States best qualified to regulate oil, gas, House panel told

US states are the most qualified to regulate oil and gas development within their boundaries because they’re well acquainted with unique geological and environmental conditions there, officials from three state governments told the US House Natural Resources Committee. But a fourth witness said federal and state regulators may have different management goals that are dictated by law.

US Rep. Doc Hastings (R-Wash.), the committee’s chairman, said the committee and some of its subcommittees have held at least five hearings in the last 2 years about problems when new federal oil and gas requirements are imposed on top of existing state regulations. “There is a simple solution to prevent duplication: Don’t duplicate the states,” he declared. “The ‘one size fits all’ regulatory structure being pursued by the Obama administration is a waste of time and energy.”

The three state officials agreed. “While day-to-day interactions with local branches of these federal land management agencies are friendly and, for the most part, productive, national policies are beyond the control of local administrators,” Utah Lt. Gov. Gregory S. Bell (R) said. “From Utah’s perspective, increasingly national political considerations are unduly influencing land use decisions that are more effectively addressed locally.”

Bell continued, “Utah believes that those closest to, and whose lives are most directly impacted by, public lands are better situated to make decisions regarding the use and enjoyment of those public lands. In our experience, when land and energy policies are determined within the political jockeying in Washington, DC, the outcomes for local communities are almost invariably negative.”

The most recent example is the US Department of the Interior’s decision to apply sequestration cuts to mineral lease royalty payments, Bell told the committee. “This move subverts the common understanding of what royalties are—dedicated revenues collected by the federal government in trust for us, but certainly not federal spending,” he said.

Certainty matters

Texas can charge more for a lease over a shorter timeframe than the federal government because it completes permit application reviews and reaches other regulatory decisions more quickly than the federal government, Texas General Land Office Commissioner Jerry Patterson said. “Producers are willing to pay more because our terms and timeframes are certain,” he explained.

The numbers speak for themselves, he told the committee. “On state trust lands, as well as private lands, permits can be secured more quickly and the process is less cumbersome than dealing with the federal government,” Patterson said. “In all categories, the states lead the way in leasing, permitting, drilling and—most important—the production of oil and gas. This administration should look to the states and follow their lead if we are to become energy independent.”

Richard J. Simmers, chief of the Division of Oil and Gas Resources Management for the Ohio Department of Natural Resources, said, “Energy development of all types—but particularly oil and gas—can be risky and dangerous. This industry needs to be regulated, and states are the most qualified to it.

Simmers added, “People who believe federal regulations are uniform and consistent, and state regulations are a patchwork of inconsistency don’t understand how oil and gas regulation works. The states are doing it properly. We’re just doing it differently.”

States also may have different resource management goals than the federal government, suggested Brad Powell, senior policy director at Trout Unlimited, a sports and recreation association. “An important distinction is that federal lands are managed for multiple uses, while state and private lands often are not,” he said. “State lands often are managed for maximum revenue under constitutional mandates requiring the managing agency to maximize revenues from commodities.”

Powell said federal agencies don’t always meet their multiple use goals, but added that protests against issued leases have dropped significantly since US Interior Sec. Ken Salazar announced major reforms during President Barack Obama’s first term, “and from sportsmen’s organizations to a trickle.”

Contact Nick Snow at nicks@pennwell.com.

Related Articles

Senators’ bill aims to curb flaring by expediting permit process

02/09/2015 North Dakota and Wyoming’s US senators introduced legislation that aims to capture methane and reduce flaring by expediting procedures for obtainin...

USW union workers add two BP refineries to strike list

02/09/2015 Union workers at two BP PLC-owned refineries in Indiana and Ohio have joined the United Steelworkers union’s (USW) unfair labor practice (ULP) stri...

Bendine elected as Petrobras’ chief executive officer

02/09/2015

The board of Petroleo Brasileiro SA (Petrobras) has approved the election of Alde Mir Bendine as the company’s chief executive officer.

Central starts gas sales from Palm Valley field

02/09/2015 Central Petroleum Ltd., Brisbane, is to start sale of early natural gas from Palm Valley field to Northern Territory Power & Water Corp. under ...

Association presidents want more access in next 5-year OCS plan

02/09/2015 The presidents of three major US oil and gas trade associations urged the US Bureau of Ocean Energy Management to keep more of the US Outer Contine...

MARKET WATCH: NYMEX oil prices settle above $51/bbl

02/09/2015 Crude oil prices rose on the New York market Feb. 6 to settle above $51/bbl after the Baker Hughes Inc. weekly rig count showed a decline of 87 rig...

