EPA, following Obama's lead, releases methane rules for oil and gas industry

By Karen Kidd | May 17, 2016

WASHINGTON (Legal Newsline) – The Obama Administration's Environmental Protection Agency has released the first-ever standards designed to reduce methane emissions from the oil and natural gas industry.

"The Obama EPA believes that methane leakage is a significant contributor to global warming and that the industry is not doing enough to curb emissions," Charles Sartain, a shareholder active in Gray Reed & McGraw's Dallas office, said in an email interview with Legal Newsline.

The interview took place just before the EPA issued the new standards on May 12.

The EPA's new standards were "another set of steps" taken in President Obama's "Climate Action Plan: Strategy to Reduce Methane Emissions and the Clean Air Act" to curb large and complex oil and natural gas industry methane emissions, according to the overview issued with the standards. The effort is the Obama's administration's attempt to achieve its goal of cutting methane emissions from the oil and gas sector by 40 to 45 percent from 2012 levels by 2025, the overview said.

"Today, we are underscoring the Administration’s commitment to finding commonsense ways to cut methane - a potent greenhouse gas fueling climate change - and other harmful pollution from the oil and gas sector," said EPA Administrator Gina McCarthy in the agency's press release.

"Together these new actions will protect public health and reduce pollution linked to cancer and other serious health effects while allowing industry to continue to grow and provide a vital source of energy for Americans across the country."

The new standards put in place EPA regulations, where there were none before, directly governing methane emissions from oil and gas wells, pipelines and other facilities, Sartain said.

"Rules proposed in January 2015 targeted future facilities," he said. "Rules proposed in March 2016 are broader in that they target existing facilities."

The new rules target only new oil and natural gas wells and require companies to monitor and limit inadvertent methane emissions during the production and transmission process. Methane is a primary component of natural gas, and the new rules will require companies to implement new procedures, such as regularly inspecting lines for leaks.

After receiving more than 900,000 comments about its August 2015 proposal, the EPA made a number of updates in the final set of standards, according to the EPA press release. These included an increase in climate benefits, including the removal of an exemption for low production wells. The final set of standards also provides companies with a pathway to align with comparable state-specific requirements that might exist, the press release said.

The new standards should reduce methane by 510,000 short tons by 2025, which is the equivalent of reducing 11 million metric tons of carbon dioxide, according to the press release.

"The standards also are expected to reduce 210,000 short tons of ozone-forming VOCs in 2025, along with 3,900 tons of air toxics, such as benzene, toluene, ethylbenzene and xylene," the press release said.

"Ozone is linked to a variety of serious public health effects, including reduced lung function, asthma attacks, asthma development, emergency room visits and hospital admissions, and early death from respiratory and cardiovascular causes. Air toxics are known or suspected to cause cancer and other serious health effects."

Naturally, oil and natural gas exploration and production and transmission businesses will be directly affected, Sartain said. He added that it might not be over as yet.

"To what extent there will be modifications is not known at this stage of the process," he said.

Sartain, whose legal career spans more than 30 years, specializes in oil and gas cases, as well as health care, business torts, noncompetition agreements and theft of trade secrets, contracts, injunctions, employment discrimination, and Election Code disputes. Sartain also is author and editor of the online publication, Energy and the Law.

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