Why are oil and gas companies wasting $360 million worth of natural gas each year?

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Oil and gas operations on public and tribal lands produce 21 percent of national emissions from gas production.

Study says easy fixes available to stop methane leaks

Staff Report

FRISCO — Methane emissions from oil and gas operations on federally managed public lands and tribal lands totaled more than 1 million tons in 2013, accounting for about 12 percent of total methane emissions across the U.S.

That methane was worth about $360 million at current gas prices, showing how oil and gas companies are squandering a valuable public resources and polluting the atmosphere, according to a new economic study released by the Environmental Defense Fund.

The releases happen when gas is either burned off, intentionally vented, or leaked from well sites and other oil and gas infrastructure. EDF prepared the report as the Bureau of Land Management finalizes new rules for oil and gas operators on venting, flaring, and other waste.

“The oil and gas industry is wasting a valuable public resource and making life difficult for their neighbors in the process by damaging both local air quality and the climate,” said EDF’s Mark Brownstein, “Solutions to the problem are simple, straightforward, and cost effective. It’s not hard to do. But it’s not going to happen without new rules.”

Methane is a potent greenhouse gas with 84 times the warming power of carbon dioxide over a 20-year timeframe, and is often accompanied by other local air pollutants. Because methane is the main component of natural gas, it also represents a waste of an energy resource every time it is released from the supply chain unburned.

The ICF analysis found that Western states tended to have higher emissions from oil and gas activity on federal and tribal lands, due to the fact that natural gas production on federal and tribal lands is largely concentrated in Western states.

New Mexico and Wyoming reported the highest methane emissions on federal lands, with Utah the largest emitter on tribal lands. High emissions were also seen in Colorado and California. Despite its small amount of public land, Pennsylvania showed methane emissions on par with some Western states, due to its volume of natural gas activity on lands managed by the U.S. Forest Service.

The study examined a range of proven, cost-effective technologies and best practices that could be applied to the emission sources it found, including frequent leak inspection and repair programs.Using widely know and cost-effective pollution reduction strategies, companies could cut emissions by at least 40 percent. the report concluded.

The BLM manages oil and gas leasing and production across 700 million acres of federal and tribal lands, an area about four times the size of the state of Texas, which produce 8 percent of U.S. oil supply and 14 percent of U.S. natural gas.

Currently, there are almost no federal limits governing private or public lands on the amount of natural gas waste and methane pollution that oil and gas operations can emit. The oil and gas sector is the nation’s largest industrial source of methane pollution, as well as a key source of other air pollutants that have toxic effects and contribute to smog.

According to the EDF, the new study emphasizes how important the agency’s new rules will be to controlling methane emissions.

“BLM has a responsibility to taxpayers to reduce the massive natural gas waste from oil and gas development happening on public lands, and this report shows there are commonsense reduction opportunities that exist to help do that,” said Tomás Carbonell, a regulatory policy specialist with the EDF.

Methane emissions have already become a priority for many Western states. In 2014, Colorado became the first state in the nation to directly regulate methane from oil and gas operations, partly prompting the Western Governors Association to pass a resolution in support of oil and gas methane emissions reductions.

Wyoming also requires stringent pollution controls in an area of heavy drilling activity. And the North Dakota Industrial Commission recently issued a strong gas capture order that has resulted in significant reductions of flaring in the state.

But these rules don’t apply evenly to all federal and tribal lands in these states, and they don’t apply at all to the other states in the region that ICF found are responsible for releasing massive amounts of methane pollution.

ICF’s new analysis is based in part on available information about the location of oil and gas production facilities, as well as emission inventories published by EPA and data on oil and gas production on federal and tribal lands within each state. The analysis builds on a previous ICF analysis that focused on opportunities to reduce national emissions from the onshore U.S. oil and gas industry that can be found here.

 

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