API backs Interior effort to align commingling rules with modern drilling practices

(WO) - The American Petroleum Institute on Jan. 30 welcomed a proposal from the U.S. Department of the Interior aimed at modernizing federal commingling regulations, a move the industry group says could support increased oil and natural gas production while maintaining resource conservation standards. 

The proposed rule would update longstanding commingling requirements that govern the production of hydrocarbons from multiple reservoirs within a single wellbore on federal lands. According to Interior, the changes are designed to reflect advances in drilling, completion and reservoir management technologies, while ensuring accurate measurement and protection of federal mineral resources.

API Vice President of Upstream Policy Holly Hopkins said the proposal represents a meaningful step toward aligning federal regulations with modern operational practices. She added that updated commingling rules could provide operators with greater flexibility to deploy new technologies and improve efficiency across federal acreage.

The announcement follows Interior Secretary Doug Burgum’s broader push to streamline permitting and regulatory processes tied to energy development on federal lands, particularly as producers seek to balance capital discipline with maintaining supply reliability.

Industry groups have long argued that existing commingling regulations, many of which date back decades, can limit operational efficiency and discourage investment by requiring separate production streams or additional infrastructure, even where modern reservoir management allows for safe and effective commingled production.