46458 Federal Register / Vol. 82, No. 192 / Thursday, October 5, 2017 / Proposed Rules 

federal requirements, and impose no 

additional requirements beyond those 

imposed by State law, and there are no 

anticipated significant adverse human 

health or environmental effects, the rule 

is not subject to Executive Order 12898. 

The Congressional Review Act, 5 U.S.C. 

801 et seq., as added by the Small 

Business Regulatory Enforcement 

Fairness Act of 1996, generally provides 

that before a rule may take effect, the 

agency promulgating the rule must 

submit a rule report, which includes a 

copy of the rule to each House of the 

Congress and to the Comptroller General 

of the United States. The EPA will 

submit a report containing this 

document and other required 

information to the U.S. Senate, the U.S. 

House of Representatives, and the 

Comptroller General of the United 

States prior to publication in the 

Federal Register. A major rule cannot 

take effect until 60 days after it is 

published in the Federal Register. This 

action is not a ‘‘major rule’’ as defined 

by 5 U.S.C. 804(2). This action 

nevertheless will be effective 60 days 

after the final approval is published in 

the Federal Register. 

List of Subjects in 40 CFR Part 271 

Environmental protection, 

Administrative practice and procedure, 

Confidential business information, 

Hazardous waste, Hazardous waste 

transportation, Indian lands, 

Intergovernmental relations, Penalties, 

Reporting and recordkeeping 

requirements. 

Authority: This action is issued under the 

authority of sections 2002(a), 3006, and 

7004(b) of the Solid Waste Disposal Act as 

amended, 42 U.S.C. 6912(a), 6926, and 

6974(b). 

Dated: September 26, 2017. 

Alexis Strauss, 

Acting Regional Administrator, Region 9. 

[FR Doc. 2017–21522 Filed 10–4–17; 8:45 am] 

BILLING CODE 6560–50–P 

DEPARTMENT OF THE INTERIOR 

Bureau of Land Management 

43 CFR Parts 3160 and 3170 

[17X.LLWO310000.L13100000.PP0000] 

RIN 1004–AE54 

Waste Prevention, Production Subject 

to Royalties, and Resource 

Conservation; Delay and Suspension 

of Certain Requirements 

AGENCY: Bureau of Land Management, 

Interior. 

ACTION: Proposed rule. 

SUMMARY: On November 18, 2016, the 

Bureau of Land Management (BLM) 

published in the Federal Register a final 

rule entitled, ‘‘Waste Prevention, 

Production Subject to Royalties, and 

Resource Conservation’’ (2016 final 

rule). The BLM is now proposing to 

temporarily suspend or delay certain 

requirements contained in the 2016 

final rule until January 17, 2019. The 

BLM is currently reviewing the 2016 

final rule and wants to avoid imposing 

temporary or permanent compliance 

costs on operators for requirements that 

may be rescinded or significantly 

revised in the near future. 

DATES: Send your comments on this 

proposed rule to the BLM on or before 

November 6, 2017. As explained later, 

the BLM is also requesting that the 

Office of Management and Budget 

(OMB) extend the control number 

(1004–0211) for the 24 information 

collection activities that would continue 

in this proposed rule. If you wish to 

comment on this request, please note 

that such comments should be sent 

directly to the OMB, and that the OMB 

is required to make a decision 

concerning the collection of information 

contained in this proposed rule between 

30 and 60 days after publication of this 

document in the Federal Register. 

Therefore, a comment to the OMB on 

the proposed information collection 

revisions is best assured of being given 

full consideration if the OMB receives it 

by November 6, 2017. 

ADDRESSES:

Mail: U.S. Department of the Interior, 

Director (630), Bureau of Land 

Management, Mail Stop 2134LM, 1849 

C St. NW., Washington, DC 20240, 

Attention: 1004–AE52. 

Personal or messenger delivery: U.S. 

Department of the Interior, Bureau of 

Land Management, 20 M Street SE., 

Room 2134 LM, Washington, DC 20003, 

Attention: Regulatory Affairs. 

Federal eRulemaking Portal: https://

www.regulations.gov. In the Searchbox, 

enter ‘‘RIN 1004–AE54’’ and click the 

‘‘Search’’ button. Follow the 

instructions at this Web site. Comments 

on the information collection burdens: 

Fax: Office of Management and Budget 

(OMB), Office of Information and 

Regulatory Affairs, Desk Officer for the 

Department of the Interior, fax 202–395– 

5806. 

Electronic mail: OIRA_Submission@

omb.eop.gov. Please indicate 

‘‘Attention: OMB Control Number 1004– 

0211,’’ regardless of the method used to 

submit comments on the information 

collection burdens. If you submit 

comments on the information collection 

burdens, you should provide the BLM 

with a copy, at one of the addresses 

shown earlier in this section, so that we 

can summarize all written comments 

and address them in the final rule 

preamble. 

FOR FURTHER INFORMATION CONTACT: 

Catherine Cook, Acting Division Chief, 

Fluid Minerals Division, 202–912–7145, 

or ccook@blm.gov, for information 

regarding the substance of this proposed 

rule or information about the BLM’s 

Fluid Minerals program. For questions 

relating to regulatory process issues, 

contact Faith Bremner, Regulatory 

Analyst, at 202–912–7441, or fbremner@

blm.gov. Persons who use a 

telecommunications device for the deaf 

(TDD) may call the Federal Relay 

Service (FRS) at 1–800–877–8339, 24 

hours a day, 7 days a week, to leave a 

message or question with the above 

individuals. You will receive a reply 

during normal business hours. 

SUPPLEMENTARY INFORMATION: 

I. Public Comment Procedures 

II. Background 

III. Discussion of the Proposed Rule 

IV. Procedural Matters 

I. Public Comment Procedures 

If you wish to comment on this 

proposed rule, you may submit your 

comments by any of the methods 

described in the ADDRESSES section. 

Please make your comments on the 

proposed rule as specific as possible, 

confine them to issues pertinent to the 

proposed rule, and explain the reason 

for any changes you recommend. Where 

possible, your comments should 

reference the specific section or 

paragraph of the proposal that you are 

addressing. The BLM is not obligated to 

consider or include in the 

Administrative Record for the final rule 

comments that we receive after the close 

of the comment period (see DATES) or 

comments delivered to an address other 

than those listed above (see ADDRESSES). 

Comments, including names and 

street addresses of respondents, will be 

available for public review at the 

address listed under ‘‘ADDRESSES: 

Personal or messenger delivery’’ during 

regular hours (7:45 a.m. to 4:15 p.m.), 

Monday through Friday, except 

holidays. Before including your address, 

telephone number, email address, or 

other personal identifying information 

in your comment, be advised that your 

entire comment—including your 

personal identifying information—may 

be made publicly available at any time. 

While you can ask us in your comment 

to withhold from public review your 

personal identifying information, we 


ethrower on DSK3G9T082PROD with PROPOSALS
Federal Register / Vol. 82, No. 192 / Thursday, October 5, 2017 / Proposed Rules 46459 

cannot guarantee that we will be able to 

do so. 

II. Background 

The BLM’s onshore oil and gas 

management program is a major 

contributor to our nation’s oil and gas 

production. The BLM manages more 

than 245 million acres of Federal land 

and 700 million acres of subsurface 

estate, making up nearly a third of the 

nation’s mineral estate. In fiscal year 

(FY) 2016, sales volumes from Federal 

onshore production lands accounted for 

9 percent of domestic natural gas 

production, and 5 percent of total U.S. 

oil production. Over $1.9 billion in 

royalties were collected from all oil, 

natural gas, and natural gas liquids 

transactions in FY 2016 on Federal and 

Indian Lands. Royalties from Federal 

lands are shared with States. Royalties 

from Indian lands are collected for the 

benefit of the Indian owners. 

In response to oversight reviews and 

a recognition of increased flaring from 

Federal and Indian leases, the BLM 

developed a final rule entitled, ‘‘Waste 

Prevention, Production Subject to 

Royalties, and Resource Conservation,’’ 

which was published in the Federal 

Register on November 18, 2016. See 81 

FR 83008 (Nov. 18, 2016). The rule 

replaced the BLM’s existing policy at 

that time, Notice to Lessees and 

Operators of Onshore Federal and 

Indian Oil and Gas Leases, Royalty or 

Compensation for Oil and Gas Lost 

(NTL–4A). The 2016 final rule was 

intended to: Reduce waste of natural gas 

from venting, flaring, and leaks during 

oil and natural gas production activities 

on onshore Federal and Indian leases; 

clarify when produced gas lost through 

venting, flaring, or leaks is subject to 

royalties; and clarify when oil and gas 

production may be used royalty-free onsite. The 2016 final rule became 

effective on January 17, 2017. Many of 

the final rule’s provisions are to be 

phased in over time, and are to become 

operative on January 17, 2018. 

Immediately after the 2016 final rule 

was issued, industry groups and States 

with significant BLM-managed Federal 

and Indian minerals filed petitions for 

judicial review. The petitioners in this 

litigation are the Western Energy 

Alliance (WEA), the Independent 

Petroleum Association of America, the 

State of Wyoming, the State of Montana, 

the State of North Dakota, and the State 

of Texas. This litigation has been 

consolidated and is now pending in the 

U.S. District Court for the District of 

Wyoming. Wyoming v. U.S. Dep’t of the 

Interior, Case No. 2:16–cv–00285–SWS 

(D. Wyo.); W. Energy All. v. Zinke, Case 

No. 16–cv–280–SWS (D. Wyo.). 

Petitioners assert that the BLM was 

arbitrary and capricious in promulgating 

the 2016 final rule and that the rule 

exceeds the BLM’s statutory authority. 

Shortly after filing petitions for judicial 

review, petitioners filed motions for a 

preliminary injunction, seeking a stay of 

the rule pending the outcome of the 

litigation. These motions were denied 

by the court on January 16, 2017, and 

the rule went into effect the following 

day. Although the court denied the 

motions for a preliminary injunction, it 

did express concerns that the BLM may 

have ‘‘usurp[ed]’’ the authority of the 

Environmental Protection Agency (EPA) 

and the States under the Clean Air Act, 

and questioned whether it was 

appropriate for the 2016 final rule to be 

justified based on its environmental and 

societal benefits, rather than on its 

resource conservation benefits alone. 

The next stage in the litigation will be 

the court’s consideration of the merits of 

the petitioner’s claims. It is possible that 

the court’s decision on these claims 

could result in the 2016 final rule being 

overturned. On June 15, 2017, the 

Department of the Interior (Department) 

issued a Federal Register notice, 

pursuant to 5 U.S.C. 705, postponing the 

January 2018 compliance dates of the 

2016 final rule pending judicial review. 

82 FR 27430 (June 15, 2017). 

In the Regulatory Impact Analysis 

(RIA) for the 2016 final rule, the BLM 

estimated that the requirements of the 

2016 final rule would impose 

compliance costs, not including 

potential cost savings for product 

recovery, of approximately $114 million 

to $279 million per year (2016 RIA at 4). 

The BLM had concluded that, while 

many of the requirements were 

consistent with EPA regulations for new 

sources, current industry practice, or 

similar to the requirements found in 

some existing State regulations, the 

2016 final rule would be an 

economically significant rule with 

estimated costs and benefits exceeding 

$100 million per year (2016 RIA at 138). 

Comments received by many oil and gas 

companies and trade associations 

representing members of the oil and gas 

industry suggested that the BLM’s 

proposed and final rules were 

unnecessary and would cause 

substantial harm to the industry. During 

the litigation following the issuance of 

the 2016 final rule, the petitioners 

argued that the BLM underestimated the 

compliance costs of the final rule and 

that the costs would drive the industry 

away from Federal and Indian lands, 

thereby reducing royalties and harming 

State and tribal economies. The 

petitioners also argued that the final 

rule would cause marginal wells to be 

shut-in, thereby ceasing production and 

reducing economic benefits to local, 

State, tribal, and Federal governments. 

The BLM is concerned that the RIA for 

the 2016 final rule may have 

underestimated costs and overestimated 

benefits, and is therefore presently 

reviewing that analysis for potential 

inaccuracies. In any event, the RIA for 

the 2016 rule indicates that the rule 

poses a substantial burden on industry, 

particularly those requirements that are 

set to become effective on January 17, 

2018. 

Since late January 2017, the President 

has issued several Executive Orders that 

necessitate a review of the 2016 final 

rule by the Department. On January 30, 

2017, the President issued Executive 

Order 13771, entitled, ‘‘Reducing 

Regulation and Controlling Regulatory 

Costs,’’ which requires Federal agencies 

to take proactive measures to reduce the 

costs associated with complying with 

Federal regulations. In addition, on 

March 28, 2017, the President issued 

Executive Order 13783, entitled, 

‘‘Promoting Energy Independence and 

Economic Growth.’’ Section 7(b) of 

Executive Order 13783 directs the 

Secretary of the Interior to review four 

specific rules, including the 2016 final 

rule, for consistency with the policy 

articulated in section 1 of the Order and, 

‘‘if appropriate,’’ to publish proposed 

rules suspending, revising, or rescinding 

those rules. Among other things, section 

1 of Executive Order 13783 states that 

‘‘[i]t is in the national interest to 

promote clean and safe development of 

our Nation’s vast energy resources, 

while at the same time avoiding 

regulatory burdens that unnecessarily 

encumber energy production, constrain 

economic growth, and prevent job 

creation.’’ 

To implement Executive Order 13783, 

Secretary of the Interior Ryan Zinke 

issued Secretarial Order No. 3349, 

entitled, ‘‘American Energy 

Independence’’ on March 29, 2017, 

which, among other things, directs the 

BLM to review the 2016 final rule to 

determine whether it is fully consistent 

with the policy set forth in section 1 of 

Executive Order 13783. The BLM 

conducted an initial review of the 2016 

final rule and found that it appears to 

be inconsistent with the policy in 

section 1 of Executive Order 13783. The 

BLM found that some provisions of the 

rule appear to add regulatory burdens 

that unnecessarily encumber energy 

production, constrain economic growth, 

and prevent job creation. Following up 

on its initial review, the BLM is 

currently reviewing the 2016 final rule 

to develop an appropriate proposed 


ethrower on DSK3G9T082PROD with PROPOSALS
46460 Federal Register / Vol. 82, No. 192 / Thursday, October 5, 2017 / Proposed Rules 

1 30 U.S.C. 189 (MLA); 30 U.S.C. 359 (MLAAL); 

30 U.S.C. 1751(a) (FOGRMA); 43 U.S.C. 1740 

(FLPMA); 25 U.S.C. 396d (IMLA); 25 U.S.C. 2107 

(IMDA); 25 U.S.C. 396. 

2See, e.g., California Co. v. Udall, 296 F.2d 384, 

388 (D.C. Cir. 1961) (noting that the MLA was 

intended to promote wise development of . . . 

natural resources and to obtain for the public a 

reasonable financial return on assets that ‘belong’ to 

the public.’’). 

