Methane, the primary component of natural gas, is a potent greenhouse gas, significantly more impactful than carbon dioxide over a 20-year period. The midstream sector, responsible for gathering, processing, and transporting natural gas, is a key focus in efforts to reduce methane emissions in the oil and gas industry.
Gathering and boosting operations, which collect natural gas from wellheads and compress it for transport, have a considerably higher methane emission intensity than other activities such as processing, transmission, and storage as shown in Exhibit 1A. Older equipment with less stringent emission controls, coupled with infrequent monitoring and maintenance in remote locations, leads to increased emissions. The high methane intensity in transmission and storage primarily results from blowdowns in large pipelines and methane slip from combustion engines, as operators are now required to report these sources under the EPA’s new regulations.
Exhibit 1A: Methane emission intensities by type of operations
Exhibit 1B: Methane emission sources in midstream operations
As illustrated in Exhibit 1B, combustion equipment is the largest source of methane emissions, followed by reciprocating compressors, equipment leaks, and blowdowns. Identifying these key sources is critical for developing targeted mitigation strategies.
Midstream operators are actively working to reduce methane emissions through various initiatives and investments in innovative technologies, aiming to keep their methane emission intensity below the Waste Emission Charge (WEC) threshold. WEC is a fee imposed by the US EPA under the Inflation Reduction Act on oil and gas facilities that exceed methane emissions thresholds. We observed that several midstream operators are already proactively exceeding regulatory requirements, demonstrating a commitment to environmental stewardship and sustainability. In Part 2 of this blog, we will delve deeper into what kind of initiatives midstream operators are taking to reduce methane emission intensity.
– Bhautik Gajera
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