Congress looks to gut federal methane rule modeled after Colorado regulations
A natural gas rig in Garfield County just west of Eagle County (David O. Williams photo).
Depending on which side of the issue you talk to — oil and gas industry advocates or members of Colorado’s conservation community — Congress is about to gut crucial and sensible regulations for limiting methane gas emissions on federal lands or strip away onerous midnight Obama administration rules crippling the industry.
The truth is somewhere in between. But one thing is clear: this is a topic well-known to Colorado regulators, who have been limiting methane emissions since 2014 with first-in-the-nation rules to limit leaks, flaring and venting of heat-trapping natural gas. And the Obama rules for U.S. Bureau of Land Management lands, in the works since January of last year, are modeled after that set of Colorado regulations, which the state argues have been effective.
The Obama administration put its BLM rules in place after the surprise Nov. 8 election that installed President Donald Trump, but the federal government had been working on the rules for at least a year. Now Congress is trying to use the obscure Congressional Review Act to roll back the Obama methane rules.
Methane is natural gas, so logically oil and gas companies should be capturing it for sale anyway rather than releasing it into the atmosphere, but often drilling companies are after oil and so the gas is flared or vented because there’s no pipeline capacity to get it to production or natural gas prices are so low it’s simply not worth the effort.
Industry experts argue that instead of requiring methane capture for drilling on leased federal lands, the government should allow more pipelines to be built. Conservation groups counter that the government simply needs to require more of the gas to be captured to keep the air clean and to combat global climate change.
The U.S. House of Representatives on Friday voted 221 to 191 to roll back the BLM methane rules (now the measure is headed to the U.S. Senate), prompting this comment from Conservation Colorado spokeswoman Jessica Goad:
“Congress has taken an extreme action that will undo the progress we have made on clean air here in Colorado by allowing other states to foul our air. Now, all eyes will be on Sen. [Cory] Gardner, who has an opportunity to show whether he stands with Washington, D.C. politicians, or with the Colorado way where the oil and gas industry came together with environmental groups to pass similar rules merely three years ago.”
RealVail.com covered this topic for RouteFifty.com, and an excerpt of that story is posted below. For the full story, which ran in March of 2016, go to the RouteFifty.com website.
Below the excerpt is a fact sheet from Conservation Colorado in support of keeping the federal rules intact, and below that is a press release from the oil and gas industry trade group Western Energy Alliance supporting repeal. Please note that Kathleen Sgamma is now the president of the WEA.
Colorado Methane Rule held up as Model for California, Nation
DENVER — Methane emissions have been a hot topic so far in 2016, not just in the national environmental media but also in the mainstream press with the Aliso Canyon leak and the Obama administration’s concerted push to more stringently regulate the gas.
But in Colorado, a state often out front on fossil fuel production regulations, methane emissions are old news. The Colorado Air Quality and Control Commission in 2014 made the state the first in the nation to seek to limit methane emissions by the oil and gas industry.
Colorado’s methane rules, which compel the oil and gas industry to seek out and stop methane leaks and install equipment to capture 95 percent of methane and volatile organic compounds, are now being held up as a model for the federal government and other states, including California, which was already considering new rules even before Aliso Canyon.
Methane, the main component of natural gas, is 25 times more potent as a heat-trapping greenhouse gas than carbon dioxide, although it doesn’t stay in the atmosphere as long. It’s the second-most prevalent greenhouse gas, according to the U.S. Environmental Protection Agency, and the oil and gas industry is the largest single human-caused source at 29 percent.
Both the EPA and the U.S. Bureau of Land Management have proposed rules similar to Colorado’s aimed at limiting methane emissions from existing and proposed oil and gas production facilities, and the EPA earlier this month expanded its proposed rule. Officials in Colorado have praised the federal government for following in the state’s regulatory footsteps.
