Energy Exchange

It’s time for the Texas Railroad Commission to curb flaring to prevent waste, protect property rights

This piece originally appeared in the Houston Chronicle

The Texas Railroad Commission has a unique chance to save the state’s oil and gas industry from one of its own worst habits — setting fire to over 100 billion cubic feet of natural gas each year, transforming a valuable asset into waste and pollution with zero benefit to anyone. Now, as commissioners eye production cuts in response to collapsing oil prices, they also have an opportunity to stem the profligate practice known as flaring.

The measure under consideration is called proration. Last used in the 1970s, it allows the commission to set a monthly production ceiling equal to market demand, with shares allocated among the state’s producers based on a variety of factors. Often described as a way to raise prices by limiting supply, authority for proration actually comes from the commission’s statutory obligation to prevent the waste of natural resources and protect property rights.

Flaring, of course, is the very definition of waste. Since 2013, operators in Texas have burned off roughly a trillion cubic feet of natural gas — enough to meet the yearly needs of every Texas home three times over. In 2019, Permian operators alone flared almost 300 billion cubic feet of gas, sending over a million dollars a day up in smoke.

Read More »

Also posted in Air Quality, Methane regulatons, Natural Gas, Texas / Comments are closed

New data finds alarming levels of methane emissions in the Permian, posing long-term risk for oil and gas portfolios

Investors managing oil and gas portfolios are contending with major disruption as two interrelated crises play out: the global COVID-19 pandemic and extreme volatility in the price of oil. Yet even before these events, cracks were showing in the sector’s financial footing. Pressure has been rising on industry to improve returns, while demand to deliver on Environmental Societal Governance initiatives has never been higher.

Into this mix comes new data from scientists working with EDF’s PermianMAP initiative showing that methane emissions in the Permian Basin, the world’s largest oil field, is nearly three times the rate reported in Environmental Protection Agency’s nationwide statistics.

The 3.5% loss rate estimated in the data area is roughly 15 times higher than reduction targets set by leading producers, and significantly higher than many companies have reported. It translates to 1.4 million tons of wasted gas each year, enough to meet the annual natural gas needs of every home in Dallas and Houston combined.

The findings surface a material risk to oil and gas investors and to the future of natural gas from the Permian Basin. At current emissions rates from the basin, burning Permian natural gas for electricity does more near-term climate damage than coal.

A year from now, the U.S. oil and gas sector may look very different for many of the independent operators who make up a large portion of Permian producers. Withstanding this period of economic turbulence will require companies to make tough decisions. Yet even in this time of crisis, operators must keep an eye on future market demands, operational excellence and climate performance.

Permian study findings

The Permian sprawls across West Texas and New Mexico and has more than 100,000 operating well sites. Between October 2019 and March 2020, EDF scientists collaborated with academic institutions to collect data using tower-based monitors, ground-based mobile sensors, helicopters and fixed wing aircraft across a 10,000-square-kilometer study area responsible for 40% of Permian production.

The estimated 3.5% leak rate reflected in the new data stands in stark contrast to the .20% leakage rate agreed to by the 13 of the world’s largest operators in the Oil and Gas Climate Initiative, representing 30% of global oil and gas production. Furthermore, the emissions rate seen in the Permian is more than 10 times the methane intensity of 0.29% that OGCI has been reporting for 2018.

Read More »

Also posted in Air Quality, Methane regulatons, New Mexico, PermianMAP, Texas / Comments are closed

Now more than ever, it’s time for strong EU standards on methane emissions

As European Union leaders begin the transition from COVID-19 rescue to economic recovery, the need to build back better is taking center stage. Already, national governments representing over 65% of the EU’s population have insisted that leaders stick with the European Green Deal. Their resolve underscores the importance of leadership, resilience and science-based decision making in the face of the gravest health emergency of our time.

These national governments know that the EGD will help usher in a thriving, sustainable European economy that creates good jobs for working people. And they understand the tragic lesson of the COVID-19 crisis: that all nations must heed scientific warnings about public health and security. The scientific community’s clarion call on climate change, and the role of methane pollution in driving near-term warning, should be at the top of the agenda.

For the oil and gas industry, this means that a key component of the post-COVID recovery is the establishment of stringent standards to certify very low methane emissions for all gas used in the EU. Without such standards, the case for “cleaner-burning” natural gas evaporates; over the first 20 years, methane is 80 times more potent than CO2 in driving planetary warming. That’s why the European Commission’s forthcoming methane proposal presents a window that energy companies must take — and an ESG opportunity that investors cannot afford to ignore.

Read More »

Also posted in Air Quality, Climate, Europe, Methane regulatons, Natural Gas / Comments are closed

Groundbreaking data is a wake-up call in the Permian, call to action for New Mexico

Last year, EDF announced a first-of-its-kind project to measure and map emissions from the Permian Basin — the nation’s most productive oilfield and the primary source of New Mexico’s methane problem.

Although the Permian Basin has led the world in oil and gas production, public data on its emissions has been near nonexistent. PermianMAP is changing that, and we’ve launched the project’s first tranche of data to help regulators, companies and the public understand and address the region’s methane challenge.

The scale of emissions PermianMAP uncovered is sobering, but this publicly available data will prove critical as New Mexico advances nation-leading rules under Gov. Lujan Grisham to cut methane pollution and achieve the state’s climate and clean air goals.

Read More »

Also posted in Climate, Natural Gas, New Mexico, PermianMAP / Comments are closed

Latest research leaves questions about some sources of atmospheric methane unsettled, but need to act remains

点击这里用中文阅读

A pair of new scientific papers published in the journals Nature and Science argue that levels of so-called fossil methane coming from naturally occurring sources — underground seeps, volcanoes, and so forth — are much lower than previous estimates, and that human-made emissions from the fossil energy industry account for a much larger share of the global methane budget.

The widely reported findings arrive in the midst of a robust debate among researchers in which a great deal is still unsettled. Whether these latest findings eventually prove correct remains to be seen. But the ongoing discourse leaves no doubt about the continued need to dramatically reduce the vast amounts of methane that we know are currently emitted by oil and gas production and distribution.

Read More »

Posted in Methane / Comments are closed

What’s increasing global methane levels? New research examines role of U.S. shale gas.

By Stefan Schwietzke and Steven Hamburg

A decade of extensive scientific research has demonstrated that methane emissions from the oil and gas supply chain have been substantially underestimated and has placed pressure on governments and industry to act. Because of methane’s potency and the feasibility and cost efficiency for reducing emissions of it, methane presents among the most powerful opportunities we have to slow the rate of planetary warming in our lifetimes.

Still, methane research continues — the more precisely we can identify global emission sources and quantify their volume, the more precise and effective mitigation efforts will be. And as this challenge is examined by different teams with different methods, we sometime have to address discrepancies among the results. Such is the case with two new papers that examine the proportion of rising atmospheric levels of methane associated with shale gas production in the United States. We know oil and gas methane emissions are higher than previously thought — and the scientific debate surrounding these papers is about where the global increases in emissions are coming from.

Read More »

Posted in Methane / Comments are closed