Environment Law - Court of Appeal gives broad meaning to "landfill"

The case reported deals with the question of whether the disposal of hazardous liquid waste into deep sandstone strata from which oil had been extracted constitutes landfill of that waste. It shows that the courts are continuing to take a broad and purposive approach to the interpretation of EU waste law.

Court of Appeal gives broad meaning to "landfill"

The judgment of the Court of Appeal in the case of Blackland Park Exploration Limited v Environment Agency [2003] EWCA Civ 1795 dealt with the question of whether the disposal of hazardous liquid waste into deep sandstone strata from which oil had been extracted constitutes landfill of that waste. The Court of Appeal ruled that the disposal does constitute landfill and therefore that the activity is illegal by virtue of the complete ban on disposal of liquid waste to landfill that came into force on the 16th July 2002.

The case shows that the courts are continuing to take a broad and purposive approach to the interpretation of EU waste law. The issue in question in the case was the legality of the disposal of hazardous liquid waste into underground strata. The key arguments and reasoning of the Court of Appeal on that issue are addressed in the first part of this article. The Court also touched on the issue of re-injection of produced water into the deep strata from which it had been extracted. This article comments briefly on the views put to the Court and whether they have any significance for re-injection of produced water off-shore or for other possible activities such as carbon sequestration.

Background and Issues

Blackland Park Exploration Limited operates an onshore oilfield at Whisby in Lincolnshire. Oil, water and gas is extracted from the production wells and separated out. The oil is transported to a refinery, the gas is flared and the produced water is re-injected down a re-injection well into the oil-bearing strata. Blackland Park also was taking payment to accept liquid hazardous waste onto the site which it also injected down the re-injection well into the deep sandstone strata. The parties asked the Court to confirm whether or not the disposal of the liquid waste by injection into the sandstone strata constitutes landfill for the purposes of the Landfill (England and Wales) Regulations 2002 (Landfill Regulations) which implement Directive 99/31/EC on the landfill of waste (Landfill Directive) and therefore whether the activity is illegal by virtue of the complete ban on the disposal of liquid waste to landfill after 16 July 2002 contained in that legislation.

Is disposal of liquid waste by injection into strata landfill and therefore prohibited?

Blackland Park argued that regulating the disposal of the liquid waste as landfill and therefore banning it does not further the objectives of the Landfill Directive which are really aimed at landfills in the classic sense of the "municipal tip". Therefore it sought to persuade the Court that the Landfill Regulations should be interpreted narrowly. The Court rejected this argument and agreed with the Environment Agency that prohibiting the disposal is consistent with the purposes of the Landfill Directive which are broadly to control the disposal of waste so as to protect the environment and human health.

Blackland Park also argued that the direct discharge of listed substances to groundwater is governed and in these circumstances permitted under Directive 80/68/EEC on the protection of groundwater against pollution caused by certain dangerous substances (Groundwater Directive) and the Groundwater Regulations 1998. It argued therefore that the disposal is already regulated and that it would be inconsistent with the Groundwater Directive to ban the liquid waste disposal activity. Again the Court disagreed. It pointed out that the liquid waste disposal was already regulated under a waste management licence held by Blackland Park and that the Landfill Directive merely constituted a tightening of the law on the landfill of waste. It stated that the law on groundwater pollution and disposal of waste do overlap and are not intended to be mutually exclusive. Therefore it considered that if the disposal of the liquid waste falls into the wording of the Landfill Regulations it is not inconsistent for it to be governed by that legislation.

The key issue was therefore the definition of "landfill" in the Landfill Regulations: "…landfill is a waste disposal site for the deposit of the waste onto or into land". The Court was in no doubt that Blackland Park was operating a "waste disposal site" but considered in more detail the question of whether the activity involves the deposit of waste into land.

