U.S. Proposes Fee on Methane from Big Oil and Gas Producers
(Reuters) — The U.S. on Friday proposed a fee on emissions of methane from big oil and gas producers as required under the 2022 climate law and as a backstop to wider regulations on the greenhouse gas from energy operations.
The fee, proposed by the Environmental Protection Agency, applies to large oil and gas facilities that report methane emissions of more than 25,000 metric tons of carbon dioxide equivalent per year.
As directed by the Inflation Reduction Act (IRA), the fee starts at $900 per ton in 2024, increases to $1,200 for 2025 and $1,500 for 2026 and beyond, the EPA said. It only applies to the emissions that exceed the specified levels.
Over time, fewer facilities will face the charge as they reduce their emissions and become eligible for compliance exemptions, the EPA said.
"Today's proposal, when finalized, will support a complementary set of technology standards and historic resources from the Inflation Reduction Act, to incentivize industry innovation and prompt action," EPA Administrator Michael Regan said in a release.
Methane tends to leak into the atmosphere undetected from drill sites, gas pipelines and other oil and gas equipment. It has more warming potential than carbon dioxide and breaks down in the atmosphere faster, so curbing methane emissions can have a more immediate impact on limiting climate change.
In December, the EPA finalized a wider rule on methane from oil and gas operations at the COP28 climate talks in Dubai.
It bans routine flaring of natural gas produced by newly drilled oil wells, requires oil companies to monitor for leaks from well sites and compressor stations and establishes a program to use third party remote sensing to detect large methane releases from so-called "super emitters."
The methane fee was watered down in the IRA, which was passed in 2022, to cover less than half of the sector's release of methane, as a result of concessions made to win over Senator Joe Manchin, a conservative Democrat from gas producing West Virginia.
Related News
Related News
- Phillips 66 to Shut LA Oil Refinery, Ending Major Gasoline Output Amid Supply Concerns
- FERC Sides with Williams in Texas-Louisiana Pipeline Dispute with Energy Transfer
- U.S. Appeals Court Blocks Kinder Morgan’s Tennessee Pipeline Permits
- ConocoPhillips Eyes Sale of $1 Billion Permian Assets Amid Marathon Acquisition
- Valero Considers All Options, Including Sale, for California Refineries Amid Regulatory Pressure
- U.S. Appeals Court Blocks Kinder Morgan’s Tennessee Pipeline Permits
- Malaysia’s Oil Exports to China Surge Amid Broader Import Decline
- U.S. LNG Export Growth Faces Uncertainty as Trump’s Tariff Proposal Looms, Analysts Say
- Marathon Oil to Lay Off Over 500 Texas Workers Ahead of ConocoPhillips Merger
- Valero Considers All Options, Including Sale, for California Refineries Amid Regulatory Pressure
Comments