American Oil and Gas Reporter - October 2019 - 27

Nine Decades After Uniting,
U.S. Independents Still Tackle
Federal Policy Challenges
Ninety years ago, independent producers came together to
tackle issues that threatened America's oil industry. Independents
accounted for more than 50 percent of U.S. petroleum production,
but were under oppressive financial pressure from rising oil imports.
In June 1929, the federal government was threatening to end
leasing on federal lands. Such were the circumstances under which
the Independent Petroleum Association of America was formed.
As IPAA comes upon its 90th anniversary, the challenges of
1929 seem to linger, but the role of independent producers is
larger than ever. Independents develop 90% of the wells in the
United States-producing 54% of America's oil and 85% of its
natural gas. America's oil and natural gas industry is one of the
prime drivers in a strong economy. Today, American producers
are exporting crude oil, with exports of liquefied natural gas
promising cleaner air for many countries suffering from oppressive
pollution. But independent producers never have the luxury of
sitting back and taking it easy.
Given the implications of regulatory and legislative action
on our industry, IPAA will be holding its 90th Annual Meeting
Nov. 6-8 in Washington. Top independent producers, and
leading service and supply providers, will have the opportunity
to hear from national policymakers to address key issues impacting the industry.
Regulation of methane will be a primary focus, with proposals
from the Environmental Protection Agency and Congress warranting our attention. EPA announced in a Sept. 24 Federal
Register notice a proposed change to target emissions of volatile
organic compounds from the natural gas and oil sector, rather
than methane emissions.
IPAA will be working with members and state oil and gas associations to submit comments on Nov. 25. Nationwide application
of new facility standards to existing sources that would result
under the current regulations would fall overwhelmingly on small
business, low production wells while failing to recognize that the
new source regulatory requirements ultimately will be in place for
all sources over time. This action would impose costly regulatory
burdens without a commensurate environmental benefit. In a
separate matter, EPA is reviewing comments submitted in early
summer on a proposed reconsideration rule making that would
hurt U.S. oil and gas production if improvements are not made
with respect to required leak detection and repair provisions for
fugitive emissions regarding alternative means of emissions limitation-including the use of equivalent state programs, the management
of storage tanks and the treatment of low production wells.
IPAA aggressively upholds independents' ability to operate
on federal lands, both onshore and offshore. However, limitations
or even outright bans on producing from federal lands is a goal
of Democratic presidential candidates as well as Republican
members of Congress. This debate will gain momentum in
advance of the 2020 elections.
Also significant are the proposed clarifications to the Clean
Water Act Section 401. EPA proposed in August to ensure that
Section 401 is not used by states to delay or deny water permits

"As IPAA comes upon its 90th
anniversary, the challenges of 1929 seem
to linger, but the role of independent
producers is larger than ever

for infrastructure development over issues other than water
quality. IPAA will comment in support of these clarifications in
October.
Methane regulation also factors into the discussion of
regulating natural gas gathering lines, based on recommendations
from the Gas Pipeline Advisory Committee to the Department
of Transportation's Pipeline and Hazardous Materials Safety
Administration. IPAA continues to advocate and educate
regulators on the safety of the smaller diameter, low-pressure
rural gathering lines, while promoting active participation by
gathering line operators to ensure these lines are marked for the
public and to prevent damage by third parties. Regulation of
gathering lines also is part of the ongoing congressional debate
on reauthorization of the Pipeline Safety Act.
Growing efforts to thwart new energy infrastructure, such as
pipelines, have included challenges to regulatory decisions from
the Federal Energy Regulatory Commission and other agencies.
The effectiveness of this agency, in particular, is in jeopardy because of vacancies at the commission. Additional commissioners
are needed, particularly as the commission has become more
politically-driven. At IPAA's convention, FERC Chairman Neil
Chatterjee will address these challenges, both within the commission and for industry.
Recently, fossil energy opponents have begun efforts to
suppress capital availability for fossil energy projects. Some of
these efforts involve actions by capital resource businesses to
demand specific environmental commitments that exceed regulatory requirements based on inadequate environmental emissions
information. In some cases, these actions slide into areas where
government policies are involved, such as Securities and
Exchange Commission disclosure requirements and shareholder
initiatives that rely on shareholders' lack of sophistication about
complex issues to exert pressure for certain corporate actions.
The challenges we face have mushroomed, along with our
industry's contribution to our energy supply and economy. Like
90 years ago, independents must work together to educate and
advocate to ensure that these contributions can continue.
❒

SUSAN GINSBERG is vice

president of crude oil and natural gas regulatory affairs for
the Independent Petroleum Association of America. She covers legislation and regulation,
focusing on the CFTC and
FERC. Her experience in natural gas regulatory affairs spans
more than three decades.
OCTOBER 2019 27

American Oil and Gas Reporter - October 2019

Table of Contents for the Digital Edition of American Oil and Gas Reporter - October 2019