Interstate Oil and Gas Compact Commission

Last updated
Interstate Oil and Gas Compact Commission
AbbreviationIOGCC
Formation1935
Type Interstate compact
PurposePromote efficient harvesting of oil and gas while protecting health, safety and the environment.
Headquarters Oklahoma City
Region
United States
2023 Chairman
 Mark Gordon, The State Governor of Wyoming [1]
Vice-Chair
Tom Kropatsch [2]
Website https://oklahoma.gov/iogcc.html
Formerly called
Interstate Oil Compact Commission

The Interstate Oil and Gas Compact Commission (IOGCC),< formerly the Interstate Oil Compact Commission, is a United States organization, representing the governors of 31 member and seven associate states, that works to ensure the nation's oil and natural gas resources are conserved and utilized to their maximum potential while protecting health, safety and the environment. [3] [4]

Contents

Background

In the early days of oil exploration, drilling was governed by the law of capture , which states that the owner of land on which a well resides has the right to any oil from that well even if it was drained from the land of his neighbors. This provided an incentive for each land owner to extract the oil as fast as possible. [5] : 21  Each state tried to regulate its own oil by such measures as proration, the limiting of production to some fraction of capacity; but then two great oil fields, the Oklahoma City Oil Field and the East Texas Oil Field, were discovered. This, along with the Great Depression, led to much waste and very low prices, with a catastrophic effect on the industry. The problems were large enough that the states recognized the need for cooperation. [5] : 33–34 

The compact was formed in 1935 as the Interstate Compact to Conserve Gas and Oil. [6] The purpose of the compact was to eliminate the glut of oil and raise prices for consumers. [7] The interstate compact was seen as an alternative to direct federal regulation that would allow oil producing states to retain more control. [8]

While the National Guard occupied wells in Oklahoma and Texas in 1931–1932, an Oil States Advisory Committee drafted the Thomas-McKeon Bill, which proposed an interstate oil compact and a Federal Interstate Oil Board to recommend quotas. However, the bill was abandoned after oil industry representatives withdrew their support. [5] : 37–38  [9] : 126  From 1933 to 1935, oil was regulated under the National Industrial Recovery Act and the Petroleum Code, which in effect left production control in the hands of industry representatives, with no representation for the states. [5] : 38  The Supreme Court found these regulations unconstitutional in 1935, [10] : 375  and the idea of an interstate compact was revived. On December 3, 1934, Oklahoma Governor-elect E. W. Marland met with the governors of Kansas and Texas to discuss an interstate compact. This led to the drafting of the Interstate Compact to Conserve Oil and Gas, which was ratified by Congress on August 27, 1935. [9] : 150–151  At first, Congress ratified it for only two years at a time, then four years, and finally the compact was made permanent in 1979. [11] : 76 

Some economic historians have described the regulation of oil output under the compact as an example of a price fixing cartel. [12] The production controls of the IOGCC and the Texas Railroad Commission have been cited as precursors to the establishment of OPEC's caps on member state oil production. [13]

The stated purpose of the compact was "conserve oil and gas by the prevention of physical waste thereof from any cause". [14] States that ratified the compact agreed to enact legislation for this purpose. Article VI of the compact constituted "The Interstate Oil Compact Commission," renamed as the Interstate Oil and Gas Compact Commission in 1991, and its duty was to make recommendations for preventing the physical waste of gas and oil. [10] [14]

Organizational structure

.mw-parser-output .legend{page-break-inside:avoid;break-inside:avoid-column}.mw-parser-output .legend-color{display:inline-block;min-width:1.25em;height:1.25em;line-height:1.25;margin:1px 0;text-align:center;border:1px solid black;background-color:transparent;color:black}.mw-parser-output .legend-text{} Member states Associate states Interstate Oil and Gas Compact Commission members map.svg
  Member states
  Associate states

Initially the commission had six members: Colorado, Illinois, Kansas, New Mexico, Oklahoma and Texas. It now has 31 member states, 7 associate states and 10 international affiliates (including 7 Canadian provinces and territories). [15] The governor of each member state appoints an official representative who can vote on policy recommendations, and any number of associate representatives who can vote in their place if the official representative is not available. The list of members can be found on the IOGCC website. [16] Many representatives are state regulators overseeing gas and drilling, but as of 2010 at least seven were industry executives and lobbyists. [17] The commission meets biannually, but much of its work occurs in small committee meetings throughout the year. [17] To govern operations, it has steering, finance, resolutions and nominating committees. Other committees are Energy Resources, Research and Technology; Environment and Safety; International; Public Lands; Public Outreach; and State Review. [18]

