Colorado industry group urges repeal of BLM methane rule

By Patrick C. Miller | March 01, 2017

The U.S. Senate should follow the action of the House to repeal the Bureau of Land Management’s (BLM) methane and waste prevention rule, according to Tracee Bentley, executive director of the Colorado Petroleum Council.

During a teleconference hosted by the American Petroleum Institute (API), Bentley urged the Senate to approve a resolution against what she called “a flawed rule that doesn’t improve upon successes in U.S. methane emission reductions and could have a negative impact—not only on industry—but on consumers, local revenues and energy security as well.”

An analysis conducted by Environmental Resources Management showed that the added cost of compliance with the BLM rule could cause up to 40 percent of flared federal wells being permanently shut in. The 2016 study found that even a 1 percent loss of royalties would create a $14 million loss in federal revenues—far greater than the $3-10 million loss in additional incremental royalties estimated by BLM.

“Companies in Colorado operate under some of the most stringent rules in the country to produce clean, safe, affordable energy while being good environmental stewards,” Bentley said. “These declining revenues would directly impact state and local governments. Such a drop in production would reduce the availability of affordable energy to consumers.”

API said many western states most impacted by the rule have submitted comments to the BLM to express their economic and environmental concerns.

“The oil and natural gas industry has proven that we can protect the environment, grow our economy, add to state and local revenues, and has simultaneously helped save the average American family an average of $1,337 per year,” Bentley said.

She added that between 1990 and 2015, U.S. oil and gas producers reduced methane emissions by 21 percent while increasing gas production by more than 45 percent. Bentley said the industry’s voluntary leadership in the innovation and advancement of technologies—combined with existing regulations—have resulted in the successful capture and reduction of methane emission.

Noting that Colorado was the first state to implement a methane rule, she added, “Our companies are applying some of the most stringent standards in the country to produce clean, safe, affordable energy while being good environmental stewards.”

Bentley said BLM’s duplicative methane rule would stifle the innovations that have led to greater use of clean-burning natural gas. The federal agency could do more to help consumers, manufacturers and the oil and gas industry by streamlining the permitting process to improve infrastructure, which would result in even greater methane capture, she said.