3See Ivy Sports Med., LLC v. Burwell, 767 F.3d 

81, 86 (D.C. Cir. 2014) (noting ‘‘oft-repeated’’ 

principle that the ‘‘power to reconsider is inherent 

in the power to decide’’). 

revision—to be promulgated through 

notice-and-comment rulemaking—that 

would propose to align the 2016 final 

rule with the policies set forth in section 

1 of Executive Order 13783. 

III. Discussion of the Proposed Rule 

A. Summary and Request for Comment 

Today, the BLM is proposing to 

temporarily suspend or delay certain 

requirements contained in the 2016 

final rule until January 17, 2019. The 

BLM is currently reviewing the 2016 

final rule, as directed by the 

aforementioned Executive Orders and 

by Secretarial Order No. 3349. The BLM 

wants to avoid imposing temporary or 

permanent compliance costs on 

operators for requirements that might be 

rescinded or significantly revised in the 

near future. The BLM also wishes to 

avoid expending scarce agency 

resources on implementation activities 

(internal training, operator outreach/ 

education, developing clarifying 

guidance, etc.) for such potentially 

transitory requirements. 

For certain requirements in the 2016 

final rule that have yet to be 

implemented, this proposed rule would 

temporarily postpone the 

implementation dates until January 17, 

2019, or for one year. For certain 

requirements in the 2016 final rule that 

are currently in effect, this proposed 

rule would temporarily suspend their 

effectiveness until January 17, 2019. A 

detailed discussion of the proposed 

suspensions and delays is provided 

below. The BLM has attempted to tailor 

the proposed rule so as to target the 

requirements of the 2016 final rule for 

which immediate regulatory relief 

appears to be particularly justified. 

Although the requirements of the 2016 

final rule that would not be suspended 

under the proposed rule may ultimately 

be revised in the near future, the BLM 

is not proposing to suspend them 

because it does not, at this time, believe 

that suspension is necessary. 

The BLM promulgated the 2016 final 

rule, and now proposes to suspend and 

delay certain provisions of that rule, 

pursuant to its authority under the 

following statutes: The Mineral Leasing 

Act of 1920 (30 U.S.C. 188–287), the 

Mineral Leasing Act for Acquired Lands 

(30 U.S.C. 351–360), the Federal Oil and 

Gas Royalty Management Act (30 U.S.C. 

1701–1758), the Federal Land Policy 

and Management Act of 1976 (43 U.S.C. 

1701–1785), the Indian Mineral Leasing 

Act of 1938 (25 U.S.C. 396a–g), the 

Indian Mineral Development Act of 

1982 (25 U.S.C. 2101–2108), and the Act 

of March 3, 1909 (25 U.S.C. 396). See 81 

FR 83008 and 83019–83021 (Nov. 18, 

2016). These statutes authorize the 

Secretary of the Interior to promulgate 

such rules and regulations as may be 

necessary to carry out the statutes’ 

various purposes.1 The Federal and 

Indian mineral leasing statutes share a 

common purpose of promoting the 

development of Federal and Indian oil 

and gas resources for the financial 

benefit of the public and Indian mineral 

owners.2 In order to ensure that the 

development of Federal and Indian oil 

and gas resources will not be 

unnecessarily hindered by regulatory 

burdens, the BLM is exercising its 

inherent authority 3 to reconsider the 

2016 final rule. The suspension of 

requirements proposed today is a part of 

the BLM’s reconsideration process. 

The BLM seeks comment on this 

proposed rule. Issues of particular 

interest to the BLM include the 

necessity of the proposed suspensions 

and delays, the costs and benefits 

associated with the proposed 

suspensions and delays, and whether 

suspension of other requirements of the 

2016 rule is warranted. The BLM is also 

interested in the appropriate length of 

the proposed suspension and delays and 

would like to know whether the period 

should be longer or shorter (e.g., six 

months, 18 months, or 2 years). The 

BLM has allowed a 30-day comment 

period for this proposed rule, which the 

BLM believes will afford the public a 

meaningful opportunity to comment. 

This proposed rule is a straightforward 

suspension and delay of regulatory 

provisions that were (in a proposed 

form) themselves recently the object of 

public comment procedures. Because 

this proposal is a narrow one, involving 

a simple and temporary suspension and 

delay of regulatory provisions with 

which interested parties are likely 

already familiar, the BLM believes that 

the 30-day comment period is 

appropriate. 

B. Section-by-Section Discussion 

43 CFR 3162.3–1(j)—Drilling 

Applications and Plans 

In the 2016 final rule, the BLM added 

a paragraph (j) to 43 CFR 3162.3–1, 

which presently requires that when 

submitting an Application for Permit to 

Drill (APD) for an oil well, an operator 

must also submit a waste-minimization 

plan. Submission of the plan is required 

for approval of the APD, but the plan is 

not itself part of the APD, and the terms 

of the plan are not enforceable against 

the operator. The purpose of the wasteminimization plan is for the operator to 

set forth a strategy for how the operator 

will comply with the requirements of 43 

CFR subpart 3179 regarding the control 

of waste from venting and flaring from 

oil wells. 

The waste-minimization plan must 

include information regarding: The 

anticipated completion date(s) of the 

proposed oil well(s); a description of 

anticipated production from the well(s); 

certification that the operator has 

provided one or more midstream 

processing companies with information 

about the operator’s production plans, 

including the anticipated completion 

dates and gas production rates of the 

proposed well or wells; and 

identification of a gas pipeline to which 

the operator plans to connect. 

Additional information is required 

when an operator cannot identify a gas 

pipeline with sufficient capacity to 

accommodate the anticipated 

production from the proposed well, 

including: A gas pipeline system 

location map showing the proposed 

well(s); the name and location of the gas 

processing plant(s) closest to the 

proposed well(s); all existing gas 

trunklines within 20 miles of the well, 

and proposed routes for connection to a 

trunkline; the total volume of produced 

gas, and percentage of total produced 

gas, that the operator is currently 

venting or flaring from wells in the same 

field and any wells within a 20-mile 

radius of that field; and a detailed 

evaluation, including estimates of costs 

and returns, of potential on-site capture 

approaches. 

In the RIA for the 2016 final rule, the 

BLM estimated that the administrative 

burden of the waste-minimization plan 

requirements would be roughly $1 

million per year for the industry and 

$180,000 per year for the BLM (2016 

RIA at 96 and 100). The BLM is 

currently reviewing the requirements of 

§ 3162.3–1(j) in order to determine 

whether the burden it imposes on 

operators is necessary and whether this 

burden can be reduced. The BLM is also 

evaluating whether there are 

circumstances in which compliance 

with § 3162.3–1(j) is infeasible because 

some of the required information is in 

the possession of a midstream company 

that is not in a position to share it with 

the operator. The BLM is considering 

narrowing the required information and 


ethrower on DSK3G9T082PROD with PROPOSALS
Federal Register / Vol. 82, No. 192 / Thursday, October 5, 2017 / Proposed Rules 46461 

is also considering whether submission 

of a State waste-minimization plan, 

such as those required by New Mexico 

and North Dakota, would serve the 

purpose of § 3162.3–1(j). While the BLM 

conducts this review and considers 

revising § 3162.3–1, the BLM does not 

believe that generating and reviewing 

lengthy, unenforceable wasteminimization plans is a prudent use of 

operator or BLM resources. The BLM is 

therefore proposing to suspend the 

waste minimization plan requirement of 

§ 3162.3–1(j) until January 17, 2019. 

This proposed rule would revise 

§ 3162.3–1 by adding ‘‘Beginning 

January 17, 2019’’ to the beginning of 

paragraph (j). The rest of this paragraph 

would remain the same as in the 2016 

final rule and the introductory 

paragraph is repeated in the proposed 

rule text only for context. 

43 CFR 3179.7—Gas Capture 

Requirement 

In the 2016 final rule, the BLM sought 

to constrain routine flaring through the 

imposition of a ‘‘capture percentage’’ 

requirement, requiring operators to 

capture a certain percentage of the gas 

they produce, after allowing for a 

certain volume of flaring per well. The 

capture-percentage requirement would 

become more stringent over a period of 

years, beginning with an 85 percent 

capture requirement (5,400 Mcf per well 

flaring allowable) in January 2018, and 

eventually reaching a 98 percent capture 

requirement (750 Mcf per well flaring 

allowable) in January 2026. An operator 

would choose whether to comply with 

the capture targets on each of the 

operator’s leases, units or communitized 

areas, or on a county-wide or state-wide 

basis. 

In the RIA for the 2016 final rule, the 

BLM estimated that this requirement 

would impose costs of up to $162 

million per year and generate cost 

savings from product recovery of up to 

$124 million per year, with both costs 

and cost savings increasing as the 

requirements increased in stringency 

(2016 RIA at 49). 

The BLM is currently considering 

whether the capture-percentage 

requirement of § 3179.7 is unnecessarily 

complex and whether it will, in fact, be 

a significant improvement on the 

requirements of NTL–4A. The BLM is 

considering whether the NTL–4A 

framework can be applied in a manner 

that addresses any inappropriate levels 

of flaring, and whether market-based 

incentives (i.e., royalty obligations) 

could improve capture in a more 

straightforward and efficient manner. 

Finally, the BLM is considering whether 

the need for a complex capturepercentage requirement could be 

obviated through other BLM efforts to 

facilitate pipeline development. Rather 

than require operators to institute new 

processes and adjust their plans for 

development to meet a capturepercentage requirement that may be 

rescinded or revised as a result of the 

BLM’s review, the BLM is proposing to 

delay for one year the compliance dates 

for § 3179.7’s capture requirements. 

This delay would allow the BLM 

sufficient time to conduct notice-andcomment rulemaking to determine 

whether the capture percentage 

requirements should be rescinded or 

revised and would prevent operators 

from being unnecessarily burdened by 

regulatory requirements that are subject 

to change. 

This proposed rule would revise the 

compliance dates in paragraphs (b), 

(b)(1) through (b)(4), and (c)(2)(i) 

through (vii) of § 3179.7 to begin 

January 17, 2019. Paragraphs (c), (c)(1), 

and the introductory text of (c)(2) would 

remain the same as in the 2016 final 

rule and are repeated in the proposed 

rule text only for context. 

43 CFR 3179.9—Measuring and 

Reporting Volumes of Gas Vented and 

Flared From Wells 

Section 3179.9 requires operators to 

estimate (using estimation protocols) or 

measure (using a metering device) all 

flared and vented gas, whether royaltybearing or royalty-free. This section 

further provides that specific 

requirements apply when the operator is 

flaring 50 Mcf or more of gas per day 

from a high-pressure flare stack or 

manifold, based on estimated volumes 

from the previous 12 months, or based 

on estimated volumes over the life of 

the flare, whichever is shorter. 

Beginning on January 17, 2018, if this 

volume threshold is met, § 3179.9(b) 

would require the operator to measure 

the volume of the flared gas, or calculate 

the volume of the flared gas based on 

the results of a regularly performed gasto-oil ratio test, so as to allow the BLM 

to independently verify the volume, 

rate, and heating value of the flared gas. 

In the RIA for the 2016 final rule, the 

BLM estimated that this requirement 

would impose costs of about $4 million 

to $7 million per year (2016 RIA at 52). 

The BLM is presently reviewing 

§ 3179.9 to determine whether the 

additional accuracy associated with the 

measurement and estimation required 

by § 3179.9(b) justifies the burden it 

would place on operators. The BLM is 

considering whether it would make 

more sense to allow the BLM to require 

measurement or estimation on a caseby-case basis, rather than imposing a 

blanket requirement on all operators. In 

order to avoid unnecessary compliance 

costs on the part of operators, the BLM 

is proposing to delay the compliance 

date in § 3179.9 until January 17, 2019. 

This proposed rule would revise the 

compliance date in § 3179.9(b)(1). The 

rest of paragraph (b)(1) would remain 

the same as in the 2016 final rule and 

is repeated in the proposed rule text 

only for context. 

43 CFR 3179.10—Determinations 

Regarding Royalty-Free Flaring 

Section 3179.10(a) provides that 

approvals to flare royalty free that were 

in effect as of January 17, 2017, will 

continue in effect until January 17, 

2018. The purpose of this provision was 

to provide a transition period for 

operators who were operating under 

existing approvals for royalty-free 

flaring. Because the BLM’s review of the 

2016 final rule could result in rescission 

or substantial revision of the rule, the 

BLM believes that terminating preexisting flaring approvals in January 

2018 would be premature and 

disruptive and would introduce 

needless regulatory uncertainty for 

operators with existing flaring 

approvals. The BLM is therefore 

proposing to extend the end of the 

transition period provided for in 

§ 3179.10(a) to January 17, 2019. 

This proposed rule would revise the 

date in paragraph (a) and replace ‘‘as of 

the effective date of this rule’’ with ‘‘as 

of January 17, 2017,’’ which is the 

effective date of the 2016 final rule, for 

clarity. This proposed rule would not 

otherwise revise paragraph (a), but the 

rest of the paragraph would remain the 

same as in the 2016 final rule and is 

repeated in the proposed rule text only 

for context. 

43 CFR 3179.101—Well Drilling 

Section 3179.101(a) requires that gas 

reaching the surface as a normal part of 

drilling operations be used or disposed 

of in one of four ways: (1) Captured and 

sold; (2) Directed to a flare pit or flare 

stack; (3) Used in the operations on the 

lease, unit, or communitized area; or (4) 

Injected. Section 3179.101(a) also 

specifies that gas may not be vented, 

except under the circumstances 

specified in § 3179.6(b) or when it is 

technically infeasible to use or dispose 

of the gas in one of the ways specified 

above. Section 3179.101(b) states that 

gas lost as a result of a loss of well 

control will be classified as avoidably 

lost if the BLM determines that the loss 

of well control was due to operator 

negligence. 

The BLM is currently reviewing 

§ 3179.101 to determine whether it is 


ethrower on DSK3G9T082PROD with PROPOSALS
46462 Federal Register / Vol. 82, No. 192 / Thursday, October 5, 2017 / Proposed Rules 

necessary in light of current operator 

practices. The experience of BLM field 

office personnel indicates that operators 

would typically dispose of gas during 

well drilling consistent with 

§ 3179.101(a). The primary effect of 

§ 3179.101, therefore, may be to impose 

a regulatory constraint on operators in 

exceptional circumstances where the 

operator must make a case-specific 

judgment about how to safely and 

effectively dispose of the gas. The BLM 

is therefore proposing to suspend the 

effectiveness of § 3179.101 until January 

17, 2019, while the BLM completes its 

review of § 3179.101 and decides 

whether to propose permanently 

revising or rescinding it through noticeand-comment rulemaking. 

This proposed rule would add a new 

paragraph (c) making it clear that the 

operator must comply with § 3179.101 

beginning January 17, 2019. 

