Methane Rule Pits Texas Oil, Gas Industry Against White House

The Texas Railroad Commission—the states regulatory body for its entire oil and gas industry—has asked the Texas attorney general to sue the Biden Administration over its law designed to lower emissions within the oil and gas industry.

The rule was issued in December by the U.S. Environmental Protection Agency and deals specifically with methane released in the course of producing oil and gas. It is the second action in less than a week, after last week, Texas Railroad Commissioner Wayne Christian sent a letter to President Joe Biden and his Energy Secretary, Jennifer Granholm, chastising the Administration for its pause on new LNG export project permits.

“Texas natural gas is saving the free world, and President Biden wants to end it,” Christian said last week, adding that the Administration’s pause on LNG export plants could “recklessly endanger European lives.”

When the Biden Administration presented the new methane rule in December, small U.S. oil and gas producers were concerned that it could shut down wells and put them out of business. The EPA argued that the nation's largest industrial source of the “super pollutant” is from the oil and gas industry.

Armed with deeper pockets to roll out what would certainly be massive changes, larger oil and gas players, such as BP, welcomed the new rule, even congratulating the Administration on achieving an “important milestone.”

The new regulation is set to take effect in five years, and will require significant investments from oil and gas companies to monitor methane leaks from, among other things, well sites and compressor stations. Some of the smaller oil and gas players may not survive, unable to shell out the cash required for such an ambitious rule.

By Julianne Geiger for Oilprice.com

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