Analysis: Cutting oil and gas methane is one of Canada’s most affordable climate solutions

By Ari Pottens and Maureen Lackner

New research confirms that cutting methane emissions from the oil and gas sector is one of the fastest and most affordable steps Canada can take to help address the climate crisis. According to the report by Dunsky Energy + Climate Advisors, Canada’s upstream oil and gas companies can eliminate 75% of their methane emissions at an average cost of about $11 per tonne. 

Marginal Cost & Potential of Methane Abatement Measures at Gas Sites

This is one of the biggest bargains that exists when it comes to climate solutions. For example, were oil and gas companies subject to Canada’s entire carbon price, they would need to pay $65 per tonne of carbon pollution they create. By 2030, this figure will rise to $170 per tonne. Meanwhile, technologies that can directly capture carbon dioxide from the atmosphere are estimated to cost between $125 and $335 USD per tonne, an astronomical figure compared to methane abatement. 

Why methane now? 

Methane is an extremely potent greenhouse gas that’s responsible for over a quarter of current global warming. It is intensifying wildfires, melting Arctic summer sea ice, creating more intense storms and deteriorating air quality.  

Back in 2021, Canada joined over a hundred other countries which pledged to help reduce global methane emissions 30% by 2030. The government then went even further, pledging to reduce 75% of methane emissions from the oil and gas sector over that same period. This assessment confirms that not only is that goal achievable, but it’s also extremely affordable.  

That’s because methane essentially is natural gas. When it leaks out of pipes, tanks and other equipment, it not only generates climate pollution, it also leads to a lot of energy waste. The oil and gas sector is the largest source of methane pollution in Canada, and according to the report, the methane gas that could be saved, rather than emitted, is enough to meet the annual gas needs of more than 750,000 Canadian homes – roughly equal to all the households in Montreal. 

This new assessment looked at the 33 of the most common methane solutions currently in practice, many of them based on some of the abatement measures provided in Canada’s methane framework released last fall. It confirms that the vast majority of these steps — like practicing regular leak detection and repair and replacing high-emitting devices with cleaner technology — can immediately reduce pollution, the cost of which makes up just 0.23% of industry’s total estimated gross revenue. 

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Download: A blueprint for reducing methane in Canada. 

While this new analysis offers encouragement for the future, we need stronger federal regulations to ensure these reductions actually happen. Nearly every time researchers measure methane from the oil and gas industry, we consistently find that methane emissions are significantly higher than what gets reported to the federal government. Stronger standards and better enforcement will be essential to achieving the real reductions that matter for the climate. If Canada wants to be a global leader on climate, mandating these affordable solutions as quickly as possible is essential. 

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