Karin Foster, Esq . Executive Director IPANM 5805 Mariola Place, NE Albuquerque, NM 87111 Fosterassociates2005@Yahoo.com

June	13,	2014 US	EPA	Office	of	Air	Quality Planning	and	Standards	(OAQPS) Raleigh,	NC By	email: oilandgas.whitepapers@epa.gov Re:	IPANM	comments	to	OAQPS	Oil	and	Natural	Gas	Sector leaks Whitepaper Dear	Sir	or	Madam;
The	 Independent	Petroleum	Association	of	New	Mexico	 (‘IPANM’)	apprec iates	 this opportunity	to	comment	to	the EPA	Office	of	Air	Quality	Planning	&	Standards	(hereinafter ‘EPA’)	whitepaper	on	Oil	and	Gas	Sector Leaks of	April	2014

. Preliminary	matters: Without	adequate	research	and a n expert understanding	of the	issues,	it	would	be unethical	 for	 th e	 EPA to	 move	 forward	 with	 promulgating methane	 reductions policy	 or
rules	 at this	 time. The whitepapers	 and	 studies	 cited	 therein	 do	 not	 appreciate	 that	 the issues	 around	 methane	 reductions are complex	 and	 very	 dyn amic. In	 fact, since	 the introduction	 of	 the	 First	 Assessment	 Report	 (FAR)	 of	 the	 Intergovernmental	 Panel	 of Climate	 Change	 (IPCC	 1990),	 there	 has	 been vigorous discussion	 about whether global warming	potential	(GWP)	to compar e different	gases	on	a	CO2	eq uivalent	scale should	beIPANM	Comments: Leak s Whitepaper June	13,	2014 Page 2 of 9

------------------------------------------------------------------ the	accepted	methodology	to	understand	the	true	impacts	of	methane

. 1 2 As	recently	as	last month,	MIT	 researchers	 published a	letter,	 titled,	 “ Climate	impacts	of	energy	 technologies depend	on	emissions	timing” in Nature	Climate	Ch ange stating	that	the	sta tic	nature	of	GWP to	compare	ga ses	with	differing	radiative	efficiencies	and	atmospheric	lifetimes	has	led	to ‘major	 shortcomings’	 in	 understanding	 energy	 technology	 valuations 3

. However,	 i n	 the
urgency to	complete	methane	reductions	regulations	by	 the	end	of	2016,	 the	Whitehouse has	directed	the	EPA	draft	whitepapers	and convene	peer	review	panels to	give	the	agency a	‘robust	understanding’	of	the	issues.		IPANM	would	contend	that	these	whitepapers	were obviously	rushed,	had	a	limited	and	biased	selection	of	studies	and	we	question	the	efficacy of	the	peer	review	process.		We	hope	that	the	agency	would	proceed	with	this	process in	a manner	 that allows	 for true	 stakeholder	 involvement	 and	 opportunity	 for comment as required	in	the federal Administrative	Procedures	Act. Finally,	we	would	urge	the	agency	to use	the	resources	and	expertise	available	at	the	New	Mexico	Petroleum	Recovery	Research Center	 to	learn	about	 the	unique	characteristics	of	oil	and	gas	o perations	in	 the	San	 Juan and	 Permian	 basins. Within	 the	 PRRC	 is	 the Research	 Partnership	 to	 Secure	 Energy	 for America	 (RPSEA),	 Small	 Producer	 Program which	is	 a public/private	 partnership	 funded by	 the	U.S.	DOE	 through	 the	National	Energy	Technology	Labor atory.	The	Small	Producer Program	aims	 to	develop	and	apply	 technology	 that	enhances	small	producer	production, and	 thereby	 contributes	 to	 the	 nation’s	 energy	 supply.	 The	 PRRC/New	Mexico	 Tech	 was

1 Shine,K. “ The global warming potential

– the need for an interdisciplinary retrial” Climactic Change Journal, Oct. 2009, vol. 96, issue 4, p. 467

