American Oil and Gas Reporter - June 2018 - 30

Groups Urge Methane Rule Changes
DENVER-Proposed changes to the
2016 Methane and Waste Prevention Rule
more accurately capture the scope of federal waste minimization authority and
will better ensure federal mineral interests
are protected adequately without excessive
burdens, the Western Energy Alliance
and Independent Petroleum Association
of America assert. They add other changes
will improve the regulation further.
The methane and waste prevention rule,
published Nov. 18, 2016, sought to reduce
gas waste on onshore federal and Indian
leases from venting, flaring or leaks; clarify
when lost gas was subject to royalties;
and clarify when oil or gas production
could be used royalty-free. It became partially effective Jan. 17, 2017, with most of
its requirements phased in on Jan. 17,
2018, or later (AOGR, July 2017, pg. 30).
President Trump issued an executive
order on March 28, 2017, directing review
of the rule and its suspension, revision or
termination, if appropriate.
The Bureau of Land Management says
it plans to revise the regulations "in a
manner that reduces unnecessary compliance burdens, is consistent with BLM's

30 THE AMERICAN OIL & GAS REPORTER

existing statutory authorities, and re-establishes long-standing requirements that
the 2016 final rule replaced."
The agency adds that, in addition to
requesting comments on the proposed
rule change, it is seeking public input on
ways that it can reduce natural gas wastage
by incentivizing capture, reinjection or
beneficial use.
According to the Alliance and IPAA,
the 2016 rule, as promulgated, exceeds
BLM's statutory authority under the Mineral Leasing Act. They point to a decision
issued by the U.S. District Court for the
District of Wyoming, which criticized
the agency for hijacking the U.S. Environmental Protection Agency's authority
under the guise of waste management.
BLM stated the primary goal of the
2016 rule was to reduce methane emissions
from oil and gas operations, and during
the rule-making process, the bureau emphasized that those reductions justified
the rule's provisions. The Alliance and
IPAA point to the Wyoming court's finding
that BLM's authority to regulate oil and
gas development is limited to preventing
waste, and thus it lacks any authority to

regulate air quality. They note the court
also has made clear that the Clean Air
Act expressly grants EPA and the states
the mission to protect air quality.
"Under the MLA, produced gas is
'wasted' only if it could have been economically captured and marketed or put
to beneficial use on the lease. Thus, to establish that a proposed waste prevention
measure is a 'reasonable precaution' against
'waste' and authorized under the MLA,
BLM must demonstrate that the gas can
be economically captured by the operator
or beneficially used on the lease. If a
waste prevention measure renders gas capture or use uneconomic, then BLM has no
authority to impose it," the groups write.
The groups also say the bureau's revisions are premised on flawed assumptions
that include substantially overstated emissions reduction projections, and include
requirements that overlap with federal
and state requirements and regulations.
BLM Revisions
BLM acknowledges the 2016 rule has
requirements that overlap with federal and
state rules, but it says unlike EPA regula-
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