Friday, September 28, 2018

Shale law in the Spotlight – Overview of Recent Amendments to the EPA Methane Emissions Rule

Written by Chloe Marie - Research Specialist

This article provides a detailed overview of the recent administrative changes and proposed changes to the EPA Methane Emissions Rule initiated by the Trump Administration since the beginning of 2018. 

The “Oil and Natural Gas Sector: Emission Standards for New, Reconstructed, and Modified Sources” – also known as the Methane Emissions Rule – was published on June 3, 2016, as part of President Obama’s Climate Action Plan to progressively reduce greenhouse gas emissions, including methane emissions.

Pursuant to President Trump’s Executive Order on Promoting Energy Independence and Economic Growth issued in March 2017, former EPA Administrator Scott Pruitt announced on April 19, 2017, that EPA would reconsider the New Source Performance Standards for fugitive methane emissions. Consequently, EPA issued a notice dated June 16, 2017, proposing to stay certain requirements of the Methane Emissions Rule for a two-year term, including fugitive emissions, pneumatic pump standards, and professional engineer certification requirements, to allow time for a complete reconsideration of the rule by the agency.

The March 2018 Final Rule
The U.S. Environmental Protection Agency (EPA) issued a final rule in the Federal Register on March 12, 2018, amending two fugitive emissions requirements contained in the Methane Emissions Rule dated June 3, 2016. The final rule became effective on the day of its publication in the Federal Register.

Industry stakeholders welcomed this final rule. The American Petroleum Institute (API), for example, expressed its support for EPA’s amendments to the Methane Emissions Rule in a statement dated March 2018, and wrote that these amendments “will provide regulatory certainty for [the oil and gas] industry.”

This final rule removes the requirement for completion of delayed repairs at well sites and compressor stations during unscheduled or emergency vent blowdowns. Initially, operators could delay repairing or replacing defective components after detection of fugitive emissions under certain situations described in the 2016 Final Rule, as long as delayed repairs were “completed during the next compressor station shutdown, well shutdown, well shut-in, after an unscheduled, planned, or emergency vent blowdown or within 2 years, whichever is earlier.” EPA contended that “the requirement to complete delayed repairs during an unscheduled or emergency vent blowdown could lead to a number of unintended negative consequences. In particular, emissions from requiring delayed repairs during an unscheduled or emergency shutdown, shut-in, or vent blowdown could result in greater emissions than the leaks that are to be repaired …” Operators, however, remain ultimately responsible for the repairs or replacement during the next compressor station shutdown, well shutdown, well shut-in, after a planned vent blowdown, or within 2 years, whichever is earlier.
Under the 2016 Final Rule, the monitoring survey of fugitive emissions components at a new well site must have been conducted within 60 days of startup production at the new well site. This same 60-day initial monitoring requirement applied for the collection of modified fugitive emissions components after the modification. Semi-annual monitoring was required thereafter.  

The final rule now provides that monitoring surveys at new or modified well sites that start production between September and March must be performed within 6 months of startup production or by June 30, whichever is later. The 60-day initial monitoring requirement as provided in the 2016 Final Rule applies to well sites with a startup production between April and August. The final rule also requires annual monitoring of fugitive emissions thereafter for all well sites located on the Alaskan North Slope. EPA made such changes to the monitoring schedule after receiving comments, which pointed out that the monitoring instruments for EPA Method 21 could not “reliably detect methane emissions at well sites on the Alaskan North Slope for a significant portion of the year due to the lengthy period of extreme cold temperatures.”  

The September 2018 Proposed Rule
On September 11, 2018, EPA proposed another set of measures described as “targeted improvements” to the Methane Emissions Rule. These proposed amendments are intended to reduce some of the regulatory costs associated with duplicative regulatory actions between EPA and state agencies. According to EPA Acting Administrator Andrew Wheeler, “removing these excessive regulatory burdens will generate roughly $484 million in cost savings and support increased domestic energy production – a top priority of President Trump.”

The proposed rule would amend Subpart OOOOa of the 2016 New Source Performance Standards (NSPS) for the oil and gas industry to review fugitive emissions requirements, but this time would focus on monitoring frequencies. EPA would implement annual monitoring for non-low production well sites and for compressor stations located on the Alaska North Slope; biennial monitoring for low production well sites; and co-proposing semiannual and annual monitoring for compressor stations. EPA also proposed to rescind the requirement that monitoring is necessary for wellhead only well sites after all major production and processing equipment has been removed. 
In addition, the proposed rule would provide review of the well site pneumatic pump standards and certification requirements for closed vent systems as well as clarification on the provisions relating to well completions, onshore natural gas processing plants, storage vessels, recordkeeping, and reporting.

The President of the Western Energy Alliance, Kathleen Sgamma, declared that both EPA actions – the March 2018 final rule and September 2018 proposed rule – are a “neat pair” before adding that the Methane Emissions Rule is “the definition of red tape. It was a record-keeping nightmare that was technically impossible to execute in the field,” as stated to the New York Times.

This proposed rule has yet to be published in the Federal Register. 

This project is funded by the National Agricultural Library, Agricultural Research Service, U.S. Department of Agriculture.

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