- 472. 2 Even as one of the lead authors of one of the chapters of the first IPCC report, Dr. Shine questions whether u sing the ‘simple approach’ of global warming potential metrics improperly influenced a ‘major piece of environmental legislation’ (Kyoto Protocol) that could impact ‘big investment and policy. ’ 3 Edwards, M. & Trancik, J., “ Climate Change of energy techno logies depend on emissions timing” , Nature Clim. Change Letter, May 2014,IPANM	Comments: Leak s Whitepaper June	13,	2014 Page 3 of 9

------------------------------------------------------------------ chosen	 to	 lea d	 the	 SP	 program	 because	 of	 their track	 record of	 research	 and	 actions	 on behalf	of	small	oil	and	gas	producers,	 for	whose	benefit	our	organization	was	established. IPANM	would	also	be	happy	to	provide	additional	input	to	the	EPA	in	the	development	of policy,	rules	and	regulation	on	methane	reduction strategies. Who	is	IPANM: The	Independent	Petroleum	Association	of	New	Mexico,	IPANM,	represents	several hundred	independent	oil	and	gas	producers	who	live,	work	and	employ	New	Mexicans.		We are	small,	with,	on	average,	25	employees	who	often	wear	multi ple	proverbial	hats,	but	we provide	enough	revenue	to	the	State	of	New	Mexico	to	support	31%	of	the	General	Fund 4

. We strive	to	be	stewards	of	the	land	in	a	state	where	nearly	41.8%	of	the	land	is	federally owned.		The	Bureau	of	Land	Management	New	Mexico office	manages	one	of	the	largest	oil and	 gas	 programs	 in	 the	 agency	 controlling	 13.4	 million	 acres	 of	 public	 lands	 and	 26 million	 subsurface	 acres	 of	 federal	 oil,	 natural	 gas,	 and	 minerals.	 	 There	 are	 currently 30,561	active	wells	on	 federal	lands 5 ranki ng	New	Mexico	sixth	in	crude	oil	production	in the	nation	in	2013 6 .	New	Mexico’s	marketed	production	of	natural	gas	accounted	for	4.8% of	U.S.	marketed	 natural	 gas	 production	in	 2012,	 despite	 a	 decline	in	 production	 of	 20% between	 2007	 and	 2012 7

. Accordin g	 to	 the	 Office	 of	 Natural	 Resources	 Revenue,	 in	 FY 2013	 the	 Federal	 Government	 disbursed	 $478,732,193.90	 in	 revenues	 to	 New	 Mexico 8 , which	is	only	48%	of	the	total	royalty	revenues	collected	for	oil	and	gas	operations	on	NM federal	lands.

4 “Fiscal Impacts of Oil and Natural Gas Production in New Mexico: Preliminary report”, New Mexico Tax Research Institute, Jan 2014. 5 http://www.emnrd.state.nm.us/OCD/documents/OCD %20Well%20Statistics03272014.pdf 6 http://www.eia.gov/state/?sid=NM 7 Id. 8 http://statistics.onrr.gov/ReportTool.aspxIPANM	Comments: Leak s Whitepaper June	13,	2014 Page 4 of 9

------------------------------------------------------------------ The	 process	 by which	 these	whitepapers	were	 developed	was	 flawed	 and	 requires	more study	and	expert	understanding	of	the	issues. Regulation	in	the	air	quality	arena	is	not	new,	however,	IPANM	would	contend	that the	 process	 by	 which	 the	 Whitehouse,	 through	 the	 EPA	 and the	 BLM , is	 seeking	 to implement new	 or	 substantially	 expanded methane	 reduction	 strategies,	 is	 not	 tenable 9

. Note	 that	 IPANM	 does	 not	 contest	 the	 authority	 of	 the	 EPA	 to	 regulate	 Greenhouse	 Gas
emissions 10 ,	of	which	methane	is	a part	of	those	emissions 11

