Oil Sector: Trump Ends Methane Rule Promising $45 Billion in Savings

President Donald Trump announced Tuesday that his administration is ending the federal rule designed to limit methane emissions from oil and gas drilling. The move eliminates the regulations that required companies to investigate and repair major methane releases. Trump stated that the decision will save consumers and energy producers $45 billion in costs.

The president made the declaration during a campaign rally in Lubbock, Texas, supporting Republican Senate candidate Ken Paxton. He argued that the previous administration's plan crushed small operators with excessive regulations. The new policy is intended to encourage more domestic drilling as the administration faces criticism over high fuel prices during the war in Iran.

Under the repealed rule, the Environmental Protection Agency maintained a Super Emitter Program. This program mandated that companies identify and fix significant leaks from oil and natural gas facilities. The final rule also established stricter standards for small wells. EPA Administrator Lee Zeldin previewed these changes last month, noting that the rule would have cost $18 billion and held back the energy industry.

The Biden-era regulation was finalized in 2024. It applied to both new and existing wells, a scope that differed from earlier regulations which focused only on new construction. The rule required operators to plug leaks from smaller wells that produce just 6% of the nation's oil and gas. Despite their small output, these wells account for up to half of all methane emissions from oil and gas fields.

Federal officials projected the rule would prevent 58 million tons of methane emissions by 2038. They estimated the regulation would yield $98 billion in benefits by 2034. This figure was calculated using the social costs of greenhouse gas emissions, a metric that Trump's EPA has rejected. The rule was designed to work alongside a methane fee that Congress repealed weeks after Trump took office.

The fee program, approved in the 2022 climate law, would have charged energy producers up to $1,500 per metric ton of methane for exceeding emission limits. It marked the first time the U.S. government directly taxed greenhouse gas emissions. The EPA previously imposed an 18-month delay on the rule last year to give companies time to meet inspection requirements.

Environmental groups criticized the rollback, arguing it allows companies to release gas that could be captured and used for energy. Fred Krupp, president of the Environmental Defense Fund, called the decision a free pass for companies at the expense of American consumers. He stated that the EPA should fight waste rather than making it easier for producers to ignore it.

Methane is the main component of natural gas and is far more potent than carbon dioxide in the short term. Scientists estimate it is responsible for about a third of planet-warming greenhouse gas emissions. The gas is invisible and often leaks from equipment or is burned off as a waste product by drillers. The administration’s move is part of a wider effort to dismantle climate policies enacted under former President Joe Biden.