EPA offers rollback of methane rules to mixed industry reaction

The EPA wants to reverse Obama administration rules requiring oil and gas companies to capture methane releases at their wells

A flag with the EPA logo flies in front of the Environmental Protection Agency. The agency moved to roll back federal methane regulations for oil and gas companies, a decision that drew lukewarm industry reaction and could trigger lawsuits. (Photo By Bill Clark/CQ Roll Call)

The Environmental Protection Agency on Thursday moved to roll back federal methane regulations for oil and gas companies, a decision that drew lukewarm industry reaction and could trigger lawsuits.

The agency is proposing to reverse regulations adopted by the Obama administration that require oil and natural gas companies to install equipment to capture methane gas releases at their wells, pipelines and other sites. Under the proposal, the agency would no longer specifically regulate the potent greenhouse gas that is up to 80 times more powerful, in the short term, than carbon dioxide.

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Anne Idsal, acting assistant administrator for EPA’s air and radiation office, told reporters EPA was removing “inappropriate” and “redundant” regulations that provided “minimal environmental benefit.”

Methane regulation divides the industry between larger players, generally multinational firms that support methane rules, and smaller firms that say the regulations are burdensome.

Oil-and-gas giants Exxon Mobil Corp., Royal Dutch Shell PLC, BP PLC and Equinor have broadly supported government and private-sector policies to limit the release of methane.

A group of 140 investors worldwide pressed oil and gas companies to oppose the EPA’s proposed rollbacks. In a letter to 35 firms, the investors, who manage more than $5 trillion in assets, said climate change is an economic and physical peril.

“Curbing methane emissions is crucial to ensure the viability of natural gas as a low-carbon transition fuel. It is a key component for oil & gas companies to get a handle on, if they want to position their businesses to benefit under a well-below 2°C trajectory,” Yasmine Svan of Legal & General Investment Management said in a statement. The 2 degrees refers to environmentalists’ goal for a limit on warming from preindustrial levels.

The Interfaith Center on Corporate Responsibility, an investors’ advocacy group, organized the letter.

According to ICCR, the majority of the industry — more than 60 percent of companies — have no measurable targets to cut emissions of methane.

Isdal said the EPA will hold a public hearing in Texas on the proposal, which she said would save the industry between $17 million and $19 million annually.

Asked why the agency was working to limit methane rules, Isdal said EPA was confident methane emission levels would drop in the U.S. “We firmly anticipate that those downward trends will continue,” she said.

Companies that wish to capture methane on their own are free to do so, she said. “We don’t preclude anybody from going above and beyond.”

Don Santa, president and CEO of the Interstate Natural Gas Association of America, did not directly address the proposal in a statement Thursday, instead focusing on voluntary steps to limit methane leakage.

“Members of INGAA will stand by these commitments, maintain pipeline integrity and safe operations, and minimize impacts to customers and communities, irrespective of any regulatory changes,” Santa said.

Environmental groups criticized the decision.

“The Obama-era safeguards were a critical first step in averting climate catastrophe,” Lauren Pagel, policy director at Earthworks, said. “We can not allow the current administration to discount future generations out of existence. ”

Darin Schroeder, an attorney with the Clean Air Task Force, an environmental group, hinted at a lawsuit. “If EPA manages to finalize and implement this illegal proposal, it will have devastating impacts on our climate for years to come,” Schroeder said.

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