On June 25, 2021, the U.S. House of Representatives voted to rescind a Trump-era methane rule using its Congressional Review Act (CRA) authority, which includes special procedures that allow Congress and the President to rescind certain rules promulgated during a prior administration, within defined time limits. The Senate passed the CRA resolution disapproving the rule on April 28, 2021. The measure garnered bipartisan support in both chambers. Congress presented the resolution to President Biden, who signed it on June 30, 2021.
Finalized in September 2020, the Trump-era methane “Policy Rule” amended rules promulgated by the Obama-era Environmental Protection Agency (EPA) in 2012 and 2016 that regulated methane emissions from new or modified sources in the oil and gas sector. As we reported previously here, the 2020 Policy Rule had removed the transmission and storage segments from the scope of the oil and gas sector subject to the rules and eliminated direct federal limits on methane emissions from the production and processing segments.
It is now expected that EPA will take action to clarify obligations on the oil and gas sector. The Policy Rule resolution does not address a separate Trump-era rule with technical amendments to the rules governing the oil and gas sector, including revisions to the timing and scope of certain monitoring, repairs, recordkeeping, and reporting requirements, which currently remain in effect. The EPA is reconsidering those amendments pursuant to Executive Order 13990, with a proposed revised rule expected in September. In a related action, EPA is developing a proposed rule to regulate methane from existing oil and natural gas sources, which is expected in September, consistent with Executive Order 13990.
Oil and gas industry participants should take note of the reversal and should consider what impact the reversal has on their compliance obligations. Sidley will closely monitor any subsequent EPA actions for the oil and gas sector.