Oil and gas producers fear that existing facilities will be included in a controversial federal directive requiring all methane from new or modified sources to be contained and transported off site rather than flare burned.
As 10/12 Industry Report details in a feature from the new quarterly issue, The U.S. Environmental Protection Agency issued the directive in May. It falls under President Barack Obama’s climate action plan, which aims to cut methane emissions from the oil and natural gas industry by up to 45% by 2025.
Louisiana Oil and Gas Association President Don Briggs says the rule is a case of incredibly bad timing given the current economics of the oil and gas industry.
“I’m more concerned about it being pushed back than I am with it being pushed forward,” Briggs says. “It’s a lot easier for us going forward because we can plan for it. If it gets pushed back to include all facilities, then we’ll have to refabricate and re-do, which will be a significant investment.”
Richard Metcalf, director of environmental affairs with Louisiana Mid-Continent Oil and Gas Association, expects possible impacts to drilling in the Haynesville Shale in northwest Louisiana, where a significant pipeline infrastructure already exists to transport the methane offsite.
Meanwhile, Erik Milito, who handles regulatory and legislative policy for the American Petroleum Institute in Washington, D.C., says the process of developing a subsequent rule to cover existing facilities has already begun.
Briggs says the stringent regulations are unnecessary. “While we’ve significantly increased our natural gas production since 2005, at the same time we’ve voluntarily decreased emissions,” he says. “We’re already more efficient today, as technology has developed to help eliminate CO2 emissions.”
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