Citing the energy security provided by the current high levels of U.S. oil and natural gas production, the Obama Administration has announced plans to cut methane emissions from the oil and gas sector by 40-50 percent (from 2012 levels) by 2025 – a move intended to address climate change and reduce the effects of pollutants on health.

Methane – the primary component of natural gas – is a potent greenhouse gas, with 25 times the heat-trapping potential of carbon dioxide over a 100-year period.

According to a statement from the EPA:

“Methane emissions accounted for nearly 10 percent of U.S. greenhouse gas emissions in 2012, of which nearly 30 percent came from the production transmission and distribution of oil and natural gas. Emissions from the oil and gas sector are down 16 percent since 1990 and current data show significant reductions from certain parts of the sector, notably well completions. Nevertheless, emissions from the oil and gas sector are projected to rise more than 25 percent by 2025 without additional steps to lower them. For these reasons, a strategy for cutting methane emissions from the oil and gas sector is an important component of efforts to address climate change.

“The steps announced today are also a sound economic and public health strategy because reducing methane emissions means capturing valuable fuel that is otherwise wasted and reducing other harmful pollutants – a win for public health and the economy. Achieving the Administration’s goal would save up to 180 billion cubic feet of natural gas in 2025, enough to heat more than 2 million homes for a year and continue to support businesses that manufacture and sell cost-effective technologies to identify, quantify, and reduce methane emissions.”

Steps in the cross agency effort will include:

Propose and Set Commonsense Standards for Methane and Ozone-Forming Emissions from New and Modified Sources

Standards for volatile organic compounds (VOC) issued by the EPA in 2012 are expected to reduce 190,000 to 290,000 tons of VOC and decrease methane emissions in an amount equivalent to 33 million tons of carbon pollution per year. The EPA says it will initiate a rulemaking effort to set standards for methane and VOC emissions from new and modified oil and gas production sources, and natural gas processing and transmission sources. EPA will issue a proposed rule in the summer of 2015 and a final rule will follow in 2016.

New Guidelines to Reduce Volatile Organic Compounds

The EPA will develop new guidelines to assist states in reducing ozone-forming pollutants from existing oil and gas systems in areas that do not meet the ozone health standard and in states in the Ozone Transport Region. These guidelines will also reduce methane emissions in these areas. The guidelines will help states that are developing clean air ozone plans by providing a ready-to-adopt control measure that they can include in those plans.

Consider Enhancing Leak Detection and Emissions Reporting

EPA will continue to promote transparency and accountability for existing sources by strengthening its Greenhouse Gas Reporting Program to require reporting in all segments of the industry. The agency will explore potential regulatory opportunities for applying remote sensing technologies and other innovations in measurement and monitoring technology to further improve the identification and quantification of emissions and improve the overall accuracy and transparency of reported data cost-effectively.

Lead by Example on Public Lands

The Department of Interior’s Bureau of Land Management (BLM) will update decades-old standards to reduce wasteful venting, flaring, and leaks of natural gas, which is primarily methane, from oil and gas wells.  These standards, to be proposed this spring, will address both new and existing oil and gas wells on public lands. This action will boost America’s natural gas supplies, ensuring that taxpayers receive the royalties due to them from development of public resources, and reducing emissions. 

Reduce Methane Emissions while Improving Pipeline Safety

The Department of Transportation’s Pipeline and Hazardous Materials Safety Administration (PHMSA) will propose natural gas pipeline safety standards in 2015.  While the standards will focus on safety, they are expected to lower methane emissions as well.

Drive Technology to Reduce Natural Gas Losses and Improve Emissions Quantification 

The President’s FY16 Budget will propose $15 million in funding for the Department of Energy (DOE) to develop and demonstrate more cost-effective technologies to detect and reduce losses from natural gas transmission and distribution systems.  This will include efforts to repair leaks and develop next generation compressors. The President’s budget will also propose $10 million to launch a program at DOE to enhance the quantification of emissions from natural gas infrastructure for inclusion in the national Greenhouse Gas Inventory in coordination with EPA.

Modernize Natural Gas Transmission and Distribution Infrastructure

• DOE will continue to take steps to encourage reduced emissions, particularly from natural gas transmission and distribution, including:
• Issuing energy efficiency standards for natural gas and air compressors;
• Advancing research and development to bring down the cost of detecting leaks;
• Working with FERC to modernize natural gas infrastructure; and
• Partnering with NARUC and local distribution companies to accelerate pipeline repair and replacement at the local level.

Release a Quadrennial Energy Review (QER)

The Administration will soon release the first installment of the QER, which focuses specifically on policy actions that are needed to help modernize energy transmission, storage, and distribution infrastructure. This installment of the QER will include additional policy recommendations and analysis on the environmental, safety, and economic benefits of investments that reduce natural gas system leakage.

Oil industry response

Oil industry representatives said new regulations are unnecessary. Jack Gerard, president and CEO of the American Petroleum Institute (AP), said existing regulations are working.

“As oil and natural gas production has risen dramatically, 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 two percent of total greenhouse gas emissions.

“Emissions will continue to fall as operators innovate and find new ways to capture and deliver more methane to consumers, and existing EPA and state regulations are working. Another layer of burdensome requirements could actually slow down industry progress to reduce methane emissions.”

A 2014 University of Texas study found that methane emissions are 10 percent lower than what the same research team found in a study released in September 2013, and EPA recently observed that methane emissions from hydraulic fracturing have fallen by 73 percent since 2011. 

“Onerous new regulations could threaten the shale energy revolution, America’s role as a global energy superpower, and the dramatic reductions in CO2 emissions made possible by an abundant and affordable domestic supply of clean-burning natural gas,” Gerard said.