Interior Department Announces Final Rule to Reduce Methane Emissions & Wasted Gas on Public, Tribal Lands
On Wednesday, U.S. Secretary of the Interior, Sally Jewell, announced the Methane and Waste Prevention Rule, in furtherance of the Obama administration’s Climate Action Plan.
Counselor to the Director of the Bureau of land Management, Alexandra Teitz, said the rule is intended to control and reduce the amount of natural gas that is released into the atmosphere during oil and gas operations.
“During the oil and natural gas production process, a lot of the gas just gets burned off in flares and other gas leaks, or is vented from various pieces of equipment,” Teitz said. “Between 2009 and 2015, the amount that was lost was enough to supply about 6.2 million households for a year.”
Teitz said the oil and gas industry is allowing all that natural gas to go to waste.
“We don’t think that operators should just be flaring it off,” she said. “So, we’re asking them to capture gradually, more and more of that gas and put it to productive use.”
Teitz responded to the argument that the new rule could lead to higher production costs, and eventually to higher rate for utility customers.
“We have done cost estimates for the rule,” she continued. “The net benefits of the rule could range from $46 million to $204 million per year. There are obviously costs involved to capture the leaking gas, but that’s the net benefit. Costs for the industry go from about $110 million to $279 million per year, while the benefits range from $209 to $403 million dollars per year. We just don’t think the rules will be that costly that it will affect prices, in fact, putting more natural gas on the market should, if anything. Lower prices.”
In response to the announcement by the BLM on Tuesday, Montana senator Steve Daines made the following comment:
“This is yet another example of the Obama administration getting dangerously close to regulating this industry out of business in the U.S.,” Daines stated. “I look forward to seeing President-elect Trump and Congress stop this assault on energy innovation.”