Vol. 6, Issue No. 1

Members,

PBPA has hit the ground running in 2023. In just the first month and a half of the year, PBPA has hired new staff, filed notice of a lawsuit against the federal government, educated international dignitaries, helped with two Congressional hearings, and advocated for your interests during the current Texas and New Mexico Legislative sessions. Our staff has been working tirelessly in both Austin and Santa Fe to protect your rights to operate in the most prolific energy-producing region in the world. While we have been engaged on both state and federal issues during the first weeks of the year, we are fortunate enough not to have had to travel to Washington, D.C., because Washington, D.C. came to us!

In this issue of The Standard, we provide you with updates on all of our advocacy activities so far in 2023 along with other important information on upcoming PBPA events and important non-PBPA events in our region:

PBPA In Action & Important Updates

• 2022 Top Hand Award Banquet
• Christine Dooley Joins PBPA Staff
• New Mexico Legislative Report
• Texas Legislative Report
• PBPA Provides NOI to Sue
• EPA Flyover Data
• PBPA Comments on EPA Methane Rule
• New WOTUS Rule
• TCEQ Mobile Monitoring
• RRC Notices
• Congressional Hearings in the Permian Basin
• Field Tour for a Czech Republic Ambassador

Upcoming PBPA Events

• Spring Swing Golf Tournament
• Membership Luncheon at PBWIEC
• March Membership Luncheon
• Committee Meetings

Community Events

• PB Water in Energy Conference
• Permian Road Safety Coalition
• Midland College PPDC Training Courses

Regards,

Ben Shepperd

Top Hand Award Banquet

On January 18, the PBPA honored Don L. Sparks of Discovery Operating as our 2022 Top Hand. The PBPA Top Hand is the highest award bestowed by the members of the PBPA, and one of the highest honors given to an energy professional in the Permian Basin. 

Being a Top Hand means that you exemplify the best qualities of professional and community service. Through his dedicated service in and to the oil and gas industry and the communities of the Permian Basin, his professional achievements and outstanding contribution to the betterment of the industry and countless lives, Mr. Sparks is truly a well-deserving Top Hand.

Thank you to all who attended the event in support of Mr. Sparks and PBPA. If you are interested in any of the pictures taken at the event, please reach out to Jamie Ramirez at jamie@pbpa.info.

Welcome New PBPA Team Member!

State Legislative Updates

New Mexico Legislative Report

With New Mexico’s 56^th Legislature opening on January 17^th and set to conclude on March 18, we are currently about at the session’s halfway point and PBPA has been engaging on behalf of our members in a number of committee hearings and legislative proposals seeking to protect your rights to continue operating in the Land of Enchantment. Currently, we are tracking around 50 different proposals that have been introduced at the round house.

With the bill filing deadline (February 16) having come and gone, unless language gets amended into those proposals already in place, we likely now know all the bills and resolutions which could impact industry this session. Some of those still active include, but are not limited to:

• SB 418 - Oil & Gas Act Changes
• SB 443 - Tax Exemption for some Oil & Gas Projects
• SJR 6 - Environmental Rights/The Green Amendment
• HB 12 - Advanced Energy Technology Act
• HB 91 - Natural Resources Trustee Changes
• HB 121 - Water Right Lease Effective Date
• HB 350 - Oil & Gas Emission Reduction Tax Credit
• HB 426 - Clean Fuels Standards
• HB 450 - Oil & Gas Re-Stimulation Well Tax Credit
• HB 478 - Clean Fuel Standard Act

During our weekly New Mexico Legislative Committee Meetings we have not only been discussing strategies for our advocacy with our members on these and other pieces of proposed legislation, but we have also been hearing from important state leaders, including the Speaker of the House, Rep. Javier Martinez (D-Bernalillo), Minority Leader of the House, Rep. Ryan Lane (R-San Juan), and State Land Commissioner Stephanie Garcia Richard. 

While there is still a long way to the finish line, there have been several worrisome legislative efforts that have fortunately and through hard work with our friends not been able to make their way out of committee and back to the floors of either the House or the Senate. There is still plenty of work to be done, however, and if you are interested either in helping out or in finding out more information about our New Mexico Legislative efforts, please reach out to Stephen Robertson (stephen@pbpa.info).

Texas Legislative Report

The 88^th Regular Session for the Texas Legislature is also under way, but not near the halfway point. To date and with several weeks until the March 10 bill filing deadline, over 4,000 bills and resolutions have already been filed by members of the House and Senate, with the majority of those (nearly 3,000) having been filed in the House. Our Texas Legislative Committee, which meets during session on a weekly basis just like its New Mexico counterpart, is tracking over 200 pieces of proposed legislation currently. As bills begin to be heard in committee we will provide more detailed updates to our members.