43 CFR 3179.102—Well Completion and 

Related Operations 

Section 3179.102 addresses gas that 

reaches the surface during wellcompletion, post-completion, and fluidrecovery operations after a well has 

been hydraulically fractured or 

refractured. It requires the gas to be used 

or disposed of in one of four ways: (1) 

Captured and sold; (2) Directed to a flare 

pit or stack, subject to a volumetric 

limitation in § 3179.103; (3) Used in the 

lease operations; or (4) Injected. Section 

3179.102 specifies that gas may not be 

vented, except under the narrow 

circumstances specified in § 3179.6(b) 

or when it is technically infeasible to 

use or dispose of the gas in one of the 

four ways specified above. Section 

3179.102(b) provides that an operator 

will be deemed to be in compliance 

with its gas capture and disposition 

requirements if the operator is in 

compliance with the requirements for 

control of gas from well completions 

established under Environmental 

Protection Agency (EPA) regulations 40 

CFR part 60, subparts OOOO or OOOOa 

regulations, or if the well is not a ‘‘well 

affected facility’’ under those 

regulations. 

The BLM is currently reviewing 

§ 3179.102 to determine whether it is 

necessary in light of current operator 

practices and the analogous EPA 

regulations in 40 CFR part 60, subparts 

OOOO and OOOOa. The experience of 

BLM field office personnel indicates 

that operators would typically dispose 

of gas during well completions and 

related operations consistent with 

§ 3179.102(a). The BLM also suspects 

that most of the well completions and 

related operations that would otherwise 

be covered by § 3179.102 are actually 

exempted under § 3179.102(b). 

Considering current industry practice 

and the overlap with EPA regulations, 

the primary effect of § 3179.102 may be 

to generate confusion about regulatory 

compliance during well-drilling and 

related operations. The BLM is therefore 

proposing to suspend the effectiveness 

of § 3179.102 until January 17, 2019, 

while the BLM completes its review of 

§ 3179.102 and decides whether to 

permanently revise or rescind it through 

notice-and-comment rulemaking. 

This proposed rule would add a new 

paragraph (e) making it clear that 

operators must comply with § 3179.102 

beginning January 17, 2019. 

43 CFR 3179.201—Equipment 

Requirements for Pneumatic Controllers 

Section 3179.201 addresses 

pneumatic controllers that use natural 

gas produced from a Federal or Indian 

lease, or from a unit or communitized 

area that includes a Federal or Indian 

lease. Section 3179.201 applies to such 

controllers if the controllers: (1) Have a 

continuous bleed rate greater than 6 

standard cubic feet per hour (scf/hour) 

(‘‘high-bleed’’ controllers); and (2) Are 

not covered by EPA regulations that 

prohibit the new use of high-bleed 

pneumatic controllers (40 CFR part 60, 

subparts OOOO or OOOOa), but would 

be subject to those regulations if the 

controllers were new, modified, or 

reconstructed sources. Section 

3179.201(b) requires the applicable 

pneumatic controllers to be replaced 

with controllers (including, but not 

limited to, continuous or intermittent 

pneumatic controllers) having a bleed 

rate of no more than 6 scf/hour, subject 

to certain exceptions. Section 

3179.201(d) requires that this 

replacement occur no later than January 

17, 2018, or within 3 years from the 

effective date of the rule if the well or 

facility served by the controller has an 

estimated remaining productive life of 3 

years or less. 

In the RIA for the 2016 final rule, the 

BLM estimated that this requirement 

would impose costs of about $2 million 

per year and generate cost savings from 

product recovery of $3 million to $4 

million per year (2016 RIA at 56). 

The BLM is currently reviewing 

§ 3179.201 to determine whether it 

should be revised or rescinded. The 

BLM is considering whether § 3179.201 

is necessary in light of the analogous 

EPA regulations and the fact that 

operators are likely to adopt more 

efficient equipment in cases where it 

makes economic sense for them to do 

so. The BLM does not believe that 

operators should be required to make 

equipment upgrades to comply with 

§ 3179.201 until the BLM has had an 

opportunity to review its requirements 

and revise them through notice-andcomment rulemaking. The BLM is 

therefore proposing to delay the 

compliance date stated in § 3179.201 

until January 17, 2019. 

This proposed rule would revise the 

first sentence of paragraph (d) by 

replacing ‘‘no later than 1 year after the 

effective date of this section’’ with ‘‘by 

January 17, 2019.’’ This proposed rule 

would also replace ‘‘the effective date of 

this section’’ with ‘‘January 17, 2017’’ 

the two times that it appears in the 

second sentence of paragraph (d). This 

proposed rule would not otherwise 

revise paragraph (d), but the rest of the 

paragraph would remain the same as in 

the 2016 final rule and is repeated in the 

proposed rule text only for context. 

43 CFR 3179.202—Requirements for 

Pneumatic Diaphragm Pumps 

Section 3179.202 establishes 

requirements for operators with 

pneumatic diaphragm pumps that use 

natural gas produced from a Federal or 

Indian lease, or from a unit or 

communitized area that includes a 

Federal or Indian lease. It applies to 

such pumps if they are not covered 

under EPA regulations at 40 CFR part 

60, subpart OOOOa, but would be 

subject to that subpart if they were a 

new, modified, or reconstructed source. 

For covered pneumatic pumps, 

§ 3179.202 requires that the operator 

either replace the pump with a zeroemissions pump or route the pump 

exhaust to processing equipment for 

capture and sale. Alternatively, an 

operator may route the exhaust to a flare 

or low-pressure combustion device if 

the operator makes a determination (and 

notifies the BLM through a Sundry 

Notice) that replacing the pneumatic 

diaphragm pump with a zero-emissions 

pump or capturing the pump exhaust is 

not viable because: (1) A pneumatic 

pump is necessary to perform the 

function required; and (2) Capturing the 

exhaust is technically infeasible or 

unduly costly. If an operator makes this 

determination and has no flare or lowpressure combustor on-site, or routing to 

such a device would be technically 

infeasible, the operator is not required 

to route the exhaust to a flare or lowpressure combustion device. Under 

§ 3179.202(h), an operator must replace 

its covered pneumatic diaphragm pump 

or route the exhaust gas to capture or 

flare beginning no later than January 17, 

2018. 

In the RIA for the 2016 final rule, the 

BLM estimated that this requirement 

would impose costs of about $4 million 

per year and generate cost savings from 


ethrower on DSK3G9T082PROD with PROPOSALS
Federal Register / Vol. 82, No. 192 / Thursday, October 5, 2017 / Proposed Rules 46463 

product recovery of $2 million to $3 

million per year (2016 RIA at 61). 

The BLM is currently reviewing 

§ 3179.202 to determine whether it 

should be rescinded or revised. 

Analogous EPA regulations apply to 

new, modified, and reconstructed 

sources, therefore limiting the 

applicability of § 3179.202. In addition, 

the BLM is concerned that requiring 

zero-emissions pumps may not conserve 

gas in some cases. The volume of 

royalty-free gas used to generate 

electricity to provide the power 

necessary to operate a zero-emission 

pump could exceed the volume of gas 

necessary to operate the pneumatic 

pump that the zero-emission pump 

would replace. The BLM does not 

believe that operators should be 

required to make equipment upgrades to 

comply with § 3179.202 until the BLM 

has had an opportunity to review its 

requirements and revise them through 

notice-and-comment rulemaking. The 

BLM is therefore proposing to delay the 

compliance date stated in § 3179.202 

until January 17, 2019. 

This proposed rule would revise 

paragraph (h) by replacing ‘‘no later 

than 1 year after the effective date of 

this section’’ in the first sentence with 

‘‘by January 17, 2019’’ and would also 

replace ‘‘the effective date of this 

section’’ with ‘‘January 17, 2017’’ the 

two times that it appears later in the 

same sentence. This proposed rule 

would not otherwise revise paragraph 

(h); the rest of the paragraph would 

remain the same as in the 2016 final 

rule and is repeated in the proposed 

rule text only for context. 

43 CFR 3179.203—Storage Vessels 

Section 3179.203 applies to crude oil, 

condensate, intermediate hydrocarbon 

liquid, or produced-water storage 

vessels that contain production from a 

Federal or Indian lease, or from a unit 

or communitized area that includes a 

Federal or Indian lease, and that are not 

subject to 40 CFR part 60, subparts 

OOOO or OOOOa, but would be if they 

were new, modified, or reconstructed 

sources. If such storage vessels have the 

potential for volatile organic compound 

(VOC) emissions equal to or greater than 

6 tons per year (tpy), § 3179.203 requires 

operators to route all gas vapor from the 

vessels to a sales line. Alternatively, the 

operator may route the vapor to a 

combustion device if it determines that 

routing the vapor to a sales line is 

technically infeasible or unduly costly. 

The operator also may submit a Sundry 

Notice to the BLM that demonstrates 

that compliance with the above options 

would cause the operator to cease 

production and abandon significant 

recoverable oil reserves under the lease 

due to the cost of compliance. Pursuant 

to § 3179.203(c), operators must meet 

these requirements for covered storage 

vessels by January 17, 2018 (unless the 

operator will replace the storage vessel 

in order to comply, in which case it has 

a longer time to comply). 

In the RIA for the 2016 final rule, the 

BLM estimated that this requirement 

would impose costs of about $7 million 

to $8 million per year and generate cost 

savings from product recovery of up to 

$200,000 per year (2016 RIA at 74). 

The BLM is currently reviewing 

§ 3179.203 to determine whether it 

should be rescinded or revised. The 

BLM is considering whether § 3179.203 

is necessary in light of analogous EPA 

regulations and whether the costs 

associated with compliance are 

justified. The BLM does not believe that 

operators should be required to make 

upgrades to their storage vessels in 

order to comply with § 3179.203 until 

the BLM has had an opportunity to 

review its requirements and revise them 

through notice-and-comment 

rulemaking. The BLM is therefore 

proposing to delay the January 17, 2018, 

compliance date in § 3179.203 until 

January 17, 2019. 

This proposed rule would revise the 

first sentence of paragraph (b) by 

replacing ‘‘Within 60 days after the 

effective date of this section’’ with 

‘‘Beginning January 17, 2019’’ and by 

adding ‘‘after January 17, 201’’ between 

the words ‘‘vessel’’ and ‘‘the operator.’’ 

This proposed rule would also revise 

the introductory text of paragraph (c) by 

replacing ‘‘no later than one year after 

the effective date of this section’’ with 

‘‘by January 17, 2019’’ and by changing 

‘‘or three years if’’ to ‘‘or by January 17, 

2020, if ’’ to account for removing the 

reference to ‘‘the effective date of this 

section.’’ This proposed rule would not 

otherwise revise paragraphs (b) and (c), 

and the rest of these paragraphs would 

remain the same as in the 2016 final 

rule and are repeated in the proposed 

rule text only for context. 

43 CFR 3179.204—Downhole Well 

Maintenance and Liquids Unloading 

Section 3179.204 establishes 

requirements for venting and flaring 

during downhole well maintenance and 

liquids unloading. It requires the 

operator to use practices for such 

operations that minimize vented gas and 

the need for well venting, unless the 

practices are necessary for safety. 

Section 3179.204 also requires that for 

wells equipped with a plunger lift 

system or an automated well-control 

system, the operator must optimize the 

operation of the system to minimize gas 

losses. Under § 3179.204, before an 

operator manually purges a well for the 

first time, the operator must document 

in a Sundry Notice that other methods 

for liquids unloading are technically 

infeasible or unduly costly. In addition, 

during any liquids unloading by manual 

well purging, the person conducting the 

well purging is required to be present 

on-site to minimize to the maximum 

extent practicable any venting to the 

atmosphere. This section also requires 

the operator to maintain records of the 

cause, date, time, duration and 

estimated volume of each venting event 

associated with manual well purging, 

and to make those records available to 

the BLM upon request. Additionally, 

operators are required to notify the BLM 

by Sundry Notice within 30 days after 

the following conditions are met: (1) 

The cumulative duration of manual 

well-purging events for a well exceeds 

24 hours during any production month; 

or (2) The estimated volume of gas 

vented in the process of conducting 

liquids unloading by manual well 

purging for a well exceeds 75 Mcf 

during any production month. In the 

RIA for the 2016 final rule, the BLM 

estimated that these requirements 

would impose costs of about $6 million 

per year and generate cost savings from 

product recovery of about $5 million to 

$9 million per year (2016 RIA at 66). In 

addition, there would be estimated 

administrative burdens associated with 

these requirements of $323,000 per year 

for the industry and $37,000 per year for 

the BLM (2016 RIA at 98 and 101). 

The BLM is currently reviewing 

§ 3179.204 to determine whether it 

should be rescinded or revised. The 

BLM does not believe that operators 

should be burdened with the 

operational and reporting requirements 

imposed by § 3179.204 until the BLM 

has had an opportunity to review them 

and, if appropriate, revise them through 

notice-and-comment rulemaking. In 

addition, as part of this review, the BLM 

would want to review how these data 

could be reported in a consistent 

manner among operators. The BLM is 

therefore proposing to suspend the 

effectiveness of § 3179.204 until January 

17, 2019. 

This proposed rule would add a new 

paragraph (i), making it clear that 

operators must comply with § 3179.204 

beginning January 17, 2019. 

43 CFR 3179.301—Operator 

Responsibility 

Sections 3179.301 through 3179.305 

establish leak detection, repair, and 

reporting requirements for: (1) Sites and 

equipment used to produce, process, 

treat, store, or measure natural gas from 


ethrower on DSK3G9T082PROD with PROPOSALS
46464 Federal Register / Vol. 82, No. 192 / Thursday, October 5, 2017 / Proposed Rules 

or allocable to a Federal or Indian lease, 

unit, or communitization agreement; 

and (2) Sites and equipment used to 

store, measure, or dispose of produced 

water on a Federal or Indian lease. 

Section 3179.302 prescribes the 

instruments and methods that may be 

used for leak detection. Section 

3179.303 prescribes the frequency for 

inspections and § 3179.304 prescribes 

the time frames for repairing leaks 

found during inspections. Finally, 

§ 3179.305 requires operators to 

maintain records of their leak detection 

and repair activities and submit an 

annual report to the BLM. Pursuant to 

§ 3179.301(f), operators must begin to 

comply with the leak detection and 

repair requirements of §§ 3179.301 

through 3179.305 before: (1) January 17, 

2018, for sites in production prior to 

January 17, 2017; (2) 60 days after 

beginning production for sites that 

began production after January 17, 2017; 

and (3) 60 days after a site that was out 

of service is brought back into service 

and re-pressurized. 

In the RIA for the 2016 final rule, the 

BLM estimated that these requirements 

would impose costs of about $83 

million to $84 million per year and 

generate cost savings from product 

recovery of about $12 million to $21 

million per year (2016 RIA at 91). In 

addition, there would be estimated 

administrative burdens associated with 

these requirements of $3.9 million per 

year for the industry and over $1 

million per year for the BLM (2016 RIA 

at 98 and 102). 

The BLM is currently reviewing 

§ 3179.301 through § 3179.305 to 

determine whether they should be 

revised or rescinded. The BLM is 

considering whether these requirements 

are necessary in light of comparable 

EPA and State leak detection and repair 

regulations. The BLM is considering 

whether the reporting burdens imposed 

by these sections are justified and 

whether the substantial compliance 

costs could be mitigated by allowing for 

less frequent and/or non-instrumentbased inspections or by exempting wells 

that have low potential to leak natural 

gas. The BLM does not believe that 

operators should be burdened with the 

significant compliance costs imposed by 

these sections until the BLM has had an 

opportunity to review them and, if 

appropriate, revise them through noticeand-comment rulemaking. The BLM is 

therefore proposing to delay the 

effective dates for these sections until 

January 17, 2019, by revising 

§ 3179.301(f). 