Transparency and accountability

The IOGCC is governed by the compact and several bylaws. The compact did not provide for any resources to support IOGCC; a later bylaw stipulated that its expenses would be paid "from voluntary contributions from the member states and other sources of revenue approved by the Commission". These sources, which include federal grants, have proved to be enough to allow the commission to function. [19] : 144  IOGCC uses an Oklahoma government email address and domain but it is not a state, not a federal agency and does not have to register to lobby the federal government. [20] A plethora of information is available but relatively little of it has come directly from the organization itself. IOGCC claims an exemption from the Open Public Records Act and has removed a provision within its by-laws that formerly said its records are open to the public. [21] [22]

Activities

To identify best practices, IOGCC surveys member states and assesses their activities. It catalogues innovative programs and shares the information with states, and it hosts biannual meetings that draw together representatives from the government, the oil industry and environmentalists. [23] IOGCC is an advocate for states' rights, arguing that state regulation is more effective than "one size fits all" federal regulation. [24] As well as creating reports, it creates model statutes as a guide for legislation by states. [25]

Issues that IOGCC has worked on include national energy policy, carbon sequestration, environmental stewardship, hydraulic fracturing and produced water. [26]

Price fixing

In the 1930s and 1940s, the commission functioned as a price fixing cartel. According to the legal scholar Blakely Murphy, the commission operated under the guise of resource conservation but primarily existed to protect the interests of oil producers. [27]

Carbon sequestration

A large part of the human contribution to global warming is from the emission of carbon dioxide (CO2) as a result of burning fossil fuels. [28] One way to reduce the contribution is to capture the CO2 before it enters the atmosphere and sequester it by injecting underground in depleted oil and natural gas fields, saline formations and coal beds. [29] [30] Recognizing that the oil and gas industry has a lot of experience with injecting CO2 into the ground for enhanced oil recovery, the IOGCC launched the Geological CO2 Sequestration Task Force in 2002 to investigate the issues surrounding sequestration. [31] A two-phase study was funded by the Department of Energy. Phase I concluded that the states had the knowledge and experience to regulate sequestration safely. In phase II, started in 2006, the task force prepared a report that included a model statute for the states with explanations on how to implement it. [31] [32]

Awards

The IOGCC has three awards:

Related Research Articles

<span class="mw-page-title-main">Ed Whitfield</span> American politician (born 1943)

Wayne Edward Whitfield is an American politician and attorney who served as the U.S. representative of Kentucky's 1st congressional district from January 1995, until his resignation in September 2016. He is a member of the Republican Party, and the first to represent the district. His district covered much of the western part of the state, including Hopkinsville, Paducah, Henderson and Kentucky's share of Fort Campbell.

<span class="mw-page-title-main">National Energy Technology Laboratory</span> United States research lab

The National Energy Technology Laboratory (NETL) is a U.S. national laboratory under the Department of Energy Office of Fossil Energy. NETL focuses on applied research for the clean production and use of domestic energy resources. It performs research and development on the supply, efficiency, and environmental constraints of producing and using fossil energy resources while maintaining affordability.

<span class="mw-page-title-main">Canadian Association of Petroleum Producers</span> Canadian oil group

The Canadian Association of Petroleum Producers (CAPP), with its head office in Calgary, Alberta, is a lobby group that represents the upstream Canadian oil and natural gas industry. CAPP's members produce "90% of Canada's natural gas and crude oil" and "are an important part of a national industry with revenues of about $100 billion-a-year ."

<span class="mw-page-title-main">Railroad Commission of Texas</span> State energy regulatory agency in Texas, USA

The Railroad Commission of Texas is the state agency that regulates the oil and gas industry, gas utilities, pipeline safety, safety in the liquefied petroleum gas industry, and surface coal and uranium mining. Despite its name, it ceased regulating railroads in 2005, when the last of the rail functions were transferred to the Texas Department of Transportation.

