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November 13, 2017
Western AGs defend BLM’s 2016 methane rule

While proposing on October 5, 2017, to suspend or delay the Obama administration’s 2016 rule to prevent atmospheric releases of natural gas on public land and inviting public comments on the proposal, the Bureau of Land Management (BLM) has apparently already decided that the suspension or delay will occur. Commenting on BLM’s proposal, the attorneys general (AGs) of California and New Mexico note that by “predetermining the outcome” of the proposal regardless of what the public has to say, the BLM has precluded any meaningful public comment in the rulemaking process and therefore is in violation of the Administrative Procedures Act.

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The AGs back up the predetermination claim with five statements made by the BLM or its counsel in a federal district court (e.g., “Once the Suspension Rule has been published, it will provide the immediate relief sought by [industry] petitioners.”)

The 2016 rule was issued to ensure that taxpayers obtain the full benefits of royalty payments that are lost when natural gas is vented or flared on leased public land. The Government Accountability Office (GAO) has estimated that about 40 percent of vented or flared natural gas from public land leases could be economically recovered with current technology. In the 2016 rule, the BLM stated that between 2009 and 2015, nearly 100,000 oil and gas wells on public land released approximately 462 billion cubic feet of natural gas through venting and flaring, enough gas to serve about 6.2 million households for a year. The majority of natural gas developed at oil and gas sites is methane, a potent greenhouse gas. Opponents of the rule have argued that, in fact, it has little to do with preventing waste and is a poorly disguised air pollution regulation that the BLM is not authorized by statute to promulgate.

Economic growth encumbered

In the proposed suspension/delay, the BLM stated that since promulgation, it found that “some provisions of the rule appear to add regulatory burdens that unnecessarily encumber energy production, constrain economic growth, and prevent job creation.” The proposal was in large part motivated by President Donald Trump’s Executive Order (EO) and a follow-up Secretarial Order from Interior Secretary Ryan Zinke. The EO directed federal agencies to review regulations that “unduly burden the development of domestic energy resources beyond the degree necessary to protect the public interest or otherwise comply with the law.”

Justification absent

In their comment letter, the California and New Mexico AGs mainly argue that BLM’s proposal fails to provide the statutorily required reasoned explanation for suspending or delaying the rule. They note that the BLM is obligated by the Mineral Leasing Act to prevent undue waste to protect the interests of the United States and safeguard the public welfare. These objectives, the AGs asserts, are explicitly achieved through the 2016 rule.

“The Rule is designed to force considerable reductions in waste from flaring (49 percent) and venting (35 percent), saving and putting to use up to 41 billion cubic feet of gas per year,” the AGs write. “In addition, the Rule would avoid an estimated 175,000–180,000 tons of methane emissions per year and reduce emissions of volatile organic compounds (VOCs), including benzene and other hazardous air pollutants, by 250,000–267,000 tons per year.”

“The Proposed Suspension achieves none of BLM’s statutory mandates and, without explanation, simply ignores the important reasons articulated for promulgation of the Waste Prevention Rule less than 1 year ago,” the AGs continue. “BLM provides absolutely no justification regarding how the Proposed Suspension will prevent waste, ensure the adequate payment of royalties, or protect the public interest. To the contrary, BLM admits that the benefits of the Rule in reducing waste, increasing royalty payments, and cutting air pollution and greenhouse gas emissions will not be achieved.”

Regarding BLM’s contention that the 2016 rule unnecessarily encumbers energy production, constrains economic growth, and prevents job creation, the AGs say that the BLM review that led to these conclusions has not been made public and is otherwise not part of the rulemaking record.

The AG’s letter is here.

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