How US / EU / UK are focusing on o&g methane

The US, EU and UK all announced plans to regulate or drive down methane emissions from fossil fuel production over 2021. It is very unusual for these organisations to do something at the same time.

Perhaps the COP 26 event had something to do with it, or the availability of satellite images showing what oil and gas methane emissions are really like. Time will tell if the regulatory environment will loosened to enable Russian supplies to be displaced more readily.

This post reviews the regulation and incentives in the US, EU and UK to drive reduced methane emissions from oil and gas production.

Future Energy Partners is a consultancy specialising in oil and gas emissions management, which can help you work out the best way to comply or achieve the required reductions. If you are interested in discussing a methane emissions management / assessment project, please let us know?here.??

US

The US Environmental Protection Agency announced in Nov 2021 plans for a new Clean Air Act rule to drive reductions in methane emissions and emissions of VOCs. EPA intends to issue the supplemental proposal in 2022, and to issue a final rule before the end of 2022.

The plan includes updated and broadened methane and VOC emission reduction requirements for new, modified, and reconstructed oil and gas sources, including from intermittent vent pneumatic controllers, associated gas, and well liquids unloading.

• Requirements that state develop plans should limit methane emissions from hundreds of thousands of existing sources nationwide, along with presumptive standards for existing sources to assist in the planning process.??
• New and existing well sites and compressor stations will need a comprehensive emissions monitoring program.
• Owners and operators have flexibility to use advanced technology that can find major leaks more rapidly and at lower cost than ever before;
• There will be a "zero-emissions standard" for new and existing pneumatic controllers (with a limited alternative standard for sites in Alaska), certain types of which account for approximately 30 percent of current methane emissions from the oil and natural gas sector
• Standards to eliminate venting of associated gas, and require capture and sale of gas where a sales line is available, at new and existing oil wells;
• Proposed performance standards and presumptive standards for other new and existing sources, including storage tanks, pneumatic pumps, and compressors;
• A requirement that states that meaningfully engagement is required with overburdened and underserved communities, among other stakeholders, in developing state plans.

The EPA is taking comments on how to structure a community monitoring program that would empower the public to detect and report large emission events for appropriate follow-up by operators for possible further development in a supplemental proposal.

The EPA calculates that its proposed rule would create costs of "pennies" per barrel of oil or thousand cubic feet of gas, and it would reduce 41m tons of methane emissions over 2023 to 2035, equivalent to the CO2 emitted from all US passenger cars and commercial aircraft in one year (2019), and mean a reduction in methane emissions by 74 per cent by 2050. It also calculates the climate benefit of the rule of $4.5bn a year, based on the social costs of greenhouse gases.

EUROPEAN UNION

In December 2021 the European Commission presented a proposal to regulate methane emission reductions in the energy sector. A feedback period on the proposal opened on 15 December 2021 and closed on 28 March 2022. The aim is to align EU energy laws with EU Climate Law's 2030 emission reduction target.

It aims to address gaps in current legislation, including for methane emissions from upstream exploration and the production of oil and natural gas, but also those from the gathering and processing of naturalgas, the transmission, distribution and underground storage of gas, and liquid gas terminals.

• It sets out requirements for methane emissions reduction, monitoring and reporting, leak detection and repair, and limits to venting and flaring.
• It has recently been possible to make use of satellite mapping to identify huge plumes of methane from oil and gas fields worldwide, some covering an area of more than 300 km, EU says.
• It calculates that low mitigation costs can be found in more than 60 % of available dedicated methane emissions reduction measures, and within those, around half of the measures have negative costs.
• The energy sector will see compulsory measurement, reporting, and verification (MRV) for all energy-related methane emissions.
• There will be legislation making it obligatory to improve leak detection and repair of leaks on all gas infrastructure, as well as any other infrastructure that produces, transports or uses gas, including as a source of feedstock.
• Furthermore, the strategy considers the need for legislation on eliminating routine venting and flaring in the energy sector covering the full supply chain.

UK

In the UK, industry body NS Transition Authority??? Or is it the old OGUK? Offshore Energies UK agreed a '6 key actions' plan with the UK government as part of the " North Sea Transition.

Deal" of March 2021.

• 50% methane emission reduction by 2030 - Industry will halve methane emissions by 2030 (against a 2018 baseline) in accordance with overall emission reduction targets.
• UKCS methane intensity below 0.20% by 2025 - Industry will adopt the 'stretch' OGCI methane intensity target of 0.20% by 2025 to drive short-term operational efficiency
• Zero Routine Flaring before 2030 - Industry will aim to meet the World Bank 'Zero Routine Flaring by 2030' initiative, with individual assets seeking to accelerate compliance where possible before 2030.
• Asset MAP - Operators will develop a Methane Action Plan for each individual asset by Q4 2022, including measurements and quantifications, flare and vent management plans, and abatement plans.
• Measuring methane - Operators will seek to validate methane quantification wherever practicable.
• International alignment - The industry will seek to align to international standards and reporting principles.

FURTHER INFORMATION / SOURCE

EU

https://www.europarl.europa.eu/RegData/etudes/BRIE/2022/729313/EPRS_BRI(2022)729313_EN.pdf

US

https://www.epa.gov/newsreleases/us-sharply-cut-methane-pollution-threatens-climate-and-public-health

UK

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/48424/5556-methane-factsheet.pdf

https://oeuk.org.uk/wp-content/uploads/2021/06/OGUK-Methane-Action-Plan-2021.pdf

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