In October, Judge Scott W. Skavdahl writing for the United States District Court for the District of Wyoming overturned and vacated the Bureau of Land Management’s (“BLM’s”) Obama-era waste prevention rule, better known as the “Venting and Flaring Rule” (the “2016 rule”).
As a starting point, the case involved a challenge to BLM’s efforts to update the way in which the waste of oil and gas resources on federal and Indian lands is managed under the Mineral Leasing Act (“MLA”). From 1980 to 2016, BLM accomplished this through Notice to Lessees 4A (“NTL 4A”) which, at a high level, assessed royalties on “avoidably lost” gas while allowing venting or flaring on “unavoidably lost” gas. The 2016 rule maintained this general framework but added substantial detail to the avoidably lost/unavoidably lost determination and imposed new requirements on operators.
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