“Both the upstream and downstream segments of the energy industry will be impacted,” said Steve Leifer, chair of the firm’s Environmental department. “The energy industry is mobilizing to meet national energy needs by accessing harder to reach reserves and utilizing an expanding geographic footprint. Environmental managers will need to address a wider array of regulatory requirements at the federal, state and local level. We may also continue to see increased scrutiny of the oil and gas industry in the wake of events in the Gulf of Mexico.”
Aileen Hooks, Deputy Chair of the firm’s Environmental department, noted that the higher number of enforcement suits brought by environmental advocacy groups can be attributed to a number of factors including their increased access to compliance information, enhanced coordination among these groups and the fact that litigation barriers have been reduced.
Scott Janoe and Matt Kuryla, partners in the firm’s Houston office, anticipate that greenhouse gas regulations will be a particular focus for the energy industry in 2011, as the mandatory reporting rule kicks in and the EPA moves to include greenhouse gas requirements in permits issued under the Clean Air Act.
Janoe and Kuryla suggest that the regulatory agencies return to a cooperative approach whereby the states have the lead role in developing plans to implement new environmental standards as they emerge. EPA has insisted that Texas wait for plan approval to implement flexible permitting. However, EPA has taken the opposite position with regard to greenhouse gas permitting, side-stepping the approved plan and the statutory plan revision process, moving directly to issue permits for greenhouse gases in Texas. Until there is comprehensive federal climate change legislation, air permits are not the answer to concerns about climate change.
Finally, Steve Leifer stepped back to consider how environmental regulation might look 10 or 20 years from now. Expected trends include a shift from human health to ecological concerns, a focus on disputes over ever-scarcer resources, an emphasis on sustainability and life-cycle management and an increase in international regulation.
About Baker Botts L.L.P.
Baker Botts L.L.P., dating from 1840, is a leading international law firm with offices in Abu Dhabi, Austin, Beijing, Dallas, Dubai, Hong Kong, Houston, London, Moscow, New York, Palo Alto, Riyadh and Washington. With approximately 700 lawyers, Baker Botts provides a full range of legal services to international, national and regional clients. For more information, please visit www.bakerbotts.com.