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Oil companies could make millions if required to capture natural gas
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Flaring on a site near Orla, Texas. Requiring oil and gas companies to capture 98 percent of natural gas produced in Texas could yield $440 million of additional revenue from increased gas production by 2025, according to a new report.Elizabeth Conley, Houston Chronicle / Staff photographer
Requiring oil and gas companies to capture 98 percent of natural gas produced in Texas could yield $440 million of additional revenue from increased gas production by 2025, according to a new report.
If Texas were to adopt a 98 percent gas-capture policy, it would nearly eliminate routine flaring in the Permian Basin of West Texas, according to a Rystad Energy report commissioned by the Environmental Defense Fund and released Tuesday. The policy would sharply reduce greenhouse gas emissions, but also allow operators to capitalize on the increased natural gas production.
An analysis finds up to 40% of the gas that s expected to be flared in the Permian Basin in 2025 could be avoided at no cost to drillers.
(Bloomberg) As much as 40% of the natural gas that’s expected to be flared in the Permian Basin in 2025 could be avoided at no cost to drillers if regulators abandoned their hands-off approach to the controversial practice, according to a report.
The vast majority of that would come from curbing so-called routine flaring, which is driven mainly by companies’ failure to adequately plan for the associated gas that’s produced alongside oil, the analysis by Rystad Energy on behalf of the Environmental Defense Fund shows.
Concerns about flaring, emissions will continue into 2021
Dec. 28, 2020
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A flare burns east of Houston in this May 2020 file photo. Flaring will continue to dominate environmental issues facing the energy industry in 2021.Mark Mulligan/Staff photographer
Flaring and emissions from Permian Basin oil and gas operations are expected to continue dominating environmental issues in 2021.
“We do fall on the aggressive side of ending routine flaring, advocating the Railroad Commission take a position of ending routine flaring in Texas by 2025,” said Colin Leyden, director, regulatory and legislative affairs with the Environmental Defense Fund.
Participating in the Oilfield Strong webinar sponsored by OTA Compression, OTA Environmental and Kimark and the Permian Basin Petroleum Association, Leyden said, “we can have a discussion of what routine flaring means.”
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The most effective and economically beneficial way to reduce flaring is through the construction of new pipelines to ship associated natural gas to market – a fact that received unanimous agreement during a recent panel discussion on the Permian Basin hosted by Rice University’s Baker Institute.
The panelists – which included Rystad Energy’s Mike McCormick, the Energy Defense Fund’s (EDF) Colin Leydon and Mark Agerton, a nonresident scholar of the Baker Institute’s Center for Energy Studies – spent a large portion of time discussing Texas’ proposed flaring regulations and the important role that infrastructure can play in reducing flaring activities.