US targets methane emissions from oil, gas sites

The US administration is setting a goal of reducing methane emissions from oil and gas operations by 40-45pc from 2012 levels by 2025.

The US Environmental Protection Agency (EPA) said today it plans to propose a formal rule this summer aimed at reducing releases of methane and volatile organic compounds (VOCs) from new and modified oil and gas production sources, as well as gas processing and transmission facilities. EPA expects to then issue a final rule next year.

EPA at the same time will work with industry and state regulators to tackle methane emissions from existing sources, including well completions, pneumatic pumps, gathering and boosting stations and compressor stations.

"We need to deal with and reduce emissions from across the sector, both new and existing," White House energy and climate change adviser Dan Utech said. "It makes sense to start on a standard-setting process with new sources, where the new investment is, where emissions increases are coming from."

If the emissions reductions are fully achieved, the White House estimates companies could capture an additional 180 Bcf/yr of gas by 2025, enough to heat 2mn homes for a year. The White House does not have an estimate for the potential cost of a new regulation.

The effort targeting methane emissions is a key element of President Barack Obama's attempt to address climate change. Methane is a potent greenhouse gas (GHG), with a global warming potential more than 25 times greater than CO2, the EPA said. VOCs are a key ingredient of ground-level ozone or smog.

Methane accounted for nearly 10pc of US GHGs in 2012, with nearly 30pc of those releases stemming from oil and gas production, as well as gas processing, transmission and distribution.

Methane emissions from the oil and gas sector have fallen 16pc since 1990, EPA said. But the administration projects emissions could rise by 25pc over the next decade if the government does not intervene.

Today's announcement comes as the Bureau of Land Management is poised this spring to issue new standards decided to reduce venting, flaring and gas leaks from new and existing wells on public lands. The administration said those standards will cover operational aspects not addressed by EPA's efforts.

EPA plans to develop new guidelines to help states reduce VOCs from existing oil and gas systems in areas that do not meet federal ozone standards or that are located in the Ozone Transport Region, a group of states in the northeastern US that under the Clean Air Act coordinate on smog issues. EPA will issue "control techniques guidelines" providing analyses of available, cost-effective technologies for covered oil and gas sources this summer and issue final guidelines in 2016.

The Pipeline and Hazardous Materials Safety Administration expects this year to propose new gas pipeline safety standards, which also will help curb methane emissions. The Energy Department is issuing new energy efficiency standards for gas compressors. Next month, the administration is scheduled to release the first installment of its quadrennial energy review, focusing on ways to modernize the US' energy transmission, storage and distribution infrastructure. That report will include recommendations to reduce leaks from gas systems.

This is not the first time the administration has taken steps to curb methane emissions.

The EPA in 2012 issued final rules to reduce emissions of VOCs, establishing the first federal air pollution standards for hydraulically fractured gas wells. While those rules targeted VOCs, they had a side benefit of trimming methane emissions as well. When fully implemented, those standards are expected to cut VOC emissions by 190,000-290,000 short tons (st) per year and methane releases by 1-1.7mn st/yr or 19-33mn metric tonnes/yr of CO2 equivalent.

In November, the EPA proposed expanding its greenhouse gas reporting requirements to more fully cover methane releases from oil and gas operations. The agency hopes to finalize those changes this year.

The oil and gas industry representatives quickly blasted the plan, calling it unnecessary. American Petroleum Institute president Jack Gerard pointed to EPA's own estimate that methane emissions from fractured wells have fallen 73pc since 2011.

"Methane emissions have fallen thanks to industry leadership and investment in new technologies," Gerard said. "And even with that knowledge, the White House has singled out oil and natural gas for regulation, where methane emissions represent only 2pc of total greenhouse emissions."

Reaction among environmentalists was mixed. The Sierra Club called regulating methane "a critical step" but said "EPA and BLM must act quickly to reduce methane emissions from all new and existing sources." And controlling methane emissions will not make oil and gas operations "climate friendly," the Sierra Club said.

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