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North Dakota panel approves plan to delay natural gas flaring limits

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North Dakota panel approves plan to delay natural gas flaring limits

Washington — The North Dakota Industrial Commission unanimously approved Thursday an industry-backed proposal to delay further cuts to associated gas flaring into late next year while easing more long-range flaring reduction targets.

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Acting on a proposal from the North Dakota Petroleum Council, the state commission on Thursday revised flaring targets it had originally approved in July 2014.

Under the new benchmarks, producers can flare no more than 23% of associated gas through March 2016 and 20% by April 1. Producers cannot flare more than 15% by November 1, 2016, 12% by November 1, 2018 and between 7% to 9% by November 1, 2020.

The commission originally ordered operators to reduce flaring to 15% by the first quarter of 2016 and to between 5% to 10% by the fourth quarter of 2020.

The industry council had argued that the delays and revisions approved Thursday were needed due to the lack of new gas capture and pipeline infrastructure, which have been delayed for a variety of reasons, including low oil and gas prices, right-of-way disputes and pad size limitations, the council argued.

Under the commission's mandate, producers face production curtailment penalties if they fail to meet these flaring reduction benchmarks. But on Thursday, the commission approved a plan to review flaring goals each December, every year, and to finalize a three-month rolling credits program which could allow certain operators to exceed limits without being in violation of the flaring reduction mandate.

The three-member commission includes North Dakota Governor Jack Dalrymple, Attorney General Wayne Stenehjem and Agriculture Commissioner Doug Goehring,.

Last week, Lynn Helms, North Dakota's top oil and gas regulator, said 20% of gas was flared statewide in July, down from the all-time high of 64% in September 2011.

The delay approved Thursday comes as North Dakota officials consider granting Bakken operators up to a year more to keep wells uncompleted in order to wait out the ongoing decline in oil prices.

--Brian Scheid,
--Edited by Kevin Saville,