<span class="mw-page-title-main">Coal pollution mitigation</span>

Coal pollution mitigation, sometimes labeled as clean coal, is a series of systems and technologies that seek to mitigate health and environmental impact of burning coal for energy. Burning coal releases harmful substances, including mercury, lead, sulfur dioxide (SO2), nitrogen oxides (NOx), and carbon dioxide (CO2), contributing to air pollution, acid rain, and greenhouse gas emissions. Methods include flue-gas desulfurization, selective catalytic reduction, electrostatic precipitators, and fly ash reduction focusing on reducing the emissions of these harmful substances. These measures aim to reduce coal's impact on human health and the environment.

<span class="mw-page-title-main">Carbon capture and storage</span> Collecting carbon dioxide from industrial emissions

Carbon capture and storage (CCS) is a process in which a relatively pure stream of carbon dioxide (CO2) from industrial sources is separated, treated and transported to a long-term storage location. For example, the burning of fossil fuels or biomass results in a stream of CO2 that could be captured and stored by CCS. Usually the CO2 is captured from large point sources, such as a chemical plant or a bioenergy plant, and then stored in a suitable geological formation. The aim is to reduce greenhouse gas emissions and thus mitigate climate change. For example, CCS retrofits for existing power plants can be one of the ways to limit emissions from the electricity sector and meet the Paris Agreement goals.

Enhanced oil recovery, also called tertiary recovery, is the extraction of crude oil from an oil field that cannot be extracted otherwise. Although the primary and secondary recovery techniques rely on the pressure differential between the surface and the underground well, enhanced oil recovery functions by altering the chemical composition of the oil itself in order to make it easier to extract. EOR can extract 30% to 60% or more of a reservoir's oil, compared to 20% to 40% using primary and secondary recovery. According to the US Department of Energy, carbon dioxide and water are injected along with one of three EOR techniques: thermal injection, gas injection, and chemical injection. More advanced, speculative EOR techniques are sometimes called quaternary recovery.

An integrated gasification combined cycle (IGCC) is a technology using a high pressure gasifier to turn coal and other carbon based fuels into pressurized gas—synthesis gas (syngas). It can then remove impurities from the syngas prior to the electricity generation cycle. Some of these pollutants, such as sulfur, can be turned into re-usable byproducts through the Claus process. This results in lower emissions of sulfur dioxide, particulates, mercury, and in some cases carbon dioxide. With additional process equipment, a water-gas shift reaction can increase gasification efficiency and reduce carbon monoxide emissions by converting it to carbon dioxide. The resulting carbon dioxide from the shift reaction can be separated, compressed, and stored through sequestration. Excess heat from the primary combustion and syngas fired generation is then passed to a steam cycle, similar to a combined cycle gas turbine. This process results in improved thermodynamic efficiency, compared to conventional pulverized coal combustion.

Jeff Cloud is an American Republican politician from the U.S. state of Oklahoma. Jeff Cloud was elected statewide to a six-year term on the Oklahoma Corporation Commission on November 5, 2002, and assumed the chairmanship of the Commission in June 2005. He was re-elected to another six-year term on November 4, 2008. However, Cloud resigned from the Commission in October 2011.

<span class="mw-page-title-main">Greenhouse gas emissions by the United States</span> Climate changing gases from the North American country

The United States produced 5.2 billion metric tons of carbon dioxide equivalent greenhouse gas (GHG) emissions in 2020, the second largest in the world after greenhouse gas emissions by China and among the countries with the highest greenhouse gas emissions per person. In 2019 China is estimated to have emitted 27% of world GHG, followed by the United States with 11%, then India with 6.6%. In total the United States has emitted a quarter of world GHG, more than any other country. Annual emissions are over 15 tons per person and, amongst the top eight emitters, is the highest country by greenhouse gas emissions per person. However, the IEA estimates that the richest decile in the US emits over 55 tonnes of CO2 per capita each year. Because coal-fired power stations are gradually shutting down, in the 2010s emissions from electricity generation fell to second place behind transportation which is now the largest single source. In 2020, 27% of the GHG emissions of the United States were from transportation, 25% from electricity, 24% from industry, 13% from commercial and residential buildings and 11% from agriculture. In 2021, the electric power sector was the second largest source of U.S. greenhouse gas emissions, accounting for 25% of the U.S. total. These greenhouse gas emissions are contributing to climate change in the United States, as well as worldwide.

Carbon capture and storage (CCS) is a technology that can capture carbon dioxide CO2 emissions produced from fossil fuels in electricity, industrial processes which prevents CO2 from entering the atmosphere. Carbon capture and storage is also used to sequester CO2 filtered out of natural gas from certain natural gas fields. While typically the CO2 has no value after being stored, Enhanced Oil Recovery uses CO2 to increase yield from declining oil fields.