“We’re pleased to see that elements of the BLM’s proposed regulations on flaring, venting and leak prevention are modeled from Colorado’s rules, and will minimize the waste of natural gas while reducing harmful emissions,” Colorado Gov. John Hickenlooper said, when the BLM first proposed its new rules in January.
But the Western Energy Alliance, a lobbying group representing oil and gas production companies in 13 western states, does not feel the Colorado methane rules have been worth the money spent by industry to implement them.
“We don’t really believe that Colorado’s rule is necessarily a model for the entire country,” said Kathleen Sgamma, WEA’s vice president of government and public affairs. “States are 50 different independent laboratories … and we certainly don’t agree that it’s a cost-effective method.”
By seeking out and minimizing leakage, “these oil and gas control measures are estimated to reduce [volatile organic compound] emissions by approximately 93,500 tons per year and methane/ethane emissions by approximately 65,000 tons per year, at a cost of approximately $42.5 million per year,” according to the state.
The VOCs are critical as the state grapples with tougher new EPA ozone standards. Methane reduction is key to combating global climate change, according to state officials and environmental groups, which also argue that oil and gas companies directly benefit from keeping methane out of the atmosphere and putting it into production.
“It’s the best bargain in air-pollution reduction today,” said former state lawmaker Dan Grossman, the Rocky Mountain regional director of the Environmental Defense Fund. “Unlike putting a scrubber on a power plant, which is only a cost, these measures put more product in the pipeline and offset a lot of the cost burdens on the operators to begin with.”
Sgamma counters that the state’s estimates are just that, estimates, and even those only equate to a very small amount of methane captured and returned to the production loop.
“What the [state] was claiming would be saved from the regulation comes out to less than a day’s worth of Colorado production—one day’s worth out of a year,” Sgamma said. “That’s the high estimate; it’s less than a day of production, and it’s very unlikely that even that estimate would be met.”
Asked to quantify the amount of methane Colorado’s new rules have kept out of the atmosphere through reduced leakage or venting, Will Allison, the director of the Air Pollution Control Division of the Colorado Department of Public Health and Environment, did not offer a set number. But he did say the program is working.
“Colorado inspectors are finding fewer leaks at oil and gas sites since the state adopted its methane rules in early 2014,” Allison said. “Because Colorado companies are required to find and fix leaks, this has led to improved operation and maintenance in the field.”
Go to RouteFifty.com to read the full story. Here’s the fact sheet from Conservation Colorado:
THE BLM METHANE WASTE PREVENTION RULE
Legislation to undo this rule is an attack against clean air, taxpayers, and the climate
The Bureau of Land Management’s Methane Waste Prevention Rule aims to limit venting, flaring, and leaking of methane — the main component in natural gas — from oil and gas operations on public lands. In doing so, the rule would cut air pollution, prevent waste of a valuable resource and taxpayer dollars, and curb climate change-causing pollution. The BLM estimates the rule would reduce flaring and venting by 49% and 35%, respectively.
The BLM received over 300,000 comments on the rule and it is supported by a wide range of stakeholders, including conservation groups, sportsmen and women, tribal leaders, western congressional delegations, and consumer watchdog groups. The agency also estimates the rule’s net benefits range from $46 – $204 million.
The rule aims to hold oil and gas companies accountable for the pollution they release into the air and their waste of taxpayer-owned resources. Eliminating the rule would allow these companies to continue practices that damage our air and climate and cheat taxpayers out of a fair return.
Here are three things to know about the BLM’s methane waste prevention rule:
Capturing wasted natural gas saves taxpayers money.
The primary goal of the rule is to minimize the waste of state, tribal, and federal taxpayer-owned natural gas. Between 2009 and 2015, oil and gas producers on public and Indian lands vented, flared, and leaked an estimated 462 billion cubic feet of natural gas. An IFC international report found that this is a waste of an estimated $330 million in federal and tribal natural gas resources per year. If implemented, the rule will save enough natural gas to supply energy for up to 740,000 households per year.
