Department of Interior Proposal to Reduce Methane Emissions

by Judy Li

On January 22, Secretary of Interior Sally Jewell announced proposals for a new rule to reduce natural gas emissions and waste from oil and gas drilling on public and Native American lands. Companies have to adopt currently available methods to limit the venting, flaring and leaking of natural gas during production. According to the Interior Department, the natural gas lost from public lands between 2009 and 2014 could power more than 500 million homes for a year. In calling for changes, Secretary Jewell emphasized the need to reduce waste of natural gas supplies, reduce harmful methane emissions and provide taxpayers a fair return from public resources (via royalties). Current regulations are 30 years old; meanwhile, the oil and gas industries have grown, and technology advances have allowed for more efficient production. Furthermore, the Obama Administration is set on fighting climate change and has a goal of reducing methane emissions from oil and gas by 40 – 45% from 2012 levels by 2025.

Katie Fehrenbacher from Fortune argues that the rule will especially hurt fossil fuel industries. Oil and gas companies have been facing low oil and gas prices in recent months and the rule would further increase costs through new equipment, operational fees, and higher fees to drill on public lands. However, Fehrenbacher notes that some companies will recognize the economic benefits and take the new rule in stride. The released natural gas can be recovered and used as a power source, which will increase revenues.

On the other side of the issue, Physicians for Social Responsibility issued a statement arguing that although the proposed rule is a good start for regulating natural gas, it is not enough to address climate change. The U.S. is the largest producer of natural gas in the world but public lands account for a small portion of oil and gas production in the U.S. and the proposed regulations would only reduce leaks by 50 percent. To effectively combat climate change, PSR calls for regulation of all fossil fuels along with increased development of renewable energy and energy efficiency.

The proposed rule would be an important step in addressing issues of natural gas emissions and waste. Talk surrounding it highlights some of the current economic and environmental problems (and thus opportunities) for all oil and gas operations. However, it is also important to remember that this specific rule would not address other environmental risks associated with oil and gas drilling and it would actually only affect a small portion of the fossil fuel industry, for good or bad depending on individual views.

U.S. Department of the Interior (https://www.doi.gov/pressreleases/secretary-jewell-announces-proposal-reduce-methane-emissions-wasted-gas-public-tribal)

Fortune (http://fortune.com/2016/01/22/new-rules-methane-emissions-oil-gas/)

Physicians for Social Responsibility (http://www.psr.org/news-events/press-releases/department-of-the-interior-limit-methane-leakage.html)

 

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