The milestones for carbon capture and storage show the lack of commercial scale development and implementation of CCS over the years since the first carbon tax was imposed.

The climate change policy of the United States has major impacts on global climate change and global climate change mitigation. This is because the United States is the second largest emitter of greenhouse gasses in the world after China, and is among the countries with the highest greenhouse gas emissions per person in the world. In total, the United States has emitted over a trillion metric tons of greenhouse gasses, more than any country in the world.

Carl Michael "Mike" Smith is an American businessman, energy expert, and politician from Oklahoma. Smith is currently serving as the executive director of the Interstate Oil and Gas Compact Commission. Smith has served in numerous energy policy positions for both the United States federal and Oklahoma state governments, including Assistant Secretary of Energy for Fossil Energy under President George W. Bush (2002–2004) and Oklahoma Secretary of Energy under Governor of Oklahoma Frank Keating (1995–2002).

<span class="mw-page-title-main">Oklahoma Secretary of Energy</span> Oklahoma state cabinet-level position

The Oklahoma Secretary of Energy is a member of the Oklahoma Governor's Cabinet. The Secretary is appointed by the Governor, with the consent of the Oklahoma Senate, to serve at the pleasure of the Governor. The Secretary serves as the chief advisor to the Governor on energy policy development and implementation.

<span class="mw-page-title-main">Kemper Project</span> Power station in Mississippi, US

The Kemper Project, also called the Kemper County energy facility or Plant Ratcliffe, is a natural gas-fired electrical generating station currently under construction in Kemper County, Mississippi. Mississippi Power, a subsidiary of Southern Company, began construction of the plant in 2010. The initial, coal-fired project was central to President Obama's Climate Plan, as it was to be based on "clean coal" and was being considered for more support from the Congress and the incoming Trump Administration in late 2016. If it had become operational with coal, the Kemper Project would have been a first-of-its-kind electricity plant to employ gasification and carbon capture technologies at this scale.

June Brooks (1924-2010) was an Oklahoma businesswoman, speaker and promoter of the oil and gas industry. She advocated for energy independence and spoke throughout the world on responsible energy development. She won numerous awards, including the Distinguished Service from both the Oklahoma Petroleum Council and the American Association of Professional Landmen, as well as being honored as an Outstanding Woman of Energy from the Association of Women in Energy and one of the inaugural inductees into the Oklahoma Women's Hall of Fame.

Mexico highly depends on the burning of its fossil fuels, and for the same reason, it is in its interest to look into mitigation solutions for its corresponding emissions. In the General Law on Climate Change on 2012, Mexico promised to reduce 20% of its greenhouse gas (GHG) emissions by 2020 and 50% by 2050, as well as in the Paris Agreement. 19% of this new mitigation plan will be dedicated to carbon capture and storage and specifically 10% to the energy industry.

The Oil and Gas Climate Initiative (OGCI), is an international industry-led organization which includes 12 member companies from the oil and gas industry: BP, Chevron, CNPC, Eni, Equinor, ExxonMobil, Occidental, Petrobras, Repsol, Saudi Aramco, Shell and TotalEnergies represent over "30% of global operated oil and gas production." It was established in 2014 and has a mandate to work together to "accelerate the reduction of greenhouse gas emissions" in full support of the Paris Agreement and its aims."

