Canadian Prime Minister Justin Trudeau came to Washington on March 10 to meet with U.S. President Barack Obama. The two leaders appear to have hit it off, and on the same day as the two leaders met, they announced coordinated initiatives to regulate methane emissions from oil and gas wells.
The Obama administration had previously announced a goal to cut methane emissions from oil and gas wells by 40 to 45 percent below 2012 levels within a decade. But the Obama administration said that the EPA will begin writing new regulations for existing oil and gas wells, not just limits for new wells.
Methane is more than 20 times more potent a greenhouse gas than carbon dioxide, so the two governments see limiting methane emissions as a crucial part of their climate change plans. Methane is emitted or leaked at different parts of the oil and gas supply chain - at the wellhead, from processors, pipelines, distribution lines and storage tanks. Related: $67 Oil Has All The Majors Converging Here
As with many other issues that are currently up in the air, energy-related and otherwise, the methane regulations largely depend on who controls the White House in 2017. The EPA hopes to have draft requirements out by April, but will not be able to finish the methane regulations before Obama leaves office. A Democrat would presumably carry on the methane regulations, while by all accounts, any Republican would scrap it. Canada will propose regulations on new and existing wells in early 2017.
The oil and gas industry opposes regulations on methane, citing the fact that methane emissions have declined from wells between 2005 and 2012 despite the rapid increase in production. But the EPA sees methane emissions rising 25 percent over the next decade without any regulatory limits.
By Charles Kennedy of Oilprice.com
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