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One of the biggest oil producers taking part in the most prolific U.S. shale play has decided to stop routine gas flaring in the Permian and plans to push for all other shale well operators to do the same.
In an interview with Reuters, Exxon officials said they would insist on tougher flaring regulations in a bid to achieve a phase-out of the practice.
“It levels the playing field,” the chief environmental scientist of the supermajor, Matt Kolesar, told Reuters. “We need strong regulations so it doesn’t matter who owns the facility.”
Flaring has come into the spotlight of environmental concerns in the past few years as it is associated with the release of significant amounts of methane, which is a more potent but shorter-lived greenhouse compound than carbon dioxide.
What’s more, reducing flaring increases the amount of natural gas an operator produces, and in today’s gas market, this is not a benefit to be overlooked.
According to Exxon, an end to flaring is a worthy goal to pursue—worthier than making oil companies pay for the emissions generated through the use of their products—the so-called Scope 3 emissions. Reducing methane emissions is by far the most cost-effective means of reducing overall emissions in the industry, Kolesar told Reuters.
To do this, the supermajor plans to deploy satellites to track emissions in the Permian. It has also made a minor investment in directing associate gas from oil production operations in the Permian to a pipeline, which is the optimal way of dealing with methane emissions.
Exxon plans to spend some $17 billion on reducing its emissions by 2027. The money will be used for ending flaring and carbon capture and storage, among other things. Environmentalists are not happy with this sort of plan because they do not envisage a reduction in oil and gas production.
By Charles Kennedy for Oilprice.com
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Charles is a writer for Oilprice.com