Oil and gas trade groups call for methane emissions, hydrogen regulation following National Petroleum Council report

April 23, 2024

(WO) – The Independent Petroleum Association of America (IPAA) and the American Petroleum Institute (API) released statements on the new National Petroleum Council (NPC) report on reducing greenhouse gas emissions from the natural gas supply chain being presented to Department of Energy Secretary Granholm.

IPAA CEO Jeff Eshelman

IPAA CEO Jeff Eshelman said, "IPAA values that the Council sought insight from smaller oil and natural gas producers as NPC built the study, and IPAA looks forward to sharing the report’s finding and recommendations with its members and partner state and regional oil and natural gas associations.

“IPAA appreciates that the NPC report makes a number of useful recommendations regarding actions that could assist smaller oil and natural gas producers. However, one issue that the report does not address is the need for a regulatory structure designed specifically for small oil and natural gas wells.

“IPAA's members are making constant improvements to the technology being used to reduce, measure and report on emissions. The industry recognizes the need for environmentally sound, cost-effective regulations to manage industry emissions and it continues to seek a regulatory pathway designed for the sources being regulated.

“Big new oil and natural gas wells and low producing older wells have differing emissions profiles. IPAA has met with and will continue to meet with the Biden Administration to encourage practical initiatives to reduce methane emissions.”

API President and CEO Mike Sommers

API President and CEO Mike Sommers said, “Today’s reports reinforce the critical role of America’s energy workforce in powering our economy, supporting U.S. security and driving innovation needed to reduce GHG emissions – both now and in the future. The U.S. oil and natural gas industry is leading the world in accelerating methane detection, reduction and reporting technology and is poised to unleash low-carbon hydrogen energy at scale.

“To fully leverage America’s energy advantage and advance climate progress, continued collaboration between energy producers and policymakers will be essential. These studies lay important groundwork for harmonized federal methane regulations and for a clear and consistent permitting process for energy infrastructure, and we look forward to working with both federal and industry stakeholders and communities across the country to advance these recommendations.”

According to API, methane emissions from U.S. oil and natural gas operations have fallen 37% since 2015 while energy production increased 39% in the largest U.S. basins.

Industry-led initiatives like The Environmental Partnership, whose members make up nearly 70% of U.S. onshore oil and natural gas production, are helping to accelerate progress on methane emissions reductions by driving collaboration and sharing best practices across the industry, API said in a statement.

API also supports cost-effective policies and direct regulation of methane for new and existing sources and is committed to working with EPA to ensure a regulatory frameworks that helps advance the progress made to date.

According to API, the U.S. oil and natural gas industry is also a leader in hydrogen - as producers, consumers and transporters of hydrogen. America’s oil and natural gas sector is expected to play a significant role across the low-carbon hydrogen value chain, supporting the administration’s stated goal of producing 10 million metric tons (MMT) of hydrogen by 2030 and 50 MMT by 2050.

“With the right policies, the U.S. hydrogen economy is projected to generate 700,000 jobs and an economic benefit of $140 billion by 2030, according to estimates, while driving down CO₂ emissions in hard-to-electrify sectors such as heavy industry, aviation, steel and cement,” API said in a statement.

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