After the Senate failed to repeal a rule governing flaring and venting of associated natural gas on public and tribal lands, a spokeswoman for the Department of Interior (DOI) said the department will "suspend, revise or rescind" the rule, citing its impact on onshore energy development.
In a statement Wednesday, Kate MacGregor, who serves as DOI's acting assistant secretary for land and minerals, said the venting and flaring rule has been "reviewed and flagged...given its significant regulatory burden that encumbers American energy production, economic growth and job creation.
"The rule is expected to have real and harmful impacts on onshore energy development and could impact state and local jobs and revenue. Small independent oil and gas producers in states like North Dakota, Colorado and New Mexico, which account for a substantial portion of our nation's energy wealth, could be hit the hardest."
An executive order (EO) signed by President Trump on March 28 included a requirement that the DOI review, rescind or revise the rule, officially known as the Waste Prevention, Production Subject to Royalties, and Resource Conservation Rule. It promulgated by DOI's Bureau of Land Management (BLM) and unveiled in January 2016, during the Obama administration.
On Wednesday, the Republican-controlled Senate narrowly failed to pass a bill calling for the rule's repeal. Lawmakers in the House of Representatives, also controlled by the GOP, had successfully invoked the Congressional Review Act (CRA) in February to introduce a bill calling for the rule's repeal, but the vote by the Senate effectively ended that strategy; under CRA rules, the Senate had until Thursday to pass the bill.
"The vote today in the Senate doesn't impact the administration's commitment to spurring investment in responsible energy development and ensuring smart regulatory protections," MacGregor said.
In the aftermath of the Senate vote Wednesday, three groups representing the oil and gas industry -- the Independent Petroleum Association of America (IPAA), the Western Energy Alliance (WEA) and the American Petroleum Institute -- pledged to work with the DOI on rescinding or revising the rule.
The IPAA and WEAfiled a lawsuit against the rule last November. Montana and Wyomingfiled a separate lawsuit three days later, and North Dakota and Texas subsequently joined as petitioners. The two lawsuits were combined at the end of November.
Under the final rule, to be implemented in stages, oil and gas producers would be required to use currently available technologies and processes to cut gas flaring in half at oil wells on public and tribal lands. Operators would also be required to periodically inspect their facilities for leaks and replace outdated equipment that vents large quantities of gas into the air. Other parts of the rule require operators to limit venting from storage tanks and to use best practices to limit gas losses when removing liquids from wells.