- On November 15, the Bureau of Land Management (BLM) issued its final rule on venting and flaring natural gas from wells drilled on federal lands. Later that same day, both the Western Energy Alliance (WEA) and the Independent Petroleum Association of America (IPAA) filed suit in federal court challenging the regulation. The industry lawsuit contends that the new regulation goes outside of the TBLM’s authority by creating an air quality regulatory program, and area of regulation reserved to the Environmental Protection Agency (BLM) and state environmental quality agencies.
- On November 17, Interior Secretary Sally Jewell announced unilateral cancellation of 65 oil and gas leases in the White River National Forest. Sec. Jewell said she was taking the action due to the fact that the leases, which sit atop the Mancos Shale, were “non-performing”. She failed to note that the main reason the leases were in that “non-performing” state is that they have been tied up in the feederal bureaucracy for the entire duration of the Obama Administration. The cancellation of these leases is especially impactful since these leases represent the best opportunity to develop the Mancos Shale, which the United States Geological Survey (USGS) estimated in June of this year to be the second largest deposit of natural gas in the United States, behind only the gargantuan Marcellus Shale in the Northeastern part of the country.
- On November 18, the Department of the Interior (DOI) issued its final five-year plan for leasing on federal lands and waters. The plan removes areas of the Arctic waters in the Chukchi and Beaufort Seas – which had been included in its previous draft – from leasing consideration. The plan represents a victory for anti-development groups who have long sought to block development of oil and gas resources in the U.S. Arctic region. As I wrote in August, the plan will also leave the U.S. without any program to compete for resource plays in the Arctic at a time when Russia has created the world’s largest fleet of ice-breaker ships and is aggressively moving into the region. DOI Secretary Sally Jewel cited “industry’s declining interest” in the region as a major reason for the decision, but again failed to note that the Administration’s efforts to make development in the region as difficult and expensive as possible have helped to reduce such interest.
Monday, November 21, 2016
The Rush To Regulate Oil And Gas Accelerates As Jan. 20 Approaches
Since election day delivered the realization that President Obama’s two terms in office would be succeeded by a Republican rather than a fellow Democrat, the Administration’s regulatory agencies have accelerated their efforts to cram through as many last-minute regulations as possible. Nowhere has this effort been more focused than on the oil and natural gas industry. Since November 8, we have already seen the following events take place: