American Oil and Gas Reporter - April 2015 - 157

ConventionCoverage: Louisiana Oil & Gas Association
a rule separate from a law that Congress
has passed and the president has signed
in public view, the REINS Act says a
new rule with an economic impact must
be affirmed by the peoples' elected representatives," he detailed. "The House
passed the REINS Act last year, but it
never came up in the Senate. The Senate
is going to take it up this year, so we are
reworking it and, ultimately, are going
to send a very bipartisan bill to the president's desk."

Visiting before the LOGA convention's state agency panel are, from left, LOGA Chairman
Bryan Hanks, Louisiana Treasurer John Kennedy, Department Natural Resources Secretary
Stephen Chustz, Department of Revenue Secretary Tim Barfield and Conservation Commissioner James Welsh. Also participating in the panel was Louisiana Department of Environmental Quality Secretary Peggy Hatch, who indicated that a tighter federal ozone
standard probably would put a number of Louisiana communities out of compliance.

low midrange in the low $50s for twothree years," he illustrated.
As for natural gas, Stuart suggested
the market was much too oversupplied.
"We had a nasty winter in which the
Northeast used a boatload of gas, and yet
the front-end price is $2.80," he observed.
"I strongly suspect the long-run gas price
of $4.50 is too high because you guys
are too good at your jobs. I don't think
you need a whole lot more than $4.00 to
make the Haynesville worthwhile."
The Haynesville has an opportunity
to supply some of the liquefied natural
gas export terminals under construction
along the Gulf Coast, Stuart reasoned.
Nevertheless, he cautioned against placing
too much faith in optimistic Asian gas
demand projections. "If you cut them in
half, then cut them in half again, you
probably are still too high by a factor of
two," he asserted. "Why would you grow
your economy on the most expensive
molecule available? That said, there are
alternatives such as Thailand and others
that will keep importing LNG. Some of
that LNG will come from here."

Regulatory Fog
U.S. House Majority Whip Scalise
acknowledged the contribution of oil and
gas to the Louisiana and national
economies, as well as the industry's
myriad challenges, including the U.S.
Army Corps of Engineers' slow permitting

process, Endangered Species Act abuses,
and the export ban on U.S. crude oil.
Their respective responses to the Deepwater Horizon incident contrasted the industry's efficient agility with federal regulators' ponderous tendencies, he suggested. "Your industry moved quickly.
It recognized a problem with the blowout
preventer design, and you took it on
yourselves to redesign BOPs," he praised.
"Today's BOPs are different than those
of 2010, but the federal government still
has not put out its regulations. The industry
only wants to know the rules. You are
making investments while wondering
what the federal government will do,
which has missed deadline after deadline."
Scalise pointed to bipartisan congressional efforts to streamline LNG export
terminal permitting as one way in which
Congress was trying to light a fire under
federal regulators. "The government would
have a shot clock," he posited. "If regulators need information from you, they
tell you they need it in 30 days or you
could be fined or lose your permits. Why
should the government not have the same
level of accountability and responsibility?"
Congress also is seeking to add accountability through proposals such as
the Regulations from the Executive in
Need of Scrutiny (REINS) Act, HR 367,
Scalise said. "If a federal agency proposes

Noxious Standard
Harbert from the U.S. Chamber pointed
to the Environmental Protection Agency's
proposed National Ambient Air Quality
Standard for ozone as the epitome of
regulatory overreach. "EPA admits this
is the largest, most expensive regulation
the country ever will enact," she related.
"It goes into effect in October. Areas out
of compliance lose federal highway funding and will not be permitted to build
anything new. Talk about putting the
brakes on the economy."
If the Obama administration lowers
the ozone NAAQS, Harbert vowed the
Chamber would battle it in court. "Hopefully, we will get some reprieve like we
did last time," she compared. "Before
the 2012 elections, President Obama
pulled this regulation from the docket
because he said it was too expensive."
Moreover, she emphasized, even some
of the president's top congressional allies
are likely to urge the EPA to show
restraint. The proposed standards' lower
range would put Clark County, Nv., out
of compliance. "That will mean no new
roads or expansion in Las Vegas," she
noted. "That is going to drive (Senator)
Harry Reid, D-Nv., crazy."
During LOGA's agency panel, DEQ
Secretary Hatch noted that five Louisiana
parishes only recently had met EPA's 75
parts per billion ozone standard. Now,
EPA is considering dropping the limit to
either 65 or 70 ppb. "If it goes below 75
ppb, those parishes will go back into
nonattainment," she responded. "If it goes
below 70 ppb, data from 2012-14 indicate
an additional 17 parishes potentially will
be in nonattainment."
Hatch said the affected Louisiana cities
would include Baton Rouge, Metairie,
Shreveport, Lake Charles, Lafayette and
Houma.
During his remarks on the agency
panel, Commissioner Welsh updated his
office's handling of legacy lawsuits as
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