Statoil reduces capital budget by $2 billion following 4Q losses

02/06/2015 Statoil ASA has reduced its organic capital expenditure to $18 billion in 2015 from $20 billion in 2014. The move comes on the heels of a fourth qu...

Chinese regulators approve Sinopec’s plan for grassroots refinery

02/06/2015 China’s National Development and Reform Commission (NDRC) has approved Sinopec Beijing Yanshan Petrochemical Co. Ltd., a subsidiary of China Nation...

BOEM schedules public meetings about draft proposed 5-year OCS plan

02/06/2015 The US Bureau of Ocean Energy Management will hold the first of 20 public meetings in Washington on Feb. 9 to receive public comments on potential ...
White Papers

Transforming the Oil and Gas Industry with EPPM

With budgets in the billions, timelines spanning years, and life cycles extending over decades, oil an...
Sponsored by

Asset Decommissioning in Oil & Gas: Transforming Business

Asset intensive organizations like Oil and Gas have their own industry specific challenges when it com...
Sponsored by

Squeezing the Green: How to Cut Petroleum Downstream Costs and Optimize Processing Efficiencies with Enterprise Project Portfolio Management Solutions

As the downstream petroleum industry grapples with change in every sector and at every level, includin...
Sponsored by

7 Steps to Improve Oil & Gas Asset Decommissioning

Global competition and volatile markets are creating a challenging business climate for project based ...
Sponsored by

The impact of aging infrastructure in process manufacturing industries

Process manufacturing companies in the oil and gas, utilities, chemicals and natural resource industri...
Sponsored by

What is System Level Thermo-Fluid Analysis?

This paper will explain some of the fundamentals of System Level Thermo-Fluid Analysis and demonstrate...

Accurate Thermo-Fluid Simulation in Real Time Environments

The crux of any task undertaken in System Level Thermo-Fluid Analysis is striking a balance between ti...

6 ways for Energy, Chemical and Oil and Gas Companies to Avert the Impending Workforce Crisis

As many as half of the skilled workers in energy, chemical and oil & gas industries are quickly he...
Sponsored by
Available Webcasts


Prevention, Detection and Mitigation of pipeline leaks in the modern world

When Thu, Apr 30, 2015

Preventing, detecting and mitigating leaks or commodity releases from pipelines are a top priority for all pipeline companies. This presentation will look at various aspects related to preventing, detecting and mitigating pipeline commodity releases from a generic and conceptual point of view, while at the same time look at the variety of offerings available from Schneider Electric to meet some of the requirements associated with pipeline integrity management. 

register:WEBCAST



On Demand

Global LNG: Adjusting to New Realities

Fri, Mar 20, 2015

Oil & Gas Journal’s March 20, 2015, webcast will look at how global LNG trade will be affected over the next 12-24 months by falling crude oil prices and changing patterns and pressures of demand. Will US LNG production play a role in balancing markets? Or will it add to a growing global oversupply of LNG for markets remote from easier natural gas supply? Will new buyers with marginal credit, smaller requirements, or great need for flexibility begin to look attractive to suppliers? How will high-cost, mega-projects in Australia respond to new construction cost trends?

register:WEBCAST


US Midstream at a Crossroads

Fri, Mar 6, 2015

Oil & Gas Journal’s Mar. 6, 2015, webcast will focus on US midstream companies at an inflection point in their development in response to more than 6 years shale oil and gas production growth. Major infrastructure—gas plants, gathering systems, and takeaway pipelines—have been built. Major fractionation hubs have expanded. Given the radically changed pricing environment since mid-2014, where do processors go from here? What is the fate of large projects caught in mid-development? How to producers and processors cooperate to ensure a sustainable and profitable future? This event will serve to set the discussion table for the annual GPA Convention in San Antonio, Apr. 13-16, 2015.

This event is sponsored by Leidos Engineering.

register:WEBCAST


The Future of US Refining

Fri, Feb 6, 2015

Oil & Gas Journal’s Feb. 6, 2015, webcast will focus on the future of US refining as various forces this year conspire to pull the industry in different directions. Lower oil prices generally reduce feedstock costs, but they have also lowered refiners’ returns, as 2015 begins with refined products priced at lows not seen in years. If lower per-barrel crude prices dampen production of lighter crudes among shale plays, what will happen to refiners’ plans to export more barrels of lighter crudes? And as always, refiners will be affected by government regulations, particularly those that suppress demand, increase costs, or limit access to markets or supply.

register:WEBCAST


Emerson Micro Motion Videos

Careers at TOTAL

Careers at TOTAL - Videos

More than 600 job openings are now online, watch videos and learn more!

 

Click Here to Watch

Other Oil & Gas Industry Jobs

Search More Job Listings >>
Stay Connected