Wyoming v. United States Department of the Interior

Associated natural gas is gas produced during an oil well’s normal production. Associated natural gas that could not be easily captured was typically disposed of by venting (i.e., releasing the gas into the atmosphere) or flaring (i.e., burning the gas). Venting and flaring both waste the same amount of gas. However, because methane is a potent greenhouse gas, venting methane into the atmosphere raised significant global-climate-change concerns. By contrast, flaring the methane turns the gas into nitrogen oxides that primarily impacts only local air pollution. The United States Secretary of the Interior (defendant), through the federal Bureau of Land Management (BLM), had the statutory authority under the Mineral Leasing Act (MLA) to prevent undue waste of federal and Indian mineral resources. Accordingly, the BLM regulated venting and flaring with respect to oil-and-gas leases covering federal and Indian lands. In 2017, the BLM promulgated a rule that, among other things, (1) prohibited venting except in limited situations, (2) set a volume of allowable flared gas and required operators to capture a certain percentage of associated natural gas produced per month, and (3) imposed inspection and repair requirements on operators to combat gas leaks. The BLM’s rule went further than some existing Environmental Protection Agency (EPA) air-quality regulations and also required states, localities, and tribes to seek variances from the BLM if any EPA-approved standards for those entities conflicted with the BLM’s rule. The BLM considered the rule’s costs to include engineering costs related to updating and repairing equipment but concluded that those costs were outweighed by benefits including cost savings from the recovery and sale of the associated natural gas and the environmental benefits of reducing global methane emissions. The State of Wyoming (plaintiff) petitioned for review of the BLM’s rule, arguing that the BLM was using the rule to regulate oil-and-gas-related air pollution, which was a matter reserved solely for the EPA under the Clean Air Act (CAA), and that the rule exceeded the scope of the BLM’s authority under the MLA.