceed to extract and produce gas (if any gas is found). Therefore, the environmental effects are most closely tied to the initial project steps.

Because of this, the recommendation from the EQB includes the language “gas resource development project” and is intended to ensure environmental review takes place before any drilling, even what might be considered “exploratory drilling”, take place. This language is tied to the gas resources development permit that is being recommended by the Department of Natural Resources (DNR). Those recommendations include the need to obtain a gas development permit before drilling any well.

The existing framework for drilling wells (or exploratory borings) in Minnesota does not require a permit or government approval prior to drilling the well, and therefore does not meet the requirements for environmental review. DNR’s recommendations to require issuance of a development permit prior to drilling a gas well would allow for environmental review to evaluate the potential environmental impacts from the project as a whole, including the drilling of the well and the long-term extraction and production of the gas. If these projects are allowed to proceed following the existing framework for exploratory borings and well notifications, then environmental review will likely not encompass the project as a whole and will only have the opportunity to evaluate a portion of the project before it proceeds to permitting. Gas production is new to Minnesota. Completing an environmental review can be extremely beneficial for a new project type; new project types are likely to raise a lot of questions, and the environmental review process informs the public and decision-makers about a project’s potential environmental impact prior to permitting.

Additionally, requiring an EAW for any gas project as a part of the interim temporary framework allows the EQB and permitting agencies to gather information about potential environmental effects, supporting future work to further develop a mandatory category in rule that includes a scientifically supported size threshold for the type of projects expected to take place in Minnesota.

While EQB staff are not recommending a mandatory EIS threshold for a gas project at this time, the RGU maintains the responsibility to evaluate and decide whether any project going through the EAW process does have the potential for significant environmental effects and will require an EIS.

Responsible Governmental Unit: