Twenty U.S. oil and gas trade groups unite against Biden’s “misguided” methane fee
(WO) – The American Petroleum Institute (API) and the Energy Workforce & Technology Council joined with 18 other associations representing all segments of the U.S. oil and gas industry operating across the country in calling on the U.S. Environmental Protection Agency (EPA) to revise its “misguided” methane fee on American energy.
In comments submitted to the agency on the “waste emissions charge” proposed rulemaking, the associations argued that EPA’s proposed rule creates an incoherent regulatory regime, fails to meet the statutory requirements outlined by the Inflation Reduction Act, and disincentivizes emissions reduction efforts by the industry.
“This tax on American energy is a serious misstep that could jeopardize our nation’s energy advantage and weaken our energy security,” said API Senior Vice President of Policy, Economics and Regulatory Affairs Dustin Meyer. “U.S. oil and natural gas is innovating throughout its operations to reduce methane emissions while meeting growing energy demand. Yet, this proposal creates an incoherent, confusing regulatory regime that will only stifle technology advancements and hamper energy development. With partners across the industry, we will consider all options to ensure a smart regulatory framework for continued American energy development.”
In their joint comment letter, the associations raised significant concerns about the proposed rule’s nexus to other methane regulations underway, highlighting the Biden administration’s disharmonized approach to methane regulations. The associations urged the administration to coordinate this proposed rule with other regulations, including Subpart W and EPA’s final Methane Rule.
Additionally, the associations called for more flexibility on netting requirements to incentivize greater emissions reductions, clarification to the rule’s exemptions as intended by Congress, and commonsense compliance and reporting timelines.
The U.S. oil and gas industry is taking action to reduce methane emissions while continuing to produce affordable, reliable energy. Thanks to industry action, average methane emissions intensity declined by nearly 66% across all seven major producing regions from 2011 to 2021.
Industry-led initiatives like The Environmental Partnership, whose members make up nearly 70% of U.S. onshore natural gas and oil production, are helping to accelerate progress on methane emissions reductions by driving collaboration and sharing best practices across the industry.
In an emailed statement, Energy Workforce said, "The EPA's proposed Waste Emissions Charge is a misguided and harmful regulation that disregards the significant emissions reductions already achieved by the energy industry. Further, the rule fails to align with existing statutory requirements, could disincentivize further emissions reductions, and imposes new costs on domestic energy production. Ultimately, it will be the hardworking American people who will feel the ramifications the most. Energy Workforce opposes this proposal and calls on the EPA to revise this rule to follow statutory intent and truly incentivize emissions reductions while supporting American energy production."
The full list of associations includes:
1. The American Petroleum Institute
2. American Exploration and Production Council
3. American Fuel and Petrochemical Manufacturers
4. Independent Petroleum Association of America
5. LNG Allies - The USLNG Association
6. Energy Workforce and Technology Council
7. Western States Petroleum Association
8. Alaska Oil and Gas Association
9. Kentucky Oil and Gas Association
10. Louisiana Mid-Continent Oil and Gas Association
11. Michigan Oil and Gas Association
12. New Mexico Oil and Gas Association
13. North Dakota Petroleum Council
14. Ohio Oil and Gas Association
15. The Petroleum Alliance of Oklahoma
16. Pennsylvania Independent Oil and Gas Association
17. Texas Independent Producers and Royalty Owners Association
18. Utah Petroleum Association
19. Gas and Oil Association of West Virginia
20. Petroleum Association of Wyoming
Separately, Western Energy Alliance President Kathleen Sgamma said,“The oil and natural gas industry and the BLM share the goal of reducing waste of natural gas through venting, flaring, and leaks. Western Energy Alliance appreciates that with the waste prevention rule, BLM is attempting to achieve clarity on how to classify waste gas as avoidably and unavoidably lost, and hence whether it bears royalties or not. The Alliance is reviewing the final rule to ensure it has corrected the problems with the 2016 Obama Administration rule that was overturned in the U.S. District Court for the District of Wyoming in State of Wyoming et al. v. the Department of the Interior, of which Western Energy Alliance was a co-plaintiff.
“The 2022 proposed rule was better than the 2016 rule that we successfully overturned in court, as the Wyoming District Court found that BLM had usurped the air quality authority of EPA and the states. Many, but not all, of those problems were fixed in the 2022 proposed rule. We provided constructive feedback in our comments and hope they were taken into consideration in this final rule, so that companies will have certainty on federal and tribal lands. We’ll be reviewing it carefully. Even without the rule, companies have joined together to reduce methane emissions, venting and flaring, with every major basin showing significant declines. Our industry is proud to continue that work, with or without new rules.”
