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First-of-its-kind case study on compliance with methane emissions released

Matthew Garrington

Colorado Case Study on Methane Emissions Finds Oil and Gas Industry Representatives Believe Colorado Regulation 7 is Effective

Washington, D.C. (April 15, 2016) – New research on oil and gas industry compliance with methane emissions regulations released today by the Center for Methane Emissions Solutions (CMES) reveals that oil and gas industry representatives in Colorado feel that Colorado’s Regulation 7 is effective and that its benefits outweigh its costs.

Under Regulation 7, Colorado has the most comprehensive regulations on methane emissions of any state in the country. The regulations require oil and gas producers to install equipment to minimize leakage and to control or capture 95 percent of emissions.  Energy producers are required to routinely inspect well sites for leaks – generally quarterly or as often as once a month, depending on how much oil or gas a well produces. When leaks are discovered, they must be fixed within 15 days.

The CMES research is timely because Colorado’s Regulation 7 may be considered as a model for new rules for all Western states currently being developed by the U.S. Bureau of Land Management (BLM). To help provide guidance on the potential applicability of Regulation 7 to these rules, CMES commissioned a series of in-depth interviews with oil and gas representatives to understand their views on the regulation and inform development of a case study.

“Until now, there was no publicly available research on the impact of methane emissions regulations on the oil and gas industry as explained by oil and gas industry leaders themselves,” declared CMES Executive Director Patrick Von Bargen. “We requested this case study because we wanted to understand what those most affected by the regulations say about their efficacy and impact.”

The Colorado Case Study on Methane Emissions was developed by Keating Research Inc. at the request of CMES. It is based on in-depth interviews with 10 representatives of oil and gas companies (including larger and smaller producers) and third-party service providers that are conducting site inspections to detect methane gas leaks at oil and gas operations in Colorado as required under Colorado’s Regulation 7. The interviews were conducted by telephone in December 2015 and January 2016.

Highlights of the research contained in the Case Study include:

  • Colorado oil and gas companies have conducted thousands of site inspections over the past year as required under Colorado’s Regulation 7.

  • Oil and gas company representatives in Colorado agree that Regulation 7 significantly reduces methane emissions in Colorado.

  • Oil and gas company representatives believe that in the long run they are not incurring significant cost impacts because of Colorado’s Regulation 7.

  • Oil and gas company representatives believe the benefits to finding and fixing the leaks under Colorado’s Regulation 7 outweigh the costs.

“Each year, America loses nearly $2 billion worth of methane - the primary component of natural gas - due to faulty equipment or inefficient practices such as venting and flaring at oil and gas well sites,” added Von Bargen. “Policies like Colorado’s Regulation 7 are designed to address that problem directly. The Colorado Case Study on Methane Emissions demonstrates that despite assumptions to the contrary, effective regulations such as Colorado Regulation 7 can be helpful in reducing harmful emissions without creating a burden for the industries affected by them.”

For a copy of the full case study, visit this link.

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The Center for Methane Emissions Solutions was founded to provide a voice for businesses that that offer innovative solutions to reduce methane emissions.  The Center represents the interests of American businesses that develop and manufacture cutting edge technologies, install commercial technologies, and aid inspectors on the job to significantly cut methane waste on a cost-effective basis across the oil and gas supply chain. For more information, visit the website at www.methanesolutions.org