It’s odorless, colorless and invisible to the naked eye, but the methane leaking from the nation’s oil and gas industry is a problem costing the energy industry over $1 billion every year in lost product.
Methane is the main ingredient of natural gas, so when it quietly escapes from equipment at wells, refineries and pipelines, it represents significant waste of a national energy resource. The 7 million metric tons of gas lost each year are enough to heat more than 5 million homes, and are 84 times as potent as carbon dioxide in the first twenty years after they are released. The keys to detecting and repairing these emissions are simple and cost-effective—begging the question, why aren’t more oil and gas companies doing it?
In Sublette County, Wyoming, oil and gas operator Jonah Energy discovered that methane and other pollutants were escaping into the air from its facilities, reducing operational efficiency and contributing to a local smog problem that had state and local officials deeply concerned. Jonah Energy began implementing proven technologies such as infrared cameras to monitor leaks across its sprawling operations about five years ago—and the results have been astounding.
Since implementing this cost-effective technology, Jonah Energy has reduced fugitive emissions by 75 percent and reduced repair time by 85 percent, ultimately saving more than $5 million in what otherwise would have been wasted product.
The story of Jonah Energy is promising and there are others like it, but sadly methane management is not the industry norm. Most companies are too busy drilling or building new pipelines to institute the methane controls needed to drive down emissions.
The good news is that when regulators step up and require companies to do inspections and repairs, the economy benefits. After Colorado implemented a statewide emissions reduction policy, oil field employment increased by 16 percent. Weld County, the center of Colorado’s oil boom, enjoyed the nation’s highest rate of job growth last year.
Around the same time, Wyoming started requiring producers to find and fix leaky equipment. Shortly afterward the industry added over 750 new oil field jobs—proving that environmental regulations and industry prosperity go hand in hand.
And it’s not just our economy that stands to benefit. Recent EPA data showed that air quality readings in what was once the most polluted region of Wyoming improved after drilling rules went into effect. The region is now on a clear path toward meeting national ozone standards.
The regulations worked because they were based on sensible technologies that are proven to be effective in reducing emissions. ICF International, an energy consulting firm, confirmed that emissions reduction technologies, such as low-emitting valves, and control practices, such as infrared cameras, are both readily available and cost-effective. Using them costs the whole industry mere pennies, on average, compared to the market value cost of a unit of gas, and can help companies prevent millions in waste while cutting harmful methane emissions by at least 40 percent.
We don’t have to sacrifice environmental integrity to enjoy economic prosperity. Clean air and a healthy economy can and should co-exist. And a clear, economically advantageous solution is to limit the amount of methane leaking from hundreds of thousands of oil and gas facilities around the country. We know it is possible, and it brings better environmental outcomes and can boost economic growth. What we don’t know is why it’s taking so long to implement commonsense standards that ensure all oil and gas companies are doing the right thing.