USEPA Proposal for First Direct Regulation on Methane to Impact Oil and Gas Emissions for Obama Climate Change Strategy

emissions

On January 14, 2015, the Obama administration unveiled plans to regulate methane emissions from the nation’s oil and natural-gas industry for the first time.  USEPA plans to propose federal regulations to cut methane emissions from the oil and gas sector by 40 to 45 percent over the next decade from 2012 levels.  The rules, scheduled to be proposed summer 2015 and completed by 2016, would apply only to new or modified sites. For existing oil and gas operations, USEPA is set to rely mostly on voluntary measures to cut methane emissions, a move backed by the industry.

To reduce emissions, companies would have to install technology that prevents methane from being inadvertently leaked and monitor operations for possible leaks. Many companies are already using this kind of equipment, according to USEPA.

USEPA’s announcement included action on two regulatory fronts.  In addition to directly regulating methane emissions, the USEPA plans to expand a rule it imposed on the oil and gas industry in 2012 that focused on reduction of traditional pollutants, which had the side benefit of indirectly cutting methane emissions.

The plan does not largely address existing infrastructure (a majority of oil and gas methane leaks) and some standards target volatile organic compounds (VOCs) rather than methane specifically, which will miss areas of methane production and transport that leak a large amount of processed gas.

The USEPA in 2012 issued new source performance standards for oil and natural gas wells, but that rule did not directly regulate methane emissions.  Instead, the agency specified that the required controls for VOCs would also reduce methane emissions by the equivalent of 33 million tons of carbon pollution per year.  The USEPA confirmed its upcoming rule will not conflict with requirements in states that have already taken steps to regulate emissions from the oil and natural gas sector.

Stay tuned for more on the Obama administration’s climate approach.

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