Oil & Gas Industry Welcomes EPA Decision to Change Course in Permian Basin

(Central Plaza) — The Biden administration has abandoned a plan to impose what critics have called “draconian rules” in the Permian Basin of western Texas and southeastern New Mexico, a move favored by the oil and gas industry and Gov. Greg. Abbott.

Biden administration on Thursday came out its Unified Regulatory and Deregulatory Action Plan for Fall 2022, which includes planned rule-making and federal action. In it, the Environmental Protection Agency omitted its plan for “discretionary change” in air quality conditions in the Permian Basin.

In June, the EPA announced it was reversing a 2017 decision designating the Permian Basin regions as out-of-reach areas, meaning they do not meet the 2015 National Ambient Air Quality Standards for Ozone.

In response, Abbott first sent letters to the President. argue in June that the EPA plan “could lead to a sharp increase in the price of pumps by reducing production, increasing the cost of this production, or both.” In August he argued The EPA’s plan to attack manufacturing in Texas” was “based on illogical and misguided grounds.”

The President did not answer. Instead, the EPA said that if it decides to do something, it notify Abbott and request information from the state.

Four months later, the administration dropped the EPA policy, which was quietly released late Wednesday night, labeling it “inactive,” meaning it would not be finalized for the next six to twelve months.

The Environmental Protection Agency confirmed in an email to Bloomberg News that its potential Permian Basin designation was not active but “may be reinstated at a later date.”

If this plan were implemented, Abbott argues, it “would lead to draconian regulations that would directly interfere with 40% of all oil produced in the United States.”

“The Permian Basin is the crown jewel of Texas’ powerful oil and gas industry, and the state of Texas will do everything it can to protect its production and hundreds of thousands of well-paying energy jobs in our state,” the governor said. in a statement.

“Despite the encouraging news that the Biden administration has abandoned this disastrous plan,” he added, “Texas remains ready to fight any job-killing attacks on our critical oil and gas industry.”

Todd Staples, president of the Texas Oil and Gas Association, said the EPA’s decision was “the right one.”

“The wide open spaces of West Texas and East New Mexico are home to oil and natural gas, which fuel our economies and improve modern life,” he said. over the past few years, and operators have been focusing on being environmentally friendly.”

He also notes that “the oil produced in the Permian Basin is one of the cleanest in the world due to its lower carbon intensity.”

“Excessive government regulation is unnecessary and hinders an affordable and reliable energy supply,” he said, noting that the oil and gas industry remains committed to “making smart decisions to improve air quality in this region and provide the resources our state needs.” , nation and world.

Ed Longanecker, president of the Texas Association of Independent Manufacturers and Royalty Owners, also welcomed the move. He also noted that “over the past few years, our industry has taken tremendous steps to reduce air pollution, and oil and gas producers are already taking the steps necessary to improve air quality.”

A recent study by Texans for Natural Gas showed that between 2011 and 2021, the intensity of methane emissions in the Permian Basin decreased by more than 76%.

“If the administration and the EPA are to develop successful policies to move forward, they must work with the private sector in a collaborative manner to help advance emissions reduction efforts rather than force them to comply with unnecessary and burdensome regulations,” Longanecker added.

Touré Cannon, president of the Texas Pipeline Association, told The Center Square that the decision “recognized the importance of oil and natural gas to Texas, the country, and the world.” He also said the association hopes that “the administration will make other favorable decisions that will benefit this industry that is so important to a strong American energy policy and our national security.”

The Permian Basin produces approximately 5.2 million barrels of oil per day, which equates to approximately 95 million gallons of gasoline per day.

The Texas oil and gas industry directly employs over 422,000 Texans and supports 1.37 million jobs in Texas. The increase in the number of jobs in the industry has helped Texas become the leader in the nation in terms of job growth and energy production in the United States.

In 2021, Texas crude oil accounted for 43% of all U.S. production and 25% of all traded natural gas production.

In the first half of 2022, the US became the world’s largest LNG exporter, according to the EIA, led by Texas.

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