American Oil and Gas Reporter - February 2017 - 23

environmental protection plan."
BLM notes its 2008 rule required a
commercial oil shale operation to pay a
5.0 percent royalty during its first five
years of production, increasing by 1.0
percent a year beginning in year six to a
maximum of 12.5 percent in year 13.
The new rule, the agency says, keeps
the annual escalator clause for years 612, but allows the secretary to set the
initial rate on a lease-by-lease basis.
"This allows (DOI) to consider all
relevant factors, including geology,
technology, costs, and market prices for
oil and gas," the agency explains. "Until
there is a commercial domestic oil shale
industry, we only can speculate about
what royalty rates those factors would
support. There are foreseeable
circumstances in which a 5.0 percent
royalty rate could be appropriate and
others in which that rate would be too
low." ❒

Obama White House Sets
Vehicle GHG Standards
WASHINGTON-In its last week in
office, the Obama administration
announced carbon pollution standards
for automobiles and light trucks would
remain unchanged through 2025.
Gina McCarthy, administrator for the
U.S. Environmental Protection Agency,
says the final determination finds that a
wide variety of effective technologies
are available to reduce greenhouse gas
emissions from those vehicles, and that
automakers are well positioned to meet
federal standards through model year
2025 at lower costs than predicted.
The standards are projected to result in
average fleetwide consumer fuel
economy sticker values of 36 miles a
gallon by model year 2025, 10 mpg
higher than the current fleet average, EPA
says. McCarthy says the government's
corporate average fuel economy (CAFE)
goals are 54.5 mpg for light-duty
vehicles, which it says translates to the
"sticker figure" of 36 mpg.
"The administrator is retaining the
current standards to provide regulatory
certainty for the auto industry, despite a
technical record that suggests the
standards could be made more
stringent," EPA says.
Oklahoma Attorney General Scott
Pruitt, President Trump's nominee to
head the EPA, said in his confirmation
hearing that the new administration will
review the agency's actions. According
to media reports, automakers have been
lobbying for an extension of the
emissions review process to 2018.

The Heartland Institute says the
decision by the Obama White House to
finalize the CAFE standards is
irresponsible and harmful to U.S.
workers and consumers.
"These standards were supposed to
be reviewed in April 2018 to determine
the feasibility of the rules," the institute
says. "EPA's decision to implement
them now is nothing more than an
obvious bad-faith attempt to throw up as
many hurdles to the incoming
administration as possible. It also will
force Americans into smaller, more
expensive cars that they do not want." ❒

California Wells To Stop
Wastewater Injections
SACRAMENTO-California ordered
475 wastewater injection wells in 23
fields to stop operating by Feb. 15, part
of the state's response to the U.S.
Environmental Protection Agency's
examining injections into potentially
nonexempt aquifers. The state Division
of Oil, Gas, and Geothermal Resources
says it will enforce that deadline while
allowing injections to continue for
1,650 wells in 29 fields, pending EPA
approval.
According to the California
Independent Petroleum Association,
DOGGR continues its analysis of shutin wells and depending on those
investigations, requests for approval
could be sent by the state to EPA. CIPA
adds it has attended aquifer exemption
hearings for fields where EPA has
requested boundary updates, testifying
in support of oil production through the
use of injection wells, which it says
have operated without incident for
decades.
The federal government considers an
aquifer an underground source of
drinking water (USDW) if its water
contains less than 10,000 milligrams a
liter of total dissolved solids, EPA
states. Many aquifers underlying oil
fields have water below this threshold
but are unsuitable for drinking or
irrigation because the water contains oil
or gas. EPA requires those oil reservoirs
to be formally exempted from USDW
status before it will permit injecting
produced water from oil operations.
EPA says it gave DOGGR primacy
for regulating oil field injections in
1982, but several years ago the two
agencies revised the process by which
aquifers are considered for exemption.
Operations were required to submit
updated applications to inject produced

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