GAO: Current Natural Gas Standards Cost Taxpayers Millions

Cameron Aubernon
by Cameron Aubernon
gao current natural gas standards cost taxpayers millions

A new report by the Government Accountability Office says the Bureau of Land Management has yet to revise standards over natural gas, costing taxpayers.

The report notes the GAO had been urging the BLM — which oversees oil and gas development on federal and Indian lands — to update the standards in regards to venting and flaring natural gas since 2010, Autoblog says. The group found by doing so, up to 40 percent of the resource could be captured cheaply, then sold on the market.

However, the bureau is just now in the early process of updating those standards, leaving the taxpayers at “high-risk” for fraud and waste under its current resource management plan. Currently, this means the government is losing around $23 million on annual royalty payments, with more millions disappearing into the air since oil and gas production in the United States began booming in recent years.

Other issues in BLM’s management noted in the GAO report include failing to meet its annual goals for high-risk wells, and the venting of methane into the environment in an EPA-estimated amount equal to 3.1 million cars removed from the road or the closure of four coal-powered plants if the greenhouse gas had been captured instead.

In response, the bureau and its parent department, the U.S. Department of the Interior, agreed with the GAO’s findings, stating funding was the main reason for not being able to remedy the issues reported. The department said it was working to update the standards, adding that President Barack Obama was working on collecting fees from oil and gas companies in order to have the budget to inspect the high-risk wells.

[Photo credit: Tim Evanson/ Flickr/ CC BY-SA 2.0]

Join the conversation
8 of 26 comments
  • Conslaw Conslaw on May 07, 2015

    The people of North Dakota and other places benefiting from the current Natural Gas boom would do well to learn the history lesson of the Indiana Gas Boom of the 1880s. A large reservoir of natural gas was discovered in 1876. The gas field covered most of east central Indiana and into western Ohio. The town of Harrisburg Indiana changed its name to Gas City. In 1882 the population of Gas City was 150. IN 1894 it was 25,000. There was a rush to dig wells to tap into the gas field. As they do today, in those days they would openly burn a flare at the top of the gas pipe. Perhaps as much as 90% of the gas in this deposit was wasted in this fashion, and the deposit was pretty much depleted within 20 years. Gas City went from boom town to practically a ghost town. The community and the communities around it appear to have gained no long term benefit from the natural bounty below the earth. History is repeating itself in the current boom, and the opportunists appear to be running the show. Today's boomtowns will be ghost-towns tomorrow with nothing but waste and pollution in the land of opportunity.

    • See 3 previous
    • Landcrusher Landcrusher on May 08, 2015

      @tedward That's just not true anymore. We now have a government agency gone rogue determined to stop the burning of fossil fuels one hassle at a time. Also, the laws about pipelines are pretty similar to those about roads. It stinks when it happens to you, but you should get adequate compensation. As a car guy, I assume you appreciate adequate roads. They cut my step mom's ranch in Tennessee into half for a highway and had the nerve to run it a hundred feet from the nicest house in the county. Then when she passed the inheritance tax collectors acted like the house was some palace despite the fact no one would ever pay that much for a house like that sitting on a busy highway. The state cleverly denied the loss of value twice. It finally sold for pennies on the dollar.

  • Shaker Shaker on May 08, 2015

    Keep the pedal to the metal - the Earth has more to give before all hell breaks loose. The "kids" will be all right. Really.

  • George B George B on May 08, 2015

    Natural gas needs either pipelines or some other infrastructure to use the gas that's flared off. Would be great if it could be used to generate electricity, but that requires power lines.

  • Sllloyd Sllloyd on May 14, 2015

    1. very little of the oil and gas drilling boom has occurred on Federal land. It has happened on State and private acreage. 2. Up til recently, natural gas was a nuisance byproduct of oil drilling. if the natural gas is not disposed of, through either flaring, or piped out, the oil well will pressure up, constraining the flow of oil. 3. The price of oil was near $100. The price of natural gas was between $2 and $4. Which hydrocarbon was more important, do you think? 4. F*ck NIMBY. Natural gas gathering systems, processing plants, and transmission pipelines are fucking expensive. When the gross spread (the difference in what you can sell the cleaned up gas for, less the cost of gas) is maybe $.20/mm but and it costs $.50/mmbtu just to build THE PIPE, let alone the gathering systems and processing plants, hopefully you can see that economic hurdle. 5. NIMBY issues. 6. Seemingly endless litigation 7. ad nauseum