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Irina Slav

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BP And Shell Take A Stand Against Gas Flaring In Texas

BP and Shell have urged Texas energy regulators to put a stop to routine gas flaring across the state’s oil fields, Bloomberg reported, citing a joint letter by the supermajors.

“We believe there is a real opportunity for the state to set the bar for others to follow,” the two Big Oil majors wrote. “We encourage the Railroad Commission of Texas to support an ambition of zero routine flaring in Texas.”

The move comes on the heels of another call to end flaring, made by investors managing more than $2 trillion in assets, on the Texas Railroad Commission earlier this week. The group urged the regulators to end flaring for good by 2025.

“Actions of leading operators demonstrate the financial and technical viability of ending routine flaring,” the investor group, including Alliance Bernstein and Legal & General Investment Management, said. “It is clear, however, that voluntary actions alone have been insufficient to eliminate routine flaring industry-wide.”

Flaring, the practice of burning excess natural gas is rampant across the world, especially in large oil producers such as Russia and Iraq. Yet flaring is also common in U.S. fields. Last year, flaring hit a record in the Permian, not least because of a shortage of pipeline capacity that could have accommodated the natural gas released during oil production.

The problem is global: the oil and gas industry flares some 150 billion cubic meters of natural gas every year. Last year, this rose to 250 billion cu m. What’s more, sometimes flares malfunction, releasing unburned methane—a much more potent greenhouse gas than carbon dioxide—into the atmosphere.

In the U.S. shale patch, flaring fell significantly when oil production dropped amid the oil price crash this year. Yet the moment production picks up, so does flaring. The Texas Railroad Commission, which has been generous with flaring permits, recently approved changes to the regulatory framework around the practice that aims to reduce the amount of gas burned at oil fields. Based on the two letters from investors and Shell and BP, however, it needs to do more.

By Irina Slav for Oilprice.com

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  • Mamdouh Salameh on September 11 2020 said:
    Oil supermajors could start the ball rolling by reducing routine gas flaring themselves as well as reducing the emission footprint in the products they produce and sell.

    It is shame that that the global oil and gas industry flared 250 billion cubic metre (bcm) of gas last year. This is 4% bigger than Iran’s gas production in 2018 and more than double Norway’s not to mention the pollution particularly the release of unburned methane—a much more potent greenhouse gas than carbon dioxide—into the atmosphere.

    Rather than talking about an illusion like zero emission by 2050, oil supermajors could immediately start by cutting drastically the amount of gas they flare in production.

    Dr Mamdouh G Salameh
    International Oil Economist
    Visiting Professor of Energy Economics at ESCP Europe Business School, London
  • Paul Rath on September 11 2020 said:
    Makes sense for them to do this. Flaring in Texas comes from frackers, and these people are BP/Shell’s competitors. Anything that hurts smaller, independent drillers is a benefit to BP/Shell. It also is a costless way to burnish their green bona fides.
  • One Second on September 12 2020 said:
    It is unfathomable that the current administration relaxed flaring regulation. Even the oil majors can see that this is not longer viable.

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