. T he	authority	under	the	Clean Air	 Act	 and	 a	 growing	 body	 of	 case	 law,	 grants	 the	 complex	 balancing	 of	 “national	 and international	 policy	 against	 environmental	 benefit,	 our	 nation’s	 energy	 needs	 and	 the possibility	 of	 economic	 disruption”	 solely	 on	 the	 Envi ronmental	 Protection	 Agency. See , American	Electric	Power	v.	Connecticut ,	131	S.Ct.	2527,	564	U.S.	 ____	,slip	op.	10

- 174	at	13 (2011).		Indeed,	through	out	the American	Electric decision,	the	US	Supreme	Court	justices refer	 to	 the	 EPA	 as	 the	 “experts” 12 in greenhouse	 gas	 and	 air	 quality	 matters. In	 the Administration’s	“2014	Climate	Action	Plan:	Strategy	 to	reduce	methane	emissions 13 ”, the
P resident	 orders	 the	BLM,	 the	EPA,	USDA,	DOE	and	even	international	agencies	 to	 target key	 sources	 including	 landfills, coalmines,	 agriculture	 and	 the	 oil	 and	 gas	 sector and to

9 IPANM does contend that the statutory jurisdiction to regulate methane reductions lies exclusively with the EPA and not the BLM which is attempting to regulate methane emissions under the guise of a prevention of waste legal theory. 10 In Massachusetts v. EPA , 549 U. S. 497 (2007), the US Supreme Court held that the Clean Air Act, 42 U. S. C. §7401 et seq., authorizes federal regulation of emissions of carbon dioxide and other greenhouse gases, including methane. 11 IPANM does, however, contest the science behind the policy for reducing human caused methane sources. Several of our members pointed out in response to this exercise that the science of global warming and impacts of human activities have not been settled yet. I n 2012, CH4 accounted for about 9% of all U.S. greenhouse gas emissions from human activities. But water vapor in the atmosphere is responsible for 95 percent ofthe gre enhouse effect and CO2 is responsible for 3.6 percent. A study from MIT reported on 5/30/07 said that 97% of all greenhouse gases are naturally occurring, and the remaining 3% are caused by man. So methane is only 3% of the 9%. Insignificant

. 12 American Electric Power v. Connecticut , 563 US _____, slip op. at p. 3, 16,17,18 13 March 2014 Climate Change Strategy: Reduction of Methane Emissions, found at http://www.whitehouse.gov/sites/default/files/strategy_to_reduce_methane_emissions_2014

- 03

- 28_final.pdf ,IPANM	Comments: Leak s Whitepaper June	13,	2014 Page 5 of 9

------------------------------------------------------------------ promulgate	rules	to	reduce	methane	emissions.		The	White	House specifically	directs 14 the BLM	to	propose	updated	standards	to	reduce	venting	and	flaring 15
, and mandated	the	EPA to	draft	white	papers	focusing	on	technical	issues relating	to	methane	emissions	from “oil
and	 co

- producing	wells,	liquids	 unloading,	leaks,	 pneumatic	 devices	and	 compressors” to “solicit	 input	 from	 independent	 experts 16 ” (hereinafter	 refe rred	 to	 as	 the	 EPA	 methane papers) .	 	 The	 EPA	 wa s	 further	 order e d to	 use	 these	 documents	 to	 “solidify	 its understanding	of	these	potentially	significant	sources	of	methane.” The EPA	methane papers	came	out	 for	peer	review	and	comment	one	month	after the release	of	the	Whitehouse	report with	only 60	days 17 to	comment on	nearly	300	pages
of	technical	data

. The Whitehouse report also	directed	the	agency	to	convene peer	review panels , which	was	done, but	those	panels	only	consist	of 5	persons	per	panel, and n ot one single	 small	 independent was included	 o n	 any	 panel