Of interest,

• Rep. Tom Craddick (R-Midland), Dean of the Texas House and the longest tenured legislator in the United States, serves this session as a member of the House Energy Resources Committee and the House Ways & Means Committee.
• Rep. Brooks Landgraf (R-Odessa) serves this session as Chair of the House Environmental Regulation Committee and as a member of the House Administration Committee, Redistricting Committee, Select Committee on Youth Health and Safety, and Transportation Committee.
• Freshman Senator Kevin Sparks (R-Midland) serves this session as Vice-Chair of the Senate Nominations Committee and as a member of the Senate Health & Human Services Committee, Natural Resources & Economic Development Committee, Veteran Affairs Committee, and Water, Agriculture & Rural Affairs Committee.

For more information on Committee Assignments, filed legislation or other Texas Legislative efforts, please reach out to Michael Lozano (michael@pbpa.info).

Federal Regulatory Updates

PBPA's Notice of Intent to Bring Suit against DOI and USFWS

On January 19, 2023, the PBPA, along with partners in the National Cattlemen's Beef Association, Texas Cattle Feeder's Association, Kansas Livestock Association, Oklahoma Cattleman's Association, and the New Mexico Cattle Growers' Association, filed a Notice of Intent to Sue the U.S. Department of Interior (DOI) and the U.S. Fish and Wildlife Service (USFWS) regarding their listing of the lesser prairie chicken as threatened and endangered under the Endangered Species Act. Before bringing any lawsuit under the Endangered Species Act, a party is required to provide a 60 day Notice of Intent to Sue. PBPA has filed this notice and is currently working on our legal claims which will be filed at the end of the 60 day period unless drastic action is taken by the DOI and USFWS regarding their listing decision.

Since the filing of our notice, the Kansas Independent Oil & Gas Association (KIOGA) has agreed to join PBPA's efforts and conversations are ongoing with additional trades, both inside and outside the oil and gas industry to join our efforts as well.

Further, the Texas Attorney General, Kansas Attorney General and Oklahoma Attorney General have also filed their Notices of Intent to bring suit regarding this listing of the lesser prairie chicken.

If you are interested in learning more about these efforts please reach out to Stephen Robertson at stephen@pbpa.info.

EPA Flyover Data

On February 15, 2023, the EPA released information regarding the agencies flyovers of the Permian Basin from this last summer. At the following link there is an interactive map that identifies the geographic location, company name, facility name, and a link to the video of the emissions captured by the OGI cameras used during the flyovers.

EPA Permian Basin Emission Videos | US EPA

Comments on EPA's Methane Rule

On February 13, 2023, PBPA submitted comments on behalf of our members regarding the U.S. Environmental Protection Agency's (EPA) proposed changes for Standards of Performance for New, Reconstructed and Modified Sources and Emissions Guidelines for Existing Sources in the Oil and Gas Sector. PBPA had also filed official comments on the previous proposal from EPA related to this topic. Both sets of comments were compiled through a Working Group comprised of volunteer PBPA members and legal assistance from outside counsel. Thank you to all those who helped with and supported the creation of these comments.

While PBPA is strongly in favor of increases in efficiency and effectiveness in the capture of all hydrocarbons, including methane which is the focus of this EPA proposal, we detailed a number of concerns, legal and technical, that we have with EPA's proposed rule. Clearer, legally defensible and technically feasible regulations can increase the control, capture and utilization of methane. However, a number of provisions in EPA's proposed rule do not hit these marks.

New WOTUS Rule

At the end of 2022, EPA and the Corps of Engineers announced a final rule establishing their version of a more “durable” definition of “water of the United States (WOTUS). The agencies claim this final rule to be an attempt to reduce regulatory uncertainty regarding their jurisdiction over waterbodies protected under the Clean Water Act (CWA).

The final rule outlines the agencies’ intentions to apply both the “relatively permanent” or “significant nexus” tests derived from the U.S. Supreme Court’s 4-1-4 decision in Rapanos to be used to determine the agencies’ jurisdiction over waterbodies and codifies eight exclusions from the definition of WOTUS.

The final rule attempts to establish a new definition for WOTUS that declares the agencies have jurisdiction over waterbodies in the U.S., including:

• Traditional navigable waters, the territorial seas, and interstate waters (e.g., large rivers or lakes used for interstate or foreign commerce; territorial seas that extend three miles out from the coast; streams, lakes or wetlands that cross or form part of state boundaries);
• Impoundments of “waters of the United States” (e.g., reservoirs and beaver ponds);
• Tributaries to traditional navigable waters, the territorial seas, interstate waters, or impoundments when the tributaries meet either the relatively permanent standard or the significant nexus standard (“jurisdictional tributaries”) (e.g., branches of creeks, streams, rivers, lakes, ponds, ditches, and impoundments that ultimately flow into traditional navigable waters, the territorial seas, interstate waters, or impoundments of jurisdictional waters);
• Wetlands adjacent to traditional navigable waters, wetlands adjacent to and with a continuous surface connection to relatively permanent impoundments, wetlands adjacent to tributaries that meet the relatively permanent standard, and wetlands adjacent to impoundments or jurisdictional tributaries when the wetlands meet the significant nexus standard (“jurisdictional adjacent wetlands”); and
• Intrastate lakes and ponds, streams, or wetlands not identified above (“additional waters”) that meet either the relatively permanent standard or the significant nexus standard.

