Though Downwardly Revised, EPA Oil and Gas Methane Emissions Still Likely Inflated

After dramatically upwardly revising methane emissions by 27 percent in the final version of its 2016 Greenhouse Gas Inventory (GHGI), EPA significantly walked back those revisions in the final version of its 2017 GHGI, released late last week.

As the following comparison charts show, natural gas and petroleum system methane emissions are approximately 16 percent lower across the board from what EPA reported in last year’s GHGI. In fact, petroleum system emissions were dramatically revised downward by 37 percent, while natural gas emissions were scaled down seven percent.

Overall — and most importantly — the latest GHGI further confirms that methane emissions from oil and gas development have fallen at the same time the shale revolution has sent production through the roof. Remarkably, EPA data show combined natural gas and petroleum system methane emissions have fallen 19 percent since 1990 at the same time natural gas production has risen 52 percent and oil production has increased 28 percent.

But as encouraging as those figures are, an EID review of the latest GHGI reveals EPA’s downward revisions have little to do with correcting the two most prominent flaws from the 2016 inventory — extrapolation of emissions data from larger facilities onto smaller facilities and inclusion of gathering and boosting emissions in the natural production segment. In other words, even with these decreases, EPA is likely still overestimating natural gas production emissions due to faulty methodology.

EPA still extrapolating GHGRP emissions data onto smaller facilities

For the second time, EPA incorporated new equation inputs collected from Subpart W of its Greenhouse Gas Reporting Program (GHGRP) into its GHGI estimates. The problem? Roughly 70 percent of smaller producing wells nationwide do not report to the GHGRP. So to fill that data gap, EPA again assumes these smaller wells have similar equipment counts and leakage rates as large facilities that are required to report emissions to the GHGRP. The EPA’s GHGI production memo states,

“[F]or the 2017 GHGI, EPA used the latest subpart W data on equipment counts for other production sources that previously used subpart W data, such as pneumatic controllers and pumps, using the same approach as the 2016 GHGI.”

As the following comparisons of methane emissions reported in the last three GHGIs illustrates, this partly explains why natural gas production segment methane emissions have more than doubled from what EPA reported in 2015. For example, in 2015 EPA reported that 2013 natural gas production segment methane emissions were 47 million metric tons CO eq. (mmt). Those 2013 emissions were upwardly revised to 110.7 mmt last year and 106.3 mmt in its latest GHGI.

Roughly a quarter of the upwardly revised emissions in the 2016 GHGI were attributable to inflated pneumatic controller counts that can be traced to extrapolation of GHGRP data onto smaller facilities. And that is the case again this year, as EPA estimates 27.6 mmt CO2 eq. of methane emissions from natural gas system pneumatic controllers.

To EPA’s credit, it at least acknowledges its GHGRP extrapolation methodology is in dispute, but ultimately concludes that continued use of its flawed methodology is the only option for addressing the data gap,

“One stakeholder suggested that the approach of applying GHGRP average equipment counts to all wells in the United States may not appropriately characterize the production population that does not report to EPA’s GHGRP, which may have higher or lower equipment counts per well. Data are currently unavailable to assess any differences between these populations.”

Gathering and boosting emissions again included in production segment

Another contributing factor to natural gas production segment emissions more than doubling from previous inventories is EPA’s new policy of including gathering and boosting station emissions in this segment.

EPA did this for the first time last year, and making matters worse, the 47 million metric tons of estimated emissions from gathering and boosting —nearly half of total production segment emissions reported! — were based on a pair of studies rather than real-world data.

Fortunately, gathering and boosting emissions were based off more accurate GHGRP data this year. But unfortunately, EPA reports that gathering and boosting emissions were 48.8 mmt CO eq. — representing nearly half of the total “production” segment emissions once again.

Clearly, these emissions are inappropriately categorized at best and inflated at worst.

Petroleum system emissions plummet

The most significant contributor to the downward revisions of methane emission in the latest GHGI can be traced to the petroleum systems segment, which account for more than 25 of the 38.7 mmt CO2 eq. 2014 methane reductions reported when compared to the final 2016 GHGI. The EPA’s 37 percent petroleum system downward revisions are detailed in the chart below.

As EPA explains and the above charts show, the revision of petroleum system methane emissions was “primarily due to recalculations for pneumatic controllers,”

“Since 1990, CH4 emissions from production field operations have decreased 29 percent, due to a large decrease in associated gas venting. Production segment methane emissions have decreased by around 8 percent from 2014 levels, primarily due to decreases in emissions from associated gas venting and flaring…”

“The changes to pneumatic controller and chemical injection pump equipment counts result from the changes in oil well counts described above and from the improved estimate of the counts of oil wells in GHGRP, which improved the activity factors of counts of controllers and pumps per oil well.”

The revisions are so significant that the 2017 GHGI now shows petroleum system methane emissions have dropped 13 percent since 2005 at the same time oil production has increased 81 percent. This comes just a year after EPA reported in its 2016 GHG inventory that petroleum system methane emissions had seen a 29 percent increase since 2005.

Conclusion

Though EPA’s data remains flawed, it still shows that methane emissions — and greenhouse gas emissions as a whole — continue to fall as natural gas and oil production continues to increase.

And in addition to plummeting petroleum system emission rates, EPA data also shows that methane leakage rates from natural gas systems are 1.5 percent of production, well below the threshold (3.2 percent) for natural gas to maintain its climate benefits. Several reputable studies show the same.

The above-listed studies and the latest EPA data are just a few of the many examples of why unnecessary, burdensome and duplicative methane regulations on the oil and gas industry are a solution in search of a problem.

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