. It	 is	 interesting	 to	 note	 that	 the Environmental	 Defense	 Fund,	 however,	 was	included	 on	 every	 panel th ereby	 giving	 that group	a	significant	voice	in	this	process

. From a	 detailed	 review	 of	 the EPA	methane	 papers , it	is	 obvious that	 the	 authors

w ere	 clearly	 limited,	 probably	 due	 to	 time	 constraints,	 to	 a	 small subset of	 studies	 that were	 often	 out	 of	 date ,	 had	 poor	 sampling	 criteria, had wildly	 inaccurate	 extrapolation
factors or	 cite	 to	 each	 oth er	 as	 ‘science’

. Of	 the	 few	 studies	 the	 EPA	 relied	 upon,	 every

14 President’s Methane Reduction Strategy, page 2, 9

. 15 The BLM Venting and Flaring public outreach sessions were conducted in North Dakota, New Mexico and Washington DC. IPANM has submitted substantive comments to the BLM on their May 2014 Venting & Flar ing proposal and would urge both the BLM and this agency to include IPANM, PRRC or RPSEA (see discussion above) in future stakeholder discussions. 16 Id. at 8 par. 2. 17 60 days to read and digest nearly 300 pages of technical information was very difficu lt. To require industry to commission, prepare and present data to augment the very weak studies relied upon by the EPA was impossible. In addition, the timeframe set did not avail IPANM the ability to structure studies with the New Mexico Petroleum Recov ery Research Center or RPSEA who are the entities often commissioned for such work.IPANM	Comments: Leak s Whitepaper June	13,	2014 Page 6 of 9

------------------------------------------------------------------ whitepaper referenced a	 study	 commissioned	 by	 the	 Env ironmental	 Defense	 Fund that reviewed	only	22	sources	of	emissions

. IPANM	strongly	contests	the	use	of	this	paper	as the	 assumptions	 used are	 wildly	 inaccurate.	 	 First,	 t he	 average	 $4mcf	 value	 is	 high, particularly	for	smaller	operators	who	received	much	less	on	average	during	most	of	2012 and	 2013 18 .	 	 Second,	 the	 base	 assumption	 that	 the	 cost	 of	 flaring	 is	 only	 $ 3523	 per	 well ignores	the	tru e	costs	which,	by	IPANM	member	review, were well in	excess	of	$10,000	per
well because	 of	 the equipment	 rental,	 mileage,	 time and	 personnel	 time	 to	 operate	 the equipment.			As	noted	earlier	in	this	comment,	the	small	producer	has	significantly	different

ec onomics	 than	 major	 companies	 who	 employ	 personnel	 versus	 hiring	 consultants	 or
contractors	at	market	r ate	to	conduct	a	test	or an	emergency	procedure	such	as	a	flare	or venting	 during	 liquids	 offloading.	 	 The	 misuse	 of	 the	 cost	 figures	 which ICF	 then

extra polated	 to	 estimate	 savings	 on	 a	 nationwide	 basis	 renders	 the	 EDF	 study	 close	 to meaningless	 as	 a	 foundation	 for	 a	 Whitehouse	 methane	 reduction	 strategy. Clearly, the
manner	 in	 which	 the	 EPA researched	 the	 is sues	 raised	 in	 the	 whitepapers	 wa s	 nothing

more than	 a	 ‘data	 dump’	 that	 c ould not	 be	 considered an	 adequate	 learning	 process	 to establish	 expertise	 on	 these	 very	 complex	 matters

. IPANM	 contends	 that	 based	 on	 the inadequate	 information	 reviewed , that	 the	 EPA	 does	 not	 have	 any	 sort	 of	 a	 ‘robust
understa nding 19 ’ of	 these	 sources	 of	 methane	 thus,	 moving	 forward	 with	 policy	 or	 rule promulgation	is	premature at	this	time

.

