EPA's new methane rule hits Basin hard

Apr. 15—A host of Texas representatives and energy industry groups has joined Congressman August Pfluger and fellow congressional Republicans to excoriate and oppose the Environmental Protection Agency's new requirements, scheduled to go into effect May 7, concerning methane emissions.

"One of the only promises that President Biden has followed through on is his campaign vow to 'end fossil fuels,'" said Pfluger, who represents Ector County in Washington, D.C. "This methane rule imposes excessive and costly restrictions on energy producers in regions like the Permian Basin that I represent and others around the nation.

"It will drive costs up even higher for all Americans who are already suffering under record-breaking inflation driven mostly by energy costs. The president should be promoting energy independence to lower costs and strengthen our national security."

Pfluger is backed in his introduction of a congressional review act to overturn the rule by Congressmen Jodey Arrington of Lubbock, Tracey Mann of Kansas, Mike Collins of Georgia, Chip Roy and Lance Gooden, both of Texas, Mary Miller of Illinois, Doug Lamborn and Lauren Boebert, both of Colorado, John Moolenaar of Michigan and David Rouzer of North Carolina and Sens. Roger Marshall of Kansas and Steve Daines of Montana.

Along with prohibiting any flaring of methane, the rule imposes stricter requirements for monitoring, maintaining and reporting emissions and it requires states to design and execute plans to meet EPA requirements or adopt the federal plan, among other provisions.

State Sen. Kevin Sparks of Midland, who represents Ector County in Austin, called the rule "huge and onerous with the potential to cause disproportionate harm to smaller oil and gas companies.

"Industry compliance with the rule in the Permian Basin is complicated by the fact that states will probably need to change their own existing rules to align with the new federal standards, which is something that neither Texas nor New Mexico has done yet," Sparks said.

"Regardless, there will still be burdensome additional administrative and compliance costs for operators if the rule goes into effect on May 7."

Sparks said Texas and a number of other states have sued to try and stop the rule, "which is clearly just another federal attack on oil and gas.

"This is despite the fact that the industry has been successful in reducing emissions," he said. "According to the Texas Methane and Flaring Coalition, the Permian Basin alone saw close to an 85 percent reduction in methane emissions from 2011 to 2022.

"Meanwhile, production more than quadrupled at the same time."

Permian Basin Petroleum Association president Ben Shepperd said the congressional action is encouraging,

"We appreciate the efforts of House Budget Committee Chairman Arrington, Congressman Pfluger and other knowledgeable members of Congress for taking these steps to undo some of the incredible damage that this administration is levying on the American economy and the oil and gas industry directly," Shepperd said. "The methane rule is very poorly crafted and it will have no environmental benefit while adding in the never-ending inflationary pressures.

"It's just the latest effort to shut down the American energy industry in favor of redistributing wealth to environmental activists."

Texas Independent Producers & Royalty Owners President Ed Longanecker said the EPA's 2022 methane requirements, which were revised and made stricter, could shut down 300,000 of the nation's 750,000 low production wells.

"We fully expect that various provisions will be litigated, so the courts may ultimately decide the outcome," Longanecker said from Austin. "The upcoming elections will also clearly impact the direction of these regulations.

"If the Republicans regain the White House in 2024, it's unlikely that litigation will move forward and the requirements will be reconsidered and amended by the EPA."

Texas Pipeline Association President Thure Cannon said pipeline companies do all they can to abide by and many times exceed federal, state and local regulations.

"The companies are naturally incentivized to deliver every molecule of their product to their end user," Cannon said from Austin. "The industry already works very hard to run clean, efficient operations to prevent and repair leaks and, in fact, historical emissions patterns show that we have reduced emissions even while production has increased."

Cannon said some of the methane rule's requirements were improved through the public comment process, "but still there remain impractical or unnecessary provisions that would lead to minimal emissions reductions while substantially increasing cost and the regulatory burden.

"Also, some of the new requirements will be difficult or impossible to comply with under EPA timelines," he said. "The new requirements in the final rule cover a wide range of equipment types across the oil and gas industry.

"The difficulty and cost of compliance will vary depending on the exact rule and the equipment at issue. Texas already has some of the safest, most reliable and most efficient midstream operations in the world and we are proud of that."