EPA Proposal Seeks to Ease Rule Lowering Methane Emissions for Oil and Gas Companies

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Written by John Egan for IIR News Intelligence (Sugar Land, Texas)

 

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Summary

At a political rally in Lubbock, Texas, on Tuesday evening, President Donald Trump announced a proposal to scale back an oil and gas methane emissions rule adopted in 2023 by the Biden administration, claiming it would expand production, ease regulatory burdens on small producers and help reduce the cost to consumers of fueling vehicles and heat homes.

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Draft EPA Rule Would Ease Regulation of Methane Emissions

The U.S. Environmental Protection Agency (EPA) on October 27 released a draft rule easing regulation of methane emissions from the oil and gas industry, reversing a rule adopted in 2023 during the Biden administration. The draft rule focused on wells that produce 15 barrels of oil equivalent or less per day. Those wells account for approximately 78% to 80% of all domestic wells and 7% of all domestic oil and gas production, the rule estimated. News reports have said that the smaller wells, as well as associated infrastructure, account for nearly 50% of methane emissions.

The proposal estimated that the new rule would save the industry, mostly smaller operators, $45 billion between 2027 and 2050 while "unleashing" about 210 million additional barrels of oil and 1.41 trillion cubic feet of natural gas by then.

In its proposal, EPA was fulfilling one of its pledges, made early in the second Trump administration, to revisit and possibly revise up to 31 separate energy and environmental rules that had been adopted during Trump's two Democratic predecessors. For more on that, see March 14, 2025, article - EPA Will Reconsider 31 Energy and Environmental Rules from Trump's Predecessors.

The EPA proposal would modify amendments to sections OOOO b and c of the Clean Air Act, adopted in 2023, which sought to lower methane emissions from the oil and gas industry. The draft rule will be published in the Federal Register in the coming days. The public will have 48 days after publication to comment on the rule. The EPA plans to hold a virtual public hearing within 15 days of the proposed rule's publication.

In a statement accompanying the release of the 388-page proposal, the EPA sought to make these five changes:

• Categorizing Wells: Two options were proposed "to make sure the regulations are workable for different types of wells," the agency said. The first option would categorize well sites by production level, either "marginal" or "non-marginal." The second option would categorize wells by production type, whether "conventional" or "unconventional."
• Super Emitter Program: The agency is proposing to rescind the program that certified third-party monitors to track so-called "super emitter" leak events and required states to do the same, claiming there were other ways to track and fix significant methane emissions.
• Covers and Closed Vent Systems: EPA is proposing to split the "No Identifiable Emissions" aspect of covers and closed vent systems into "design" requirements and "operational" requirements. The operational requirements would allow for repairs.
• Associated Gas: The agency wants to restore 95% efficient flaring or other control devices as the best system of emission reduction, rather than requiring all associated natural gas coming from oil wells to be captured and sold.  
• Control Devices: Technical changes were proposed to give flexibility for flame monitoring data deviations, control device alerts and visible emissions test conditions where appropriate.

Earlier this month, at an energy conference in New Mexico, EPA Administrator Lee Zeldin said this about the then-unreleased draft rule: "Americans must be able to afford to heat their homes in the winter and fill up their car and drive to work. They can't do that when the people producing the energy are weighed down by unnecessary burdens." The October 27 statement from the EPA announcing the proposed rule had similar comments from other members of the administration.

By the Numbers

• US$45: The cumulative savings, in billions of dollars, the Trump administration estimated would result from a new draft rule loosening methane emissions regulation on the oil and gas industry. The savings would be created between 2027 and 2050.
• 210: Millions of incremental barrels of oil production per day that will result from the new regulations, again over the next 23 years.
• 1.41: Trillion cubic feet of incremental natural gas production that will take place between 2027 and 2050 under the proposed methane emissions rule.

Trade Group Applauds Methane Move

Edith Naegele, president and chief executive of the Independent Petroleum Association of America (IPAA), the trade group representing smaller oil and gas producers, applauded the administration's move, calling the Biden-era rule "burdensome."

"As originally written, the (Biden-era) regulations would have placed an outsized burden on independent producers and could have threatened the continued operation of hundreds of thousands of marginal wells nationwide," she said in a statement. "The result would have been felt far beyond the wellhead, impacting workers, small businesses, landowners, local governments and the communities that depend on domestic energy production.

"Marginal wells are the backbone of a uniquely American energy success story," she continued. "While often overlooked, these wells account more than 75% of producing wells in the United States and collectively provide a meaningful share of our nation's domestic oil and natural gas supply."

Why Methane? Why Now?

Last November, the Trump administration delayed the effective date for many of the Biden-era methane emissions limits until 2027.

The U.S. already is producing record levels of oil and natural gas. According to the Energy Information Administration (EIA), domestic gas production will average approximately 123.5 billion cubic feet per day (Bcf/d) in 2026 and 128 Bcf/d in 2027. Twenty years ago, before the start of the shale revolution and the introduction of hydraulic fracturing, roughly 53 Bcf/d of gas was produced domestically.

EIA's October 2026 Short-Term Energy Outlook projected domestic oil production will average 13.9 million barrels of oil per day (mbd) this year and 14.3 mbd next year. In 2006, U.S. production averaged about 5 mbd, EIA said.

Higher production generally exerts downward pressure on prices. But world crude and refined product oil prices have shot up this year following the U.S.-Israeli war with Iran, which has effectively closed the Strait of Hormuz, through which about 20% of the world's oil traverses by ship. The squeeze on refined products has increased in recent months after Ukraine began targeting Russia's refineries.

Easing methane regulations has not been a top issue for large producers, but it has been for smaller producers, who operate the majority of wells in the U.S. but contribute only a small fraction of oil and gas production.

By announcing the draft proposal in Texas, the state that produces the most oil and gas in the nation, the president was trying to support Ken Paxton's run for the U.S. Senate. Texans voted for Trump in all three of his presidential runs, but signs have emerged that the state, once reliably ruby-red in political demeanor, may elect more Democrats in next month's mid-term elections. The president has many friends and donors in the oil and gas industry.

As a greenhouse gas, methane has a shorter lifespan than carbon dioxide in the atmosphere, but is many times more powerful. As such, its impact on global warming is significant. Around the world, the oil and gas industry is one of the largest emitters of methane.

The proposed rollback, which may be challenged in court, comes as the world marks yet another record high for temperatures. Scientists and environmental organizations have said temperatures have been driven upward by greenhouse gases like methane and carbon dioxide. Lowering the oil and gas industry's methane emissions not only would be a counterweight to rising greenhouse gas emissions in other countries, but made economic sense too, as il and gas companies would be able to sell more of their product. The president has long doubted climate science.

Key Takeaways

• The Environmental Protection Agency on October 27 released a draft rule scaling back methane emissions limits enacted during the Biden administration.
• At a political rally in Lubbock, Texas, Tuesday evening, the president said the new rule would cut costs by US$45 billion from 2027-2050 and lead to increased production of oil and gas in the U.S.
• The U.S. is already producing record amounts of oil and natural gas.
• The EPA will take public comments on its 388-page proposal for 45 days after it is published in the Federal Register.

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