American Oil and Gas Reporter - December 2024 - 27

timeline, which will lead to bankruptcies,
insolvencies and other problems. "
According to Naatz, a leading complaint
among independents is the extent
to which those methane rules use a onesize-fits-all
approach. Unfortunately, he
acknowledges, campaign promises do not
always survive inauguration day. " It is
easy to say you are going to do all sorts
of things on day one, " Naatz considers.
" As important as it is to reduce regulations
and streamline processes, the new administration
is going to have to grapple
with some complicated issues as it moves
forward. Part of the goal is developing a
durable regime. "
Longanecker concurs that not even a
president can unilaterally cancel a regulation
that has followed proper rulemaking
protocols. " It is not like President Trump
can wave a magic wand and immediately
do away with all that, " Longanecker says.
" Providing the industry with a reprieve
may be a long process, but he can pull
some levers. "
Regarding subparts OOOOb/c, Longanecker
suggests legislation is an implausible
vehicle for addressing many
industry concerns, and says the two regulatory
pathways are to promulgate new
regulations or reconsider the existing
ones. As TIPRO learned after 2016, he
recalls, promulgating new regulations can
entail nearly four years, which then may
open those new rules to reversals by a
succeeding administration.
" Reconsideration has never been used
for something this significant, but it is
an option that can lead to a significantly
reduced regulatory burden if it works
and can be done more quickly, " Longanecker
says.
Meanwhile, Ness insists, the methane
tax also deserves the axe, but since the
measure's origins lie in statute, fully rooting
it out will require congressional action.
" That will be a killer to small businesses, "
he predicts. " A different administration
can come back with that in four years or
more, so that issue has to go. "
According to Longanecker, since Republicans
control Congress, they are likely
to try to pass a budget reconciliation bill
that will prevent a filibuster in the Senate.
It opens the possibility of repealing the
methane tax in the IRA through the same
process that passed it.
Meanwhile, he continues, some have
expressed a desire to utilize the Congressional
Review Act to rescind the
methane tax. Although the CRA makes
it possible to overturn a regulation, Lonpoints
out that one way in which presidential
administrations exercise considerable
influence in that area deals with
their approach to leasing. " It makes an
incredible difference, " he says. " We have
a lot of investment opportunity up here
and dragging out the process really kills
that. Delays and constant drags on the
process can kill projects. "
" After Trump's first election, people were not even
jogging or walking into their agencies. This time, I hope
they come in at a full sprint. Congress should not be slow
to get these people in place. "
Ron Ness
NDPC President
ganecker notes the WEC, which is used
to calculate the applicable tax, is a legal
mandate. Although a successful CRA
resolution would block the existing WEC,
EPA nevertheless could undertake the
lengthy process of developing a new and
sufficiently different regulation.
" We think the methane tax is a bad
idea, but Congress will have to get rid of
it, " Naatz confirms. " Congress is going
to take a very serious look at doing away
with it. IPAA has opposed it from the
first day it appeared in the IRA. "
Even so, Ness urges Congress to be
judicious as it returns to that statute.
He points out that not all the incentive
funds for carbon capture projects are
going to fossil fuel opponents. " Some
people lump those IRA incentives in
with the Biden administration's 'Green
New Deal' concepts, but carbon sequestration
programs for enhanced oil recovery
started in the early 2000s under
President George W. Bush's administration, "
he observes. " A lot of the Q45
credits were introduced during the previous
Trump administration. "
Executive Impact
Although statutory improvements to
the permitting process for projects on
federal lands and waters cannot take
effect without passing Congress, Ness
" Some of that has to do with the organizational
leadership at the top, " Ness
adds. " After Trump's first election, people
were not even jogging or walking into
their agencies. This time, I hope they
come in at a full sprint. Congress should
not be slow to get these people in place. "
Although President Trump has been
out of the presidency for four years,
Naatz suggests there will be little or no
need for the sort of acclimation that tends
to accompany new administrations. " He
knows where the bathrooms are, " Naatz
chuckles. " His staff will be in place
swiftly and I believe the transition will
move quickly. I guarantee the Senate will
quickly bring up the president's nominees
and move fast on approving them. "
Naatz notes that Biden and many in
his administration have touted strong hydrocarbon
output on federal lands and
waters, but such crowing fails to acknowledge
the extent to which those leasing
and investment decisions predate
Biden's presidency.
" This administration has issued very
few new leases, but the lag means we
will not see those effects until later, "
Naatz relates. " Oil and gas is not a justin-time
business, and that is especially
true off shore, where investments can
run hundreds of millions of dollars. The
Biden administration ignored the law and
DECEMBER 2024 27
American Oil and Gas Reporter - December 2024

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