Newspaper article THE JOURNAL RECORD

API Warns of Costs from Proposed Rules

Newspaper article THE JOURNAL RECORD

API Warns of Costs from Proposed Rules

Article excerpt

Journal Record Staff Reporter

Proposed environmental regulations would result in increased industry compliance costs, job reductions and reduced government revenue, according to a senior associate of the American Petroleum Institute.

Meanwhile, these regulations would provide only minimal environmental benefits, Chuck Liles, with the institute's exploration and production department, told members of the Central Oklahoma Chapter of the American Petroleum Institute on Thursday.

Liles presented highlights of the institute's March 1995 report, "Potential Impact of Environmental Regulations on the Oil and Gas Exploration and Production Industry," at the Central Oklahoma chapter's meeting in Oklahoma City.

The economic impacts on industry activity have been analyzed under two cases: Regulatory _ include potential costs of compliance with air, water, naturally occurring radioactive materials (NORM), chemical reporting and underground injection control initiatives considered. Regulatory and legislative _ include potential costs of compliance with added requirements for above-ground storage tanks and production waste management are also included as regulatory and legislative initiatives.

"American is drowning in a sea of regulations and the situation shows no signs of improvement," Liles said.

Pending regulatory and legislative actions could triple industry compliance costs in five years, he said.

The costs could climb to $4.5 billion per year for the next five years if the proposed regulations are put in place, according to Liles. By 2000, compliance costs would total $7 billion.

The proposed actions would also cause a reduction in the exploration and production work force as well as other employment areas, according to Liles.

The exploration and production industry lost 365,000 jobs from 1982-93. If these actions are implemented, the industry could lose an additional 19,300 to 26,800 jobs between 1996 and 2000, according to the report.

The losses won't be limited to the exploration and production industry. The impact will "ripple to cities around the sites" where exploration and production activity is located, he said. …

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