The U.S. Senate attempted to weigh in on the energy debate as legislation moved through the Senate Energy and Natural Resources Committee. The bill has many stand-alone components including federal lands and National Parks activities, and funding for technology research. For the oil and gas industry, an important component is language designed to streamline permitting for pipelines and LNG facilities. The legislation appeared to be on a Senate fast-track for potential passage but seemed to lose momentum in late July. The Senate was also working to approve nominees to fulfill vacancies at the Federal Energy Regulatory Commission (FERC) that need to be filled in order to permit pipelines and LNG facilities.

                                                       

Federal Actions

Bureau of Land Management (BLM) proposes to rescind hydraulic fracturing rule:  The administration claims the rule duplicates state and tribal standards and would create compliance costs between $32 million and $42 million.  In its proposed rulemaking, BLM is seeking input on how best to utilize “pre-existing authorities” to manage unconventional oil and gas operations.   The comment period for the proposed repeal is scheduled to close September 25.

 

BLM to expedite permitting process:  On July 6, Interior Secretary Zinke signed a secretarial order to “tackle permitting backlogs and delays, identify solutions to improve the permitting process on federal lands.” The order notes that as of January 31, 2017, BLM had 2,802 pending Applications for Permit to Drill with an average processing time during Fiscal Year 2016 of 257 days.

 

Federal court orders Environmental Protection Agency (EPA) to enforce methane rule:  At the end of July, the U.S. District Court of Appeals for the District of Columbia ruled that EPA must enforce its methane emission requirements for the oil and gas industry.  Earlier in the month, the court ruled that the agency had misapplied the Clean Air Act to stay implementation for parts of the rule.

 

State/Local Actions

Alaska

  • In an effort to shore up the state’s deficit, Alaska lawmakers voted to cut the state’s subsidy for oil and gas companies.  New legislation will replace the existing subsidy program with a new one that puts in place a system of tax writeoffs.

California

  • State officials cleared the way and injections have resumed at the Aliso Canyon gas storage facility following a comprehensive safety review ordered by the state legislature in response to a leak at the site.

Colorado

  • The Broomfield Oil and Gas Comprehensive Plan Update Committee presented its results to the public in July.  The group provided a public presentation and an opportunity to visit with committee members individually.  The committee recommended a quarter-mile buffer zone between wells and homes, parks, schools and bodies of water.  Other issues addressed by the committee include health, safety, emergency response, property values and alternative-site analysis.  The public was invited to comment on these findings.

Pennsylvania

  • The state Senate approved a budget bill late July that proposes a tax increase on natural gas and a severance tax on unconventional well production.  These measures were included as part of the budget package to pay for the state’s General Appropriations Bill, which became law earlier in the month.