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Coming Soon: EPA’s Supplemental Proposed Methane Rules for the Oil and Gas Sector

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The U.S. Environmental Protection Agency’s (“EPA”) supplemental proposal for regulating methane and volatile organic compound emissions from the oil and gas sector is coming in October, according to the EPA’s latest semiannual regulatory agenda. The Office of Management and Budget began an inter-agency review of the supplemental proposal this week, which is consistent with the EPA’s October timeline. Those interested in commenting on the supplemental proposal should have a plan in place as they will likely have just 60 days to do so following the publication of the supplemental proposal in the Federal Register.

Per our earlier update, the EPA’s far-reaching initial proposal in November 2021 included three separate actions under the Clean Air Act that target new and existing air emission sources at oil and natural gas well sites, natural gas gathering and boosting compressor stations, natural gas processing plants, and transmission and storage facilities. We have highlighted some of the initial proposal’s potential shortcomings identified by commenters, including the fact that it did not include the proposed regulatory text. We can expect the EPA’s supplemental proposal to attempt to address many of the issues identified by commenters.

The importance of the EPA’s methane rulemaking has only increased with the passage of the Inflation Reduction Act (“IRA”), which expressly exempts sources from the IRA’s methane emissions fee if the EPA’s methane rulemaking will result in “equivalent or greater emission reductions.”

This information is provided by Vinson & Elkins LLP for educational and informational purposes only and is not intended, nor should it be construed, as legal advice.