This proposed rule would revise 

paragraph (f)(1) by replacing ‘‘Within 

one year of January 17, 2017 for sites 

that have begun production prior to 

January 17, 2017;’’ with ‘‘By January 17, 

2019, for all existing sites.’’ This 

proposed rule would also revise 

paragraph (f)(2) by adding ‘‘new’’ 

between the words ‘‘for’’ and ‘‘sites’’ 

and by replacing the existing date with 

‘‘January 17, 2019.’’ Finally, this 

proposed rule would revise paragraph 

(f)(3) by adding ‘‘an existing’’ between 

the words ‘‘when’’ and ‘‘site’’ and by 

adding ‘‘after January 17, 2019’’ to the 

end of the sentence. This proposed rule 

would not otherwise revise paragraph 

(f), and the rest of the paragraph would 

remain the same as in the 2016 final 

rule and is repeated in the proposed 

rule text only for context. 

C. Summary of Estimated Impacts 

The BLM reviewed the proposed rule 

and conducted an RIA and 

Environmental Assessment (EA) that 

examine the impacts of the proposed 

requirements. The following discussion 

is a summary of the proposed rule’s 

economic impacts. The RIA and draft 

EA that we prepared have been posted 

in the docket for the proposed rule on 

the Federal eRulemaking Portal: https:// 

www.regulations.gov. In the Searchbox, 

enter ‘‘RIN 1004–AE54’’ and click the 

‘‘Search’’ button. Follow the 

instructions at this Web site. 

The suspension or delay in the 

implementation of certain requirements 

in the 2016 final rule would postpone 

the impacts estimated previously to the 

near-term future. That is to say, impacts 

that we previously estimated would 

occur in 2017 are now estimated to 

occur in 2018, impacts that we 

previously estimated would occur in 

2018 are now estimated to occur in 

2019, and so on. In the RIA for this 

proposed rule, we track this shift in 

impacts over the 10-year period 

following the delay. A 10-year period of 

analysis was also used in the RIA 

prepared for the 2016 final rule. Except 

for some notable changes, the 2017 RIA 

uses the impacts estimated and 

underlying assumptions used by the 

BLM for the RIA prepared for the 2016 

final rule, published in November 2016. 

The BLM’s proposed rule would 

temporarily suspend or delay almost all 

of the requirements in the 2016 final 

rule that we estimated would pose a 

compliance burden to operators and 

generate benefits of gas savings or 

reductions in methane emissions. 

Estimated Reductions in Compliance 

Costs (Excluding Cost Savings) 

First, we examine the reductions in 

compliance costs excluding the savings 

that would have been realized from 

product recovery. The BLM’s proposed 

rule would temporarily suspend or 

delay almost all of the requirements in 

the 2016 final rule that we estimated 

would pose a compliance burden to 

operators. We estimate that suspending 

or delaying the targeted requirements of 

the 2016 final rule until January 17, 

2019, would substantially reduce 

compliance costs during the period of 

the suspension or delay (2017 RIA at 

29). 

Impacts in year 1: 

• A reduction in compliance costs of 

$114 million (using a 7 percent discount 

rate to annualize capital costs) or $110 

million (using a 3 percent discount rate 

to annualize capital costs). 

Impacts from 2017–2027: 

• Total reduction in compliance costs 

ranging from $73 million to $91 million 

(net present value (NPV) using a 7 

percent discount rate) or $40 million to 

$50 million (NPV using a 3 percent 

discount rate). 

Estimated Reduction in Benefits 

The BLM’s proposed rule would 

temporarily suspend or delay almost all 

of the requirements in the 2016 final 

rule that we estimated would generate 

benefits of gas savings or reductions in 

methane emissions. We estimate that 

the proposed rule would result in 

forgone benefits, since estimated cost 

savings that would have come from 

product recovery would be deferred and 

the emissions reductions would also be 

deferred (2017 RIA at 32). 

Impacts in year 1: 

• A reduction in cost savings of $19 

million. 

Impacts from 2017–2027: 

• Total reduction in cost savings of 

$36 million (NPV using a 7 percent 

discount rate) or $21 million (NPV using 

a 3 percent discount rate). 

We estimate that the proposed rule 

would also result in additional methane 

and VOC emissions of 175,000 and 

250,000 tons, respectively, in year 1 

(2017 RIA at 32). 

These estimated emissions are 

measured as the change from the 

baseline environment, which is the 2016 

final rule’s requirements being 

implemented per the 2016 final rule 

schedule. Since the proposed rule 

would delay the implementation of 

those requirements, the estimated 

benefits of the 2016 final rule would be 

forgone during the temporary 

suspension or delay. 

The BLM used interim domestic 

values of the carbon dioxide and 

methane to value the forgone emissions 

reductions resulting from the delay (see 

the discussion of social cost of 

greenhouse gases in the 2017 RIA at 

Section 3.2 and Appendix). 


ethrower on DSK3G9T082PROD with PROPOSALS
Federal Register / Vol. 82, No. 192 / Thursday, October 5, 2017 / Proposed Rules 46465 

Impact in Year 1: 

• Forgone methane emissions 

reductions valued at $8 million (using 

interim domestic SC–CH4 based on a 7 

percent discount rate) or $26 million 

(using interim domestic SC–CH4 based 

on a 3 percent discount rate). 

Impacts from 2017–2027: 

• Forgone methane emissions 

reductions valued at $1.9 million (NPV 

and interim domestic SC–CH4 using a 7 

percent discount rate); or 

• Forgone methane emissions 

reductions valued at $300,000 (NPV and 

interim domestic SC–CH4 using a 3 

percent discount rate). 

Estimated Net Benefits 

The proposed rule is estimated to 

result in positive net benefits, meaning 

that the reduction of compliance costs 

would exceed the reduction in cost 

savings and the cost of emissions 

additions (2017 RIA at 36). 

Impact in year 1: 

• Net benefits of $83–86 million 

(using interim domestic SC–CH4 based 

on a 7 percent discount rate) or $64–68 

million (using interim domestic SC–CH4

based on a 3 percent discount rate). 

Impacts from 2017–2027: 

• Total net benefits ranging from $35– 

52 million (NPV and interim domestic 

SC–CH4 using a 7 percent discount rate); 

or 

• Total net benefits ranging from $19– 

29 million (NPV and interim domestic 

SC–CH4 using a 3 percent discount rate). 

Energy Systems 

The proposed rule is expected to 

influence the production of natural gas, 

natural gas liquids, and crude oil from 

onshore Federal and Indian oil and gas 

leases, particularly in the short-term. 

However, since the relative changes in 

production are expected to be small, we 

do not expect that the proposed rule 

would significantly impact the price, 

supply, or distribution of energy. 

We estimate the following 

incremental changes in production, 

noting the representative share of the 

total U.S. production in 2015 for context 

(2017 RIA at 41). 

Annual Impacts: 

• A decrease in natural gas 

production of 9.0 billion cubic feet (Bcf) 

in year 1 (0.03 percent of the total U.S. 

production). 

• An increase in crude oil production 

of 91,000 barrels in year 2 (0.003 

percent of the total U.S. production). 

There is no estimated change in crude 

oil production in year 1. 

Royalty Impacts 

In the short-term, the rule is expected 

to decrease natural gas production from 

Federal and Indian leases, and likewise, 

is expected to reduce annual royalties to 

the Federal Government, tribal 

governments, States, and private 

landowners. From 2017–2027, however, 

we expect a small increase in total 

royalties, likely due to production 

slightly shifting into the future where 

commodity prices are expected to be 

higher. 

Royalty payments are recurring 

income to Federal or tribal governments 

and costs to the operator or lessee. As 

such, they are transfer payments that do 

not affect the total resources available to 

society. An important but sometimes 

difficult problem in cost estimation is to 

distinguish between real costs and 

transfer payments. While transfers 

should not be included in the economic 

analysis estimates of the benefits and 

costs of a regulation, they may be 

important for describing the 

distributional effects of a regulation. 

We estimate a reduction in royalties 

of $2.6 million in year 1 (2017 RIA at 

43). This amount represents about 0.2 

percent of the total royalties received 

from oil and gas production on Federal 

lands in FY 2016. However, from 2017– 

2027, we estimate an increase in total 

royalties of $1.26 million (NPV using a 

7 percent discount rate) or $380,000 

(NPV using a 3 percent discount rate). 

Consideration of Alternative 

Approaches 

In developing this proposed rule, the 

BLM considered alternative timeframes 

for which it could suspend or delay the 

requirements (e.g., 6 months and 2 

years). Ultimately, the BLM decided to 

propose a suspension or delay for one 

year, which it believes to be the 

minimum length of time practicable 

within which to review the 2016 final 

rule and complete a notice-andcomment rulemaking to revise that 

regulation. We note that, based on the 

progress of the review during this 

rulemaking process, the BLM may revise 

the length of the suspension or delay for 

the final rule. 

A shorter suspension of delay of the 

same 2016 final rule requirements 

would result in a smaller reduction in 

compliance costs, smaller reduction in 

cost savings, and a smaller amount of 

forgone emissions reductions, relative to 

the proposal (2017 RIA at 49–50). 

Meanwhile, a longer suspension or 

delay of the same 2016 final rule 

requirements would result in a larger 

reduction in compliance costs, larger 

reduction in cost savings, and larger 

amount of forgone emissions reductions, 

relative to the proposal (2017 RIA at 50). 

Employment Impacts 

The proposed rule would temporarily 

suspend or delay certain requirements 

of the BLM’s 2016 final rule on waste 

prevention and is a temporary 

deregulatory action. As such, we 

estimate that it would result in a 

reduction of compliance costs for 

operators of oil and gas leases on 

Federal and Indian lands. Therefore, it 

is likely that the impact, if any, on the 

employment would be positive. 

In the RIA for the 2016 final rule, the 

BLM concluded that the requirements 

were not expected to impact the 

employment within the oil and gas 

extraction, drilling oil and gas wells, 

and support activities industries, in any 

material way. This determination was 

based on several reasons. First, the 

estimated incremental gas production 

represented only a small fraction of the 

U.S. natural gas production volumes. 

Second, the estimated compliance costs 

represented only a small fraction of the 

annual net incomes of companies likely 

to be impacted. Third, for those 

operations that would have been 

impacted to the extent that the 

compliance costs would force the 

operator to shut in production, the 2016 

final rule had provisions that would 

exempt these operations from 

compliance. Based on these factors, the 

BLM determined that the 2016 final rule 

would not alter the investment or 

employment decisions of firms or 

significantly adversely impact 

employment. The RIA also noted that 

the requirements would require the onetime installation or replacement of 

equipment and the ongoing 

implementation of a leak detection and 

repair program, both of which would 

require labor to comply. 

We do not believe that the proposed 

rule would substantially alter the 

investment or employment decisions of 

firms for two reasons. First, the RIA for 

the 2016 final rule determined that that 

rule would not substantially alter the 

investment or employment decisions of 

firms, and so therefore delaying the 

2016 final rule would likewise not be 

expected to impact those decisions. We 

also recognize that while there might be 

a small positive impact on investment 

and employment due to the reduction in 

compliance burdens, the magnitude of 

the reductions are relatively small. 

Small Business Impacts 

The BLM reviewed the Small 

Business Administration (SBA) size 

standards for small businesses and the 

number of entities fitting those size 

standards as reported by the U.S. 

Census Bureau. We conclude that small 


ethrower on DSK3G9T082PROD with PROPOSALS
46466 Federal Register / Vol. 82, No. 192 / Thursday, October 5, 2017 / Proposed Rules 

entities represent the overwhelming 

majority of entities operating in the 

onshore crude oil and natural gas 

extraction industry and, therefore, the 

proposed rule would impact a 

significant number of small entities. 

To examine the economic impact of 

the rule on small entities, the BLM 

performed a screening analysis on a 

sample of potentially affected small 

entities, comparing the reduction of 

compliance costs to entity profit 

margins. 

The BLM identified up to 1,828 

entities that operate on Federal and 

Indian leases and recognizes that the 

overwhelming majority of these entities 

are small business, as defined by the 

SBA. We estimated the potential 

reduction in compliance costs to be 

about $60,000 per entity during the 

initial year when the requirements 

would be suspended or delayed. This 

represents the average maximum 

amount by which the operators would 

be positively impacted by the proposed 

rule. 

We used existing BLM information 

and research concerning firms that have 

recently completed Federal and Indian 

wells and the financial and employment 

information on a sample of these firms, 

as available in company annual report 

filings with the Securities and Exchange 

Commission (SEC). From the original 

list of companies, we identified 55 

company filings. Of those companies, 33 

were small businesses. 

From data in the companies’ 10–K 

filings to the SEC, the BLM was able to 

calculate the companies’ profit margins 

for the years 2012, 2013, and 2014. We 

then calculated a profit margin figure for 

each company when subject to the 

average annual reduction in compliance 

costs associated with this proposed rule. 

For these 26 small companies, the 

estimated per-entity reduction in 

compliance costs would result in an 

average increase in profit margin of 0.17 

percentage points (based on the 2014 

company data) (2017 RIA at 46). 

Impacts Associated With Oil and Gas 

Operations on Tribal Lands 

The proposed rule would apply to oil 

and gas operations on both Federal and 

Indian leases. In the RIA, the BLM 

estimates the impacts associated with 

operations on Indian leases, as well as 

royalty implications for tribal 

governments. We estimate these impacts 

by scaling down the total impacts by the 

share of oil wells on Indian lands and 

the share of gas wells on Indian Lands. 

Please reference the RIA at section 4.4.5 

for a full explanation about the estimate 

impacts. 

IV. Procedural Matters 

Regulatory Planning and Review 

(Executive Orders 12866 and 13563) 

Executive Order 12866 provides that 

the Office of Information and Regulatory 

Affairs within the Office of Management 

and Budget (OMB) will review all 

significant rules. 

Executive Order 13563 reaffirms the 

principles of Executive Order 12866 

while calling for improvements in the 

Nation’s regulatory system to promote 

predictability, to reduce uncertainty, 

and to use the best, most innovative, 

and least burdensome tools for 

achieving regulatory ends. The 

Executive Order directs agencies to 

consider regulatory approaches that 

reduce burdens and maintain flexibility 

and freedom of choice for the public 

where these approaches are relevant, 

feasible, and consistent with regulatory 

objectives. Executive Order 13563 

emphasizes further that regulations 

must be based on the best available 

science and that the rulemaking process 

must allow for public participation and 

an open exchange of ideas. 

This proposed rule would temporarily 

suspend or delay portions of the BLM’s 

2016 final rule while the BLM reviews 

those requirements. We have developed 

this proposed rule in a manner 

consistent with the requirements in 

Executive Order 12866 and Executive 

Order 13563. 

