Reported / Citable
Background
The Deepwater Port Act requires a federal license to construct or operate a deepwater port. After receiving an application, the Secretary of Transportation must designate an “application area” encompassing the proposed deepwater-port site. Because the statute permits only one deepwater port in an application area, competing proposals within the same area must be evaluated to determine which clearly best serves the national interest.
The Maritime Administration approved Texas GulfLink, LLC’s proposed oil-export port off the Texas coast after defining its application area as a circle around its offshore platform and excluding its proposed pipeline to shore. Citizens for Clean Air & Clean Water in Brazoria County, known as Better Brazoria, petitioned for review, arguing that the pipeline had to be included and that the properly drawn area would overlap the pipeline of the previously approved SPOT project.
The Fifth Circuit first confirmed Better Brazoria’s associational standing. A member who lived near Texas GulfLink’s proposed tank farm and pipeline identified concrete concerns involving flooding, well-water pollution, noise, light, traffic, road deterioration, aesthetics, and property value, and vacating the approval would redress those threatened injuries.
The Court’s Holding
The Fifth Circuit held that the Deepwater Port Act requires an application area to encompass the entire proposed deepwater-port site, including pipelines located seaward of the high-water mark. The statute expressly defines a “deepwater port” to include its components and equipment, including pipelines, and the requirement that an application area “encompass” the port site establishes a minimum boundary. Although the agency retains discretion to select a reasonable area within the statute’s maximum geographic limit, it cannot exclude part of the statutorily defined port.
Properly drawn, Texas GulfLink’s application area would intersect SPOT’s planned pipeline and therefore contain parts of two deepwater ports, contrary to the Act’s one-port-per-application-area requirement. The court concluded that the approval was not in accordance with law, granted Better Brazoria’s petition, vacated the record of decision approving Texas GulfLink’s application, and remanded for further proceedings.
The court declined to remand without vacatur. MARAD’s erroneous designation occurred early in the licensing process, affected a fundamental procedural requirement, and could not merely be corrected or justified while leaving the approval intact. Because the statutory issue resolved the petition, the court did not address Better Brazoria’s separate argument that MARAD inadequately explained its departure from its earlier application-area methodology.
Key Takeaways
- A Deepwater Port Act application area must encompass offshore pipelines that are components of the proposed port.
- MARAD may exercise geographic discretion only within the statutory minimum and maximum boundaries for an application area.
- Overlapping application areas implicate the Act’s requirement that only one deepwater port be approved within each area.
- Vacatur remains the default remedy when an agency’s licensing decision rests on a serious statutory defect that cannot be cured while the approval remains effective.
Why It Matters
The decision limits MARAD’s discretion when defining application areas and may require competing deepwater-port projects to undergo the Act’s comparative national-interest process when their offshore pipelines overlap. Agencies cannot avoid that process by drawing application areas solely around loading platforms.
The opinion also illustrates post-Loper Bright judicial review: the Fifth Circuit independently selected what it considered the best reading of the statute without deferring to MARAD’s interpretation.