Marginal Wells Exemption from Section 111

Summary#

This bill would change the Clean Air Act so many small (“marginal”) oil and gas wells no longer have to follow certain federal performance rules. It adds a new exemption for marginal wells to the law section that sets standards for new and modified sources (section 111). The stated goal is to protect small oil and gas businesses from those federal requirements.

• Main change: Marginal wells are exempted from standards of performance under section 111 and from related monitoring, reporting, recordkeeping, leak surveys, and repair requirements written under that section.
• Who is “marginal”: An oil well producing ≤15 barrels per day (or ≤15 barrels of oil equivalent per day) or a gas well producing ≤90,000 cubic feet per day. The exemption covers the well site and listed associated equipment.
• State plans: EPA may not require state air plans to include section 111 standards for marginal wells. If a state revises its plan to remove such standards, EPA must act within 180 days or the revision is deemed approved.
• Implementation steps: EPA must update rules and guidance within 180 days of enactment. Any pending enforcement actions under these section 111 requirements against marginal wells would be terminated.
• Sponsors: Introduced in the Senate by Sen. Lummis with several Republican co-sponsors.

What it means for you#

• Owners/operators of small oil or gas wells:

  • If your well meets the production cutoffs, you would not have to follow section 111 performance standards or the monitoring, reporting, recordkeeping, and leak-detection and repair rules written under that section.
  • Pending federal enforcement actions under those particular section 111 requirements would be ended for qualifying wells.

• Energy companies with mixed-size operations:

  • Wells that meet the marginal definition would be treated differently than larger wells. Companies will need to track production to determine which wells qualify.

• State environmental agencies:

  • States cannot be required by EPA to include section 111 standards for marginal wells in State Implementation Plans.
  • If a state submits a plan revision removing standards for marginal wells, EPA must approve or disapprove within 180 days or the revision is automatically approved.

• EPA (federal regulators):

  • Must revise its regulations and guidance to reflect the new exemption within 180 days and end certain pending enforcement actions.

• Nearby residents, public health and environment:

  • The bill removes certain federal monitoring and repair rules for qualifying wells. This could affect how much information regulators and the public have about emissions from those sites. (The bill does not itself measure or report expected changes in emissions.)

Expenses#

No direct public cost estimate is included in the bill text or the supplied materials.

• No publicly available information.
• The bill does require EPA to revise regulations and guidance within 180 days; that could create administrative work for EPA and for states, but the bill provides no fiscal note or dollar estimates.
• The exemption could reduce compliance costs for owners of marginal wells by removing monitoring, reporting, and repair obligations under section 111; the bill contains no estimate of those savings.
• The bill also ends pending enforcement actions under the affected rules, which could affect collected fines or enforcement-related costs, but no estimates are provided.

Proponents' View#

The bill appears intended to reduce federal regulatory burdens on very small oil and gas wells and on small businesses that operate them. Possible arguments in favor, drawn from the bill’s text and title:

• The bill appears intended to protect “small business” and small well operators from the costs of complying with section 111 standards.
• It could simplify compliance by removing overlapping federal monitoring and reporting requirements for low‑producing wells.
• Supporters may argue this reduces regulatory complexity and administrative costs for small, low‑output operations.

Opponents' View#

Based only on the bill text, reasonable concerns and trade-offs include:

• One concern is that exempting many small wells from performance standards and monitoring could reduce emissions controls and public information about leaks or releases from those wells.
• The bill requires EPA to terminate pending enforcement for affected wells; that retroactive effect may be viewed as removing legal accountability for past noncompliance under the specified rules.
• It is unclear how this exemption will interact with other parts of the Clean Air Act or with state laws and permits that may still cover emissions; the bill only amends section 111, so effects on other programs are not clearly described.
• The marginal-well definitions could create incentives to manage reported production to qualify for the exemption; the bill does not explain safeguards against such gaming.
• Automatic approval of state plan revisions after 180 days could reduce federal review time and oversight of state decisions about these exemptions.