After reviewing the requirements of 

the proposed rule, the OMB has 

determined that it is an economically 

significant action according to the 

criteria of Executive Order 12866. The 

BLM reviewed the requirements of the 

proposed rule and determined that it 

will not adversely affect in a material 

way the economy, a sector of the 

economy, productivity, competition, 

jobs, the environment, public health or 

safety, or State, local, or tribal 

governments or communities. For more 

detailed information, see the RIA 

prepared for this proposed rule. The 

RIA has been posted in the docket for 

the proposed rule on the Federal 

eRulemaking Portal: https://

www.regulations.gov. In the Searchbox, 

enter ‘‘RIN 1004–AE54’’ and click the 

‘‘Search’’ button. Follow the 

instructions at this Web site. 

Regulatory Flexibility Act 

This proposed rule would not have a 

significant economic effect on a 

substantial number of small entities 

under the Regulatory Flexibility Act (5 

U.S.C. 601 et seq.) The Regulatory 

Flexibility Act (RFA) generally requires 

that Federal agencies prepare a 

regulatory flexibility analysis for rules 

subject to the notice-and-comment 

rulemaking requirements under the 

Administrative Procedure Act (5 U.S.C. 

500 et seq.), if the rule would have a 

significant economic impact, either 

detrimental or beneficial, on a 

substantial number of small entities. See 

5 U.S.C. 601—612. Congress enacted the 

RFA to ensure that government 

regulations do not unnecessarily or 

disproportionately burden small 

entities. Small entities include small 

businesses, small governmental 

jurisdictions, and small not-for-profit 

enterprises. 

The BLM reviewed the SBA size 

standards for small businesses and the 

number of entities fitting those size 

standards as reported by the U.S. 

Census Bureau in the Economic Census. 

The BLM concludes that the vast 

majority of entities operating in the 

relevant sectors are small businesses as 

defined by the SBA. As such, the 

proposed rule would likely affect a 

substantial number of small entities. 

However, the BLM believes that the 

proposed rule would not have a 

significant economic impact on a 

substantial number of small entities. 

Although the rule would affect a 

substantial number of small entities, the 

BLM does not believe that these effects 

would be economically significant. The 

proposed rule would temporarily 

suspend or delay certain requirements 

placed on operators by the 2016 final 

rule. Operators would not have to 

undertake the associated compliance 

activities, either operational or 

administrative, that are outlined in the 

2016 final rule until January 17, 2019, 

except to the extent the activities are 

required by State or tribal law, or by 

other pre-existing BLM regulations. The 

screening analysis conducted by the 

BLM estimates that the average 

reduction in compliance costs 

associated with this proposed rule 

would be a small fraction of a percent 

of the profit margin for small 

companies, which is not a large enough 

impact to be considered significant. 

Small Business Regulatory Enforcement 

Fairness Act 

This proposed rule is a major rule 

under 5 U.S.C. 804(2), the Small 

Business Regulatory Enforcement 

Fairness Act. This proposed rule: 

(a) Would have an annual effect on 

the economy of $100 million or more. 

(b) Would not cause a major increase 

in costs or prices for consumers, 

individual industries, Federal, State, or 

local government agencies, or 

geographic regions. 

(c) Would not have a significant 

adverse effects on competition, 


ethrower on DSK3G9T082PROD with PROPOSALS
Federal Register / Vol. 82, No. 192 / Thursday, October 5, 2017 / Proposed Rules 46467 

employment, investment, productivity, 

innovation, or the ability of U.S.-based 

enterprises to compete with foreignbased enterprises. 

Unfunded Mandates Reform Act 

(UMRA) 

This proposed rule would not impose 

an unfunded mandate on State, local, or 

tribal governments, or the private sector 

of $100 million or more per year. The 

proposed rule would not have a 

significant or unique effect on State, 

local, or tribal governments or the 

private sector. The proposed rule 

contains no requirements that would 

apply to State, local, or tribal 

governments. It would temporarily 

suspend or delay requirements that 

would otherwise apply to the private 

sector. A statement containing the 

information required by the Unfunded 

Mandates Reform Act (UMRA) (2 U.S.C. 

1531 et seq.) is not required for the 

proposed rule. This proposed rule is 

also not subject to the requirements of 

section 203 of UMRA because it 

contains no regulatory requirements that 

might significantly or uniquely affect 

small governments, because it contains 

no requirements that apply to such 

governments, nor does it impose 

obligations upon them. 

Governmental Actions and Interference 

With Constitutionally Protected Property 

Right—Takings (Executive Order 12630) 

This proposed rule would not affect a 

taking of private property or otherwise 

have taking implications under 

Executive Order 12630. A takings 

implication assessment is not required. 

The proposed rule would temporarily 

suspend or delay many of the 

requirements placed on operators by the 

2016 final rule. Operators would not 

have to undertake the associated 

compliance activities, either operational 

or administrative, that are outlined in 

the 2016 final rule until January 17, 

2019, and therefore would impact some 

operational and administrative 

requirements on Federal and Indian 

lands. All such operations are subject to 

lease terms which expressly require that 

subsequent lease activities be conducted 

in compliance with subsequently 

adopted Federal laws and regulations. 

This proposed rule conforms to the 

terms of those leases and applicable 

statutes and, as such, the rule is not a 

government action capable of interfering 

with constitutionally protected property 

rights. Therefore, the BLM has 

determined that the rule would not 

cause a taking of private property or 

require further discussion of takings 

implications under Executive Order 

12630. 

Federalism (Executive Order 13132) 

Under the criteria in section 1 of 

Executive Order 13132, this proposed 

rule does not have sufficient federalism 

implications to warrant the preparation 

of a federalism summary impact 

statement. A federalism impact 

statement is not required. 

The proposed rule would not have a 

substantial direct effect on the States, on 

the relationship between the Federal 

Government and the States, or on the 

distribution of power and 

responsibilities among the levels of 

government. It would not apply to 

States or local governments or State or 

local governmental entities. The rule 

would affect the relationship between 

operators, lessees, and the BLM, but it 

does not directly impact the States. 

Therefore, in accordance with Executive 

Order 13132, the BLM has determined 

that this proposed rule does not have 

sufficient federalism implications to 

warrant preparation of a Federalism 

Assessment. 

Civil Justice Reform (Executive Order 

12988) 

This proposed rule complies with the 

requirements of Executive Order 12988. 

More specifically, this proposed rule 

meets the criteria of section 3(a), which 

requires agencies to review all 

regulations to eliminate errors and 

ambiguity and to write all regulations to 

minimize litigation. This proposed rule 

also meets the criteria of section 3(b)(2), 

which requires agencies to write all 

regulations in clear language with clear 

legal standards. 

Consultation and Coordination With 

Indian Tribal Governments (Executive 

Order 13175 and Departmental Policy) 

The Department strives to strengthen 

its government-to-government 

relationship with Indian tribes through 

a commitment to consultation with 

Indian tribes and recognition of their 

right to self-governance and tribal 

sovereignty. We have evaluated this 

proposed rule under the Department’s 

consultation policy and under the 

criteria in Executive Order 13175 and 

have identified substantial direct effects 

on federally recognized Indian tribes 

that would result from this proposed 

rule. Under this proposed rule, oil and 

gas operations on tribal and allotted 

lands would not be subject to many of 

the requirements placed on operators by 

the 2016 final rule until January 17, 

2019. 

The BLM believes that temporarily 

suspending or delaying these 

requirements would assist in preventing 

Indian lands from being viewed by oil 

and gas operators as less attractive than 

non-Indian lands due to unnecessary 

and burdensome compliance costs, 

thereby preventing economic harm to 

tribes and allottees. 

The BLM is conducting tribal 

outreach which it believes is 

appropriate given that the proposed rule 

would extend the compliance dates of 

the 2016 final rule, but would not 

change the policies of that rule. The 

BLM notified tribes of the action and 

requested feedback and comment 

through the respective BLM State Office 

Directors. Future tribal consultation 

may occur on an ongoing basis. 

Paperwork Reduction Act 

1. Overview 

The Paperwork Reduction Act (PRA) 

(44 U.S.C. 3501–3521) provides that an 

agency may not conduct or sponsor, and 

a person is not required to respond to, 

a collection of information, unless it 

displays a currently valid control 

number. 44 U.S.C. 3512. Collections of 

information include requests and 

requirements that an individual, 

partnership, or corporation obtain 

information, and report it to a Federal 

agency. 44 U.S.C. 3502(3); 5 CFR 

1320.3(c) and (k). 

OMB has approved the 24 information 

collection activities in the 2016 final 

rule and has assigned control number 

1004–0211 to those activities. In the 

Notice of Action approving the 24 

information collection activities in the 

2016 final rule, OMB announced that 

the control number will expire on 

January 31, 2018. The Notice of Action 

also included terms of clearance. 

The BLM requests the extension of 

control number 1004–0021 until January 

31, 2019. The BLM requests no other 

changes to the control number. 

In accordance with the PRA, the BLM 

is inviting public comment on the 

proposed extension of control no. 1004– 

0211. Descriptions of the information 

collection activities in this proposed 

rule, along with estimates of the annual 

burdens, are shown below. Included in 

the burden estimates are the time for 

reviewing instructions, searching 

existing data sources, gathering and 

maintaining the data needed, and 

completing and reviewing each 

component of the proposed information 

collection requirements. 

The BLM has submitted the 

information collection request for this 

proposed rule to OMB for review in 

accordance with the PRA. You may 

obtain a copy of the request from the 

BLM by electronic mail request to James 

Tichenor at jtichenor@blm.gov or by 

telephone request to 202–573–0536. 


ethrower on DSK3G9T082PROD with PROPOSALS
46468 Federal Register / Vol. 82, No. 192 / Thursday, October 5, 2017 / Proposed Rules 

You may also review the information 

collection request online at: http://

www.reginfo.gov/public/do/. 

The BLM requests comments on the 

following subjects: 

• Whether the collection of 

information is necessary for the proper 

functioning of the BLM, including 

whether the information will have 

practical utility; 

• The accuracy of the BLM’s estimate 

of the burden of collecting the 

information, including the validity of 

the methodology and assumptions used; 

• The quality, utility, and clarity of 

the information to be collected; and 

• How to minimize the information 

collection burden on those who are to 

respond, including the use of 

appropriate automated, electronic, 

mechanical, or other forms of 

information technology. 

If you want to comment on the 

information collection requirements of 

this proposed rule, please send your 

comments directly to OMB, with a copy 

to the BLM, as directed in the 

ADDRESSES section of this preamble. 

Please identify your comments with 

‘‘OMB Control Number 1004–0211.’’ 

OMB is required to make a decision 

concerning the collection of information 

contained in this proposed rule between 

30 to 60 days after publication of this 

document in the Federal Register. 

Therefore, a comment to OMB is best 

assured of having its full effect if OMB 

receives it by November 6, 2017. 

2. Summary of Information Collection 

Activities 

Title: Waste Prevention, Production 

Subject to Royalties, and Resource 

Conservation (43 CFR parts 3160 and 

3170). Form 3160–5, Sundry Notices 

and Reports on Wells. 

OMB Control Number: 1004–0211. 

Forms: Form 3160–3, Application for 

Permit to Drill or Re-enter; and Form 

3160–5, Sundry Notices and Reports on 

Wells. 

Description of Respondents: Holders 

of Federal and Indian (except Osage 

Tribe) oil and gas leases, those who 

belong to Federally approved units or 

communitized areas, and those who are 

parties to oil and gas agreements under 

the Indian Mineral Development Act, 25 

U.S.C. 2101–2108. 

Respondents’ Obligation: Required to 

obtain or retain a benefit. 

Frequency of Collection: On occasion. 

Abstract: The BLM requests the 

extension of control number 1004–0021 

until January 31, 2019. The BLM 

requests no changes to the control 

number except this extension. 

Estimated Number of Responses: 

63,200. 

Estimated Total Annual Burden 

Hours: 82,170. 

Estimated Total Non-Hour Cost: 

None. 

3. Information Collection Request 

The BLM requests extension of OMB 

control number 1004–0211 until January 

31, 2019. This extension would 

continue OMB’s approval of the 

following information collection 

activities. 

Plan To Minimize Waste of Natural Gas 

(43 CFR 3162.3–1) 

The 2016 final rule added a new 

provision to 43 CFR 3162.3–1 that 

requires a plan to minimize waste of 

natural gas when submitting an 

Application for Permit to Drill or Reenter (APD) for a development oil well. 

This information is in addition to the 

APD information that the BLM already 

collects under OMB Control Number 

1004–0137. The required elements of 

the waste minimization plan are listed 

at paragraphs (j)(1) through (j)(7). 

Request for Approval for Royalty-Free 

Uses On-Lease or Off-Lease (43 CFR 

3178.5, 3178.7, 3178.8, and 3178.9) 

Section 3178.5 requires submission of 

a Sundry Notice (Form 3160–5) to 

request prior written BLM approval for 

use of gas royalty-free for the following 

operations and production purposes on 

the lease, unit or communitized area: 

• Using oil or gas that an operator 

removes from the pipeline at a location 

downstream of the facility measurement 

point (FMP); 

• Removal of gas initially from a 

lease, unit PA, or communitized area for 

treatment or processing because of 

particular physical characteristics of the 

gas, prior to use on the lease, unit PA 

or communitized area; and 

• Any other type of use of produced 

oil or gas for operations and production 

purposes pursuant to § 3178.3 that is not 

identified in § 3178.4. 

Section 3178.7 requires submission of 

a Sundry Notice (Form 3160–5) to 

request prior written BLM approval for 

off-lease royalty-free uses in the 

following circumstances: 

• The equipment or facility in which 

the operation is conducted is located off 

the lease, unit, or communitized area for 

engineering, economic, resourceprotection, or physical-accessibility 

reasons; and 

• The operations are conducted 

upstream of the FMP. 

Section 3178.8 requires that an 

operator measure or estimate the 

volume of royalty-free gas used in 

operations upstream of the FMP. In 

general, the operator is free to choose 

whether to measure or estimate, with 

the exception that the operator must in 

all cases measure the following 

volumes: 

• Royalty-free gas removed 

downstream of the FMP and used 

pursuant to §§ 3178.4 through 3178.7; 

and 

• Royalty-free oil used pursuant to 

§§ 3178.4 through 3178.7. 

If oil is used on the lease, unit or 

communitized area, it is most likely to 

be removed from a storage tank on the 

lease, unit or communitized area. Thus, 

this regulation also requires the operator 

to document the removal of the oil from 

the tank or pipeline. 

Section 3178.8(e) requires that 

operators use best available information 

to estimate gas volumes, where 

estimation is allowed. For both oil and 

gas, the operator must report the 

volumes measured or estimated, as 

applicable, under ONRR reporting 

requirements. As revisions to Onshore 

Oil and Gas Orders No. 4 and 5 have 

now been finalized as 43 CFR subparts 

3174 and 3175, respectively, the final 

rule text now references § 3173.12, as 

well as § 3178.4 through § 3178.7 to 

clarify that royalty-free use must adhere 

to the provisions in those sections. 

