WASHINGTON, Aug. 18 (UPI) — The Environmental Protection Agency on Tuesday proposed new regulations to reduce methane emissions from the oil and gas sector by up to 45 percent by 2025, reflecting President Obama‘s push toward making environmental issues a priority during his last two years in office.
The agency’s proposal under Obama’s Climate Action Plan would reduce emissions of greenhouse gases — including methane — and volatile organic compounds by 40 percent to 45 percent compared to 2012 levels in the next decade.
“Today, through our cost-effective proposed standards, we are underscoring our commitment to reducing the pollution fueling climate change and protecting public health while supporting responsible energy development, transparency and accountability,” said EPA Administrator Gina McCarthy. “Cleaner-burning energy sources like natural gas are key compliance options for our Clean Power Plan and we are committed to ensuring safe and responsible production that supports a robust clean energy economy.”
The EPA said the estimated cost benefits of reducing 340,000 to 400,000 short tons of methane would be $120 million to $150 million by 2025. The make this reduction, the agency proposes oil and gas companies find and repair leaks; capture natural gas from the completion of hydraulically fractured oil wells; limit emissions from new and modified pneumatic pumps; and limit emissions from several types of equipment at natural gas transmission compressor stations.
Fadel Gheit, senior energy analyst at Oppenheimer, told CNBC that while the proposed regulations wouldn’t have a significant financial impact on most oil and gas companies, the timing isn’t great.
“For an industry desperate for an additional dime to move margin higher, everything, even the very little, will count at the end of the day,” he said. “[Energy companies are] being kicked while they’re down, but eventually they will comply. There are no ifs or buts about it.”