Environmental Partnership Leadership and Modified Methane Rule

Mark Green
Posted August 4, 2020

Let’s follow up on the recent news coming out of The Environmental Partnership – that the group is opening membership to industry’s midstream sector and that participants are discussing the best ways to reduce routine flaring.

Both are big-time developments; both show that the Partnership is doing what it set out to do when it was born in December 2017. Both will help protect the environment and reduce greenhouse gas emissions – even as our industry produces the energy Americans count on every day.

Adding midstream companies (including pipelines and storage infrastructure) comes as the Partnership reports more than tripling its membership, including 36 of the top 40 U.S. natural gas producers. It’s more than numbers. Each new member company means a new commitment to improve environmental performance in the field. Growth means the Partnership’s program to reduce methane emissions is extending further across the country. And now, here comes the midstream. API President and CEO Mike Sommers:

Expanding participation in The Partnership is key to building on more than two productive years of achievement, teamwork, and continued progress. … As the Partnership grows, our industry stands ready to solve problems and continue to provide the world with affordable, reliable, and ever-cleaner energy. We take seriously our role in strengthening the economy while working to reduce our environmental footprint.

The flaring conversation is timely. Everyone is for reducing the need for routine flaring, and discussion within the Partnership is focused on high-tech, real-world applications and practical solutions. It also reflects the Partnership’s long-stated intent to confront issues beyond those it started with. Bottom line: The Partnership participants aren’t standing still. Morgan Iannuzzi, Permian Air Team lead for Chevron:

I’m proud to see how The Partnership is addressing the concerns of communities and operators in the Permian basin and across the country. The Partnership helps our air team learn and improve by exchanging best practices with other operators. Emissions reduction is bigger than any single company or basin. The Partnership creates the opportunity for industry-wide progress across the U.S. and beyond.

You can read about the Partnership’s accomplishments in its second annual report, here. In less than three years the initiative has enhanced ongoing efforts to optimize environmental performance out in the field. The Partnership is a key catalyst for progress on issues that are important to our workers, the communities where we operate and society as a whole.

When individual companies step up with new technologies and best practices, which they share under the Partnership’s umbrella, we think it’s a faster, more cost-effective and all-around superior approach than adding new layers of regulation and red tape from Washington.

Our industry is highly motivated to capture as much methane as possible, to bring natural gas to consumers – a fundamental principle around which the Partnership is galvanizing broad-based solutions. From their joint statement in the Partnership’s annual report – Chevron’s Vanessa Ryan, chair, and Director Matt Todd:

The challenges we face as an industry and a nation strengthen the need to work together to get the best solutions in the field as quickly as possible. Our members’ combined ingenuity, creativity, and know-how gives us great confidence in the industry’s ability to continually improve our environmental performance.

The Partnership is building on a strong record of environmental progress. The U.S. leads the world in natural gas and oil production. At the same time, across some of the largest producing regions in the U.S. methane emissions rates were down nearly 70% (data here and here) from 2011-2018 – even as combined production in those regions tripled.

At the same time, the increased use of natural gas developed from these and other basins is the main reason the U.S. has reduced carbon dioxide emissions more than any other nation since 2000, according to the International Energy Agency.

This is what has happened, this is industry’s approach, as EPA nears a finalized modification to Obama-era methane regulations. The proposed changes will help EPA meet its statutory obligations under the Clean Air Act, and it will better align federal and state methane requirements. The proposal would permit operators to meet certain state requirements as an alternative to EPA requirements where it makes sense – for example, in a state like Texas where strong standards are in place.

As EPA has proposed, operators still will have to control methane emissions – which, again, they’re already motivated to do, and the industry – including the midstream segment – isn’t waiting to demonstrate its commitment to improve and build on the progress it has already achieved.

The point is for our industry to operate under smart, clear regulation under which emissions are reduced and vital energy production occurs. Lem Smith, API vice president for upstream policy and industry operations:

“EPA’s modifications of the rule, as proposed, allow the agency to adhere to its obligations under the Clean Air Act and achieve the shared goal of continued emissions reductions. The natural gas and oil industry is committed to reducing emissions from operations and has done so successfully while dramatically increasing production.”