According to a recent report by the Western Values Project, without the rule, taxpayers could conservatively lose almost $800 million over the next decade from the venting and flaring of natural gas on public lands. These royalty revenues are crucial tax dollars that help to fund local governments, education programs, and infrastructure projects.
Air pollution from oil and gas facilities can have a significant impact on public health.
Over 50 million Americans live in a county with oil and gas operations that has measured air pollution levels exceeding the federal health standard. When natural gas leaks during production, methane and toxic air pollutants like benzene and volatile organic compounds (VOCs) are released. By reducing the amount of venting and flaring, the rule is expected to reduce VOC emissions by 250,000 – 267,000 tons per year. VOC’s are a pre-cursor to ground level ozone, which poses a real threat to children who suffer from asthma and can affect Americans’ daily lives.
Nationally, there are more than 750,000 summertime asthma attacks in children under the age of 18 due to ozone smog resulting from oil and gas pollution. As a consequence, children miss 500,000 days of school each year from this pollution. Each summer, there are more than 2,000 asthma related emergency room visits and over 600 respiratory related hospital admissions in the U.S. due to ozone from oil and gas pollution. Each year, adults experience 1.5 million days when they are forced to rest or reduce activity due to this pollution. A recent EPA analysis found that there is approximately $260 – $1,100 in monetized benefits from reduced ozone exposure for every ton of VOC reduced. If Congress eliminates this rule, it will be placing the short-term interests of the oil and gas industry over public health.
Reducing methane pollution is critical to stopping climate change from getting worse.
In addition to being a valuable resource, methane is a potent greenhouse gas that traps more than 25 times the heat of carbon dioxide over a 100-year period. The International Panel on Climate Change found that more than 50 percent of the warming in the next two decades will come from short-lived pollutants like methane, making its immediate regulation even more important.
The BLM estimates that the methane waste prevention rule could avoid an estimated 164,000-169,000 tons of methane emissions per year – a reduction of about 35% – and equivalent to 4.1-4.2 million metric tons of carbon dioxide emissions. That is comparable to eliminating the emissions of at least 924,000 vehicles.
And here’s the full press release from the Western Energy Alliance:
Tribal, Business And Local Leaders In Colorado Endorse Repeal Of BLM Methane Rule
Plans to repeal a last-minute Obama administration rule targeting oil and natural gas development on public and tribal lands are winning the support of tribal, business and local leaders in Colorado.
The methane regulation, finalized by the U.S. Bureau of Land Management (BLM) after the 2016 election, has been controversial across the West. Three states – Wyoming, Montana and North Dakota – have sued to stop the “venting and flaring” rule. Western officials are also leading an effort to repeal the methane regulation using the Congressional Review Act (CRA) as part of a broader regulatory reform push.
Methane is the primary constituent of natural gas and the BLM argues the rule prevents waste. But critics of the rule say it imposes overlapping and damaging restrictions on oil and natural gas development on public and tribal lands. Emissions from oil and gas development are already regulated under existing state and federal programs, and higher costs from the extra red tape will harm local economies that depend on energy production, they argue.
Existing regulations “already protect air quality” and the BLM’s methane rule should be abolished, Clement Frost, chairman of the Southern Ute Indian Tribe, said in a statement to Western Wire. The Tribe, located in southwest Colorado, develops oil and natural gas. The new restrictions pose a threat to the local economy and to funding levels for essential services, Frost said.
“The Tribe relies on revenues from Reservation energy development to fund important government services,” Frost said. “BLM’s rule is unnecessary and would further negatively impact the Tribe’s energy development revenue.”
In a Jan. 27 letter to House Speaker Paul Ryan (R), Frost endorsed the CRA disapproval measure, which is expected to get a vote in the U.S. House this week. If it passes the House and Senate, and is signed by the president, the BLM methane rule would be struck down.
