Serving as a guide for companies and policymakers who aim to reduce methane emissions throughout the energy supply chain, API’s newly released Methane Action Plan (“MAP”) creates a blueprint that builds on the industry’s existing actions to reduce emissions through programs like the Environmental Partnership.
The plan outlines the need for effective methane regulation that doesn’t sacrifice energy security and reliability. As the U.S. Environmental Protection Agency crafts its final methane rule, the plan advocates for a final rule that focuses on the innovative practices that have already reduced methane emissions intensity by 66 percent across all seven producing basins from 2011 to 2021.
Industry taking proactive steps to address methane
The newly released Methane Action Plan details the proactive steps the industry is already undertaking to reduce emissions.
Launched by API in 2017, the Environmental Partnership is an industry-led alliance of oil and natural gas players that have voluntarily committed to consistently improving the industry’s environmental performance.
Companies are taking action through the Partnership by adopting performance programs within their organizations, learning and sharing best practices and new technology, and promoting collaboration. Its key benefit to the industry is that it provides a platform for peer-to-peer sharing among operators across the four crucial areas of facility design, operations and maintenance, measurement and detection, and data integrity.
Since its establishment, the Partnership has grown to now include 70 percent of total U.S. onshore natural gas and oil production. This success underscores the importance of industry led efforts to address emissions.
“The United States is a global leader in energy production and emissions reductions, and thanks to innovation and concerted industry action, average methane emissions intensity declined by nearly 66 percent across all seven major producing regions from 2011 to 2021,” said API Senior Vice President of Policy, Economics and Regulatory Affairs Dustin Meyer.
“Tackling methane emissions is an urgent challenge, but the men and women of the U.S. natural gas and oil industry have the ingenuity, dedication and know-how to meet this challenge while continuing to power our daily lives.”
The Methane Action Plan outlines the six steps partnership members are already taking with an emphasis on facility design, innovative technology, and operational practices:
- Reducing flaring through facility design, takeaway capacity planning and alternative beneficial use.
- Replacing, removing or retrofitting high-bleed pneumatic controllers with low- or zero-emitting devices.
- Monitoring manual liquids unloading to minimize emissions by ensuring all wellhead vents are closed to atmosphere.
- Minimizing compressor emissions by implementing design and operation changes.
- Detecting and repairing leaks through regular component inspections.
- Minimizing pipeline blowdown emissions through operational changes prioritizing alternative beneficial use of gas that would otherwise be vented.
In 2022, participating companies continued to take action to reduce their flaring, achieving a 14 percent reduction in total flare volumes and a 2.4 percent reduction in flare intensity reported from the previous year, even as U.S. oil and gas production grew by 5.6 and 4 percent, respectively, during the same time period.
EPA’s proposed methane rule
The plan also calls for commonsense changes to the Environmental Protection Agency’s (EPA) proposed methane rule. API argues these changes are necessary to ensure that the final rule is cost-effective, technically feasible, and legally durable.
The EPA’s proposed rule as drafted could hinder innovation and energy production leading to higher energy costs at time when Americans are already dealing with an increase in the cost of living.
API President and CEO Mike Sommers urged caution on the rulemaking in a letter to U.S. Environmental EPA Administrator Michael Regan.
“This methane rulemaking marks an important opportunity to build on our industry’s innovation and progress in reducing U.S. emissions.”
“We are concerned that a rushed approach to finalization and implementation of this sweeping regulation could stifle innovation, diminish American energy production, and ultimately harm consumers with higher costs and less reliable energy.”
The Independent Petroleum Association of America (IPAA) echoed calls for a balanced approach to methane regulations.
“For over the past twelve years IPAA has been actively engaged in working with the EPA to promulgate NSPS for the oil and natural gas sector that are cost-effective, reasonable and justified under the Clean Air Act,” said IPAA President and CEO Barry Russell. “IPAA’s message has been clear and consistent: EPA’s ‘one-size-fits all’ approach to regulating the oil and natural gas industry is inappropriate and disproportionally impacts conventional operations, low production wells, and small businesses.”
In a separate letter sent last week to the EPA, IPAA and API urged the agency to adopt an extended implementation timeline for its final methane rule, citing a new study released this week from IPAA, API, the American Exploration and Production Council, and the Interstate Natural Gas Association of America. The study concludes that backorder times for the equipment can range from six months to two years, threatening to put companies out of compliance with the rule and shutting in domestic production unless the timeline is adjusted.
The proposed EPA rule should foster industry innovation and cost-effective implementation while achieving meaningful methane emissions reductions. This cannot be achieved though without meaningful permitting reform to support emissions reduction goals.
Bottom Line: American energy companies are committed to reducing methane emissions and have a proven track record of double-digit reductions over the last decade. This is only possible through continuous innovation and meaningful voluntary and regulatory steps that carefully consider all the factors at play. The Methane Action Plan strikes the balance and lays out a clear path for the industry to continue to address emissions.
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