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BLM proposes new waste prevention rule
Proposes to roll back Obama administration regulations aimed at limiting wastage though venting, flaring of gas on federal land
Alan Bailey Petroleum News
On Sept. 18, a few days after the U.S. Department of Energy proposed softening Obama era rules for reducing gas leakage from oil and gas wells and compressors, the Bureau of Land Management proposed rolling back the Obama administration’s regulations aimed at limiting waste through the venting and flaring of gas from oil and gas operations on federal land.
Both of the original rules, introduced in 2016, had objectives of reducing methane and carbon dioxide emissions from oil and gas activities, as part of a regulatory approach to limiting U.S. greenhouse gas emissions. Methane, the main component of natural gas, is a potent greenhouse gas. The flaring of natural gas also causes carbon dioxide emissions. And leakage, flaring and venting result in the wastage of hydrocarbon resources that might otherwise be put to productive use.
The new actions under the Trump administration come as part of the administration’s efforts, in the interests of boosting U.S. energy development and production, to eliminate what it sees as regulation that is unnecessarily burdensome on industry.
“Sadly, the flawed 2016 rule was a radical assertion of legal authority that stood in stark contrast to the longstanding understanding of Interior’s own lawyers,” said Interior Deputy Secretary David Bernhardt. “The Trump administration is committed to innovative regulatory improvement and environmental stewardship, while appropriately respecting the clear and distinct authorities of the states, tribes, as well as the direction we receive from Congress.”
Limits on flaring and venting The 2016 rule placed limits on the amount of gas flaring per development well. It required operators to evaluate opportunities for methane capture and to prepare a methane waste management plan prior to development drilling. Operators would be required to instigate an instrument-based leak detection program to find and repair leaks. And there would be a complete prohibition on the venting of methane, except under some narrowly specified circumstances such as emergency situations or to meet equipment limitations.
In Alaska the rule only applies on federal land, in particular in the National Petroleum Reserve-Alaska. However, oil and gas wells in Alaska, including those on federal lands, are already subject to strict rules enforced by the Alaska Oil and Gas Conservation Commission and the Alaska Department of Environmental Conservation, to prevent the wastage of hydrocarbon resources and avoid air pollution. Those rules include a prohibition of methane flaring or venting, other than in small volumes for specific allowed purposes.
In 2017 BLM issued a notice, postponing implementation of some parts of the rule, but in October a federal judge declared that notice to be in violation of the Administrative Procedures Act. Then, in February, the BLM announced that it was developing a new rule that would, in essence, roll back the 2016 rule. BLM has now announced that new rule, with a 60-day public comment period, once the rule has been published in the Federal Register.
BLM: costs exceed benefits In its newly published rule BLM says that it had reviewed the 2016 rule and determined that the rule would impose costs that exceed its benefits, with the compliance costs exceeding the value of the natural gas that would be conserved. Moreover, the rule would render many marginal wells uneconomic, and would impose unnecessary burdens on operators and the BLM, the agency determined.
Essentially, the new rule replaces the 2016 rule with regulations that are broadly similar to those in place before the 2016 rule came into force. The new rule rescinds requirements relating to waste minimization plans; well drilling; well completions; pneumatic controllers and pumps; storage vessels; and leak detection and repair. The rule modifies or replaces regulations relating to gas capture; downhole well maintenance and liquids unloading; and the measuring and reporting of gas vented and flared.
The new rule discourages the venting and flaring of gas by placing limits on the amount of royalty-free venting and flaring during well production testing, emergency situations, and downhole well maintenance and liquids unloading, BLM says. The new rule does retain provisions in the 2016 rule that encourage the beneficial use of gas through making the use of gas royalty-free for operations and production purposes. However, the new rule rescinds regulations relating to gas emissions from certain types of equipment such as pneumatic equipment and storage tanks.
BLM says that many of the provisions rescinded from the 2016 rule are already covered by regulation by the Environmental Protection Agency under the terms of the Clean Air Act.
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