BLM’s methane proposal takes cues from Colorado
The Bureau of Land Management on Friday unveiled a proposal that targets methane emissions from oil and gas operations and takes its lead in many respects from Colorado’s groundbreaking rules.
The BLM’s proposal drew widespread praise from conservation and citizen groups and criticism from an industry group that said it’s unnecessary and illegal.
The proposal targets venting, flaring and leaking related to oil and gas development on federal and American Indian lands. It is designed to reduce waste of a valuable resource that’s also a potent greenhouse gas, while ensuring a fair return for taxpayers, tribes and states, the agency said.
“I think most people would agree that we should be using our nation’s natural gas to power our economy — not wasting it by venting and flaring it into the atmosphere,” Interior Secretary Sally Jewell said in a news release.
In 2014, Colorado passed the nation’s first rules specifically targeting methane emissions from oil and gas development.
Among the proposed BLM requirements is leak detection and repair, which Colorado and Wyoming already require and the Environmental Protection Agency has proposed; replacement of “high bleed” pneumatic controllers with “low bleed” ones as Colorado and Wyoming require; and capture or flaring of gas from storage tanks venting more than six tons of volatile organic compounds a year. The latter is similar to an EPA requirement for new tanks and Colorado and Wyoming requirements for new and existing tanks.
Other measures include limits on flaring of oil wells with exceptions for cases such as exploratory wells, and preparation of a gas capture plan as part of well permit applications.
Measures being taken by the BLM and EPA are part of a suite of actions by the Obama administration to try to cut methane emissions from the oil and gas sector by 40 to 45 percent from 2012 levels by 2025.
The BLM says that from 2009-14, enough gas was lost during oil and gas development on federal and Indian lands to power more than 5 million homes for a year. A 2010 Government Accountability Office report estimated as much as $23 million in annual royalty revenues to the federal governments and states that share in those revenues was being lost due to methane waste.
The BLM estimates the rule could prevent between 164,000 and 169,000 tons of methane emissions per year, roughly equal to eliminating the greenhouse gas emissions from 860,000 to 890,000 vehicles. It estimates net benefits of $155 million to $188 million per year, including environmental benefits and revenues to companies from sale of recovered gas.
The implementation cost to the industry could be between $125 million and $161 million per year, the BLM says.
“BLM is taking an important step to ensure the responsible development of our nation’s natural resources,” said Fred Krupp, president of the Environmental Defense Fund, which helped negotiate Colorado’s methane rules with industry.
He said in a news release that in 2013 energy companies wasted more than $330 million worth of methane on public and tribal lands.
The rules will have limited implications for Colorado, because its methane rules extend to federal lands. The BLM says it will work with states and the EPA to coordinate and streamline regulations between agencies.
Karen Sjoberg of Citizens for Clean Air and Western Colorado Congress of Mesa County applauded the BLM’s proposal in a statement.
“In 2014, Colorado passed ground-breaking air quality rules for oil and gas production and it is time for the rest of the country to follow suit. We have shown that the right balance can be struck between public protections and industry development,” she said.
“However, even if states make changes on a local level, methane pollution is not limited to state lines. For this effort to be meaningful, we need rules that fairly govern all airsheds and protect all people equally. Air pollution from oil and gas sites is not a problem that can be solved piecemeal; nationwide rules are needed to level the playing field for states, industry, and the public health of all Americans.”
U.S. Sen. Michael Bennet, D-Colo., also pointed to Colorado’s leadership on the issue, and said, “We’re glad that the BLM is following Colorado’s lead and appears to be using similar strategies.”
But the Western Energy Alliance industry group countered in a news release that the BLM proposal is redundant due to state rules and fails to recognize industry’s success reducing emissions voluntarily.
“We support the goal of capturing greater quantities of methane and reducing waste gas, but a command-and-control regulatory approach is not the most effective way to meet that goal, particularly one that exceeds BLM’s jurisdiction,” said Kathleen Sgamma, the group’s vice president of government and public affairs.
She said companies have decreased methane emissions by 21 percent since 1990 even as natural gas production has climbed 47 percent, all without federal regulation. “The new BLM regulation is simply another case of a federal government fix to something that’s already working well,” she said.
Gas flaring was a big concern during the oil drilling boom in the Bakken formation of North Dakota, but Sgamma said North Dakota companies have invested more than $11 billion to install pipelines and other infrastructure there, and the gas capture rate rose from 64 percent in 2011 to 85 percent today.
She said Wyoming, with more mature infrastructure in place, has a venting and flaring rate of just 0.26 percent.
“By proposing emissions controls on existing wells, BLM is attempting unlawful Clean Air Act regulation that even EPA doesn’t try to assert,” she contended.
The BLM previously has said the focus of its methane initiative isn’t pollution reduction but conservation of a resource and prevention of its waste, while helping ensure a fair return in royalties to taxpayers, because that’s where its legal authorities lie.