Congress Makes Moves to Roll Back Methane and Waste Prevention Rule

On Friday, the House of Representatives voted to repeal the Bureau of Land Management’s (BLM) Methane and Waste Prevention rule, which prevents the “waste” of natural gas on federal and Indian lands by reducing the amount of flaring, venting, and leaking at oil and gas operations.

Not only is the wasted gas a harmful air pollutant, it also belongs to the American public, at a lost value of more than $330 million each year.

Three Democrats, Jim Costa (CA), Henry Cuellar (TX), and Collin Peterson (MN), voted in favor of repealing the rule, despite the economic and environmental benefits, and 11 Republicans voted against it. View the complete breakdown of the 221-191 House vote.

The bill still needs to pass through the Senate, which has not yet scheduled a vote.  By repealing this rule with the Congressional Review Act, BLM is also prohibited from proposing another “substantially similar” rule.


Fact Sheet: The Bureau of Land Management’s Methane and Waste Prevention Rule

Between 2009 and 2015, oil and gas operators on federal and Indian lands wasted 462 billion cubic feet of natural gas—enough to power over 6 million households for a year. This wasted natural gas belongs to the American public, at a lost value of more than $330 million each year.

BLM’s rule is an update to 30-year-old regulations and attempts to address this problem by requiring operators to take straightforward measures and precautions to reduce their waste of natural gas. These measures include setting plans for capturing natural gas before drilling wells, reducing flaring and venting where feasible, and detecting and repairing leaks. BLM developed these requirements through extensive collaboration with states, Indian tribes, and stakeholders, including the review of over 300,000 comments.

These requirements will reduce flaring by 49 percent and cut venting and leaks by 35 percent. Overall, BLM’s rule will reduce wasted natural gas by 41 billion cubic feet each year—enough to power 740,000 households. Reducing this wasted natural gas not only has great benefits for the environment, human health, and the American public, but also operators will be able to sell or use any natural gas they capture.

Even on the numbers alone, the rule’s benefits will greatly exceed its costs, by $46 million to $204 million each year.

The rule’s benefits include both the market value of the captured natural gas and the environmental benefits. In market value alone, the benefits will be between $189 and $247 million per year. The American public’s additional royalties for this gas will be $3 to $14 million each year. Altogether, the benefits will be between $209 and $403 million per year.

The rule’s costs include both the engineering compliance costs of installing and upgrading equipment and certain environmental costs, given that captured gas will generate CO2 when used as a fuel. Each year, these costs will be between $110 million and $279 million.

The rule has also has numerous ancillary benefits, which are not easily monetized. These ancillary benefits include reductions in the release of volatile organic compounds (VOCs) such as carcinogenic benzene; reduced nitrogen oxides (NOx) and particulate matter, which cause respiratory and heart problems; and improved quality of life for the local residents who live nearby the loud nuisance of flares.

Overall, the rule is a win-win: a great value for the American public, the environment, human health, and even oil and gas operators. The requirements are reasonable and commonsense updates to 30-year-old rules that reduce waste and implement long-held American values of conservation and thrift.

Sources: BLM, Waste Prevention, Production Subject to Royalties, and Resource Conservation, 81 Fed. Reg. 83,008 (Nov. 18, 2016); BLM, Fact Sheet on Methane and Waste Prevention Rule (Nov. 15, 2016)