US oil industry pledges to cut emissions
Companies producing oil and gas in the US have signed up to a voluntary scheme that aims to cut emissions of the potent greenhouse gas methane, in the face of Trump administration efforts to weaken or cancel Obama-era rules with the same aim.
The American Petroleum Institute, the industry group, has organised an initiative called the Environmental Partnership that will work on cutting leaks from wells, pipelines and other sources from US onshore production. Last month, large international oil groups including ExxonMobil, BP and Royal Dutch Shell announced they had signed up to “guiding principles” for cutting emissions, in an alliance with multinational agencies and environmental groups. The API hopes to encourage smaller and medium-sized companies to adopt specific measures, particularly the shale industry, which has grown strongly over the past 15 years. However, it has not set goals for targeted or expected reduction.
Cutting leaks of methane into the atmosphere is central to the oil and gas industry’s argument that it can help reduce the risk of catastrophic climate change. Gas emits less carbon dioxide than coal when burnt to generate power, but methane, the principal constituent of natural gas, is also a potent greenhouse gas, and if leaks are not controlled they can wipe out any benefit from switching fuels. Erik Milito, the API’s director of upstream and industry operations, said the plan to cut methane leakage supported the group’s view that shale gas could be “part of the solution” for the risks of climate change. “We’ve had the technological advances of hydraulic fracturing and horizontal drilling that have allowed us to unlock vast quantities of clean-burning and affordable gas, which has enabled our power generators to cut their greenhouse gas emissions to a 25-year low,” he said.
Many environmental campaigners argue that the pollution caused by gas production, and the investment in long-lived gas infrastructure that will continue emissions even if at a lower rate than coal, mean the climate argument for increasing the use of gas is unconvincing. There are initially 26 companies that have signed up for the API-led initiative, including several signatories to last month’s “guiding principles”, including Exxon, BP and Shell. Chevron, which was the only large western oil group not to sign up to the guiding principles, will also take part, as will leading independent shale production companies such as EOG Resources and Pioneer Natural Resources.
The programme includes improved detection of leaks from pipelines, installing new controllers that limit releases, and cutting emissions from gas wells that are producing liquids. Together the companies currently in the partnership account for only about 25% of US natural gas production, but the objective is to sign up many more, including those that are not members of the API. Successive sets of regulations on methane emissions put forward by the Obama administration were criticised by the API, and the Trump administration has attempted in Congress and in the courts to roll them back. It has so far made little progress, but has also stopped work on additional planned regulations. Mr Milito said the API’s voluntary partnership was “a complement” to regulation, but that the group supported “cost-effective” rules, and saw a need for “technical fixes” to the existing system.
Source: Ed Crooks for the Financial Times
