On August 18, 2015, the U.S. Environmental Protection Agency released proposed regulations aimed at cutting greenhouse gas emissions and volatile organic compounds (VOCs) from oil and gas facilities. These first-ever proposed standards are a key part of a broader strategy, under the President’s Climate Action Plan, to cut methane emissions in the sector by 40% to 45% below 2012 levels in the next decade.

Building on its 2012 New Source Performance Standards (NSPS) for VOC emissions for the oil and natural gas industry, EPA’s proposed updates would require that the industry also reduce methane emissions. Sources already subject to the 2012 NSPS requirements for VOC reductions, which would also be covered by the proposed 2015 methane requirements, would not have to install additional controls, because the controls to reduce VOCs reduce both pollutants. Although the three-year-old mandates targeted VOCs at the sites, the approach cut methane emissions as a side benefit.

The new proposal would go further, requiring methane and VOC reductions from hydraulically fractured oil wells, too. And, the new plan would extend those emission-cutting requirements further downstream to natural gas transmission and processing equipment.

To create the reduction, the proposed rules target oil wells, compressors and other equipment. The proposed rule will require oil and gas producers to upgrade their pumps and compressors on new wells, and expand the use of methane-capturing equipment from gas wells to oil wells. The rules would apply to new or modified sources of oil and natural gas and would capture natural gas during the completion of hydraulically fractured wells, and would limit emissions from pneumatic pumps and several other types of equipment. Owners and operators would also be required to find and repair leaks, which can be a significant source of both methane and VOC pollution.

The proposed standards for new and modified sources are expected to reduce 340,000 to 400,000 short tons of methane in 2025, the equivalent of reducing 7.7 to 9 million metric tons of carbon dioxide. EPA estimates the rules will yield net climate benefits of $120 million to $150 million in 2025.

EPA will take comments on these proposals for 60 days  after they are published in the Federal Register and will also hold public hearings about the proposals in the months ahead.

For more information, see the EPA Proposed Rules and the Fact Sheet here.

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Photo of Mike Mills Mike Mills

Mike Mills is a partner and chair of the firm’s Oil & Gas, Pipelines and Mining Industry Team.  Oil & gas, as well as mining companies, look to Mike to skillfully advise them on natural resources development issues, counsel them on federal and…

Mike Mills is a partner and chair of the firm’s Oil & Gas, Pipelines and Mining Industry Team.  Oil & gas, as well as mining companies, look to Mike to skillfully advise them on natural resources development issues, counsel them on federal and state hazardous waste cleanup matters, and help them successfully navigate property tax valuation disputes.

When necessary to protect his clients’ interests, Mike relies on his understanding of complex regulatory matters and his clients’ businesses to defend them in environmental litigation, defeat citizen suit claims, and reduce or eliminate fines and penalties. He has been listed in Northern California Super Lawyer® since 2013 in Environmental Law and Energy & Natural Resources.

Click here for Mike Mills’ full bio.

Photo of Parissa Florez Parissa Florez

Parissa Florez focuses her practice in environmental and energy law, emphasizing land use, environmental due diligence, the California Environmental Quality Act (CEQA) permit approval process, municipal law, and land use and environmental litigation. She also works with Indian tribes and parties engaged in…

Parissa Florez focuses her practice in environmental and energy law, emphasizing land use, environmental due diligence, the California Environmental Quality Act (CEQA) permit approval process, municipal law, and land use and environmental litigation. She also works with Indian tribes and parties engaged in business or other transactions with Indian tribes. Prior to joining the firm, she was a clean tech policy intern for the U.S.-China Green Energy Council, where she worked on current policy, legislation and trends in clean tech and green energy. Parissa was also a Green Policy and Leadership Intern at Green For All working under Van Jones to collaborate on key provisions to be entered into the 2009 Climate and Energy Bill passed through the House of Representatives.