Ian Shavitz Quoted in Law360 on New Government Rules for Emissions Reduction on Public and Tribal Lands

Ian Shavitz, senior counsel in the public law and policy practice at Akin Gump, has been quoted in the Law360 article “DOI Flaring Rule Could Crimp Tribal Oil & Gas Plans” regarding a proposal by the Department of the Interior to reduce emissions by curbing the venting and flaring of natural gas on public and tribal lands.

The new plan was introduced January 22, which, as the article reported, was part of the Obama administration’s overall plan to cut methane emissions, but the rule would force companies working with tribes that are already substantially invested in oil and gas development to take on the additional costs of complying with it.

Shavitz said some tribes see the rule as a way to protect both their trust lands and their economic rights. “If natural gas is leaking and being flared and not captured and sold, it’s basically a waste of the trust resource [from the tribes’ point of view],” he said. “And what stems directly from that, besides the trust resource being wasted in the literal sense, is that the royalties that are supposed to be paid on it aren’t being paid.”

Smaller “mom and pop” producers on tribal lands, however, may be put out of business, Shavitz said, if the costs of installing methane capture technology and infrastructure under the rule prove too much. “Their profit margins,” he noted, “are probably already slim enough that it just makes sense for them to shut down the wells.”

Shavitz continued, “If it wasn’t economical to operate on these lands, these companies wouldn’t be doing it. It may very well be the case that some companies who have infrastructure in place on operations outside tribal lands just don’t want to put them in place on tribal lands because they don’t have to, but once they’re forced to, they would.”