Here’s the release from Governor Hickenlooper’s office:
Proposed rules for air pollution released today would make Colorado the first state to directly regulate detection and reduction of methane emissions associated with oil and gas drilling and further Colorado’s efforts as a national leader in environmental-friendly energy production.
The rules, which cover the lifecycle of oil and gas development (from drilling to production to maintenance), reflect a collaborative effort by the Environmental Defense Fund and Noble Energy, Encana and Anadarko oil and gas companies as part of the Air Quality Control Division’s stakeholder process.
The plan, with Gov. John Hickenlooper’s support and active engagement, constitutes the division’s official proposed rules and will now go before the state Air Quality Control Commission, which will meet Thursday, Nov. 21, and will be asked to set a February 2014 public hearing on the rules.
“These proposed rules provide common sense measures to help ensure Colorado has the cleanest and safest oil and gas industry in the country,” Hickenlooper said. “The rules will help Colorado prepare for anticipated growth in energy development, while protecting public health and the environment. They represent a significant step forward in addressing a wider range of emissions that before now have not been directly regulated. We welcome the proposed rules and are grateful all of the interested parties worked together.”
The comprehensive set of rules were crafted after an extensive process in which the Colorado Department of Public Health and Environment (CDPHE) sought input from diverse stakeholders across Colorado. The rules will now be subject to further input as the Air Quality Control Commission considers them under CDPHE’s formal rulemaking process.
“Tackling smog and climate pollution from the oil and gas sector is a critical part of making sure communities are protected and that the lower carbon advantage of natural gas doesn’t simply leak away,” said Fred Krupp, president of the Environmental Defense Fund. “If this package is adopted, Coloradans will breathe easier, knowing they have the best rules in the country for controlling air pollution from oil and gas activities.”
Anadarko, Encana and Noble jointly stated: “As citizens of Colorado, we all want clean air, and we support this joint proposal initiated by Gov. Hickenlooper. This collaboration is a good model for developing effective regulations and activities to monitor, control and reduce methane leaks and VOCs. The process and increased accountability established by the proposal will provide transparency and build public trust. We remain committed to continuously improving industry practices and protecting our communities through responsible energy development.”
The rules will benefit Colorado’s public health, environment and economy by increasing the capture and use of clean burning natural gas. Highlights of the rules include:
A first-in-the-nation requirement for leak detection from tanks, pipelines, and other drilling and production processes, using instruments such as infrared cameras that can detect leaks that otherwise may not be discovered using other more conventional means. Instrument-based monthly inspections on large sources of emissions. An aggressive timeline for repair of leaks found using either these instrument-based methods or leaks found through sight, smell or sound. Leak detection and repair of storage tanks, at well-site production facilities and at compressor stations. Requirements for detection and repair of leaks of a wide variety of hydrocarbons, including VOCs and methane, another first in the country. Expanding provisions statewide for reducing emissions of pollutants that today apply only in nonattainment areas, so anyone living near a well site would benefit. New, more stringent limits on emissions from dehydrator units located near where people live and play.
“Colorado is fortunate to have a governor who is invested in protecting the state’s environment and who brought parties together to advance the draft regulations,” said Dr. Larry Wolk, executive director and chief medical officer at CDPHE.
CDPHE estimates the package will reduce volatile organic compounds (VOC) emissions in Colorado by approximately 92,000 tons per year. That’s more VOC emissions than the VOCs emitted by all cars in Colorado in a year, and it would be a 34 percent reduction based on a 2011 inventory by CDPHE that showed oil and gas VOC emissions were approximately 275,000 tons. [ed. emphasis mine]
The draft rules also include elements that have the unique and additional benefit of significantly reducing methane emissions.
These kinds of significant reductions in VOC emissions will improve public health by decreasing asthma and other respiratory ailments.
Colorado’s unique state rules would complete the state’s adoption of EPA rules that further reduce air pollution associated with oil and gas operations. Interested individuals and parties can submit comments on the proposed rules to the Air Quality Control Commission at firstname.lastname@example.org. The proposal and related information may be found online here.
From The Denver Post (Bruce Finley):
State health officials rolled out groundbreaking rules for the oil and gas industry Monday to address worsening air pollution, including a requirement that companies control emissions of the greenhouse gas methane, linked to climate change. The rules would force companies to capture 95 percent of all toxic pollutants and volatile organic compounds they emit.
This would cut overall air pollution by 92,000 tons a year — roughly equivalent to taking every car in the state off the road for a year, state health chief Larry Wolk said. Such reductions could help bring Colorado’s heavily populated Front Range, where smog and ozone are on the rise, back into compliance with federal air quality standards.
No state has adopted rules directly limiting methane emitted by oil and gas operations. Federal government and United Nations authorities are developing rules to try to reduce such emissions because they are a large factor in global warming.
