The State of Texas sued the U.S. Environmental Protection Agency (EPA) on July 29, 2016, to block the agency’s new rules aimed at reducing oilfield methane emissions.
Texas Attorney General Ken Paxton challenged the federal government’s authority to force oil and gas companies to reduce methane leaks. Paxton called the agency’s rules “a gross demonstration of federal overreach” in an official statement.
Paxton also faulted regulators for failing to consider the economic harm oil and gas producers would suffer in order to comply with the new rule, especially at a time when they are already reeling due to low oil prices.
Texas became the second state, following North Dakota, to challenge EPA’s new methane rule. After Texas announced its suit, 13 additional states—Alabama, Arizona, Kansas, Kentucky, Louisiana, Michigan, Montana, North Carolina, Ohio, Oklahoma, South Carolina, West Virginia, and Wisconsin—also filed suit challenging EPA’s methane rule. The 15 states’ lawsuits have been consolidated into a single case, which is now before the U.S. Court of Appeals for the DC Circuit.
Regulations Will Harm Small Producers
“President [Barack] Obama’s methane regulations are not law; they have not been voted upon, they have not passed through Congress, nor have they even been debated, but they have been crammed down our throats by regulatory agencies, primarily EPA,” said Gary L. Stone, vice president of engineering at Five States Energy Capital.
“These regulations impact small producers,” Stone said. “Unlike big producers, the guys producing just three or four barrels of oil per day will not be able to afford the technology necessary to comply with the new rules.”
Stone says the cost of installing emissions-monitoring devices could push operating costs beyond what small producers can afford.
“When you add an additional $100 to $1,000 of compliance costs per month to the cost of a break-even well, it will put them out of business,” Stone said.
‘Solution in Search of a Problem’
Isaac Orr, a research fellow for energy policy at The Heartland Institute, which publishes Environment & Climate News, says methane emissions from oil and gas operations are so small, the rule will accomplish very little.
“The new methane rule is a solution in search of a problem,” said Orr, “The oil and gas industry has already reduced methane emissions 14.3 percent from 2008 to 2012, and emissions from natural gas hydraulic fracturing operations have fallen 73 percent from 2011 to 2013.
“If the previous rules intended to combat climate change are any indication, the new methane rules will prove expensive and ineffective,” Orr said.
Kenneth Artz ([email protected]) writes from Dallas, Texas.