Recently, the federal government’s EPA issued new mandates on the oil and gas industry – requiring a process called “green completion.” These new EPA rules are meant to protect the air from harmful gases, such as methane, which can be released during the oil and gas drilling process.
A noble purpose – but it raises two questions in my mind: (1) Do Oklahomans need Washington, D.C., intervention to protect us from the oil and gas industry? And (2) If so, do these EPA rules accomplish their goal in the least burdensome, most efficient way?
In my opinion, the answer to both questions is “no.”
Speaking as only one commissioner – and not for the Oklahoma Corporation Commission as a whole – my private sector experience has shown me that government intrusion from Washington, D.C., is not narrowly tailored to the needs of Oklahomans. When regulation is formulated at a local or state level, Oklahoma’s citizens and taxpayers have a better opportunity for meaningful dialog with less intrusive consequences.
The recently-adopted EPA rules state that their goal was ”cost-effective regulations, required by the Clean Air Act, to reduce harmful air pollution from the oil and natural gas industry while allowing continued, responsible growth in U.S. oil and natural gas production.” To support this new mandate of “green completion,” the EPA argues that it will significantly increase air quality, and will not be overly costly on businesses.
Oklahoma’s oil and gas industry – both big and small companies – disagrees, pointing out some of the faulty assumptions made by the EPA to justify these additional mandates. First, the amount of harmful gases emitted during the initial stages of a well’s life are far less than estimated by the EPA. Oklahoma’s oil and gas industry estimates that the EPA missed the mark by as much as 1400%.
Secondly, the EPA states that the costs of “green completion” are offset by the additional recovery of natural gas and other products which can be sold. Again, our Oklahoma companies disagree. Oklahoma companies estimate that cost to business could be as much as $1 million per ton of harmful gas reduction. From a small business owner’s standpoint, these costs are huge and the benefit is small. The math simply does not work.
To their credit, our largest oil and gas companies already use “green completion” methods in more than 90% of the wells drilled – and were doing so prior to the EPA’s edict. As for the smaller companies, these new rules might cause them to choose not to drill a well – which means a loss of jobs for Oklahoma families
Regulation has a place, and there are sound reasons for it. In fact, the Oklahoma Corporation Commission is the chief regulator of this industry. Before state regulations are enacted, we hold official conferences to gather input from parties who will be affected by new regulations. The Oklahoma commissioners are elected by Oklahomans – and are vested with the duty and responsibility to protect and defend Oklahoma’s resources, both natural and economic.
States should be allowed to regulate our industries. The Oklahoma Corporation Commission has been a leader in sound regulation for this industry, and in my opinion, is the best way for Oklahomans to regulate Oklahoma.