EPA proposes crackdown on methane emissions

Source: Jean Chemnick, E&E reporter • Posted: Wednesday, August 19, 2015

U.S. EPA today proposed methane rules for new and modified oil and natural gas operations, setting in motion a regulatory apparatus that eventually could cover leakage from the entire sector.

Addressing four of the five segments that EPA considered regulating, the draft rule would require the oil and gas industry to find and repair leaks, capture natural gas from the completion of hydraulically fractured oil wells, limit emissions from new and modified pneumatic pumps on well pads, and limit emissions from several types of equipment used at natural gas transmission compressor stations.

It would not cover emissions from liquids unloading, though the agency will take comment on whether that segment should be added to a final rule.

EPA said the proposed standard for new and modified source methane will help avoid between 340,000 and 400,000 short tons of methane emissions in 2025. It is written under Section 111 (b) of the Clean Air Act, the same section that EPA used to control power plant carbon dioxide pollution. And like the new source carbon rule, the law stipulates that EPA must next consider whether to use Section 111 (d) to rein in existing sources in the same category.

The draft rule is combined with rules for volatile organic compounds that EPA air chief Janet McCabe said would complement its reductions.

“Together, these actions set a course for responsible development of this valuable and abundant domestic resource,” she said on a call with reporters. “They will help reduce waste of valuable resources, deliver more product for sale, and they will better protect our climate and our health.”

The methane draft was combined with a proposal that would apply a 2012 rule requiring gas wellheads to use green completion technology on oil-producing wellheads. Another proposal would tighten restrictions for wellheads in ozone nonattainment areas — a restriction that could apply to more operations this fall when EPA releases a long-awaited revision to its ozone rule. Both would capture methane as a co-benefit while limiting volatile organic compounds. A fourth proposal would limit emissions from operations on American Indian lands.

The Bureau of Land Management also is putting the finishing touches on a new rule for venting and flaring on federal lands that will come out in September, and EPA rolled out a new voluntary program for petroleum sources last month.

On a call with reporters yesterday, Mark Brownstein, an associate vice president at the Environmental Defense Fund, said environmentalists were eager to see what the proposal would contribute toward the president’s stated goal for petroleum-sector methane emissions reduction. But he said rules for future operations alone wouldn’t be enough.

“It’s very clear that we’re going to need regulation for existing sources in order to achieve the 40 to 45 percent reduction, so the question will be how far down the road will this particular proposal take us to addressing existing sources and what else could we expect to see from the administration over the coming year to get us there,” he said.

EPA Administrator Gina McCarthy said earlier this year that EPA planned to start with a rule for new and modified petroleum-sector methane sources because that was where the growth in emissions was coming from. She noted that the industry had expressed enthusiasm for voluntary efforts to curb emissions from existing wells and said it would be up to the industry to show progress.

“Hopefully by the time people begin to look at what are the next steps we have to take here beyond what we’ve already announced, that those steps will already have been taken,” she said at the time (Greenwire, Jan. 16).

McCabe said the draft requirements for methane and VOCs would indeed fall short of the 40-45 percent goal, weighing in at roughly a 30 percent reduction compared with 2005 levels. But she noted that other agencies are also taking steps to rein in emissions and that EPA would continue to solicit input to “identify appropriate steps to take” to reduce leakage. The rules will be open for public comment for 60 days after they are published in the Federal Register in the coming weeks.

The oil and gas industry, meanwhile, has said that no additional federal regulation is needed to persuade the sector to reduce emissions. Leaks that are cost-effective to plug are being plugged, petroleum advocates say, because doing so allows gas producers to capture and sell more of their product. And each of these new restrictions from EPA and BLM applies a new “burden” to domestic producers, they contend.

“All of this is in the backdrop of when methane emissions have been dropping according to EPA inventories, and as a result of natural gas use, CO2 emissions from power plants have reached a 27-year low,” Howard Feldman, regulatory chief at the American Petroleum Institute, said on a call yesterday.

Feldman noted that McCarthy has not indicated whether EPA has plans to regulate existing wellheads. And environmentalists also say the agency has scant time to complete such a rulemaking before President Obama leaves office at the beginning of 2017.

Methane reduction is a component of Obama’s broader pledge to limit U.S. greenhouse gas emissions between 26 and 28 percent by 2025 — the core of the U.S. negotiating position ahead of climate negotiations in Paris at the end of this year. And the oil and gas sector is the largest industrial source of methane in the United States, contributing what EPA estimates to be 7 million metric tons of the powerful greenhouse gas pollutant each year (E&ENews PM, April 15). Empirical studies backed by EDF and others put that estimate significantly higher.