The battle over oil and gas regulation heats up in Wyoming – states v. feds

The Department of Interior’s Bureau of Land Management recently filed in the 10th Circuit Court of Appeals looking to end an injunction placed against the agency as it looks to regulate oil and gas on federally controlled lands. Many states feel that the BLM has overstepped its authority in trying to impose federal regulations on oil and gas at the state level, several of them are fighting back in court.

Last year, U.S. District Judge Scott Skavdahl blocked the implementation of more stringent rules in response to the legal challenge from the states of ColoradoNorth Dakota, Utah and Wyoming. The states claim they have the authority to regulate oil and gas activity under the 2005 Safe Drinking Water Act, which bars the federal government from regulating underground injections like fracing, except when diesel fuel is used.

Exclusive interview Oil & Gas 360 - Wyoming Governor Matt Mead

Wyoming Governor Matt Mead

States are better at regulating oil and gas: Mead

Note only do states have primacy in regulating oil and gas activity, they are better at it too, Wyoming Governor Matt Mead told Oil & Gas 360®.

“I think we can show consistently that the state can do it better than the federal government,” said Mead. “The state of Wyoming was years ahead of the federal government when it comes to regulating oil and gas. It’s not that states can’t make mistakes, but when we do, we can correct it in a matter of months rather than a matter of years.”

Allowing the BLM to take charge of regulation would set a dangerous precedent, said the Wyoming governor. “It creates confusion, expenses, and it sends the wrong message to the states. If the federal government is concerned about practices like fracing, they should look at individual states and see how they’re doing,” rather than issuing a blanket statement for all states, said Mead. “It takes away incentive to make progress in the areas apparently important to the federal government if they’re going to come in after a few years and bring these conflicting regulations.”

“They should look at states like Wyoming and say ‘that’s how we should be doing this’,” rather than trying to make duplicative and contradicting regulations said Mead.

No perfuming this pig

“There’s no perfuming this pig,” Mead said about the current state of the oil and gas industry. “It’s tough times in the industry,” but Wyoming continues to work with energy companies to navigate the downturn.

With a major portion of the state’s energy production coming from coal, Wyoming has been especially hard hit in recent years as increasing use of natural gas and higher political and regulatory costs make coal a less economical fuel source for electricity. The decline in the use of coal combined with the oil and gas layoffs seen everywhere in the country has left many in the energy sector in a tough spot. Wyoming is a prime example.

Like a natural disaster

“Several weeks ago, we had sizable layoffs in coal. You combine that with the layoffs in oil and gas, and I decided to bring together 12 of my agencies, and told them to respond to this like it was a natural disaster,” said Mead.

“[The workers who have been laid off] are good citizens, and we want to do anything we can to help keep food and their table, and keep them in the state of Wyoming. The agencies have set up in the counties most affected by the downturn to help these people find new jobs,” said Mead.

The governor said that the programs have not been able to find jobs for every worker, but that they are helping to fill some positions available in the state. “It’s not a huge number, but we’re using this to fill jobs in places like the Department of Corrections.”

The added regulations the BLM is proposing could add more burden to the companies struggling with the current downturn. When asked how he saw things playing out with the court case, Mead said he is optimistic.

“When you look at the authority the BLM has, it seems to me that we should win this case.”

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