EPA's methane standards for oil and gas operations face legal challenge by 24 states

Texas, Oklahoma, 22 other states, excluding Colorado, and oil giant Continental Resources filed a petition in federal court in claiming that a new Environmental Protection Agency rule regulating methane standards for oil and gas operations illegally expands EPA’s authority beyond what the Clean Air Act (CAA) authorizes.

The final rule, published in the Federal Register March 8, is intended to “mitigate climate destabilizing pollution and protect human health by reducing greenhouse gas and volatile organic compound emissions from the oil and gas industry.”

The petition, filed last month, calls the new rules “arbitrary and capricious” in part because EPA is applying the new emissions standards to existing oil and gas infrastructure — something that’s never been done before — and in part because the rule allegedly usurps state authority to regulate oil and gas emissions.

According to Denver environmental attorney Paul Seby, who represents Continental Resources, the only industry representative to join the case, the first order of business is to obtain a ruling on a motion to stay enforcement of the rule pending resolution of the case.

The reason 24 states have challenged the rule is because the states are supposed to have the power to create emissions regulations within their own states that the EPA is restricted to reviewing and accepting or rejecting, Seby said. But, they argue, the EPA is now claiming federal jurisdiction to dictate how oil and gas producers must control emissions and the standards they must meet.

Continental’s petition says the rule also illegally delegates enforcement authority to private citizens and organizations.

Environmental groups argue that having citizens monitoring oil and gas emissions is a way to force companies to reduce their emissions of methane. Methane is a greenhouse gas that traps more heat than CO2, making it 80 times more harmful than CO2, according to the UN Environment Programme.

The rule requires oil and gas owners and operators “to provide information necessary for the purposes of carrying out the CAA” to the public and further grants private third parties the power to inspect facilities and enforce EPA regulations by reporting suspected emissions violations.

“It is well established that federal agencies may not delegate their statutory authorities to private parties,” according to the Continental brief, citing a 1996 U.S. Supreme Court decision. “EPA plainly lacks authority under the CAA to delegate its monitoring duties to private third parties.”

While the CAA says EPA can delegate its authorities to states, which is what it has been doing, the new “Super Emitter Program” established in the rule “turns this delicate balance on its head, duplicating and conflicting with existing state regulations and policymaking,” according to Continental’s brief.

The Super Emitter program sets up private individuals and organizations as detectives who can file complaints whenever they perceive something they think violates the federal standards. That, says Continental, makes the program “ripe for abuse” through false or mistaken reports that cost the company money to investigate and refute, and that provides no substantial penalties for false reporting.

EPA is setting up a “one-size-fits-all” standard that illegally supplants the standards set by the individual states, Seby said.

“The Final Rule’s presumptive emission standards violate the statutory structure of the Clean Air Act because they impose mandatory nationwide one-size-fits-all presumptive emissions standards that leave the states no flexibility in regulating existing sources contrary to the cooperative federalism required by CAA Section 111(d),” says Continental Resource’s brief.

In a related matter, the Center for Biological Diversity released a statement Wednesday, saying that it intends to file a lawsuit against the EPA claiming it has not acted quickly enough to revoke oil and gas permits issued by the Colorado Department of Public Health and Environment for four oil and gas wells in Weld County.

“Colorado is effectively giving the oil and gas industry a free pass to pollute under illegal permits,” said Jeremy Nichols, a senior advocate at the Center. “We need the EPA to intervene to ensure public health and the environment comes first and put an end to Colorado’s dangerous foot-dragging.”