Section 3178.9 requires the following 

additional information in a request for 

prior approval of royalty-free use under 

§ 3178.5, or for prior approval of offlease royalty-free use under § 3178.7: 

• A complete description of the 

operation to be conducted, including 

the location of all facilities and 

equipment involved in the operation 

and the location of the FMP; 

• The volume of oil or gas that the 

operator expects will be used in the 

operation and the method of measuring 

or estimating that volume; 

• If the volume expected to be used 

will be estimated, the basis for the 

estimate (e.g., equipment manufacturer’s 

published consumption or usage rates); 

and 

• The proposed disposition of the oil 

or gas used (e.g., whether gas used 

would be consumed as fuel, vented 

through use of a gas-activated 

pneumatic controller, returned to the 

reservoir, or disposed by some other 

method). 

Request for Approval of Alternative 

Capture Requirement (43 CFR 3179.8) 

Section 3179.8 applies only to leases 

issued before the effective date of the 

2016 final rule and to operators 

choosing to comply with the capture 

requirement in § 3179.7 on a lease-bylease, unit-by-unit, or communitized 

area-by-communitized area basis. The 

regulation provides that operators who 


ethrower on DSK3G9T082PROD with PROPOSALS
Federal Register / Vol. 82, No. 192 / Thursday, October 5, 2017 / Proposed Rules 46469 

4The EPA has convened a proceeding for 

reconsidering the final OOOOa rule, see 82 FR 

25730 (June 5, 2017). If EPA’s requirements are 

altered in any way in the future, then PRA burdens 

estimated for BLM’s rule could increase by up to 

$130/event if the operator files for an exemption. 

meet those parameters may seek BLM 

approval of a capture percentage other 

than that which is applicable under 43 

CFR 3179.7. The operator must submit 

a Sundry Notice (Form 3160–5) that 

includes the following information: 

• The name, number, and location of 

each of the operator’s wells, and the 

number of the lease, unit, or 

communitized area with which it is 

associated; and 

• The oil and gas production levels of 

each of the operator’s wells on the lease, 

unit, or communitized area for the most 

recent production month for which 

information is available and the 

volumes being vented and flared from 

each well. 

In addition, the request must include 

map(s) showing: 

• The entire lease, unit, or 

communitized area, and the 

surrounding lands to a distance and on 

a scale that shows the field in which the 

well is or will be located (if applicable), 

and all pipelines that could transport 

the gas from the well; 

• All of the operator’s producing oil 

and gas wells, which are producing 

from Federal or Indian leases, (both on 

Federal or Indian leases and on other 

properties) within the map area; 

• Identification of all of the operator’s 

wells within the lease from which gas 

is flared or vented, and the location and 

distance of the nearest gas pipeline(s) to 

each such well, with an identification of 

those pipelines that are or could be 

available for connection and use; and 

• Identification of all of the operator’s 

wells within the lease from which gas 

is captured; 

The following information is also 

required: 

• Data that show pipeline capacity 

and the operator’s projections of the cost 

associated with installation and 

operation of gas capture infrastructure, 

to the extent that the operator is able to 

obtain this information, as well as cost 

projections for alternative methods of 

transportation that do not require 

pipelines; and 

• Projected costs of and the combined 

stream of revenues from both gas and oil 

production, including: (1) The 

operator’s projections of gas prices, gas 

production volumes, gas quality (i.e., 

heating value and H2S content), 

revenues derived from gas production, 

and royalty payments on gas production 

over the next 15 years or the life of the 

operator’s lease, unit, or communitized 

area, whichever is less; and (2) The 

operator’s projections of oil prices, oil 

production volumes, costs, revenues, 

and royalty payments from the 

operator’s oil and gas operations within 

the lease over the next 15 years or the 

life of the operator’s lease, unit, or 

communitized area, whichever is less. 

Notification of Choice To Comply on 

County- or State-Wide Basis (43 CFR 

3179.7(c)(3)(ii)) 

Section 3179.7 requires operators 

flaring gas from development oil wells 

to capture a specified percentage of the 

operator’s adjusted volume of gas 

produced over the relevant area. The 

‘‘relevant area’’ is each of the operator’s 

leases, units, or communitized areas, 

unless the operator chooses to comply 

on a county- or State-wide basis and the 

operator notifies the BLM of its choice 

by Sundry Notice (Form 3160–5) by 

January 1 of the relevant year. 

Request for Exemption From Well 

Completion Requirements (43 CFR 

3179.102(c) and (d)) 

Section 3179.102 lists several 

requirements pertaining to gas that 

reaches the surface during well 

completion and related operations. An 

operator may seek an exemption from 

these requirements by submitting a 

Sundry Notice (Form 3160–5) that 

includes the following information: 

(1) The name, number, and location of 

each of the operator’s wells, and the 

number of the lease, unit, or 

communitized area with which it is 

associated; 

(2) The oil and gas production levels 

of each of the operator’s wells on the 

lease, unit or communitized area for the 

most recent production month for 

which information is available; 

(3) Data that show the costs of 

compliance; and 

(4) Projected costs of and the 

combined stream of revenues from both 

gas and oil production, including: the 

operator’s projections of oil and gas 

prices, production volumes, quality (i.e., 

heating value and H2S content), 

revenues derived from production, and 

royalty payments on production over 

the next 15 years or the life of the 

operator’s lease, unit, or communitized 

area, whichever is less. 

The rule also provides that an 

operator that is in compliance with the 

EPA regulations for well completions 

under 40 CFR part 60, subpart OOOO or 

subpart OOOOa is deemed in 

compliance with the requirements of 

this section. As a practical matter, all 

new, reconstructed, and modified 

hydraulically fracturing or refracturing 

events are now subject to the EPA 

requirements, so the BLM does not 

believe that the requirements of this 

section would have any independent 

effect, or that any operator would 

request an exemption from the 

requirements of this section, as long as 

the EPA requirements remain in effect. 

For this reason, the BLM is not 

estimating any PRA burdens for 

§ 3179.102.4

Request for Extension of Royalty-Free 

Flaring During Initial Production 

Testing (43 CFR 3179.103) 

Section 3179.103 allows gas to be 

flared royalty-free during initial 

production testing. The regulation lists 

specific volume and time limits for such 

testing. An operator may seek an 

extension of those limits on royalty-free 

flaring by submitting a Sundry Notice 

(Form 3160–5) to the BLM. 

Request for Extension of Royalty-Free 

Flaring During Subsequent Well Testing 

(43 CFR 3179.104) 

Section 3179.104 allows gas to be 

flared royalty-free for no more than 24 

hours during well tests subsequent to 

the initial production test. The operator 

may seek authorization to flare royaltyfree for a longer period by submitting a 

Sundry Notice (Form 3160–5) to the 

BLM. 

Reporting of Venting or Flaring (43 CFR 

3179.105) 

Section 3179.105 allows an operator 

to flare gas royalty-free during a 

temporary, short-term, infrequent, and 

unavoidable emergency. Venting gas is 

permissible if flaring is not feasible 

during an emergency. The regulation 

defines limited circumstances that 

constitute an emergency, and other 

circumstances that do not constitute an 

emergency. 

The operator must estimate and report 

to the BLM on a Sundry Notice (Form 

3160–5) volumes flared or vented in 

circumstances that, as provided by 43 

CFR 3179.105, do not constitute 

emergencies for the purposes of royalty 

assessment: 

(1) More than 3 failures of the same 

component within a single piece of 

equipment within any 365-day period; 

(2) The operator’s failure to install 

appropriate equipment of a sufficient 

capacity to accommodate the 

production conditions; 

(3) Failure to limit production when 

the production rate exceeds the capacity 

of the related equipment, pipeline, or 

gas plant, or exceeds sales contract 

volumes of oil or gas; 

(4) Scheduled maintenance; 

(5) A situation caused by operator 

negligence; or 


ethrower on DSK3G9T082PROD with PROPOSALS
46470 Federal Register / Vol. 82, No. 192 / Thursday, October 5, 2017 / Proposed Rules 

(6) A situation on a lease, unit, or 

communitized area that has already 

experienced 3 or more emergencies 

within the past 30 days, unless the BLM 

determines that the occurrence of more 

than 3 emergencies within the 30 day 

period could not have been anticipated 

and was beyond the operator’s control. 

Pneumatic Controllers—Introduction 

Section 3179.201 pertains to any 

pneumatic controller that: (1) Is not 

subject to EPA regulations at 40 CFR 

60.5360a through 60.5390a, but would 

be subject to those regulations if it were 

a new or modified source; and (2) has 

a continuous bleed rate greater than 6 

standard cubic feet (scf) per hour. 

Section 3179.201(b) requires operators 

to replace each high-bleed pneumatic 

controller with a controller with a bleed 

rate lower than 6 scf per hour, with the 

following exceptions: (1) The pneumatic 

controller exhaust is routed to 

processing equipment; (2) the 

pneumatic controller exhaust was and 

continues to be routed to a flare device 

or low pressure combustor; (3) The 

pneumatic controller exhaust is routed 

to processing equipment; or (4) The 

operator notifies the BLM through a 

Sundry Notice and demonstrates, and 

the BLM agrees, that such would impose 

such costs as to cause the operator to 

cease production and abandon 

significant recoverable oil reserves 

under the lease. 

Notification of Functional Needs for a 

Pneumatic Controller (43 CFR 

3179.201(b)(1)–(3)) 

An operator may invoke one of the 

first three exceptions described above 

by notifying the BLM through a Sundry 

Notice (Form 3160–5) that use of the 

pneumatic controller is required based 

on functional needs that may include, 

but are not limited to, response time, 

safety, and positive actuation, and the 

Sundry Notice (Form 3160–5) describes 

those functional needs. 

Showing That Cost of Compliance 

Would Cause Cessation of Production 

and Abandonment of Oil Reserves (43 

CFR 3175.201(b)(4) and 3175.201(c)) 

An operator may invoke the fourth 

exception described above by 

demonstrating to the BLM through a 

Sundry Notice (Form 3160–5), and by 

obtaining the BLM’s agreement, that 

replacement of a pneumatic controller 

would impose such costs as to cause the 

operator to cease production and 

abandon significant recoverable oil 

reserves under the lease. The Sundry 

Notice (Form 3160–5) must include the 

following information: 

(1) The name, number, and location of 

each of the operator’s wells, and the 

number of the lease, unit, or 

communitized area with which it is 

associated; 

(2) The oil and gas production levels 

of each of the operator’s wells on the 

lease, unit or communitized area for the 

most recent production month for 

which information is available; 

(3) Data that show the costs of 

compliance; 

(4) Projected costs of and the 

combined stream of revenues from both 

gas and oil production, including: the 

operator’s projections of gas prices, gas 

production volumes, gas quality (i.e., 

heating value and H2S content), 

revenues derived from gas production, 

and royalty payments on gas production 

over the next 15 years or the life of the 

operator’s lease, unit, or communitized 

area, whichever is less; and the 

operator’s projections of oil prices, oil 

production volumes, costs, revenues, 

and royalty payments from the 

operator’s oil and gas operations within 

the lease over the next 15 years or the 

life of the operator’s lease, unit, or 

communitized area, whichever is less. 

Showing in Support of Replacement of 

Pneumatic Controller Within 3 Years 

(43 CFR 3179.201(d)) 

The operator may replace a high-bleed 

pneumatic controller if the operator 

notifies the BLM through a Sundry 

Notice (Form 3160–5) that the well or 

facility that the pneumatic controller 

serves has an estimated remaining 

productive life of 3 years or less. 

Pneumatic Diaphragm Pumps— 

Introduction 

With some exceptions, § 3179.202 

pertains to any pneumatic diaphragm 

pump that: (1) Uses natural gas 

produced from a Federal or Indian lease, 

or from a unit or communitized area 

that includes a Federal or Indian lease; 

and (2) Is not subject to EPA regulations 

at 40 CFR 60.5360a through 60.5390a, 

but would be subject to those 

regulations if it were a new, 

reconstructed, or modified source as 

defined in 40 CFR part 60 subpart 

OOOOa. This regulation generally 

requires replacement of such a pump 

with a zero-emissions pump or routing 

of the pump’s exhaust gas to processing 

equipment for capture and sale. 

This requirement does not apply to 

pneumatic diaphragm pumps that do 

not vent exhaust gas to the atmosphere. 

In addition, this requirement does not 

apply if the operator submits a Sundry 

Notice to the BLM documenting that the 

pump(s) operated on less than 90 

individual days in the prior calendar 

year. 

Showing That a Pneumatic Diaphragm 

Pump Was Operated on Fewer Than 90 

Individual Days in the Prior Calendar 

Year (43 CFR 3179.202(b)(2)) 

A pneumatic diaphragm pump is not 

subject to § 3179.202 if the operator 

documents in a Sundry Notice (Form 

3160–5) that the pump was operated 

fewer than 90 days in the prior calendar 

year. 

Notification of Functional Needs for a 

Pneumatic Diaphragm Pump (43 CFR 

3179.202(d)) 

In lieu of replacing a pneumatic 

diaphragm pump or routing the pump 

exhaust gas to processing equipment, an 

operator may submit a Sundry Notice 

(Form 3160–5) to the BLM showing that 

replacing the pump with a zero 

emissions pump is not viable because a 

pneumatic pump is necessary to 

perform the function required, and that 

routing the pump exhaust gas to 

processing equipment for capture and 

sale is technically infeasible or unduly 

costly. 

Showing That Cost of Compliance 

Would Cause Cessation of Production 

and Abandonment of Oil Reserves (43 

CFR 3175.202(f) and (g)) 

An operator may seek an exemption 

from the replacement requirement by 

submitting a Sundry Notice (Form 

3160–5) to the BLM that provides an 

economic analysis that demonstrates 

that compliance with these 

requirements would impose such costs 

as to cause the operator to cease 

production and abandon significant 

recoverable oil reserves under the lease. 

The Sundry Notice (Form 3160–5) must 

include the following information: 

(1) Well information that must 

include: (i) The name, number, and 

location of each well, and the number 

of the lease, unit, or communitized area 

with which it is associated; and (ii) The 

oil and gas production levels of each of 

the operator’s wells on the lease, unit or 

communitized area for the most recent 

production month for which 

information is available; 

(2) Data that show the costs of 

compliance with § 3179.202(c) through 

(e); and 

(3) The operator’s estimate of the costs 

and revenues of the combined stream of 

revenues from both the gas and oil 

components, including: (i) The 

operator’s projections of gas prices, gas 

production volumes, gas quality (i.e., 

heating value and H2S content), 

revenues derived from gas production, 

and royalty payments on gas production 


ethrower on DSK3G9T082PROD with PROPOSALS
Federal Register / Vol. 82, No. 192 / Thursday, October 5, 2017 / Proposed Rules 46471 

over the next 15 years or the life of the 

operator’s lease, unit, or communitized 

area, whichever is less; and (ii) The 

operator’s projections of oil prices, oil 

production volumes, costs, revenues, 

and royalty payments from the 

operator’s oil and gas operations within 

the lease over the next 15 years or the 

life of the operator’s lease, unit, or 

communitized area, whichever is less. 

Showing in Support of Replacement of 

Pneumatic Diaphragm Pump Within 3 

Years (43 CFR 3179.202(h)) 

The operator may replace a pneumatic 

diaphragm pump if the operator notifies 

the BLM through a Sundry Notice (Form 

3160–5) that the well or facility that the 

pneumatic controller serves has an 

estimated remaining productive life of 3 

years or less. 

