American Oil and Gas Reporter - August 2017 - 94

ConventionSection: Kansas Independent Oil & Gas Association

Markets, Rules Rollback
Hint At Good News
By Dan Holder

MISSION, KS.-Recovering oil and
natural gas prices support a renewed feeling of optimism in the industry, although
U.S. shale play production could undercut
that positive mood, assesses Nick Powell,
chairman of the Kansas Independent Oil
& Gas Association.
"The mood for KIOGA members will
be, if anything, cautiously optimistic,"
judges Powell, president of Missionbased Colt Energy. "It is tough with how
much oil these shales can produce. Part
of it is Wall Street keeps putting money
into the shale plays, even though at the
current price it is tough for producers to
make any money."
Tips for responding to market prices
using hedges will be among the presentations at KIOGA's annual convention,
set for Aug. 13-15 at the Hyatt
Regency/Century II Convention Center
in Wichita, Ks.
Powell points to the White House as
another reason for confidence in improved
prospects for oil and gas operations, as
the Republican presidential administration
continues to push for fewer federal regulations.
"The administrative branch is moving
toward a more favorable position with
Trump in the White House, but our problem is that Trump will not always be in
the White House," he assesses. "Eventually, it will go back to someone who is
friendlier to the environmentalists. We
need rules that give the power to make
laws permanently back to Congress, where
it belongs."
KIOGA President Edward Cross points
to problems with hiring at federal agencies
that are tasked to carry out President
Trump's policies. "Right now, the previous
administration's staff members still are
in those positions," he says. "Although
the people at the Cabinet secretary level
will listen to industry's concerns, when
they step in on the first day, it is not like
they can clean house throughout the
agency and start all over. It will take
some time to make those changes."
As the White House makes policy
94 THE AMERICAN OIL & GAS REPORTER

and personnel adjustments, Cross points
to industry groups, including the Domestic
Energy Producers Alliance, as crucial
components of advancing the industry's
message. He describes the Alliance as an
important information source for the
Trump Leadership Council that advises
the president on the needs and concerns
of the business sector. Cross, one of
DEPA's representatives on the council,
says it allows small oil and gas producers
a chance to be heard in Washington.

Methane Regulations
Cross says KIOGA also is involved
in a multiassociation effort that supports
the White House's push to rewrite regulations governing methane emissions from
new oil and natural gas wells.
On June 6, several anti-development
groups filed a petition in the U.S. Court
of Appeals for the District of Columbia
seeking to overturn the two-year stay intended by the Trump administration,
claiming the U.S. Environmental Protection Agency violated federal laws in not
providing public notification or opportunity
to comment (AOGR, July 2017, pg. 30).
Less than a month after the agency announced it would stay those emissions
regulations for 90 days, the U.S. Court
of Appeals for the District of Columbia
ruled EPA lacked authority for such a
step, Cross says.
"In its July 3 decision, the court also
mandated the rule be enforced, but it did
leave the door open a little," he describes.
"When EPA announced it was going to
reconsider the rule, it also said it wanted
a two-year administrative stay. So, the
court left the door open for EPA to continue on that. On July 7, EPA filed a motion to recall that mandate that the court
issued four days earlier," (see related
story, page 28).
KIOGA has joined with 18 other oil
and gas associations to help shape future
methane emission regulations, Cross says,
adding KIOGA supports the EPA's filing
of a motion to recall the mandate.
According to media sources, following
the July 3 ruling that EPA could not suspend the methane emissions regulations,

on July 13, the D.C. court ruled in favor
of a 14-day delay to allow EPA to consider
its legal options
Powell points to the possibility that
politics influenced that July 3 ruling,
with the two judges voting against the
suspension appointed by Democratic presidents and the lone judge favoring the
agency's move a Republican presidential
selection.
"That ruling throws the regulation
back to the agency, but the statement the
judges made was a bit confusing," Powell
notes. "It essentially said 'we can see a
way that you can get this back to where
you want to, but you have to go do that.'
I know they are still trying to figure out
what the decision means."

Sue And Settle
Legislation to limit sue-and-settle policies may emerge in Congress later this
year, Cross says, adding EPA Administrator Scott Pruitt has expressed a desire
to move his agency away from those
agreements.
Powell says he calls the practice of
closed-door settlement agreements with
groups filing lawsuits "environmental
cronyism," noting both the EPA and U.S.
Fish and Wildlife Service have engaged
in it. The House is expected to begin debates on adding requirements for public
comments before sue-and-settle agreements are accepted, he says.
In addition, Powell says he is watching
congressional actions to impose more
control over the regulatory process. He
points to S 21, Regulations in Need of
Scrutiny Act of 2017, introduced by Senator Rand Paul, R-Ky., as one solution to
executive branch regulatory excess.
According to the congressional website,
S 21 would require congressional approval
of every new regulation that has an impact
of $100 million or more. It also requires
information on the new rule to be published in the Federal Register, along with
an analysis of its costs and benefits. A
joint congressional approval must be enacted within 70 legislative days after the
agency proposing the rule submits its report before the rule can take effect.



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