UPDATE 2-Trump administration plans to delay methane controls on oil, gas

(Changes lead and third paragraph to add information about federal judge's ruling on BLM's first attempt to delay the rule)

WASHINGTON, Oct 4 (Reuters) - The U.S. Interior Department this week will try again to delay parts of an Obama-era rule to limit methane emissions from oil and gas production on federal lands, a rule Congress upheld earlier in the year, a document showed on Wednesday.

The rule, finalized by the Interior Department's Bureau of Land Management (BLM) two months before former President Barack Obama left office, requires oil and gas operators on public lands to prevent leaking, venting and flaring of methane, a potent greenhouse gas.

The administration of President Donald Trump has sought to do away with the rule, viewing it as excessive environmental regulation. BLM announced it would delay implementation of the rule in June, but a federal judge on Wednesday ruled it had violated a federal law dictating the process government agencies must follow for rule changes.

The agency released a new proposal on Wednesday that would delay implementation until Jan. 17, 2019 as it reviews Obama's regulation, according to the document, scheduled to be published on Thursday in the Federal Register. The document can be seen at http://bit.ly/2xZ5BPc

The petroleum industry's chief lobbying group praised the planned delay, while environmental groups criticized it.

Delays could benefit energy drillers on public lands as the Trump administration seeks to make the country "energy dominant" by maximizing oil and gas output for domestic consumption and for shipping energy products to allies.

Energy companies have said the methane rule could cost tens of thousands of dollars per well and hinder production. They consider it unnecessary because energy producers have made strides in reducing emissions of methane, the main component of natural gas.

Drillers on federal lands produced 9 percent of the natural gas and 5 percent of the oil in the United States last fiscal year.

The American Petroleum Institute, the industry's top lobbyist, said the delay provides time to "develop an achievable rule ... that serves to prevent waste and conserve resources while encouraging energy production on federal lands."

Kate Kelly, public lands director at the liberal Center for American Progress, said Interior Secretary Ryan Zinke and the Trump administration "need to realize that they are not above the law and that it is American taxpayers, not the oil and gas industry, that pay their salaries."

In May, the U.S. Senate rejected a resolution to revoke the rule, as several of Trump's fellow Republicans, including Senator John McCain, voted against the measure.

The Interior Department, which will take public comments on the proposed delay once it is published in the Federal Register, did not immediately respond to questions about the document. (Reporting by Timothy Gardner; additional reporting by Emily Flitter; Editing by David Gregorio and Cynthia Osterman)