A federal judge has blocked the Interior Department from enforcing its new methane rule in five Western states.
In an order issued late Thursday, the U.S. District Court for the District of North Dakota said the Biden-era rule from Interior’s Bureau of Land Management represents a “significant impingement” upon states’ rights. He halted the regulation in North Dakota, Texas, Utah, Montana and Wyoming.
“This case is an example of where the left hand of the government does not know what the right hand of the government is doing,” wrote Judge Daniel Traynor, finding that BLM would “suffer little, if any, harm by preserving the status quo” until litigation over the agency’s rule is resolved.
He wrote that BLM’s regulation targets “an area that is already regulated by the Clean Air Act and state laws meant to protect the environment.”
BLM’s rule slashes emissions of a potent greenhouse gas by making oil companies pay royalties for “wasted” methane, the primary component of natural gas. Companies also face limits on how much gas they can either release or burn.
But Traynor, a Trump appointee, wrote that the costs of BLM’s flaring limits don’t outweigh their environmental benefit.
“They conflict with other federal and state laws,” he wrote of the requirements, “and they add nothing more than a layer of federal regulation on top of existing federal regulation.”
Wyoming Gov. Mark Gordon called the decision “a great first step and an extremely positive indication that our legal case will continue to find success.”
The Republican said it was “encouraging to see Wyoming’s fight against unreasonable BLM policies and the Biden-Harris administration’s agenda producing tangible results for our hometown companies.”
Interior declined to comment on the ruling.
The decision comes months after North Dakota and other Republican-led states sued to block the BLM rule.
The state challengers — which also include Wyoming, Texas, Montana and Utah — argued that the Biden rule tried for a second time to improperly step into EPA’s shoes by finalizing “sweeping greenhouse gas emission controls” after a federal judge blocked an Obama-era version of the regulation in 2020.
BLM said when it announced the new rule earlier this year that the regulation would generate $50 million in additional natural gas royalty payments and would help to keep billions of cubic feet of gas in the ground. The rule revises decades-old waste prevention standards to include updated technological controls to avoid waste and leaks.
Interior Secretary Deb Haaland said at the time that the new rule would not only protect the environment but ensure a “fair return” to U.S. taxpayers.
The states, however, claimed that the rule exceeded BLM’s statutory authority and the Clean Air Act because it was an “unlawful regulation of air emissions.” They also argued that BLM had unlawfully regulated state and private mineral interests and that they would suffer harm because state revenue from royalties and extraction taxes would fall.
The federal government had argued that the rule properly regulates the “communitized production” of oil and gas and that BLM had provided “sound economic analysis” in support of the rule.
But in siding with the states, Traynor noted that they were “more than likely” to succeed on the merits in the case. He wrote that BLM has “no congressional mandate to protect local public health and safety” — at least when it comes to managing gas waste.
And he said the rule compromises the states’ sovereign interests.
“BLM haphazardly adds more stringent flaring restrictions and bureaucratic hoops the states have to jump through,” he wrote. “The states’ regulatory schemes have now been replaced by an overbearing bureaucratic mandate which is a direct affront to state sovereignty as recognized under the Clean Air Act.”
