Providing coverage of Alaska and northern Canada's oil and gas industry
March 2018

Vol. 23, No.9 Week of March 04, 2018

Judge rejects rule delay

Temporary injunction imposed on BLM rule suspending parts of venting, flaring regs

Alan Bailey

Petroleum News

A judge in the federal District Court of Northern California has granted a preliminary injunction, preventing the U.S. Bureau of Land Management from suspending the implementation of parts of federal regulations issued in 2016 by the Obama administration to limit the venting and flaring of methane from oil and gas operations on federal land. On Feb. 22 Judge William Orrick issued an order saying that the suspension rule had been arbitrary and capricious. And so, because the appeal against the suspension is likely to succeed, an injunction banning the immediate suspension of the regulations is warranted, the judge wrote.

The regulations under dispute were introduced in 2016 as part of President Obama’s efforts to use government regulation as a means of enforcing the reduction of U.S. emissions of greenhouse gases, including methane. BLM’s efforts to suspend the regulations reflect the Trump administration’s strategy of rolling back regulations that the administration sees as posing unwarranted limitations on business activity.

Regulatory roll back

In February of this year the administration proposed a rule rolling back some of the methane venting and flaring regulations. However, in anticipation of the eventual regulatory roll back, in June and October of last year, the administration proposed rules suspending the implementation of some components of the regulations that had not yet gone into effect - under the Obama-era rule, the regulation roll out is being phased over time.

Both rules for suspension of regulation components were challenged in the federal District Court of Northern California.

In October the court upheld combined appeals by the states of California and New Mexico, and by a group of environmental organizations, against the June suspension rule. That case has since been appealed to the U.S. Court of Appeals for the 9th Circuit.

In December similar groupings of organizations appealed BLM’s October regulation suspension rule. That case, which has now brought Orrick’s granting of a preliminary injunction, continues in District Court. The court has declined to link this case with appeals against the June suspension rule.

Orrick: no connection to evidence

Orrick, in his ruling, wrote that, “while the plaintiffs have shown irreparable injury caused by the waste of publicly owned natural gas,” BLM’s reasoning for the rule suspension does not connect with evidence against the implementation of the venting and flaring rule. For example, BLM asserts that the regulations would jeopardize the economic viability of marginal or low-producing wells but does not provide any supporting evidence for this assertion. Nor has BLM provided any detailed analysis of anticipated compliance costs, Orrick wrote.

BLM must present a detailed justification, including any new facts or evidence, for suspending the regulations, given that the regulations resulted from three years of study and deliberation, Orrick wrote.

Although the regulations at issue apply to drilling within the National Petroleum Reserve-Alaska, the Alaska Oil and Gas Conservation Commission and the Alaska Department of Environmental Conservation already have stringent regulations designed to prevent hydrocarbon wastage and to avoid air pollution in the state.

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