18 http://gotech.nmt.edu/gotech/Marketplace/year_prices.aspx?year=2013 19 In the President’s Climate report ordering EPA to complete the whitepapers, the Whitehouse assumes that completion of the papers would result in ‘robust technical understanding’ of the issues. IPANM contends that in every instance that the studies used and the lack of data does not give EPA regulators the required understanding of the issues to establ ish policy.IPANM	Comments: Leak s Whitepaper June	13,	2014 Page 7 of 9

------------------------------------------------------------------ In	addition,	 IPANM	would	 urge	 the	 EPA	 to	 review and	 completely	 understand the information included	 in	 the	 National	 emissions	 inventory	 and	 information submitted pursuant	 to	 the	recently	promulgated	NSPS	SubPart	OOOO	amendments 20 .		This	data will provide	a	large amount	of	information	about emissions	at	oil	and	natural	gas	facilities but experts	 w ho	 understand	 industry must study	 and	 understand	 the	 information	 prior	 to establishing	policy

. 21 NSPS	SubPart	OOOO requires	 federal	air	 standards	 for	new	natural gas	 wells	 that	 are	 hydraulically	 fractured,	 along	 with	 requirements	 for	 several	 other

sources of	 volatile	 organic	 compound	 (VOC)	 emissions	 from	 new	 storage	 vessels,	 newly installed	compressors,	pneumatic	controllers	and	equipment	leaks	at	natural	gas	facilities. Although	 the	 New	 Source	 Performance	 Standards	 directly	 regulate	 VOC	 emissions, in	 a
Go vernment	Accounting	Office	report	issued	May	16,	2014, the	EPA	reports	that	the	control require ments	 of	 NSPS	 SubPart	 OOOO substantially	 reduce s methane	 emissions 22

. C oncurrent	with	the	NSPS, in	April	2012,	EPA published	final	National	Emission	Standards for	 Hazardous	 Air	 Pollutants,	 updating	 its	 air	 toxics	 standards	 for	 oil	 and	 natural	 gas 23

. These	standards	cover	hazardous	air	pollutants	emitted	from	glycol	dehydrators

— used	to remove	 water	 from	 gas

— and	 storage	 vessels,	 and	 equipment	 leaks	 at	 natural	 gas
p rocessing	 plants. Use	 of	actual	measurement	 from	locations	is	 obviously	 better	 towards

20 U.S. EPA, Oil and Natural Gas Sector: New Source Performance Standards and National Emission Standards for Hazardous Air Pollutants Reviews Final Rule, 77 Fed .Reg. 49490 (Aug. 16, 2012) (codified at 40 C.F.R. Parts 60 and 63). 21 IPANM would urge the reviewers to look at the UT study that clearly explains differences in modeling based numbers used in the National Emissions Inventory versus actual measurements on location. We would caution against exclusive use of this study, how ever, since the measurements used were from shale formations only. See, Proceeding of the National Academy of Sciences of the United States of America (PNAS). 2013. Measurement of Methane Emissions at Natural Gas Production Sites in the United States. Aug ust 19, 2013. Available at http://www.pnas.org/content/early/2013/09/10/1304880110.abstract.. 22 GAO

- 14

- 238; Oil and Gas, Updated Guidance, Increased Coordination, and Comprehensive Data Could Improve BLM's Management and Oversight, page 23 23 77 Fed. Reg. 4 9490 (Aug. 16, 2012) (codified at 40 C.F.R. Parts 60 and 63).IPANM	Comments: Leak s Whitepaper June	13,	2014 Page 8 of 9

