Republican Attorneys General Urge Congress to Reject New Methane Fees on Oil and Natural Gas Producers

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  • A group of 19 Republican AGs, led by West Virginia AG Patrick Morrisey, sent a letter to the leaders of the U.S. Senate Committee on Environment and Public Works and the Committee on Energy and Natural Resources urging Congress to reject legislation that would increase fees on oil and natural gas producers.
  • The letter opposes the Senate’s Methane Emissions Reduction Act, S.645, and certain provisions in the House’s Build Back Better Act, H.R.5376, which would charge oil and natural gas producers $1,500 to $1,800 per ton of methane emissions above certain thresholds, and argues that the fees will increase consumers’ heating bills at a time when heating bills are projected to spike in some markets. The letter also argues that the legislation is unnecessary because oil and natural gas producers are already motivated to capture methane and sell it as a commodity, thereby limiting emissions, and because the Biden administration directed the Environmental Protection Agency (“EPA”) to develop a new Oil and Natural Gas Methane Rule.
  • The letter further argues that the proposed new fees require complex formulas and calculations, and that the legislation does not provide clear guidance to industry. The letter also warns that, even though the legislation is focused on oil and natural gas producers, it will likely open the door to EPA regulation of other major methane emitters, including agricultural operations, landfills, and coal mines.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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