Frost also rejected efforts to paint the measure as anti-environment. “[T]he Tribe and our members have long held the view that air quality – and a clean environment in general – are values we hold dear,” he said in the letter to Ryan.
In Colorado, “the oil and gas industry is already the most regulated of any state,” Leah Curtsinger, director of federal policy for the Colorado Association of Commerce and Industry (CACI), told Western Wire. “Continuing to implement the BLM’s venting and flaring rule will negatively affect our restaurants, hotels, home builders, lenders, the companies who supply mechanics and parts, as well as the farmers and ranchers reliant on royalties to supplement incomes,” Curtsinger said.
The Denver-based group “supports the CRA efforts to roll back the BLM’s venting and flaring rule” because it wasn’t approved by Congress and adds “high-cost compliance and heavy-handed government regulations” to one of Colorado’s most important economic sectors.
Methane, or natural gas, is a valuable commodity. But energy producers are sometimes forced to flare or vent some natural gas “for both safety and environmental reasons,” according to the U.S. Energy Information Administration. Even so, the approval and construction of new natural gas pipelines has dramatically reduced venting and flaring in states like North Dakota, the EIA says.
Critics of the BLM rule, including Montana Congressman Ryan Zinke (R) – nominated to serve as the nation’s next Interior Secretary – and New Mexico Gov. Susana Martinez (R), have said building more pipeline capacity on federal lands would be a more effective way to curb methane emissions than an additional layer of federal regulation.
Rio Blanco County Commissioner Shawn Bolton (R) told Western Wire he supports the effort in Congress to repeal the BLM methane rule because “the cost of this rule far outweighs any benefit that we could possibly get out of it.”
Seventy-five percent of the Colorado county he represents is public land “and 85 percent of our tax revenue comes from the extraction industry in one form or the other,” he said. Bolton also serves as the chairman of the public lands committee of Colorado Counties Inc., a non-profit group representing local leaders from across the state.
“Regulation is just getting out of control,” Bolton said. “There’s less and less incentive for these companies to want to drill on BLM land.” The problem is bigger than just the BLM venting flaring rule, he said, but repealing the regulation “would definitely be a step in the right direction.”
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David O. Williams is an award-winning freelance reporter based in the Vail Valley of Colorado, writing on health care, immigration, politics, the environment, energy, public lands, outdoor recreation and sports. His work has appeared in 5280 Magazine, American Way Magazine (American Airlines), the Anchorage Daily News (Alaska), Aspen Daily News, Aspen Journalism, the Aspen Times, Beaver Creek Magazine, the Chicago Tribune, the Colorado Independent (formerly Colorado Confidential), Colorado Politics (formerly the Colorado Statesman), Colorado Public News, the Colorado Springs Gazette, the Colorado Springs Independent, the Colorado Statesman (now Colorado Politics), the Colorado Times Recorder, the Daily Trail (Vail), the Denver Daily News, the Denver Post, the Durango Herald, the Eagle Valley Enterprise, the Eastside Journal (Bellevue, Washington), ESPN.com, the Glenwood Springs Post-Independent, the Greeley Tribune, the Huffington Post, the King County Journal (Seattle, Washington), KUNC.org (northern Colorado), LA Weekly, the London Daily Mirror, the Montgomery Journal (Maryland), The New York Times, the Parent’s Handbook, Peaks Magazine (now Epic Life), People Magazine, Powder Magazine, the Pueblo Chieftain, PT Magazine, Rocky Mountain Golf Magazine, the Rocky Mountain News, Atlantic Media's RouteFifty.com (formerly Government Executive State and Local), SKI Magazine, Ski Area Management, SKIING Magazine, the Summit Daily News, United Hemispheres (United Airlines), Vail/Beaver Creek Magazine, Vail en Español, Vail Valley Magazine, the Vail Daily, the Vail Trail and Westword (Denver). Williams is also the founder, publisher and editor of RealVail.com and RockyMountainPost.com.