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Trump Administration Proposing Two-Year Delay for EPA Methane Rule, Stalling BLM Venting/Flaring Rules

Thirteen days after ordering a 90-day stay over parts of proposed rules governing new sources of methane emissions from the oil and natural gas industry, the U.S. Environmental Protection Agency (EPA) said Tuesday that it is considering extending the stay by two years.

Meanwhile, the Interior Department's Bureau of Land Management (BLM) said it will postpone implementing an Obama-era rule governing flaring and venting of associated natural gas on public and tribal lands.

The EPA said Tuesday it was "taking steps” to ensure portions of the agency's 2016 New Source Performance Standards (NSPS) for the energy industry “do not take effect while the agency works through the reconsideration process."

In order to ensure that there is no gap in the stay during the reconsideration process, the EPA said it was proposing an additional three-month stay to serve as a bridge between the 90-day administrative stay the agency issued on May 31, and the two-year stay proposed on Tuesday.

The EPA plans to accept public comments on each of the proposed stays for 30 days after they are published in the Federal Register.

At issue are the fugitive emissions, pneumatic pump and professional engineer certification requirements outlined in updates to the NSPS, which the agency first unveiled during the Obama administration. The NSPS was designed to reduce methane, volatile organic compounds (VOC) and toxic air pollutants.

Last April, the EPA said it would reconsider the rules to comply with an executive order (EO) signed by President Trump on March 28. The EO included a directive for EPA to immediately review regulations on energy sources, and then to either suspend, revise or rescind them.

In mid-May, an appellate court granted the administration's request to delay a series of lawsuits over the proposed rules to give the EPA more time to review them. The U.S. Court of Appeals for the District of Columbia agreed to temporarily hold several consolidated lawsuits pending further review of the lead case, American Petroleum Institute (API) et al v. EPA et al [No. 13-1108].

Last week, a coalition of six environmental groups filed a lawsuit against EPA Administrator Scott Pruitt over his decision to issue the 90-day administrative stay.

EPA built NSPS upon VOC emission reduction requirements for new oil and gas wells that the agency first unveiled in April 2012. Those requirements called for a two-phase process to reduce VOCs: requiring flaring followed by "green completions," a term that means deploying equipment to capture and sell natural gas emissions that are otherwise lost.

EPA previously said it expected the NSPS to reduce 510,000 short tons of methane in 2025, which is the equivalent of reducing 11 million metric tons of carbon dioxide. The rules were also expected to reduce other pollutants, including 210,000 tons of VOCs and 3,900 tons of air toxics, by 2025.

BLM to Stay Venting, Flaring Rule

According to a notification to be published in the Federal Register on Thursday, the BLM said it wants to postpone the compliance dates for its Waste Prevention, Production Subject to Royalties, and Resource Conservation Rule, aka the venting and flaring rule.

"In light of the existence and potential consequences of the pending litigation, the BLM has concluded that justice requires it to postpone the compliance dates for certain sections of the rule pursuant to the Administrative Procedure Act, pending judicial review," the BLM said.

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 by 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.

The Independent Petroleum Association of America and the Western Energy Alliance (WEA )filed a lawsuit against the rule last November. Montana and Wyoming filed a separate lawsuit three days later, and North Dakota andTexas subsequently joined as petitioners. The two lawsuits were combined at the end of November.

"While the BLM believes the Waste Prevention Rule was properly promulgated, the petitioners have raised serious questions concerning the validity of certain provisions of the rule," the BLM said. "Given this legal uncertainty, operators should not be required to expend substantial time and resources to comply with regulatory requirements that may prove short-lived as a result of pending litigation or the administrative review that is already under way.

"Postponing these compliance dates will help preserve the regulatory status quo while the litigation is pending and the [Interior] Department reviews and reconsiders the rule."

Last month, lawmakers in the Republican-controlled Senate narrowly failed to pass a bill to repeal the BLM's venting and flaring rule.

WEA President Kathleen Sgamma said Wednesday the organization was encouraged that the EPA and BLM had decided to delay implementation of their respective rules. WEA is also a plaintiff in the a lawsuit against the EPA over the NSPS rule.

"Both rules vastly exceeded federal authority," Sgamma said. "In the case of the BLM rule, the bureau tried to assume authority that resides with the states and EPA to regulate air quality. In the case of the EPA rule, the agency attempted to regulate methane without conducting a methane endangerment finding, as required by the Clean Air Act. The actions today by the agencies are a first step to correcting that federal regulatory overreach."

Sierra Club spokeswoman Lena Moffitt disagreed. "Once again, Donald Trump and [Interior Secretary] Ryan Zinke are showing where their priorities lie: the profits of corporate polluters above all else, including the health of our communities.

"BLM's methane rule would protect our public lands and communities, and it has already withstood legal challenges and an attempted repeal in Congress. Working behind closed doors to undermine these commonsense protections is a slap in the face to the millions of Americans who support them, and to the many communities who will breathe polluted air as a result."

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