Methane crackdown at heart of ‘historic’ U.S.-Canada pact

By Amanda Reilly | 03/10/2016 01:25 PM EST

U.S. EPA plans to regulate methane from existing oil and gas operations under a U.S.-Canada climate agreement announced today.

U.S. EPA plans to regulate methane from existing oil and gas operations under a U.S.-Canada climate agreement announced today.

Marking the start of a White House visit by Canadian Prime Minister Justin Trudeau, the Obama administration also rolled out a partnership to address climate impacts in the Arctic and vowed to accelerate efforts to shape long-term greenhouse gas reduction strategies under the Paris climate change agreement. The nations also pledged to expand renewable energy and to align energy efficiency standards.

At a White House news conference, President Obama said major developed countries must take leadership roles on global warming.


"If we don’t agree, if we’re not aggressive, if we’re not farsighted, if we don’t pool our resources around the research and development and clean energy agenda that’s required to solve this problem, then other countries won’t step up and this won’t get solved," he said.

The announcement on methane is controversial. The oil and gas industry, which believes voluntary actions are sufficient to address its emissions, pushed back against the agreement and warned that it would halt the development of U.S. shale resources.

The American Petroleum Institute said the Obama administration was "catering to environmental extremists" and didn’t rule out legal action.

"We don’t have a dollar figure, but we can only assume that the economic impacts of regulating existing wells is going to be massive," said Kyle Isakower, API’s vice president of regulatory and economic policy.

Environmentalists and Democratic lawmakers — both of whom have been calling on the administration for months to tackle existing oil and gas operations — applauded the agreement as a big step forward for addressing climate change.

Sen. Brian Schatz (D-Hawaii) called the announcement the "last and biggest remaining piece" of Obama’s climate legacy.

"Obviously, there’s always more to do, but they’ve announced their intentions to move forward in this," he said.

But the future of methane regulations in the United States is still unclear, given that much work could be left for the next presidential administration. A Republican administration is unlikely to take aggressive steps to combat climate change.

"The question now is not whether but how quickly EPA will move forward to issue safeguards against methane pollution from existing oil and gas equipment," said Conrad Schneider, advocacy director at Clean Air Task Force.

Methane is a greenhouse gas that is about 28 times more potent than carbon dioxide, according to the latest U.N. climate report.

The Obama administration had previously committed to reducing methane emissions from the oil and gas sector between 40 and 45 percent by 2025 compared to 2012 levels. But until now, EPA had only been considering a rule to limit methane emissions from new operations in the sector, relying on voluntary actions to address emissions from existing sources.

Today’s agreement commits Canada to the same emissions reduction goal. Both countries agreed, through their respective environmental regulatory agencies, to develop regulations for existing sources.

"Our countries are the second- and fourth-largest emitters of methane emission from the oil and gas industry," said John Morton, senior director for energy and climate change at the National Security Council. "So this commitment will have major ramifications for climate change."

EPA Administrator Gina McCarthy last month hinted that the United States would take more aggressive action on climate change. At a speech before oil executives in Houston, she highlighted a recent draft greenhouse gas inventory that showed methane emissions from the oil and gas sector were 27 percent higher in 2013 than the agency had previously calculated.

Other studies by environmental groups and academic institutes have warned that the United States would not meet its methane reduction goals through simply regulating new sources.

"Based on this growing body of more refined data," McCarthy said today, "it has become clear that it’s time for EPA to take additional action to regulate existing sources in the oil and gas sector."

‘We want to get this right’

EPA plans to "immediately" move on regulating existing sources as it works to finalize its proposed regulations for new operations this spring, McCarthy said.

In a matter of weeks, she said, EPA will issue an "information-collection request" to solicit information on methane emissions from oil and gas producers.

The information will allow EPA to gather "important information" on emissions, emissions-reduction technologies and the costs of reducing methane in all segments of the oil and gas supply chain, from production to transmission and storage, she said.

"It’s a really complex industry with hundreds of thousands of emissions sources, and we want to get this right," McCarthy said.

When pressed by reporters, McCarthy, however, committed only to the information request and not to actually proposing or completing a rule before the Obama administration leaves office.

"We’re not, at this point, taking any options or tools off the table in terms of what else we might do this year," she said. "But we have no further announcements at this point."

API’s Isakower said that if EPA completes the information request quickly, it could issue a proposed rule by the end of the year, but "certainly it will be difficult" for the administration to finalize the rule before the end of the Obama administration.

API countered that the draft inventory released by EPA showed methane emissions were tracking downward over the long term and argued that it showed that voluntary actions by the industry have been successful.

Howard Feldman, API’s senior director of regulatory and scientific affairs, blamed, in part, the Supreme Court’s recent stay of EPA’s carbon rule for power plants for the new push to address methane emissions.

"We see the Clean Power Plan was stayed, and now the next thing we know, we see they’re coming hard after us," Feldman said. "Our emissions are an order of magnitude lower than the utility industry, and yet they’re coming hard after us. We’re helping reducing greenhouse gas emissions through our fuels."

The Environmental Defense Fund, which has pushed aggressively for new regulations after the massive methane leak in California, today called the agreement "historic."

"I look forward to the day when national limits on methane from existing oil and gas sources are fully implemented," EDF President Fred Krupp said. "That will be the ultimate measure of progress."

Arctic partnership

The Obama administration also announced a new partnership on the Arctic that calls for science-based collaboration, the incorporation of traditional knowledge into decisionmaking, new standards on commercial activities and sustainable development.

Later this year, an inaugural White House meeting of science ministers from Arctic nations will report on progress and set a path for future commitments.

Both the United States and Canada today reaffirmed a goal to protect at least 17 percent of land areas and 10 percent of marine areas in the Arctic by 2020. They agreed to make climate change a key consideration in commercial activities in the Arctic, such as shipping, commercial fishing, and oil and gas exploration.

As part of that, the two nations will call for a binding international deal to prevent the opening of unregulated fisheries in the central Arctic.

"This helps build on a precautionary science-based principle to commercial fishing that both countries have put in place in their Arctic waters," Interior Secretary Sally Jewell said.

The two countries will also work together to establish policies for ships operating in the Arctic region that take into account important ecological areas and indigenous values, as well as work to address the risks of heavy fuel oil and black carbon, the Obama administration said.

The United States and Canada also said they would align their standards to ensure that oil and gas exploration activities are done safely in Arctic conditions.

While the agreement does not go so far as to bar Arctic drilling, as some environmental groups had called for earlier this week, conservation groups broadly applauded the announcement.

"It is our hope that other Arctic nations will follow the leadership of the U.S. and Canada in committing to permanent marine protections for the region," Greenpeace Arctic campaigner Mary Sweeters said.

"Countries must unite to create a network of marine reserves, ban the use of heavy fuel oil from shipping and seismic blastings that threaten Arctic marine life, and reject industrial Arctic exploitation once and for all."

Reporter Hannah Hess contributed.