In an April 18, 2017 letter, EPA Administrator Scott Pruitt stated that the Agency will reconsider final rules governing new sources of methane emissions from the oil and gas industry. This decision was prompted by issues raised in petitions for reconsideration filed by a number of groups—including API and the Texas Oil and Gas Association—concerning EPA’s final rule amending the oil and natural gas sector New Source Performance Standards (NSPS) (the Final Rule), which was published on June 3, 2016 and became effective August 2, 2016. Under Clean Air Act Section 307(d)(7)(B), the Agency must convene a proceeding if a petition for reconsideration raises issues that are of central relevance to the rule and arose after the public comment period closed or were impracticable to raise during the public comment period.

The petitioners raised objections associated with the Final Rule’s fugitive emissions monitoring requirements. In particular, the petitioners objected to “provisions for requesting and receiving an alternative means of emission limitations and the inclusion of low-production wells.” Because these provisions were not included in the proposed rule, the public did not have the opportunity to raise objections during the public comment period. Administrator Pruitt’s letter indicates that EPA will provide a notice and comment opportunity during the reconsideration process for these issues, as well as any others it believes will benefit from additional comment. While a reconsideration proceeding does not automatically postpone a rule’s effectiveness, the Administrator may stay a rule’s compliance date for up to three months. In this case, Administrator Pruitt stayed the Final Rule’s compliance date for fugitive emissions monitoring requirements for ninety days.

The rule has been challenged at 16 states and by 19 oil and gas industry groups in the D.C. Court of Appeals. On March 2, 2017, EPA announced that it was withdrawing its information request to oil and gas industry operators that was part of information gathering for development of the final rule. In addition, this decision comes on the heels of a March 28th Executive Order directing EPA to immediately review regulations on energy sources and to suspend, revise or rescind them as well as a request to the D.C. Court of Appeals to hold the lead case in abeyance until 30 days after the EPA completes its review under the Executive Order. By convening this proceeding for reconsideration, EPA continues to signal its willingness to revaluate a key Obama administration rule targeted to significantly reduce methane emissions. Voluntary oil and gas industry initiatives have already substantially reduced methane emissions since 2011.