WEA questions cost of BLM's proposed fracing rule

The US Bureau of Land Management’s proposed rule to regulate hydraulic fracturing on public lands could impose costs of up to $1.6 billion/year upon society, the Western Energy Alliance (WEA) said in a full economic analysis released June 13.

The analysis was done by John Dunham & Associates, an economics firm.

BLM’s proposed rule threatens to divert investments away from energy development, job creation, and economic growth, WEA said, adding the BLM proposal also could create federal compliance requirements redundant with existing state regulations.

“States have been successfully regulating fracing for generations, including on federal lands, with no incident of contamination that would necessitate redundant federal regulation,” said Kathleen Sgamma WEA vice-president of government and public affairs. “Western Energy Alliance calls on the federal government to abandon plans to move forward with this rule.”

Sgamma said operators developing on federal lands must obtain state permits and comply with all state regulations. States already have decades of expertise on how to regulate fracing, she said.

BLM would be acting prematurely by issuing new regulation before the release of the US Environmental Protection Agency’s scientific study examining fracing, she said.

WEA believes BLM failed to conduct a full economic assessment required for rules with over $100 million/year in cost, which suggested the proposed rule violates the Paperwork Reduction Act, the Small Business Regulatory Enforcement Fairness Act, the Unfunded Mandates Reform Act, the Regulatory Flexibility Act, the Small Business Regulatory Enforcement Fairness Act, and Executive Order 12866 Regulatory Planning and Review.

Several western governors, tribes, members of Congress and the Interstate Oil & Gas Compact Commission oppose BLM regulating hydraulic fracturing on public lands.

WEA was founded in 1974 as the Independent Petroleum Association of Mountain States, is a nonprofit trade association representing 400 oil and gas companies.

Contact Paula Dittrick at paulad@ogjonline.com.

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