The Obama administration unveiled new regulations on Wednesday targeting methane emissions from oil and natural gas operations that the industry says could stymie the U.S. energy boom.
“As oil and natural gas production has risen dramatically, methane emissions have fallen thanks to industry leadership and investment in new technologies,” said Jack Gerard, president of the American Petroleum Institute, the nation’s top oil and gas lobby.
“Onerous new regulations could threaten the shale energy revolution, America’s role as a global energy superpower,” Gerard added.
The White House’s plan looks to reduce methane emissions from oil and gas operations 40 to 45 percent by 2025. President Barack Obama has ordered the Environmental Protection Agency to issue new methane rules for new oil and gas operations. Obama also proposed regulating existing oil and gas operations, but only if they reside in countries that fail ozone standards.
“EPA’s proposed methane regulation is redundant, costly, and unnecessary,” said Thomas Pyle, president of the free-market Institute for Energy Research. “Energy producers are already reducing methane emissions because methane is a valuable commodity. It would be like issuing regulations forcing ice cream makers to spill less ice cream.”
The White House has been considering a national methane reduction plan for the last year or so, looking to regulate emissions from landfills, dairy farms and oil and gas drilling. Methane is a much more potent greenhouse gas than carbon dioxide and environmentalists argue that reducing it would help fight global warming.
Methane, however, is the main byproduct of natural gas drilling — most of which is done through hydraulic fracturing, or fracking. Hydro-fracking has allowed U.S. energy producers to unlock vast oil and gas reserves trapped in underground shale formations, causing U.S. oil and gas production to boom. The U.S. now produces more natural gas than Russia and is on track to be the world’s largest producer of oil as well.
In addition to undercutting Russia and Venezuela, whose economies rely heavily on high oil prices, AEI reports that the boom “will continue to break the relative importance of Persian Gulf energy exporters,” reordering strategic balances globally.
“Curbing the rampant methane waste from the oil and gas industry is the biggest new step the White House can take to fight climate change,” said Rhea Suh, former Obama administration official and president of the Natural Resource Defense Council.
Environmental groups, however, think the White House’s new methane plan should be more far reaching, requiring the EPA to regulate emissions across the country and not just in parts of the country that fail to meet federal smog standards.
Taking such industry-wide action would be a powerful follow-up to the president’s historic action on carbon pollution from power plants,” Suh said.
But White House rules come as methane emissions in the U.S. have been plummeting, according to federal figures. Methane released from hydraulic fracturing operations has fallen 73 percent since 2011— an important figure, since virtually all gains in oil and gas production have come from fracking.
Emissions from natural gas operations as a whole represented only 0.38 percent of production, according to a 2014 University of Texas study. That number is actually 10 percent lower than what the same researchers found in 2013.
“Emissions will continue to fall as operators innovate and find new ways to capture and deliver more methane to consumers, and existing EPA and state regulations are working,” Gerard said. “Another layer of burdensome requirements could actually slow down industry progress to reduce methane emissions.”
Obama also ordered the EPA to regulate existing oil and gas operations in countries that are in violation of federal smog, or ozone, standards. It just so happens the EPA has already proposed smog standards that could put most of the U.S.A. out of compliance.
The EPA proposed stricter smog standard last fall that could end up being the costliest clean air regulation ever, according to the National Association of Manufacturers. EPA also added into their proposal room for a stricter smog standard than what they proposed. NAM says this lower smog standard could put most of the country out of compliance and cost the economy $270 billion a year.
“In 2012, President Obama dismissed and mocked the notion that we could drill our way to lower oil and gasoline prices. He was wrong,” Pyle said.
“Thanks to increases in oil production on private and state lands, Americans are feeling some relief from high energy prices,” Pyle added. “Today, this administration has issued yet another crushing regulation aimed at driving energy prices right back up again.”
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