No Temporary Stay for BLM Flaring Rule

On January 16, 2017, the U.S. District Court for the District of Wyoming denied a motion for a preliminary injunction requested by three states and three trade associations that would have stayed the Department of the Interior, Bureau of Land Management’s “Waste Prevention, Production Subject to Royalties, and Resource Conservation” rule. Although the states and trade associations contend that the Waste Prevention Rule represents unlawful agency action because it exceeds BLM’s authority and is otherwise arbitrary and capricious, the District Court determined that the petitioners did not establish a “clear and unequivocal” right to relief.

BLM states

that the Waste Prevention Rule is intended to reduce waste of natural gas from venting, flaring, and leaks during oil and natural gas production activities on onshore federal and Indian leases. Specifically, the rule amends federal regulations with respect to when produced gas lost through venting, flaring, or leaks is subject to royalties. Any gas flared in excess of the final rule’s capture requirements is deemed an avoidable loss and subject to royalties. Moreover, the final rulemaking also requires operators to inspect equipment twice per year, timely repair any leaks found, and update certain equipment that BLM believes contributes to lost gas such as storage vessels, well maintenance, drilling, and completion.

Wednesday, January 25, 2017

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