It is likely that this "final" rule could be impacted by a pending Supreme Court opinion in Sackett v. EPA and is likely to face additional legal challenges as well. This case was argued before the Supreme Court in October 2022, but to date a decision from the Supreme Court has not been published.

State Regulatory Updates

TCEQ Mobile Monitoring

PBPA has been informed by the Texas Commission on Environmental Quality (TCEQ) that the regional office will be receiving a mobile monitoring vehicle in the next 6 to 8 months that will be able to drive around and possibly pinpoint emission sources. The vehicle will have the capability to detect ppb levels of H2S as well as numerous other emissions (Benzene being one of them). The mobile monitoring vehicle will be deployed throughout the Texas side of the Permian Basin.

RRC Notice to Oil & Gas and Pipeline Operators: Updates to Form CI-D and Form CI-X Online Filing System Launch January 31

Effective January 31, 2023, the Railroad Commission of Texas (RRC) launched updates to the online system used to file the Form CI-D, Acknowledgement of Critical Customer/Critical Gas Supplier Designation, and Form CI-X, Critical Designation Exception Application.

RRC hopes the updates to the online filing system will provide a more efficient process when submitting the required forms.

• Users are no longer required to enter data on a workbook spreadsheet and upload as a .CSV file to the RRC Online System.
• There are two new left-hand menu options “File CID” and “File CIX.” When selecting either of these options, the RRC Online System will display three tabs – “Acknowledge,” “Select,” and “Submit.” These tabs allow users to enter information and complete online filing of either form.
• The organization’s facilities now auto -populate on the “Select” tab with the option to select which facilities when filing either form. Upload of a .CSV file is no longer required, but the online system still allows users to attach supporting documentation.

Please be reminded that oil and gas operators and pipeline operators must file the Form CI-D or Form CI-D online by March 1, 2023, using the RRC Online System at https://webapps.rrc.texas.gov/security/login.do. Hard copy forms or email form submissions are not accepted. 

RRC Notice to Operators: U.S. Chemical Safety Board Recommendations Following their Report on the 2019 Aghorn H2S Incident

Pursuant to the request by U.S. Chemical Safety Board (CSB) Recommendation No. 2020-01-I-TX-R9, the Railroad Commission of Texas (RRC) is providing notice to operators under RRC jurisdiction of the safety issues described in the CSB report.

Several safety issues were identified.

To view the full notice, visit the RRC website at https://rrc.texas.gov/media/kycavdof/nto_csb-2019-aghorn-h2s-incident-report_2-6-2023.pdf.

From the Permian Basin

U.S. Congressional Hearings

Field Tour with Friends from the Czech Republic

PBPA and our members were honored to host the Ambassador at Large for Energy Security of the Czech Republic, Vaclav Bartuska, and Martin Fott, Economic and Energy Counselor at the Czech Embassy in the United States, for an educational tour of various oil and gas operations in the Permian Basin.

Domestic production that begins right here in the Permian Basin is a vital commodity for America and our allies and we were privileged to have the opportunity to discuss these issues with our friends from abroad. Every barrel produced in the United States is a barrel that is not bought from oligarchs, dictators, or tyrants. 

We are proud of the work that our members engage in daily to produce energy freedom and security in the Permian Basin for the free world.

Upcoming PBPA Events

Sponsorship and Registration for PBPA's annual Spring Swing Golf Tournament are now open! Join us for a day of networking and fellowship in the heart of the Permian Basin. The tournament will be held on April 17th and hosted at the Odessa Country Club. This is one of our most well-attended events every year. Sponsorships and slots to compete will go fast now that registration is open, so reach out to reserve your space today!

Membership Luncheons

For more information on these luncheons or any other events, please contact Jamie Ramirez at jamie@pbpa.info or (432) 684-6345.

Committee Meetings

• Weekly New Mexico Legislative Committee Meetings, Feb. 22 - March 15
• Weekly Texas Legislative Committee Meetings, Feb. 21 - May 23
• Regulatory Practices Committee Meeting, February 21, 2023
• Electrical Coalition Meeting, February 21, 2023

For more information on these or any of our other committees, please contact Stephen Robertson at stephen@pbpa.info or (432) 684-6345.

Community Events

The Permian Basin Water in Energy Conference is fast approaching! Register to attend or learn more at WaterinEnergy.com.

PPDC Programs

MC PPDC provides quality training programs designed to keep oil and gas industry professionals current in their areas of expertise by offering the latest industry updates, as well as providing timely and pertinent educational opportunities. Click the link below for upcoming classes being offered by the MC PPDC in the coming months.

All classes are held in person at the PPDC unless designated “online” in the course description.

Customized Training Available! For more information contact Midland College PPDC at (432) 683-2832 or cepetroleumtraining@midland.edu