Industry, greens face off over methane rules for drill sites

Posted: Apr 9, 2013

Written by

Jean Chemnick, Greenwire
Methane flaring

Environmentalists and natural gas producers agree that without better information about the amount of methane that is vented from natural gas systems, the climate implications of more gas production and use are hard to quantify.

But industry advocates say federal regulators should hold off on implementing new restrictions for the industry until better data are available, while environmentalists argue that if controls are available and cost-effective, they should be applied without delay.

Both opinions were on display yesterday when the World Resources Institute (WRI) rolled out a study evaluating the well-to-wheel greenhouse gas impact of increased natural gas use, steps the industry could take to reduce upstream emissions and the possible need for increased regulation.

Estimates of the amount of methane released during gas production are murky, but U.S. EPA has suggested that on average the industry vents less than 3 percent of its production into the atmosphere. At that rate, gas carries a smaller greenhouse gas footprint than coal, but the industry must still take steps to reduce its emissions below 1 percent of production to beat the climate performance of diesel for heavy-duty trucks, according to the WRI assessment.

EPA's estimate is not based on direct measurements of methane emissions from a representative segment of the nation's gas producers, because such data do not exist. And some assessments put the leak rate at a much higher percentage of production, endangering gas's claim to be half as greenhouse-gas-intensive as coal.

But researchers with the University of Texas, Austin, are working with industry and the Environmental Defense Fund to clarify what the greenhouse gas footprint of the industry is, an effort that all parties say will inform policy down the road. Mark Brownstein of EDF said at yesterday's event that some of the results of that study related to the gas production side would be available as early as next month.

But environmentalists said regulators should not wait until the data are complete before taking steps to improve the climate performance of the natural gas industry, which has grown quickly in recent years and which EPA in its recent inventory said now accounts for upward of 5 percent of the nation's greenhouse gas emissions.

"The most important question is, are we doing as much as possible to bring upstream methane leakage down as much as is economically feasible?" said Michael Obeiter, one of the authors of the WRI study. "And I think right now the answer to that is 'no.'"

Obeiter and other experts note that technologies do exist to capture methane that is currently being allowed to leak at various points throughout the natural gas system, but the industry has no incentive to make those investments. That might change if EPA agrees to regulate the sector's methane emissions directly, as groups including the Natural Resources Defense Council and the Environmental Defense Fund have asked the agency to do.

"We need to look at reducing these methane emissions in the context of everything else we need to be doing to address climate change," Brownstein said. He noted that methane has more than 21 times the effect on climate change in the short term as carbon dioxide. And it would be relatively inexpensive to reduce methane from the gas sector, he said.

"It seems to me that even with imprecise data, this is some of the most urgent actions that we can take to reduce the chances of harmful global warming, and we should do everything we can to reduce those chances," he said.

But Fiji George, regulatory adviser for Shell Exploration & Production Co., said that while the industry is "anxious" to help improve the public understanding of emissions from natural gas development, regulators should hold off on crafting new rules until those data are firmly in place.

EPA's assumptions about the industry's emissions are mostly based on data that are very outdated, he said, and have fluctuated greatly from year to year based on methodology rather than new information.

"We'd agree there are good technologies to reduce emissions, and where needed we need to apply" them, George said. "But to develop stringent data based on incorrect data is problematic."

Unconventional natural gas producers are already required to use green completion technology to reduce emissions from hydraulic fracturing under a toxic emissions rule EPA finalized last year, he noted. The WRI study puts methane savings from the rule at 25 percent by 2035.

Implementing tighter restrictions might not be cost-effective, George said, and might hurt consumers by inhibiting development of natural gas.

"The question is, how much do you want to regulate this for what kind of return?" he said.

But Obeiter said EPA should consider moving ahead with other rules.

"The EPA rulemaking process and the rulemaking practice in states is not something that happens overnight," he said. "It's a process that generally takes a few years."

James Bradbury, Obeiter's co-author on the report, said, "We can't afford to take a wait-and-see approach given the projected growth in the sector."



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