You are here

New EPA emissions standards under fire

16th March 2012

Standards issued by US environment agency will be a burden on oil and gas industry finds new report.

Oil and gas industry fears EPA performance standards could disrupt production.

New emissions standards for oil and natural gas production proposed by the Environmental Protection Agency (EPA) would significantly slowdown drilling, according to a new study funded by the American Petroleum Institute.

The air pollution standards would result in less oil and natural gas production, lower royalties to the federal government, and lower tax payments to state governments, found the report.

“The EPA needs to fix these rules in a way that they’ll reduce emissions but not impede oil and natural gas development, which creates jobs and government revenue and improves our energy security,” said Howard Feldman, API director of scientific and regulatory affairs.

The study – by Advanced Resources International – claims that the proposed rules would reduce drilling for natural gas using hydraulic fracturing by up to 52 per cent, reduce natural gas production by up to 11 per cent, and reduce oil production by up to 37 per cent. As a result, the federal government would not collect up to USD 8.5bn in royalties and state governments would not collect up to USD 2.3bn in severance taxes due to reduced drilling and production, accoridng to the report.

Feldman has asked the EPA to avoida "one-size-fits-all approach for emissions completions"; to allow more time to implement the requirements; and to streamline the compliance and recordkeeping requirements.

“Natural gas prices are half what they were three years ago because of the shale boom, and this is benefiting consumers and businesses,” said Feldman. “At a time when the government is desperate for revenue, and America’s fuel prices are high, applying overly burdensome regulations would be bad public policy and could place an even bigger burden on Americans in the form of higher energy costs", he said.

Related topics: