California Greenhouse Gas Emission Standards for Crude Oil and Natural Gas Facilities – A Future Model?

On June 3, 2016 California Air Resources Board (CARB) issued their proposed rule to reduce methane emissions from new and existing oil and gas facilities and operations. Has ALL4 opened a regional office in California? Not yet, although we do work there. We share this news from the West Coast in order to highlight the fact that the proposed California rule may serve as a model to U.S. EPA and other states when they are developing regulations targeting existing sources, as the provisions of CARB’s proposed rule go beyond similar measures taken by other states. The rule, as proposed, covers a wide array of Crude Oil and Natural Gas Facility sources located both on and offshore, including new or more stringent requirements for the following:

• Separator and tank systems
• Flash analysis testing
• Vapor collection systems and vapor control devices
• Circulation tanks for well stimulation treatments 
• Reciprocating compressors 
• Centrifugal compressors
• Pneumatic devices and pumps
• Liquids unloading of gas wells
• Leak detection and repair (LDAR)
• Natural gas storage facilities

You may recall that U.S. EPA recently issued its draft information collection request (ICR) for the oil and gas industry. Responses to the ICR will inform the next administration on how to regulate oil and gas industry sources, but it’s important to keep in mind that U.S. EPA will also examine state regulations and may well look for opportunities to align the Federal rules with them. States, in turn, will also look to what the rest of the country is doing. In fact, Pennsylvania’s Methane Reduction Strategy Briefing Paper states that “The “best-in-class” measures that Pennsylvania will require are already used by industry-leading companies, required by Federal regulations, or mandated by other states”. Furthermore, Appendix A to the Briefing Paper compares Colorado’s existing regulations to Pennsylvania’s draft recommendations. So, if your facility is located in Pennsylvania, I recommend you consider how California’s proposed rule compares to Pennsylvania’s draft recommendation. Would Pennsylvania’s draft recommendation still be “best-in-class”? For those of you with operations outside of Pennsylvania, I urge you to also evaluate California’s proposed rule as it may be used to shape future Federal regulations. The proposed rule is available here for your further review.