Coronavirus Relief Update November 2, 2020

Legislative, NSWA Legislative ReportLeave a Comment

Chris Kearney | NSWA Vice President, Governmental Affairs

On again-off again discussions between Treasury Secretary Mnuchin and House Speaker Nancy Pelosi (D-CA) over the last several weeks have ended without agreement on further pandemic relief.  While differences may have narrowed on various issues, setting up possible advancement of a legislative package after the election, significant ones remain – not the least of which is the funding  levels.  

The Senate has previously passed a targeted $500 billion package – the largest spending package the GOP could unite behind – while the most recent House bill tallies $2.2 trillion package. The White House’s offer has varied – with the most recently reported at $1.8 trillion.  

Substantively, key differences continue on the same issues that have plagued negotiations from the beginning: funding for state and local governments, funding for primary and secondary public education, and liability protections for businesses.

Methane Emissions

Last Monday, the D.C. Circuit Court of Appeals issued an order announcing that it would not block EPA’s rescission  of the Obama- era methane regulations on methane emissions while it’s being litigated.  The court  announced a series of dates for the  various parties – State of California (joined by 24 other states), API/ other intervenors, as well as EPA —    to be prepared to start filing legal arguments associated with the pending suit, beginning in December. Of note, EPA’s first brief is due Jan. 6 and its final brief due Feb. 10, 2021. Oral arguments will be heard at a later date.    

NSWA and multiple oil and gas associations had joined efforts in court to defend EPA’s repeal of the Obama-era regulations on methane emissions. The State of California  sued the agency to reverse the ruling.

The EPA’s rulemaking repealed the onerous regulations on methane emissions from new sources and simultaneously stopped the federal government from regulating emissions from existing wells, which the agency would have been compelled to do if the Obama-era regulations remained. NSWA and the other organizations opposing those methane regulations argued that the costs of plugging the leaks from older equipment is too high and would force many wells to shut down.

The 2016 rule, which was repealed, required companies to install stronger pollution control equipment at newly constructed wells or other production facilities, and to search for and repair leaks. The final rule maintained EPA’s argument from the 2019 draft proposal that the Obama administration never legally determined whether the oil and gas industry’s methane emissions count as a “significant contribution” to air pollution that endangers human health and welfare, a legal hurdle under the Clean Air Act.   

Court Ruling on Methane Emissions On Public Lands

The Bureau of Land Management’s (BLM) 2016 regulations, which had established methane leak detection and repair requirements for oil and gas production on federal lands, has been struck down.

In early October, the U.S. District Court for the District of Wyoming  ruled that the Interior Department “exceeded its statutory authority” with the regulation, which was intended to reduce emissions of the potent greenhouse gas.

Specifically,  Judge Scott Skavdahl ruled  that BLM overstepped its authority under the Mineral Leasing Act, which allows the agency to take actions to reduce waste of oil and gas. Instead, Skavdahl said the rule strayed into the territory of Clean Air Act regulations — the purview of EPA.

“BLM used its waste prevention authority as a more expedient means to accomplish the primary end goal of regulating methane emissions from existing oil and gas sources — outside of, and inconsistent with, the comprehensive scheme established by Congress under the [Clean Air Act],” Skavdahl wrote.

The court did allow two minor portions of the rule to stand: language relating to the royalty-free use of production and an amendment conforming the regulatory text with the Mineral Leasing Act.

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