References

  1. ↑ "Officers". Interstate Oil & Gas Compact Commission. Retrieved 2024-03-24.
  2. ↑ "Officers". Interstate Oil & Gas Compact Commission. Retrieved 2024-03-24.
  3. ↑ Baca, Marie C. (9 December 2010). "Some Appointees to Oil and Gas Commission Are Industry Execs, Lobbyists". Our Investigations. ProPublica. Retrieved 23 September 2014.
  4. ↑ Marginal Wells (oklahoma.gov)
  5. 1 2 3 4 Lovejoy, Wallace F.; Homan, Paul T. (2011). Economic aspects of oil conservation regulation. Hoboken: Taylor and Francis. ISBN   9781135985462.
  6. ↑ Joint resolution consenting to an interstate oil compact to conserve oil and gas Pub. Res., No. 64 (1935); 74TH CONGRESS. SESS. I. CHS. 780, 781.
  7. ↑ Leach, Richard H. "The Interstate Oil Compact: A Study in Success." Okla. L. Rev. 10 (1957): 274.
  8. ↑ Murphy, Blakely M. "The Interstate Compact to Conserve Oil and Gas: An Experiment in Co-Operative State Production Control." Miss. LJ 17 (1945): 314.
  9. 1 2 Nash, Gerald D. (1968). United States Oil Policy, 1890–1964: Business and Government in Twentieth Century America. University of Pittsburgh Press. ISBN   9780822975748.
  10. 1 2 Daintith, Terence (2010). Finders keepers? how the law of capture shaped the world oil industry. Washington, DC: RFF Press. ISBN   9781936331765.
  11. ↑ Zimmerman, Joseph F. (2002). Interstate cooperation : compacts and administrative agreements. Westport, Conn.: Praeger. ISBN   9780275977566.
  12. ↑ Libecap, Gary D. (1989). "The Political Economy of Crude Oil Cartelization in the United States, 1933-1972". The Journal of Economic History. 49 (4): 833–855. JSTOR   2122740.
  13. ↑ Grossman, Peter Z (2004). How cartels endure and how they fail: studies of industrial collusion. Cheltenham: Elgar. p.  218. ISBN   1858988306.
  14. 1 2 "Charter". IOGCC. Retrieved 24 September 2014.
  15. ↑ "Member states". IOGCC. Retrieved 29 April 2017.
  16. ↑ "Member States". IOGCC. Retrieved 3 February 2016.
  17. 1 2 Baca, Marie C. (9 December 2010). "Some Appointees to Oil and Gas Commission Are Industry Execs, Lobbyists". ProPublica. Retrieved 24 September 2014.
  18. ↑ "Committees and Workgroups". What We Do. IOGCC. Retrieved 24 September 2014.
  19. ↑ Broun, Caroline N.; Buenger, Michael L. (2006). The evolving use and the changing role of interstate compacts : a practitioner's guide. Chicago, Ill.: Administrative Law Section, American Bar Association. ISBN   9781590316436.
  20. ↑ DESMOG: Introducing IOGCC: The Most Powerful Oil and Gas Lobby
  21. ↑ Energy Wire: Hydraulic Fracturing - Public disclosure database kept private
  22. ↑ Huffington Post: IOGCC: The Most Powerful Oil and Gas Lobby You’ve Never Heard Of
  23. ↑ "What We Do". IOGCC. Retrieved 26 September 2014.
  24. ↑ "States' Rights". Issues. IOGCC. Retrieved 26 September 2014.
  25. ↑ "Model Statutes". Issues. IOGCC. Retrieved 26 September 2014.
  26. ↑ "Issues". IOGCC. Retrieved 26 September 2014.
  27. ↑ Murphy, Blakely M. "Administrative Mechanism of the Interstate Compact to Conserve Oil and Gas: The Interstate Oil Compact Commission, 1935-1948." Tul. L. Rev. 22 (1947): 384.
  28. ↑ Houghton, J.T.; Ding, Y.; Griggs, D. J.; Noguer, N.; Linden, P. J. van der; Xiaosu, D.; Maskell, K.; Johnson, C. A., eds. (2001). Climate change 2001: The scientific basis. Contribution of Working Group I to the third assessment report of the Intergovernmental Panel on Climate Change. Cambridge: Cambridge Univ. Press. p.  7. ISBN   0521-80767-0 . Retrieved 26 September 2014.
  29. ↑ "Carbon Sequestration". Issues. IOGCC. Retrieved 26 September 2014.
  30. ↑ "Deep saline formations". CO2 storage. ICO2N. Retrieved 26 September 2014.
  31. 1 2 Curtiss, David K. (April 2008). "Carbon sequestration rules emerge". Explorer. American Association of Petroleum Geologists. Retrieved 26 September 2014.
  32. ↑ CO2 Storage: A Legal and Regulatory Guide for States (PDF) (Report). IOGCC. December 2007. Retrieved 26 September 2014.
  33. ↑ "Award Programs". What We Do. IOGCC. Retrieved 26 September 2014.
  34. ↑ "Chairman's Stewardship Awards 2012" (PDF). IOGCC. Retrieved 26 September 2014.

Further reading

This page is based on this Wikipedia article
Text is available under the CC BY-SA 4.0 license; additional terms may apply.
Images, videos and audio are available under their respective licenses.