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Page added on October 10, 2013
Government And Oil Industry Need ‘Regulatory Detente’
Regulation after regulation has been thrown at the oil and gas industry by federal and state agencies since 2009.
All 13 federal agencies that regulate a portion of the oil and gas industry have tried in some way to make it more difficult to drill, produce and refine hydrocarbons in the United States.
The Environmental Protection Agency has been the most visible in many respects with its new air emission regulations that define carbon dioxide (CO2) as a pollutant and sets emission limits.
EPA also has initiated a study of hydraulic fracturing even though many legal scholars point out that federal law exempts hydraulic fracturing from federal regulation. State regulatory agencies have regulated hydraulic fracturing for decades.
The new federal oversight includes such agencies as the U.S. Fish and Wildlife who enforces the Endangered Species Act; the Federal Energy Regulatory Commission which oversees natural gas rules enforcement; the Commodities Futures and Trading Commission that is trying to write new regulations on “swaps” and trading on the futures market; the Department of Interior and Bureau of Land Management that has set new drilling standards on federal lands; and on and on.
Texas has jumped into the act also with the Texas Commission on Environmental Quality implementing new air emission requirements and even using special cameras in helicopters to enforce the new limits.
The Texas Railroad Commission has issued new drilling and completion regulations, and it is proposing new rules for injection wells. It already had initiated new requirements for inactive wells.
All of these new regulations have the industry spinning just trying to catch up with methods and resources needed to comply.
One former regulator, John Tintera, who retired from the RRC in 2012 as Executive Director and 22 years with the commission, has called for a “regulatory détente”. Tintera, who is a geologist and consultant in Austin, says that “unconventional energy development has been politicized. Not just in our great country, but also on the international stage. Right or wrong, the future role of shale oil and gas must now be viewed through a political prism.”
Tintera said that political problems require political solutions. “Without political solutions, our disagreements grow into problems which lead to broader conflicts. Let’s not go there,” he said.
“We need an unconventional solution to our unconventional energy debate. It is time to consider ‘Regulatory Détente,’” he said.
Tintera explained that detente as modern political concept comes from the decades old Cold War era. It bore fruit as a Kissinger – Nixon policy that now, in hindsight, was one of the key factors that began the march to the end of the Cold War.
“It was intended to ease tensions and lead us away from brinksmanship by recognizing we have a common geopolitical denominator that is as basic as it is important. Survival.”
Tintera said that the oil and gas industry is immersed in a regulatory “cold war”. “In this “war” the combatants are politicians and regulators, the weapons are statutes and rules. If we are to turn the current antagonism into a golden age of economic prosperity with abundant energy, environmental protection, and a prosperous future, we need to recognize three fundamental facts:
- Energy needs water.
- Water needs energy.
- We, the people, need both.
“These are the common denominators to build our future on and avoid mutually assured destruction through competing over-regulation or under-regulation,” he said. “The concepts of federal versus state, energy versus water, blue versus red, are counter-productive too. It is time to move beyond them.”
6 Comments on "Government And Oil Industry Need ‘Regulatory Detente’"
action on Thu, 10th Oct 2013 7:47 pm
Bloody hell, meaningless words representing meaningless noises from flapping rig porn gums and lips, whoever wrote this fails to make a concise point or really any sense whatsoever. Where’s the plan of action in this rabble, there is none, just oral flatulence and business as usual.
DC on Thu, 10th Oct 2013 7:50 pm
Yup.
BillT on Fri, 11th Oct 2013 3:25 am
Somebody actually gets paid to shovel this shit.
GregT on Fri, 11th Oct 2013 5:44 am
Even worse.
People actually believe the people, that get paid to shovel this shit.
rockman on Fri, 11th Oct 2013 11:55 am
I fully agree with the sh*t characterization but for different reasons. The biggest pile of BS is from Tintera especially since he was with the TRRC for 22 years and should know all the details as far as Texas regs go. I’ll guess he’s just trying to stir up some consulting work. Louisiana also has very tight regs on drilling, frac’ng and air quality. But it is true that other state regulators, such as PA and NY, were pitifully ill prepared for the surge in drilling and frac’ng.
First layer of BS: there have been no significant changes in the TRRC regs. There was no need. The TRRC has thousands of detailed regs covering every aspect and they do enforce them with enthusiasm. I deal with those regs on a daily basis. I’m in the process of getting a permit for a salt water injection well. It will take months to clear the hurdle as a result of TRRC regs as well as direct input from the local community. Over 130 locals have signed up for the first public meeting. In the bad ole days decades ago the situation in Texas and Louisiana wasn’t very good. But that’s not the case today. In La. not only do I have to meet state air quality regs for my production equipment but some parishes have even tighter restrictions I have to comply with.
As far as fed regs in 38 years the only agency I’ve dealt in La. and Texas was the Corps of Engineer when my activities involved navigable waters. But I have drilled in KY where the state has given over control of the drilling regs to the feds. The EPA runs the show there. And that is not good news for the citizens. There was not one EPA hand on the ground in KY to monitor my activities. Their regs were a total joke. I would file my paper work with the EPA office in Atlanta. They had no capability (or interest from what I could tell) of knowing if anything I submitted was true. I could have been breaking any number of regs that would have gotten me arrested in Texas and no one with the KY govt or the EPA would have a clue. If folks are expecting the feds to keep the oil patch honest they will almost certainly be very disappointed IMHO.
I do agree with Tintera that rational conversations should be held between all parties involved. But in the end the other states need to take control of the situation just as Texas and Louisiana did long ago. When there’s a profit to be made the oil patch will deal with any of the regs put in front of them. But they have to be rigorously monitored and enforced as in La. and Texas.
Which brings up another irritating point when I hear folks in PA complain about not having the monies to expand enforcement. Over the years La. and Texas have collected $trillions from the oil patch in production taxes and fees. Yet in PA, home of the first oil well drilled in the US, they’ve never collected one penny of production tax. A couple of years ago I estimated that if PA changed the same production tax rate as Texas they would be collecting over $220 million per year from the oil patch. That would go a long way towards expanding enforcement as well as fixing the roads the oil patch has been tearing up. Texas and La. have the most thorough oil/NG regs and enforcement on the planet. They make the fed offshore enforcement look like amateur night. And every bit of these costs (and a lot more) is covered by the monies the states collect from the oil patch.
Years ago I recommended both PA and NY to just download the thousands of pages of TRRC regs (you can do that if you’re interested in seeing just how extensive they are), change the logo to that of their state and go with that. Instead both states are waiting for the feds to take charge. And that appears to still be a long way off even today.
Dave Thompson on Fri, 11th Oct 2013 7:34 pm
Same old story of getting a complicated issue into the minds of many. The international corporate bankers military industrial media complex will always internalize profits and externalize costs at the expense of the commons.