Maze Of Federal Oversight Impedes North Dakota's Anti-Flaring Push



The federal holdups are "a major disappointment," said Lynn Helms, head of the North Dakota Department of Mineral Resources. "It will make it harder to meet that 74-percent goal."

State and industry officials say Hess Corp is running its newly built Tioga gas processing plant, the state's largest, at just 70 percent capacity because it needs to re-route a key new pipeline eight miles around an American Indian historical site.

This requires a review by the U.S. Bureau of Land Management, one of ten state and federal agencies overseeing various pieces of North Dakota land and water.

"The regulatory process could be improved if the multiple agencies involved, both state and federal, were to adopt a more-streamlined and interconnected system," Mike Turner, a Hess executive, said in an industry speech in August.

Hess declined to comment on the federal regulatory review for the new line, citing a plan to spin off its North Dakota oil and natural gas storage facilities and processing plants next year into a master-limited partnership.

Penalties

If producers violate the new flaring standards they won't be allowed to produce more than 200 barrels per day (bpd) of oil at each well. Most North Dakota wells produce in excess of 1,500 bpd when first online.

In addition, an oil producer could have future drilling permits delayed if it does not meet the flaring reduction goal and does not desire to utilize the gas in a "beneficial manner."


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