New Oil and Gas Industry Regulations in the Pipeline

Overshadowed by the national debt debate, the U.S. Environmental Protection Agency (EPA) has announced proposed regulations on the oil and gas industry, targeting air pollution emitted during the production of natural gas and oil. 

The rules are intended to reduce emissions of air pollutants in order to improve outdoor air quality, reduce the risk of cancer to humans from air toxic emissions and health effects from ozone exposure. 

The agency also championed the “climate co-benefit” accompanying the changes: a reduction in methane emissions valued at $1.6 billion in annual savings by 2015 from avoided damage to crops, coastal properties, and health impacts. 

In a public statement, the EPA stressed the economic viability of such measures, asserting that the new rules rely upon proven technologies, rather than developing ones, that will reduce emissions of smog-forming volatile organic compounds (VOCs). 

The “suite of highly cost-effective regulations [will] reduce harmful air pollution from the oil and natural gas industry while allowing continued, responsible growth in U.S. oil and natural gas production.” 

The announcement was laden with fiscal reassurances, presumably to attract bipartisan support during economically turbulent times.  With the nation’s debt and future credit standing up in the air, further restrictions on domestic industry are expected to ignite more controversy between already polarized political camps. 

The EPA, however, stressed that the technologies employed to reduce harmful VOC emissions would actually result in net savings to the industry.  By capturing gas that currently escapes to the air during the drilling process, companies can profit from the sale of the saved product on the energy market. 

“The estimated revenues from selling the gas that currently goes to waste are significant – so much so that today’s proposed rule is anticipated to quickly result in a net savings of nearly $30 million annually, while significantly reducing pollution from this expanding industry.”

The oil and natural gas industry currently represents the largest domestic source of air toxics (such as benzene), VOCs and methane emissions. 

VOCs contribute to the formation of ground-level ozone (or smog), which has been linked to premature death, respiratory illnesses, and other health problems.  Methane, the primary component of natural gas, is a greenhouse gas that is 20 times more potent than carbon dioxide. 

If instituted, the regulations would cut VOC emissions by nearly 25% across the industry, further resulting in a 95% reduction in VOCs emitted from new and modified hydraulically fractured gas wells that are currently unregulated.  Methane emissions would be cut by three and a half million tons annually, and air toxics by 38,000 tons. 

Capturing these gases in order to reduce emissions entails containment of the “flowback” from hydraulically fractured gas wells. 

In the “fracking” process, water, chemicals, and sand are streamed into the at well at extremely high pressures to fracture the rock below and allow natural gas to escape.  Before the gas is pumped out of the well, the fracking chemicals and reservoir gases gush back to the surface in the stage of well completion known as “flowback”. 

Spewing from the ground in this mixture are methane, VOCs, and air toxics that can be – if more responsible practices are administered – isolated and saved to reduce air pollution emissions, and then sold. 

The new rules would apply to 25,000 new gas wells, storage tanks, and other equipment that presently are not subject to regulation.  The existing standards for VOC emissions were created in 1985 and address only leak detection and repair. 

The EPA is currently seeking public comment on more ways “to reduce the compliance burdens” on the industry. 

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