Oil & Gas Methane Emissions Rule Finalized

gas flaring

by | Nov 16, 2016

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gas flaringThe US Interior Department has finalized a rule to reduce methane emissions from oil and gas operations on public and tribal lands, part of the Obama administration’s push to finalize several climate and clean energy regulations before president-elect Donald Trump takes office in January.

The new methane regulation, proposed earlier this year, limits venting, flaring and leaking of natural gas during the production process, which the department says will help curb waste, reduce emissions and “provide a fair return on public resources for federal taxpayers, tribes and states.”

Enough natural gas was lost between 2009 and 2015 to serve more than 6 million households for a year, according to Interior Department estimates. A 2010 Government Accountability Office report says that amount of wasted gas means states, tribes and federal taxpayers lose millions of dollars annually in royalty revenue for the federal government and the states that share it.

The rule, which will be phased in over time, requires oil and gas producers to use currently available technologies and processes to cut flaring in half at oil wells on public and tribal lands. Operators also must periodically inspect their operations for leaks, and replace outdated equipment that vents large quantities of gas into the air.

Other parts of the rule require operators to limit venting from storage tanks and to use best practices to limit gas losses when removing liquids from wells. The rule also clarifies when operators owe royalties on flared gas, and allows the government to set royalty rates at or above 12.5 percent of the value of production.

Without this and other Obama administration policies that target methane emissions from the oil and gas sector, these releases are projected to increase substantially, the federal agency says. The Obama administration has set a goal to cut methane emissions from the oil and gas sector by 40 percent to 45 percent from 2012 levels by 2025. This rule projects cutting methane emissions by as much as 35 percent.

The oil and gas industry immediately attacked the new rule as unnecessary and duplicative.

“The BLM’s rush to regulate something already being regulated at the state and federal level is an example of poor government policy and a left hand not knowing what the right hand is doing,” said American Petroleum Institute director of upstream and industry operations Erik Milito. “BLM’s new regulations are unnecessary, redundant, technically flawed and could stifle the innovations that have led to our nation’s environmental successes.

“If the goal is to prevent emissions, not impede US energy production, then the BLM should focus on fixing permitting, infrastructure and pipeline delays that slow our nation’s ability to capture more natural gas and deliver affordable energy to consumers.”

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