------------------------------------------------------------------ building	an	understanding	of	the	issue	of	methane	emissions,	which	is	what	we	believe	the agency	is	attempting	with	 the	recent	implementation	of	 the	NSPS	regulations.		W e	would urge	 the	 EPA	 not	 to	 rush	 to	 creating	 regulations	 for	 all	 new	 and	 existing	 oil	 and	 gas locations	 to	 reduce	 methane	 emissions	 without	 a	 solid	 understanding	 of	 the	 actual impacts 24 of	methane	emissions	on	human	health	and	the	environment	or	the	actual levels emitted	from	all	types	of	oil	and	gas	sources.
Specific	Comments BY	IPANM	Members to	April	2014	Whitepaper,	“ Oil	and	Natural	Gas Sector Leaks ” Comments : IPANM members	strong ly	state	that	they are	in	the	business	of	sell ing	gas.	We	would much	rather	sell	the	gas	down	the	pipeline	than	vent	it	to	the	atmosphere	as	long	as	it	is economical	to	do	so.	Our	operators	are	tasked	to	maintain	production	equipment	in	good working	order.	Part	of	their	job	is	to	check	for	leaks	(look ,	listen	and	feel)	and	repair anything	that	is	discovered.
There is	a	wide	discrepancy	between	many	of	the	studies	on	leaking	components.	A study	on	pages	28	and	29	states	that 68% of	the	58,421	components	were	either	leaking	or venting	gas. However,	the study	on	pages	34	and	35	states	that	only 2.2	% of	t he	74,438 screened	components were	determined	to	be	leaking.	Most	small	independent	operators do	not	have	any	experience	in	using	an	I nfra

- red	camera or	even	Method	21	for	leak d etection,	but both	methods	are	expensive	and	time	consuming. IPANM	member s	reported

24 Edwards, M. & Trancik, J., “ Climate Change of energy technologies depend on emissions timing” , Nature Clim. Change Letter, May 2014. T he actual impact of methane from different energy sources is substantially different than previously believed using the very simplistic GWP modeling. The MIT researchers advocate the use of dynamic modeling that better accounts for the differing radiative efficiencies and atomospheric lifetimes of different gase s. In essence, the comparison of gases must be dependent on the timing of the emissions. The researchers note that while it might be in vogue to tout the disasterous health effects of emissions from coal

fired plants as a policy determination to support n atural gas plants, three decades from now, the emissions advantages of natural gas as compared to coal would be half of the levels claimed in the GWP modeling.IPANM	Comments: Leak s Whitepaper June	13,	2014 Page 9 of 9

------------------------------------------------------------------ that	the	average	consultant	charged	$4000	per	day	for	usage	of the camera	which	resulted in	information	that	was	not	useful.		While	the	photos	taken	on	location	may	have	indicated emissions,	the source	of	the	leak	or	the	volume	was	not	ascertainable.		Moreover,	in	the	hot climate of the southwest,	environmental	consultants	encouraged	the	use	of	IR	camera ’ s more	often	on	100	degree	plus	days	than	on	cooler	days because the	readings	would	result in	higher	readings.
In addition on	page	48, where	th e	paper	discuss es the	cost	effectiveness	of	Direct Inspection	and	Maintenance	in	a	2006	study, a	gas	price	of	$7.15/MCF was	used which	is significantly	higher	than	the	amount	our	producers receive in	2014. IPANM	thanks	the	EPA	for	the	opportunity	to	comment	on	the	Oil	and	gas	Sector Hydraulically	Fractured	Oil	Well	Completions	and	Associated	Gas	during	Ongoing Operations	whitepaper.	We	would	be	interested	in	participating	in	any stakeholder/taskforce/peer	re view	groups	convened	for	the	purpose	of	addressing	these policy	proposals.		We	look	forward	to	providing	additional	comments	as	the	agency	drafts of	these	proposed	regulations	materialize.		Please	feel	free	to	contact	me	at Karin@ipanm.org or	at	(505)	238

- 8385	if	you	have	any	questions	regarding	the	issues.

Respectfully	submitted,
INDEPENDENT	PETROLEUM	ASSOCITION	OF	NEW	MEXICO

______________________________________________ By:	Karin	V.	Foster,	esq. Executive	Direc tor