As US president Joe Biden looks to fulfil his commitments to address the oil and gas industry’s climate pollution, cutting the sector’s methane industry must become a key pillar of his strategy.
Methane is a greenhouse gas 84 times more powerful than carbon dioxide, but remains in the atmosphere for 12 years versus 100 years for carbon dioxide, while the fracking boom has led to a spike in levels of the gas, according to studies by the European Geosciences Union and Nasa.
Removing methane will provide more time to deal with longer-lived climate pollutants such as carbon dioxide. In order to do so, President Biden’s early steps should include using the power available to him under existing US law to reduce methane emissions from oil and gas production by 65 per cent within the next five years.
With comprehensive climate legislation unlikely to pass a divided Senate, President Biden’s best and most reliable option is to use the full power of the Clean Air Act to require the oil and gas industry to cut emissions through a detailed plan drafted by the Clean Air Task Force.
Government intervention is necessary because, despite the economic downturn’s impact on oil and gas demand, recent research from the Environmental Integrity Project forecasts that US oil and gas greenhouse gas emissions will increase more than a third over the next five years. And that may be a lowball figure as it relies on Environmental Protection Agency data that is based on industry self-reports, and only for its largest facilities.
It is clear, however, that the oil and gas sector’s concerns over methane emissions have reached a breaking point. This autumn, France’s Engie backed out of a reported $7bn, 20-year contract to import US liquefied natural gas due to concerns about methane emissions associated with the product. In January, French oil group Total renounced its membership of the American Petroleum Institute, the lobbying arm of US oil and gas operators, over its climate policy. Immediately thereafter, API begrudgingly provided a qualified endorsement of methane safeguards.
The industry’s shift follows decades of climate denial and obfuscation. The industry eventually turned to voluntary commitments such as the Oil and Gas Climate Initiative, insisting they would suffice in place of the force of law. But under immense investor and public pressure, some of the oil majors, including BP, Shell, ExxonMobil, Total, and Equinor, have now publicly announced support for government regulation of methane pollution.
They are wise to do so. The UN’s Intergovernmental Panel on Climate Change informs us we only have nine years to halve carbon emissions, and the industry has proven incapable of addressing the issue itself. In December 2020, we at Earthworks compared the climate promises of eight leading oil and gas operators versus how they spend their money and found that all were still funding climate-denying trade groups that lobby for methane deregulation.
Despite the corporate announcements, change on the ground is still hard to find. Using gas imaging cameras, Earthworks has conducted thousands of inspections of oil and gas operations over the past five years, which showed that methane pollution is still common throughout the industry — from multinationals such as Royal Dutch Shell and ExxonMobil’s shale gas operations to regional producers such as Blue Chip Oil Co.
After four years of the Trump administration’s blatant disregard for science and extensive rollbacks to environmental safeguards, Biden pledged to “require aggressive methane pollution limits for new and existing oil and gas operations”, and he has ordered federal agencies to begin writing new rules for new and existing sources by September 2021.
But the devil is in the details. There are some people in Congress and the industry who hope that Biden’s Environmental Protection Agency will write less stringent rules that will only cut methane pollution by 20 per cent, despite the Clean Air Act allowing for much greater action to protect public health and welfare. It will undoubtedly face opposition, not least from industry resisting change and hoping to find a friendly judiciary.
To adequately address oil and gas methane emissions given congressional limits, the Biden administration must use existing law to its full extent and require a 65 per cent reduction by 2025.
Lauren Pagel is a policy director of Earthworks, a non-profit group dedicated to protecting communities and the environment from the adverse impacts of resource extraction
The Commodities Note is an online commentary on the industry from the Financial Times