New Mexico business leaders are pushing back against a campaign led by environmental activists to save a last-minute regulation from the Obama administration targeting oil and natural development.
In a guest column published today by the Albuquerque Journal, the New Mexico Business Coalition (NMBC) said the “venting and flaring” rule imposed late last year “clouds the regulatory environment” for one of the state’s most important industries. The rule, finalized by the U.S. Bureau of Land Management (BLM) two months before President Barack Obama left office, adds to existing state and federal regulations that limit methane emissions.
“An ax, not a scalpel, is needed on BLM’s venting and flaring rule,” Cristina Arnold, regional vice president with NMBC, said in the column. “Adding layers of duplicative regulations adds unnecessary costs of compliance and makes following the regulations confusing, particularly for small companies,” Arnold said.
Because it was imposed at the end of the Obama administration, the BLM methane regulation can be repealed with a disapproval motion under the Congressional Review Act (CRA). The U.S. House passed a CRA disapproval motion on the venting and flaring rule last month and the repeal measure now awaits a vote in the U.S. Senate.
Methane is the primary constituent of natural gas. The Obama administration and environmental groups claimed the new BLM rule will prevent natural gas from being wasted, increasing production of the fossil fuel on federal lands and resulting in more royalty revenue for federal, state and local governments. But critics of the rule say just the opposite will occur: The extra red tape will block many wells from being drilled and force others to prematurely shut down due to higher costs, resulting in lower oil and gas production and less royalty revenue.
Critics of the Obama methane regulation argue that the BLM can curb venting and flaring more effectively by approving more pipelines to transport natural gas away from well sites to the markets where it can be sold. But new pipeline projects have been opposed by the Sierra Club, the Center for Biological Diversity and other “keep it in the ground” activist groups – the same groups that have called the venting and flaring rule “a positive step” towards ending fossil-fuel production on public lands completely.
The venting and flaring rule has angered officials from across the West, including New Mexico Gov. Susana Martinez (R), Utah Gov. Gary Herbert (R), North Dakota Gov. Doug Burgum (R), the Greater North Dakota Chamber, Grand Junction Chamber of Commerce, Southern Ute Indian Tribe, Colorado Association of Commerce and Industry, Colorado Business Roundtable and Club 20, a coalition of local governments, tribes, businesses and citizens from the Western Slope. Three states – Wyoming, Montana and North Dakota – are also trying to overturn the rule in court.
In response, environmental activists have been campaigning through various groups – including the newly created Western Leaders Network – to save the venting and flaring rule. The Environmental Defense Fund, for example, says any problems with the rule can be fixed through regulatory and legislative amendments rather than full repeal. Overturning the rule with a CRA disapproval motion is like “taking a chain saw to a problem that might better be fixed with a scalpel,” Mark Brownstein, vice president of climate and energy for the Environmental Defense Fund, told E&E News in January.
Earlier this month, the Albuquerque Journal advanced a similar argument against the CRA motion in an editorial headlined “Scalpel, not ax, needed on BLM’s new methane rule.” Today’s column by the NMBC was a rebuttal to the newspaper’s editorial.
As Western Wire reported in January, the NMBC has warned that restrictions on energy production imposed by the venting and flaring rule carry major economic consequences in New Mexico. The state is struggling to overcome a series of budget deficits and revenue from oil and gas production is essential, NMBC president Carla Sonntag said in support of the CRA disapproval motion.
“One-third of our state’s budget is derived from the production of oil and natural gas,” Sonntag said. “It’s also the single largest source of state funding for our public schools, our colleges, and it also covers healthcare.”