“These are going to amount to the very best air quality regulations in the country,” Gov. John Hickenlooper said.
He credited executives from Anadarko, Encana and Noble Energy — the state’s largest producers — for compromising and helping minimize environmental harm from drilling before the cost implications are fully known.
“They understand it is a shared responsibility,” he said, “and they have really stepped up.”
Under the rules, companies would have to:
• Detect leaks from tanks, pipelines, wells and other facilities using devices such as infrared cameras.
• Inspect for leaks at least once a month at large facilities and plug leaks.
• Adhere to more stringent limits on emissions from equipment near where people live and play.
• Use flare devices to burn off emissions from facilities not connected to pipelines.
Noble Vice President Ted Brown said the prescribed practices are “the right thing to do” but added that “it’s a tough rule.”
He and counterparts from Anadarko and Encana said they support the proposed rules as a way to operate more safely and build public trust.
“Regulatory certainty is important to the company, and doing the right thing also is important to the company,” Encana’s Lem Smith said. Reducing industry air pollution will bring a “quantifiable environmental benefit.”
Colorado Petroleum Association president Stan Dempsey questioned the state’s authority and the need for new rules. Regulation of industry air pollution might better be done through the state’s overall air pollution control program or by the Colorado Oil and Gas Conservation Commission, he said.
The COGCC, part of the state Department of Natural Resources, has a dual mandate of promoting and regulating the industry and has been the primary overseer after contentious rule-makings over where wells can be drilled and protection of groundwater.
But state air pollution control division director Will Allison said statutes give the state’s Department of Public Health and Environment the authority to regulate hydrocarbons. “Volatile organic compounds are one type of hydrocarbon. Methane is another type of hydrocarbon.”
An industry study estimated the costs related to the new rules, assuming monthly inspections for leaks, could reach $80 million a year. A CDPHE study estimated costs at $30 million.
“I am very concerned that the costs — especially for small and midsize operations — will be quite significant,” said John Jacus, an attorney who represented five companies in CDPHE stakeholder sessions.
Environment groups, led by the Environmental Defense Fund, helped craft the proposed rules.
“First in the nation, direct regulation of methane from oil and gas production facilities is a big, exciting step forward,” Conservation Colorado director Pete Maysmith said.
Around the nation, state regulators have not dealt comprehensively with increasing air pollution from the oil and gas industry — a challenge as companies ramp up domestic energy production. And, when it comes to emissions of methane, the industry is largely unregulated, even though state data show oil and gas operations are a major source.
Colorado’s political landscape for oil and gas development has been toughening, however, with voters in four cities passing moratoriums and a ban on operations inside city limits.
The new air rules, to be hashed out at formal hearings in February, do not include a proposal to raise the threshold of air pollution above which companies would have to obtain permits from the state — 4,000 this year. State health officials had proposed reducing their administrative workload by raising the reporting threshold to 25 tons of air pollution per year from 2 tons to 5 tons. But state officials dropped the effort because the “messaging” to residents would be difficult, Allison said.
“It was going to distract from the overall process,” he said. “We want the focus in this rule-making to be on emissions reduction.”
From the Denver Business Journal (Cathy Proctor):
Unveiled Monday, the proposed rule will be formally sent on Thursday to the Air Quality Control Commission, a division of the Colorado Department of Public Health and Environment (CDPHE). Public hearings are expected to be held in February. The proposed regulation aims to reduce the amount of natural gas and methane leaking into the air at all stages of industry operations, such as the well itself as well as storage tanks, pipelines and other steps along the path to market.
At a press conference at the Capitol on Monday afternoon, Hickenlooper joined with representatives from EDF, Anadarko Petroleum Corp. (NYSE: APC), Noble Energy Inc. (NYSE: NBL) and Encana Corp. (NYSE: ECA) to praise the effort that went into the proposed rules…
If adopted as proposed, Colorado will be the first state in the nation to regulate methane — an element of natural gas that’s a powerful greenhouse gas…
Cutting those emissions, which contribute to asthma and other respiratory ailments, is expected to improve public health, according to the health department.
Hickenlooper said the proposed rules were a group effort, requiring compromise on all sides.
“We recognize, and the people should recognize, that the rules, while they will be enforced, they weren’t imposed,” he said, referring to the stakeholder group that worked with state officials to craft the proposal.
Industry and environmental representatives in turn credited the governor for pushing the group to make the rules tough…
Ted Brown, Noble’s senior vice president for the Rocky Mountain region, said his company also supports the proposal “because it’s the right thing to do.”
“It’s a tough rule, it’s an additional layer of regulations,” Brown said.
“But we wanted to develop a sound solution based on science. [ed. emphasis mine] We believe this proposal sends a clear message — we can have a health environment, clean air, and responsible energy development here in Colorado,” Brown said.