Having examined the Landfill Directive and the Landfill Regulations the Court stated its view that both must be interpreted broadly. Blackland Park argued that discharging liquid waste to groundwater is not a landfill activity. However, the Court confirmed that a landfill can be on or beneath the surface of the land and disagreed with Blackland Park's suggestion that the waste was being "discharged" and not "deposited". It took the view that the word "deposit" does not imply placing into a controlled medium and the fact that the liquid waste would mix with other water in the underground strata does not mean that it has not been deposited.

Finally Blackland Park tried to argue that the waste acceptance criteria for landfills set out in Council Decision of 19 December 2002 and the General Requirements for All Classes of Landfills in Annex II of the Landfill Directive do not really apply to the disposal of liquid waste and therefore the Landfill Directive cannot have been intended to regulate that activity. However, the Court pointed out that this argument puts the cart before the horse. Given that the Landfill Directive expressly prohibits disposals of liquid waste it is logical that no waste acceptance criteria or general requirements relevant to liquid waste should be included.

What about produced water?

The Court was not asked to rule on the issue of whether the re-injection of produced water also falls foul of the ban on disposal of liquid waste to landfill in the Landfill Directive and Landfill Regulations. Nevertheless the Court noted that the Environment Agency and Blackland Park agreed that the ban does not apply and re-injection of produced water can continue at the oilfield but did not agree why, from a legal point of view, that is so.

The Environment Agency submitted that the produced water is not waste. It formed its view by applying the European Court of Justice's reasoning in its judgment on the definition of waste in Case 9/00 Palin Granit Oy. The Environment Agency reasoned that the produced water is a production residue that, following the three criteria identified in that case: (1)

is always re-injected into the oil bearing strata; (2) is not subjected to any further processing prior to its reuse by re-injection; and (3) is re-injected to maintain the oilfield's pressure and is therefore an integral part of the production process.

Blackland Park submitted that the produced water does fall under the EU definition of waste but is excluded from the scope of the Framework Directive on Waste (75/442/EEC (as amended)) and consequently the UK definition of Directive Waste on the basis that it is waste resulting from prospecting, extraction, treatment and storage of mineral resources which at the time of the Framework Directive on Waste was already covered by other legislation. Blackland Park appears to have submitted that that other legislation is the Groundwater Directive.

Both arguments appear to have some merit but are both based on the thorny issue of the EU definition of waste and the exclusions from the Framework Directive on waste. There is not space in this article to try and analyse the two arguments. However, it is worth commenting on a point on the Water Framework Directive (2000/60/EC) raised by Blackland Park in the case that does seem to add weight to an argument that produced water is not intended to be regulated by waste legislation. Blackland Park pointed out that the Water Framework Directive, which will eventually replace the Groundwater Directive, expressly permits Members States to authorise, subject to conditions, the "injection of water containing substances resulting from the operations for exploration and extraction of hydrocarbon or mining activities, and injection of water for technical reasons into geological formations from which hydrocarbons or other substances have been extracted or into geological formations which for natural reasons are permanently unsuitable for other purposes. Such injections shall not contain substances other than those resulting from the above operations". Despite the comments of the Court that the law on waste and the law on groundwater pollution are not meant to be mutually exclusive it would seem to be contrary to the intention of the EU in adopting the Water Framework Directive if the re-injection of produced were held to be prohibited liquid waste disposal by landfill.

Trying to apply this judgment and any arguments on produced water to the offshore industry adds the further complication of establishing whether the relevant EU directives are intended to apply off shore. If it is assumed that all the legislation applies equally off shore, the arguments mentioned above that re-injection of produced water is not subject to waste legislation appear to apply equally. However, if the courts are asked to rule on the issue of reinjecting liquids they are likely to focus on the true purpose of the activity in any case. As for carbon sequestration it is hard to apply the same arguments that were made to the Court in relation to produced water

so if the carbon is controlled waste then a landfill permit might be required for that particular activity.

For further information please contact Daniel Chappell on +44 (0) 20 7367 2810 or [email protected] [email protected]