WASHINGTON (Reuters) - The U.S. Environmental Protection Agency will propose regulations on Tuesday aimed at cutting methane emissions from the oil and gas sector by up to 45 percent over the next decade from 2012 levels, sources familiar with the issue said on Monday.
The regulations on methane are one part of the Obama administration’s strategy to curb greenhouse gases and combat climate change and come just two weeks after the president unveiled a sweeping rule to slash carbon emissions from the country’s power plants.
The proposal that will be unveiled on Tuesday aims to reduce oil and gas industry methane emissions by up to 45 percent from 2012 levels by 2025, a goal it first announced in January, one source said.
The rules are intended to put the United States on course to meet its pledge to the United Nations climate change talks to cut its greenhouse gas emissions 26-28 percent below 2005 levels by 2025.
EPA Administrator Gina McCarthy said in January that methane emissions are projected to rise by more than 25 percent by 2025 even though the industry has decreased methane emissions 16 percent since 1990.
The U.S. boom in natural gas and oil production has raised concerns about leaks and venting of methane throughout the production process – from wells to transmission. So far, programs aimed at preventing those leaks have been voluntary.
Methane is the main component of natural gas, but when it is released into the atmosphere, it becomes a potent greenhouse gas.
“The challenge is very large, but the opportunity to make a difference is equally large,” said Mark Brownstein, a vice president of climate and energy at the Environmental Defense Fund. He added, however, that 99 percent of industry has failed to participate in voluntary programs.
Industry groups have said that oil and gas companies have already made great strides in expanding production while keeping methane emissions in check. They say requiring companies to buy that extra equipment is costly, especially as oil prices drop, and particularly for smaller producers.
The American Petroleum Institute said last month that methane emissions from natural gas production was down 11 percent since 2005.
But advocates for stricter methane rules have said capturing methane is mutually beneficial for oil and gas companies, and would save them money in the long run.
Detecting those leaks and capturing the methane with technology that is currently on the market can save companies money and help them produce oil and gas more efficiently, they say.
Vendors of methane mitigation technologies and services such as infrared cameras and seals for compressors have already organized a Washington trade organization earlier this year in anticipation of the rule called the Center for Methane Solutions.
“These measures pay off in a few months, not a few years,” said Conrad Schneider of the Clean Air Task Force.
Companies can invest in more efficient compressors and seals, infrared cameras to detect leaking methane, which is invisible to the human eye, and pneumatic controllers to control valves throughout the oil and gas production system, which are all measures the EPA has been studying.
Details of the proposal are not known yet, but experts following the rulemaking process said a methane regulation that entered force in Colorado last year may offer clues as to what a federal rule could look like.
Three major oil and gas producers, Anadarko, Encana and Noble Energy, worked with Democratic Governor John Hinkenlooper’s staff and environmental groups led by the Environmental Defense Fund to craft the rule.
The rule requires companies to inspect for methane leaks in tanks, pipelines and wells once a month at large facilities and plug them using infrared cameras. The rule applies emissions limits on different equipment.
“Ours was the first rule to directly regulate methane,” said Will Allison, director of Colorado’s Air Pollution Control agency, adding that it is expected to cut 100,000 tons of methane per year.
He said while industry raised concerns about costs of buying detection and sealing equipment, the rule is not “one size fits all” and requires stricter standards from the largest sources of emissions.
“We think it can serve as a model for the federal government and states,” he said.
Reporting By Valerie Volcovici; Writing by Mohammad Zargham; Editing by Peter Cooney and Ken Wills