Storage Vessels (43 CFR 3179.203(c) and 

(d)) 

A storage vessel is subject to 43 CFR 

3179.203(c) if the vessel: (1) Contains 

production from a Federal or Indian 

lease, or from a unit or communitized 

area that includes a Federal or Indian 

lease; and (2) Is not subject to any of the 

requirements of EPA regulations at 40 

CFR part 60, subpart OOOO, but would 

be subject to that subpart if it were a 

new, reconstructed, or modified source. 

The operator must determine, record, 

and make available to the BLM upon 

request, whether the storage vessel has 

the potential for VOC emissions equal to 

or greater than 6 tpy based on the 

maximum average daily throughput for 

a 30-day period of production. The 

determination may take into account 

requirements under a legally and 

practically enforceable limit in an 

operating permit or other requirement 

established under a Federal, State, local 

or tribal authority that limit the VOC 

emissions to less than 6 tpy. 

If a storage vessel has the potential for 

VOC emissions equal to or greater than 

6 tpy, the operator must replace the 

storage vessel at issue in order to 

comply with the requirements of this 

section, and the operator must 

(1) Route all tank vapor gas from the 

storage vessel to a sales line; 

(2) If the operator determines that 

compliance with the requirement to 

route all tank vapor gas from the storage 

vessel to a sales line is technically 

infeasible or unduly costly, route all 

tank vapor gas from the storage vessel to 

a device or method that ensures 

continuous combustion of the tank 

vapor gas; or 

(3) Submit an economic analysis to 

the BLM through a Sundry Notice (Form 

3160–5) that demonstrates, and the BLM 

agrees, that compliance with 

§ 3179.203(c)(2) would impose such 

costs as to cause the operator to cease 

production and abandon significant 

recoverable oil reserves under the lease. 

To support the demonstration 

described above, the operator must 

submit a Sundry Notice (Form 3160–5) 

that includes the following information: 

(1) The name, number, and location of 

each well, and the number of the lease, 

unit, or communitized area with which 

it is associated; 

(2) The oil and gas production levels 

of each of the operator’s wells on the 

lease, unit or communitized area for the 

most recent production month for 

which information is available; 

(3) Data that show the costs of 

compliance with § 3179.203(c)(1) or (2) 

on the lease; and 

(4) The operator must consider the 

costs and revenues of the combined 

stream of revenues from both the gas 

and oil components, including: The 

operator’s projections of oil and gas 

prices, production volumes, quality (i.e., 

heating value and H2S content), 

revenues derived from production, and 

royalty payments on production over 

the next 15 years or the life of the 

operator’s lease, unit, or communitized 

area, whichever is less. 

Downhole Well Maintenance and 

Liquids Unloading—Documentation and 

Reporting (43 CFR 3179.204(c) and (e)) 

The operator must minimize vented 

gas and the need for well venting 

associated with downhole well 

maintenance and liquids unloading, 

consistent with safe operations. Before 

the operator manually purges a well for 

liquids unloading for the first time after 

the effective date of this section, the 

operator must consider other methods 

for liquids unloading and determine 

that they are technically infeasible or 

unduly costly. The operator must 

provide information supporting that 

determination as part of a Sundry 

Notice (Form 3160–5). This requirement 

applies to each well the operator 

operates. 

For any liquids unloading by manual 

well purging, the operator must: 

(1) Ensure that the person conducting 

the well purging remains present on-site 

throughout the event to minimize to the 

maximum extent practicable any 

venting to the atmosphere; 

(2) Record the cause, date, time, 

duration, and estimated volume of each 

venting event; and 

(3) Maintain the records for the period 

required under § 3162.4–1 and make 

them available to the BLM, upon 

request. 

Downhole Well Maintenance and 

Liquids Unloading—Notification of 

Excessive Duration or Volume (43 CFR 

3179.204(f)) 

The operator must notify the BLM by 

Sundry Notice (Form 3160–5), within 30 

calendar days, if: 

(1) The cumulative duration of 

manual well purging events for a well 

exceeds 24 hours during any production 

month; or 

(2) The estimated volume of gas 

vented in liquids unloading by manual 

well purging operations for a well 

exceeds 75 Mcf during any production 

month. 

Leak Detection—Compliance With EPA 

Regulations (43 CFR 3179.301(j)) 

Sections 3179.301 through 3179.305 

include information collection activities 

pertaining to the detection and repair of 

gas leaks during production operations. 

These regulations require operators to 

inspect all equipment covered under 

§ 3179.301(a) for gas leaks. 

Section 3179.301(j) allows an operator 

to satisfy the requirements of 

§§ 3179.301 through 3179.305 for some 

or all of the equipment or facilities on 

a given lease by notifying the BLM in a 

Sundry Notice (Form 3160–5) that the 

operator is complying with EPA 

requirements established pursuant to 40 

CFR part 60 with respect to such 

equipment or facilities. 

Leak Detection—Request To Use an 

Alternative Monitoring Device and 

Protocol (43 CFR 3179.302(c)) 

Section 3175.302 specifies the 

instruments and methods that an 

operator may use to detect leaks. 

Section 3175.302(d) allows the BLM to 

approve an alternative monitoring 

device and associated inspection 

protocol if the BLM finds that the 

alternative would achieve equal or 

greater reduction of gas lost through 

leaks compared with the approach 

specified in § 3179.302(a)(1) when used 

according to § 3179.303(a). 

Any person may request approval of 

an alternative monitoring device and 

protocol by submitting a Sundry Notice 

(Form 3160–5) to BLM that includes the 

following information: (1) Specifications 

of the proposed monitoring device, 

including a detection limit capable of 

supporting the desired function; (2) The 

proposed monitoring protocol using the 

proposed monitoring device, including 

how results will be recorded; (3) 

Records and data from laboratory and 

field testing, including but not limited 

to performance testing; (4) A 

demonstration that the proposed 

monitoring device and protocol will 


ethrower on DSK3G9T082PROD with PROPOSALS
46472 Federal Register / Vol. 82, No. 192 / Thursday, October 5, 2017 / Proposed Rules 

achieve equal or greater reduction of gas 

lost through leaks compared with the 

approach specified in the regulations; 

(5) Tracking and documentation 

procedures; and (6) Proposed 

limitations on the types of sites or other 

conditions on deploying the device and 

the protocol to achieve the 

demonstrated results. 

Leak Detection—Operator Request To 

Use an Alternative Leak Detection 

Program (43 CFR 3179.303(b)) 

Section 3179.303(b) allows an 

operator to submit a Sundry Notice 

(Form 3160–5) requesting authorization 

to detect gas leaks using an alternative 

instrument-based leak detection 

program, different from the specified 

requirement to inspect each site semiannually using an approved monitoring 

device. 

To obtain approval for an alternative 

leak detection program, the operator 

must submit a Sundry Notice (Form 

3160–5) that includes the following 

information: 

(1) A detailed description of the 

alternative leak detection program, 

including how it will use one or more 

of the instruments specified in or 

approved under § 3179.302(a) and an 

identification of the specific 

instruments, methods and/or practices 

that would substitute for specific 

elements of the approach specified in 

§§ 3179.302(a) and 3179.303(a); 

(2) The proposed monitoring protocol; 

(3) Records and data from laboratory 

and field testing, including, but not 

limited to, performance testing, to the 

extent relevant; 

(4) A demonstration that the proposed 

alternative leak detection program will 

achieve equal or greater reduction of gas 

lost through leaks compared to 

compliance with the requirements 

specified in §§ 3179.302(a) and 

3179.303(a); 

(5) A detailed description of how the 

operator will track and document its 

procedures, leaks found, and leaks 

repaired; and 

(6) Proposed limitations on types of 

sites or other conditions on deployment 

of the alternative leak detection 

program. 

Leak Detection—Operator Request for 

Exemption Allowing Use of an 

Alternative Leak-Detection Program 

That Does Not Meet Specified Criteria 

(43 CFR 3179.303(d)) 

An operator may seek authorization 

for an alternative leak detection program 

that does not achieve equal or greater 

reduction of gas lost through leaks 

compared to the required approach, if 

the operator demonstrates that 

compliance with the leak-detection 

regulations (including the option for an 

alternative program under 43 CFR 

3179.303(b)) would impose such costs 

as to cause the operator to cease 

production and abandon significant 

recoverable oil or gas reserves under the 

lease. The BLM may approve an 

alternative leak detection program that 

does not achieve equal or greater 

reduction of gas lost through leaks, but 

is as effective as possible consistent 

with not causing the operator to cease 

production and abandon significant 

recoverable oil or gas reserves under the 

lease. 

To obtain approval for an alternative 

program under this provision, the 

operator must submit a Sundry Notice 

(Form 3160–5) that includes the 

following information: 

(1) The name, number, and location of 

each well, and the number of the lease, 

unit, or communitized area with which 

it is associated; 

(2) The oil and gas production levels 

of each of the operator’s wells on the 

lease, unit or communitized area for the 

most recent production month for 

which information is available; 

(3) Data that show the costs of 

compliance on the lease with the 

requirements of §§ 3179.301–305 and 

with an alternative leak detection 

program that meets the requirements of 

§ 3179.303(b); 

(4) The operator must consider the 

costs and revenues of the combined 

stream of revenues from both the gas 

and oil components and provide the 

operator’s projections of oil and gas 

prices, production volumes, quality (i.e., 

heating value and H2S content), 

revenues derived from production, and 

royalty payments on production over 

the next 15 years or the life of the 

operator’s lease, unit, or communitized 

area, whichever is less; 

(5) The information required to obtain 

approval of an alternative program 

under § 3179.303(b), except that the 

estimated volume of gas that will be lost 

through leaks under the alternative 

program must be compared to the 

volume of gas lost under the required 

program, but does not have to be shown 

to be at least equivalent. 

Leak Detection—Notification of Delay in 

Repairing Leaks (43 CFR 3179.304(b)) 

Section 3179.304(a) requires an 

operator to repair any leak no later than 

30 calendar days after discovery of the 

leak, unless there is good cause for 

delay in repair. If there is good cause for 

a delay beyond 30 calendar days, 

§ 3179.304(b) requires the operator to 

submit a Sundry Notice (Form 3160–5) 

notifying the BLM of the cause. 

Leak Detection—Inspection 

Recordkeeping and Reporting (43 CFR 

3179.305) 

Section 3179.305 requires operators to 

maintain the following records and 

make them available to the BLM upon 

request: (1) For each inspection required 

under § 3179.303, documentation of the 

date of the inspection and the site where 

the inspection was conducted; (2) The 

monitoring method(s) used to determine 

the presence of leaks; (3) A list of leak 

components on which leaks were found; 

(4) The date each leak was repaired; and 

(5) The date and result of the follow-up 

inspection(s) required under § 3179.304. 

By March 31 each calendar year, the 

operator must provide to the BLM an 

annual summary report on the previous 

year’s inspection activities that 

includes: (1) The number of sites 

inspected; (2) The total number of leaks 

identified, categorized by the type of 

component; (3) The total number of 

leaks repaired; (4) The total number of 

leaks that were not repaired as of 

December 31 of the previous calendar 

year due to good cause and an estimated 

date of repair for each leak; and (5) A 

certification by a responsible officer that 

the information in the report is true and 

accurate. 

Leak Detection—Annual Reporting of 

Inspections (43 CFR 3179.305(b)) 

By March 31 of each calendar year, 

the operator must provide to the BLM 

an annual summary report on the 

previous year’s inspection activities that 

includes: 

(1) The number of sites inspected; 

(2) The total number of leaks 

identified, categorized by the type of 

component; 

(3) The total number of leaks repaired; 

(4) The total number leaks that were 

not repaired as of December 31 of the 

previous calendar year due to good 

cause and an estimated date of repair for 

each leak. 

(5) A certification by a responsible 

officer that the information in the report 

is true and accurate to the best of the 

officer’s knowledge. 

4. Burden Estimates 

The following table details the annual 

estimated hour burdens for the 

information activities described above. 


ethrower on DSK3G9T082PROD with PROPOSALS
Federal Register / Vol. 82, No. 192 / Thursday, October 5, 2017 / Proposed Rules 46473 

Type of response Number of 

responses 

Hours per 

response 

Total hours 

(Column B × 

Column C) 

A B C D 

Plan to Minimize Waste of Natural Gas, 43 CFR 3162.3–1, Form 3160–3 ............................... 2,000 8 16,000 

Request for Approval for Royalty-Free Uses On-Lease or Off-Lease, 43 CFR 3178.5, 3178.7, 

3178.8, and 3178.9, Form 3160–5 .......................................................................................... 50 4 200 

Notification of Choice to Comply on County- or State-wide Basis, 43 CFR 3179.7(c)(3)(iii) ..... 200 1 200 

Request for Approval of Alternative Capture Requirement, 43 CFR 3179.8(b), Form 3160–5 .. 50 16 800 

Request for Exemption from Well Completion Requirements, 43 CFR 3179.102(c) and (d), 

Form 3160–5 ............................................................................................................................ 0 0 0 

Request for Extension of Royalty-Free Flaring During Initial Production Testing, 43 CFR 

3179.103, Form 3160–5 ........................................................................................................... 500 2 1,000 

Request for Extension of Royalty-Free Flaring During Subsequent Well Testing, 43 CFR 

3179.104, Form 3160–5 ........................................................................................................... 5 2 10 

Reporting of Venting or Flaring, 43 CFR 3179.105, Form 3160–5 ............................................ 250 2 500 

Notification of Functional Needs for a Pneumatic Controller, 43 CFR 3179.201(b)(1)–(3), 

Form 3160–5 ............................................................................................................................ 10 2 20 

Showing that Cost of Compliance Would Cause Cessation of Production and Abandonment 

of Oil Reserves, 43 CFR 3175.201(b)(4) and 3175.201(c), Form 3160–5 ............................. 50 4 200 

Showing in Support of Replacement of Pneumatic Controller within 3 Years, 43 CFR 

3179.201(d), Form 3160–5 ...................................................................................................... 100 1 100 

Showing that a Pneumatic Diaphragm Pump was Operated on Fewer than 90 Individual 

Days in the Prior Calendar Year, 43 CFR 3179.202(b)(2), Form 3160–5 .............................. 100 1 100 

Notification of Functional Needs for a Pneumatic Diaphragm Pump, 43 CFR 3179.202(d), 

Form 3160–5 ............................................................................................................................ 150 1 150 

Showing that Cost of Compliance Would Cause Cessation of Production and Abandonment 

of Oil Reserves, 43 CFR 3175.202(f) and (g), Form 3160–5 ................................................. 10 4 40 

Showing in Support of Replacement of Pneumatic Diaphragm Pump within 3 Years, 43 CFR 

3179.202(h), Form 3160–5 ...................................................................................................... 100 1 100 

Storage Vessels, 43 CFR 3179.203(c), Form 3160–5 ................................................................ 50 4 200 

Downhole Well Maintenance and Liquids Unloading—Documentation and Reporting, 43 CFR 

3179.204(c) and (e), Form 3160–5 .......................................................................................... 5,000 1 5,000 

Downhole Well Maintenance and Liquids Unloading—Notification of Excessive Duration or 

Volume, 43 CFR 3179.204(f), Form 3160–5 ........................................................................... 250 1 250 

Leak Detection—Compliance with EPA Regulations, 43 CFR 3179.301(j), Form 3160–5 ........ 50 4 200 

Leak Detection—Request to Use an Alternative Monitoring Device and Protocol, 43 CFR 

3179.302(c), Form 3160–5 ...................................................................................................... 5 40 200 

Leak Detection—Operator Request to Use an Alternative Leak Detection Program, 43 CFR 

3179.303(b), Form 3160–5 ...................................................................................................... 20 40 800 

Leak Detection—Operator Request for Exemption Allowing Use of an Alternative Leak-Detection Program that Does Not Meet Specified 43 CFR 3179.303(d), Form 3160–5 .................. 150 20 3,000 

Leak Detection—Notification of Delay in Repairing Leaks, 43 CFR 3179.304(a), Form 3160–5 100 1 100 

Leak Detection—Inspection Recordkeeping and Reporting, 43 CFR 3179.305 ........................ 52,000 .25 13,000 

Leak Detection—Annual Reporting of Inspections, 43 CFR 3179.305(b), Form 3160–5 .......... 2,000 20 40,000 

Totals .................................................................................................................................... 63,200 ........................ 82,170 

National Environmental Policy Act 

The BLM has prepared a draft 

environmental assessment (EA) to 

determine whether this proposed rule 

would have a significant impact on the 

quality of the human environment 

under the National Environmental 

Policy Act of 1969 (NEPA) (42 U.S.C. 

