Everyone agrees that burning off as much as a third of the natural gas produced in North Dakota is a terrible waste of an important natural resource. The flaring problem arises out of the fact that energy companies are primarily drilling for oil in North Dakota. A lot of natural gas comes out of those very same wells, though; and since the infrastructure isn’t in place to take that gas to market, companies end up flaring gas as a “waste” byproduct of oil production.
This isn’t a problem that can be fixed overnight. Building the gathering systems, processing capacity and transmission pipelines to get this gas to market requires major planning and investment. But we also have to recognize that in a capital-constrained world, the incentive is for companies to put their next dollar toward the next oil well – not toward lower-return (but still lucrative) investments in gas infrastructure. If a company’s bottom line was all that mattered, that might be fine. But we have other issues at play here.
Flaring natural gas undermines national energy security, has negative impacts on the region’s air quality, results in unnecessary greenhouse gas emissions and represents millions of dollars of lost revenue for the state, local governments, schools and mineral estate owners. In fact, in 2012 alone, flaring resulted in the waste of around $1 billion in fuel – or enough gas to heat more than a million homes.
