Having failed to strike the Bureau of Land Management’s methane waste rule in the spring using the Congressional Review Act, some members of Congress are still looking for ways to kill the rule even before the Department of Interior has a chance to act on it. The House of Representatives will vote on an amendment offered by Rep. Steve Pearce (R-N.M.) that would prevent the agency from using any funds to enforce the new rule. We think it would be a mistake to prevent funding for DOI to collect royalties owed to the taxpayer.
Taxpayers for Common Sense has supported efforts to update rules that limit the amount of natural gas lost – intentionally or not – during drilling on federal lands. This is a valuable resource that everyone wants to see brought to market instead of vented or flared, i.e, wasted, into the air. Moreover, taxpayers own this resource, and it is in our interest to make sure companies are acting responsibly to capture it, sell it, and pay royalties on it – just like they would on private land.
The problem of natural gas being released or escaping during drilling has been well-documented over the years. In 2010, the Inspector General for the Department of the Interior recommended the agency clarify its requirements for royalty-free use of gas.
That same year, the Government Accountability Office found that as much as 40 percent of natural gas vented or flared could have been economically captured with the use of available off-the-shelf technology and that the regulations did not address significant sources of lost gas. The following year, it put Management of Federal Oil and Gas Resources on its list of “high risk” government programs — those with “greater vulnerabilities to fraud, waste, abuse, and mismanagement.”
In 2014 alone, $444 million worth of natural gas was vented or flared from federal and tribal lands, almost all of it royalty-free. On average, the royalty value of the lost natural gas is roughly $50 million a year, an amount that will likely increase as production continues to grow and natural gas prices increase from their historic lows. And the problem continues to get worse, not better. The amount of gas lost in 2013 from taxpayer-owned lands was double the amount lost in 2009.
The old rules which were put in place in during the Reagan administration, are grossly outdated. They were written before techniques like hydraulic fracturing even existed. Much of the gas capture technology the rule requires has been on the market for years. States like Colorado passed similar rules years ago in response to increasing losses of natural gas, and companies are already complying with those requirements.
Interior Secretary Ryan Zinke says he will try to rewrite the methane waste rule. Congress should let him do that. The government has a chance to get more natural gas to the market and increase revenue for federal and state governments. Making that job harder is exactly the wrong thing to do.
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