Methane emissions to rebound after Covid-19: IEA

Methane emissions from the global oil and gas industry could rebound strongly after the Covid-19 pandemic in the absence of stronger action by companies, policy makers and regulators, according to the Paris-based IEA.

Last year's 10pc drop in methane emissions from the sector mostly stemmed from producers slashing output in response to the coronavirus crisis, rather than being the result of leak prevention, the IEA said. This has raised concerns that the downward trend may be swiftly reversed as output rises to fuel a rebound in global economic activity, it added.

The oil and gas industry needs to ensure that there is no resurgence in methane emissions as the world economy recovers, and that 2019 is regarded as their "historical peak", IEA executive director Fatih Birol said.

The agency estimates worldwide methane emissions from the oil and gas industry at 70mn t in 2020, down from 77.5mn t a year earlier. A similar trajectory must be maintained in the coming years with the aim of achieving a 70pc reduction by 2030 compared with last year, as outlined in the sustainable development scenario of the IEA's World Energy Outlook , it said. It is technically possible to avoid around three-quarters of today's methane emissions from global oil and gas operations, according to IEA estimates.

The drop in the oil and gas sector's methane emissions stems mostly from lower upstream production, particularly in countries with a high emissions intensity, such as Libya and Venezuela, the agency said. Lower shale activity in the US and the introduction of new regulations on methane emissions in a number of countries also played a role, it added.

While countries such as the US and Russia account for a far higher share of total emissions, their methane intensity is comparatively low, the IEA said, adding that countries with higher methane intensity can emit up to 100 times more than those with the lowest intensity. Gas production facilities account for 60pc of the industry's methane leaks.

The IEA has published a report outlining a regulatory roadmap for policy makers aiming to tackle methane emissions. Low global gas prices for most of 2020 may have reduced the industry's focus on reducing methane emissions, highlighting the importance of regulation to address the issue, the agency said.

That said, reducing methane leaks also allows companies to market additional volumes, which in some cases can cover the cost of improving operations to prevent methane leaks. The IEA estimates that around 10pc of global methane emissions could be avoided at no net cost because the value of the additional gas brought to market is sufficient to cover the cost of abatement measures.

By Antonio Peciccia

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