4321 et seq.). If the final EA supports 

the issuance of a Finding of No 

Significant Impact (FONSI) for the rule, 

the preparation of an environmental 

impact statement pursuant to the NEPA 

would not be required. 

The draft EA and FONSI have been 

placed in the file for the BLM’s 

Administrative Record for the rule at the 

address specified in the ADDRESSES

section. The EA and FONSI have also 

been posted in the docket for the rule on 

the Federal eRulemaking Portal: https:// 

www.regulations.gov. In the Searchbox, 

enter ‘‘RIN 1004–AE54’’ and click the 

‘‘Search’’ button. Follow the 

instructions at this Web site. The BLM 

invites the public to review these 

documents and suggests that anyone 

wishing to submit comments on the EA 

and FONSI should do so in accordance 

with the instructions contained in the 

‘‘Public Comment Procedures’’ section 

above. 

Actions Concerning Regulations That 

Significantly Affect Energy Supply, 

Distribution, or Use (Executive Order 

13211) 

This proposed rule is not a significant 

energy action under the definition in 

Executive Order 13211. A statement of 

Energy Effects is not required. 

Section 4(b) of Executive Order 13211 

defines a ‘‘significant energy action’’ as 

‘‘any action by an agency (normally 

published in the Federal Register) that 

promulgates or is expected to lead to the 

promulgation of a final rule or 

regulation, including notices of inquiry, 

advance notices of rulemaking, and 

notices of rulemaking: (1)(i) That is a 

significant regulatory action under 

Executive Order 12866 or any successor 

order, and (ii) Is likely to have a 

significant adverse effect on the supply, 

distribution, or use of energy; or (2) That 

is designated by the Administrator of 

[OIRA] as a significant energy action.’’ 

The rule temporarily suspends or 

delays certain requirements in the 2016 

final rule and would reduce compliance 

costs in the short-term. The BLM 

determined that the 2016 final rule 

would not have impacted the supply, 

distribution, or use of energy and so the 

suspension or delay of many of the 2016 

final rule’s requirements until January 


ethrower on DSK3G9T082PROD with PROPOSALS
46474 Federal Register / Vol. 82, No. 192 / Thursday, October 5, 2017 / Proposed Rules 

17, 2019, will likewise not have an 

impact on the supply, distribution, or 

use of energy. As such, we do not 

consider the proposed rule to be a 

‘‘significant energy action’’ as defined in 

Executive Order 13211. 

Clarity of This Regulation (Executive 

Orders 12866) 

We are required by Executive Orders 

12866 (section 1(b)(12)), 12988 (section 

3(b)(1)(B)), and 13563 (section 1(a)), and 

by the Presidential Memorandum of 

June 1, 1988, to write all rules in plain 

language. This means that each rule 

must: 

(a) Be logically organized; 

(b) Use the active voice to address 

readers directly; 

(c) Use common, everyday words and 

clear language rather than jargon; 

(d) Be divided into short sections and 

sentences; and 

(e) Use lists and tables wherever 

possible. 

If you feel that we have not met these 

requirements, send us comments by one 

of the methods listed in the ADDRESSES

section. To better help the BLM revise 

the rule, your comments should be as 

specific as possible. For example, you 

should tell us the numbers of the 

sections or paragraphs that you find 

unclear, which sections or sentences are 

too long, the sections where you feel 

lists or tables would be useful, etc. 

Authors 

The principal authors of this 

proposed rule are: James Tichenor and 

Michael Riches of the BLM Washington 

Office; Sheila Mallory of the BLM New 

Mexico State Office, Eric Jones of the 

BLM Moab, Utah Field Office; David 

Mankiewicz of the BLM Farmington, 

New Mexico Field Office; and Beth 

Poindexter of the BLM Dickinson, North 

Dakota Field Office; assisted by Faith 

Bremner of the BLM’s Division of 

Regulatory Affairs and by the 

Department of the Interior’s Office of the 

Solicitor. 

List of Subjects 

43 CFR Part 3160 

Administrative practice and 

procedure; Government contracts; 

Indians—lands; Mineral royalties; Oil 

and gas exploration; Penalties; Public 

lands—mineral resources; Reporting 

and recordkeeping requirements. 

43 CFR Part 3170 

Administrative practice and 

procedure; Flaring; Government 

contracts; Incorporation by reference; 

Indians—lands; Mineral royalties; 

Immediate assessments; Oil and gas 

exploration; Oil and gas measurement; 

Public lands—mineral resources; 

Reporting and record keeping 

requirements; Royalty-free use; Venting. 

Dated: September 28, 2017. 

Katharine S. MacGregor, 

Acting Assistant Secretary for Land and 

Minerals Management. 

43 CFR Chapter II 

For the reasons set out in the 

preamble, the Bureau of Land 

Management proposes to amend 43 CFR 

parts 3160 and 3170 as follows: 

PART 3160—ONSHORE OIL AND GAS 

OPERATIONS 

■ 1. The authority citation for part 3160 

continues to read as follows: 

Authority: 25 U.S.C. 396d and 2107; 30 

U.S.C. 189, 306, 359, and 1751; and 43 U.S.C. 

1732(b), 1733, and 1740. 

■ 2. Amend § 3162.3–1 by revising 

paragraph (j) introductory text to read as 

follows: 

§ 3162.3–1 Drilling applications and plans. 

* * * * * 

(j) Beginning January 17, 2019, when 

submitting an Application for Permit to 

Drill an oil well, the operator must also 

submit a plan to minimize waste of 

natural gas from that well. The waste 

minimization plan must accompany, but 

would not be part of, the Application for 

Permit to Drill. The waste minimization 

plan must set forth a strategy for how 

the operator will comply with the 

requirements of 43 CFR subpart 3179 

regarding control of waste from venting 

and flaring, and must explain how the 

operator plans to capture associated gas 

upon the start of oil production, or as 

soon thereafter as reasonably possible, 

including an explanation of why any 

delay in capture of the associated gas 

would be required. Failure to submit a 

complete and adequate waste 

minimization plan is grounds for 

denying or disapproving an Application 

for Permit to Drill. The waste 

minimization plan must include the 

following information: 

* * * * * 

PART 3170—ONSHORE OIL AND GAS 

PRODUCTION 

■ 3. The authority citation for part 3170 

continues to read as follows: 

Authority: 25 U.S.C. 396d and 2107; 30 

U.S.C. 189, 306, 359, and 1751; and 43 U.S.C. 

1732(b), 1733, and 1740. 

■ 4. Amend § 3179.7 by revising 

paragraphs (b) and (c) to read as follows: 

§ 3179.7 Gas capture requirement. 

* * * * * 

(b) Beginning January 17, 2019, the 

operator’s capture percentage must 

equal: 

(1) For each month during the period 

from January 17, 2019, to December 31, 

2020: 85 percent; 

(2) For each month during the period 

from January 1, 2021, to December 31, 

2023: 90 percent; 

(3) For each month during the period 

from January 1, 2024, to December 31, 

2026: 95 percent; and 

(4) For each month beginning January 

1, 2027: 98 percent. 

(c) The term ‘‘capture percentage’’ in 

this section means the ‘‘total volume of 

gas captured’’ over the ‘‘relevant area’’ 

divided by the ‘‘adjusted total volume of 

gas produced’’ over the ‘‘relevant area.’’ 

(1) The term ‘‘total volume of gas 

captured’’ in this section means: For 

each month, the volume of gas sold from 

all of the operator’s development oil 

wells in the relevant area plus the 

volume of gas from such wells used on 

lease, unit, or communitized area in the 

relevant area. 

(2) The term ‘‘adjusted total volume of 

gas produced’’ in this section means: 

The total volume of gas captured over 

the month plus the total volume of gas 

flared over the month from high 

pressure flares from all of the operator’s 

development oil wells that are in 

production in the relevant area, minus: 

(i) For each month from January 17, 

2019, to December 31, 2019: 5,400 Mcf 

times the total number of development 

oil wells ‘‘in production’’ in the relevant 

area; 

(ii) For each month from January 1, 

2020, to December 31, 2020: 3,600 Mcf 

times the total number of development 

oil wells in production in the relevant 

area; 

(iii) For each month from January 1, 

2021, to December 31, 2021: 1,800 Mcf 

times the total number of development 

oil wells in production in the relevant 

area; and 

(iv) For each month from January 1, 

2022, to December 31, 2022: 1,500 Mcf 

times the total number of development 

oil wells in production in the relevant 

area; 

(v) For each month from January 1, 

2023, to December 31, 2024: 1,200 Mcf 

times the total number of development 

oil wells in production in the relevant 

area; 

(vi) For each month from January 1, 

2025, to December 31, 2025: 900 Mcf 

times the total number of development 

oil wells in production in the relevant 

area; and 

(vii) For each month after January 1, 

2026: 750 Mcf times the total number of 

development. 

* * * * * 


ethrower on DSK3G9T082PROD with PROPOSALS
Federal Register / Vol. 82, No. 192 / Thursday, October 5, 2017 / Proposed Rules 46475 

■ 5. Amend § 3179.9 by revising 

paragraph (b)(1) introductory text to 

read as follows: 

§ 3179.9 Measuring and reporting volumes 

of gas vented and flared. 

* * * * * 

(b) * * * 

(1) If the operator estimates that the 

volume of gas flared from a high 

pressure flare stack or manifold equals 

or exceeds an average of 50 Mcf per day 

for the life of the flare, or the previous 

12 months, whichever is shorter, then, 

beginning January 17, 2019, the operator 

must either: 

* * * * * 

■ 6. Amend § 3179.10 by revising 

paragraph (a) to read as follows: 

§ 3179.10 Determinations regarding 

royalty-free flaring. 

(a) Approvals to flare royalty free, 

which are in effect as of January 17, 

2017, will continue in effect until 

January 17, 2019. 

* * * * * 

■ 7. Amend § 3179.101 by adding 

paragraph (c) to read as follows: 

§ 3179.101 Well drilling. 

* * * * * 

(c) The operator must comply with 

this section beginning January 17, 2019. 

■ 8. Amend § 3179.102 by adding 

paragraph (e) to read as follows: 

§ 3179.102 Well completion and related 

operations. 

* * * * * 

(e) The operator must comply with 

this section beginning January 17, 2019. 

■ 9. Amend § 3179.201 by revising 

paragraph (d) to read as follows: 

§ 3179.201 Equipment requirements for 

pneumatic controllers. 

* * * * * 

(d) The operator must replace the 

pneumatic controller(s) by January 17, 

2019, as required under paragraph (b) of 

this section. If, however, the well or 

facility that the pneumatic controller 

serves has an estimated remaining 

productive life of 3 years or less from 

January 17, 2017, then the operator may 

notify the BLM through a Sundry Notice 

and replace the pneumatic controller no 

later than 3 years from January 17, 2017. 

* * * * * 

■ 10. Amend § 3179.202 by revising 

paragraph (h) to read as follows: 

§ 3179.202 Requirements for pneumatic 

diaphragm pumps. 

* * * * * 

(h) The operator must replace the 

pneumatic diaphragm pump(s) or route 

the exhaust gas to capture or to a flare 

or combustion device by January 17, 

2019, except that if the operator will 

comply with paragraph (c) of this 

section by replacing the pneumatic 

diaphragm pump with a zero-emission 

pump and the well or facility that the 

pneumatic diaphragm pump serves has 

an estimated remaining productive life 

of 3 years or less from January 17, 2017, 

the operator must notify the BLM 

through a Sundry Notice and replace the 

pneumatic diaphragm pump no later 

than 3 years from January 17, 2017. 

* * * * * 

■ 11. Amend § 3179.203 by revising 

paragraph (b) and paragraph (c) 

introductory text to read as follows: 

§ 3179.203 Storage vessels. 

* * * * * 

(b) Beginning January 17, 2019, and 

within 30 days after any new source of 

production is added to the storage 

vessel after January 17, 2019, the 

operator must determine, record, and 

make available to the BLM upon 

request, whether the storage vessel has 

the potential for VOC emissions equal to 

or greater than 6 tpy based on the 

maximum average daily throughput for 

a 30-day period of production. The 

determination may take into account 

requirements under a legally and 

practically enforceable limit in an 

operating permit or other requirement 

established under a Federal, State, local 

or tribal authority that limit the VOC 

emissions to less than 6 tpy. 

(c) If a storage vessel has the potential 

for VOC emissions equal to or greater 

than 6 tpy under paragraph (b) of this 

section, by January 17, 2019, or by 

January 17, 2020, if the operator must 

and will replace the storage vessel at 

issue in order to comply with the 

requirements of this section, the 

operator must: 

* * * * * 

■ 12. Amend § 3179.204 by adding 

paragraph (i) to read as follows: 

§ 3179.204 Downhole well maintenance 

and liquids unloading. 

* * * * * 

(i) The operator must comply with 

this section beginning January 17, 2019. 

■ 13. Amend § 3179.301 by revising 

paragraph (f) to read as follows: 

§ 3179.301 Operator responsibility. 

* * * * * 

(f) The operator must make the first 

inspection of each site: 

(1) By January 17, 2019, for all 

existing sites; 

(2) Within 60 days of beginning 

production for new sites that begin 

production after January 17, 2019; and 

(3) Within 60 days of the date when 

an existing site that was out of service 

is brought back into service and repressurized after January 17, 2019. 

* * * * * 

[FR Doc. 2017–21294 Filed 10–4–17; 8:45 am] 

BILLING CODE 4310–84–P 


ethrower on DSK3G9T082PROD with PROPOSALS