Industry Cheers Methane Rules Pause Despite New Uncertainty

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By David Schultz

The energy industry is cheering the EPA’s plans to place a two-year hold on an Obama-era methane regulation despite any additional uncertainty the pause may introduce.

If the Environmental Protection Agency enacts this proposal (RIN:2060-AT59), oil and gas drillers will be able to avoid complying with several aspects of the regulation, which requires them to significantly increase their monitoring of leaking methane, a potent greenhouse gas. The agency wants to pause the rule for at least two years while it weighs whether to repeal it altogether.

Before the two-year stay can go into effect, the EPA will have to formally propose it in the Federal Register, and then solicit and analyze comments on it from the public. Late last month, the EPA placed this rule on hold for 90 days, a move it could take without having to go through this formal rulemaking process.

Additionally, the Bureau of Land Management also announced (RIN:1004-AE14) that it is delaying compliance deadlines for a separate rule that governs methane emissions from wells on federal lands.

Uncertainty?

Some of the monitoring provisions of the EPA regulation were scheduled to take effect earlier this month. But with this new proposal, it’s unclear if oil and gas companies will ever have to comply with them.

Lee Fuller, one of the leaders of a trade association that represents small drilling operations, said this regulation was so onerous on the oil and gas industry and would have forced so many wells to shutter that any attempt to nullify it is welcome, regardless of the uncertainty it may cause in the short term.

The regulation “was creating certainty, but it was a certainty of a loss of production down the line,” Fuller, vice president of the Independent Petroleum Association of America, told Bloomberg BNA. “If you’re going to do a program, do it right, and [the EPA] haven’t done it right.”

Kathleen Sgamma, head of Western Energy Alliance, said in a statement that the regulation “kills jobs and economic growth needlessly,” but that well operators would continue to capture methane emissions due to market forces.

Litigation

Even before this latest move, environmental groups had taken the EPA to court over its 90-day stay of the methane regulations ( Clean Air Council v. Pruitt, D.C. Cir., No. 17-1145, 6/5/17 ).

The groups, which include the Sierra Club, have filed an emergency motion asking the court to invalidate this initial stay on the regulations. The EPA has until 4 p.m. ET June 15 to file a response. The Sierra Club has received funding from Bloomberg Philanthropies, the charitable organization founded by Michael Bloomberg, founder of Bloomberg L.P. Bloomberg BNA is an affiliate of Bloomberg L.P.

Joel Minor, an attorney with the group Earthjustice who is representing the plaintiffs in the suit, said he hopes the court rules on this motion soon, given the role methane emissions play in contributing to air pollution.

“This is an emergency summer ozone season upon us,” he told Bloomberg BNA. “This summer is really a key time to prevent air pollution that causes people to have heart attacks and asthma. We hope that court will rule very promptly so [the methane regulation] can go fully into effect.”

To contact the reporter on this story: David Schultz in Washington at dschultz@bna.com

To contact the editor responsible for this story: Rachael Daigle at rdaigle@bna.com

For More Information

A copy of the EPA's upcoming Federal Register notice proposing a two-year stay is available at http://src.bna.com/pRT.

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