The US government has strengthened its clampdown on methane pollution from the oil and gas industry, despite resistance from energy companies and Republican congress members.

As part of the Inflation Reduction Act (IRA), the Biden administration has committed to reducing the release of methane into the atmosphere. The Emissions Reduction Plan is part of a series of measures to reduce greenhouse gas emissions.

The latest clampdown comes after criticism from business leaders that Biden’s approach to methane reduction was overly lenient.

According to the International Energy Agency, methane production has accounted for 30% of the rise in global temperatures since the industrial revolution. US oil and gas companies account for around a third of the nation’s methane emissions through leaks, flaring, where excess gas is burned unnecessarily, and deliberate releases.

The US Environmental Protection Agency (EPA) is planning to charge emitters of methane up to $1,500 a tonne, under the IRA, which is the first nationwide fee imposed for the production of greenhouse gases.

The body is currently finalising a new rule which will force energy companies to take action on methane leaks by finding and plugging them at new and existing wellheads, pipeline compressor stations and other sites.

How well do you really know your competitors?

Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.

Company Profile – free sample

Thank you!

Your download email will arrive shortly

Not ready to buy yet? Download a free sample

We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form

By GlobalData

EPA administrator Michael Regan told the Financial Times: “We’ve designed a very aggressive rule to ensure that everyone that’s contributing to this problem has some full accounting for that”. He went on to say that no oil and gas systems would be “getting out of jail free”.

US natural gas production

Methane is the primary component of natural gas and the second most abundant hydrocarbon after carbon dioxide. Biden’s new rules to cut the gas come despite his recent energy policies suggesting a preference for natural gas production.

Last week US natural gas firms added the most rigs in 15 months as Biden seeks to set standards for the certification of what he called ”responsibly sourced natural gas”, in a move that has been criticised as greenwashing.

Many in the US oil and gas industry dispute the new methane regulations as they add additional costs at a time when they are expected to drill more wells.

The American Exploration & Production Council said that the new rules could add “significant new costs associated with compliance” when they were first announced in 2021.

The US Department of Energy (DOE) announced on March 13 nearly $47m in funding to support 22 research projects which seeks to devise new ways of monitoring methane emissions.

US Secretary of Energy Jennifer M. Granholm said in a statement: “The projects announced today will help the DOE accelerate the deployment of technology that detects and reduces methane emissions across the oil and gas sector, our largest source of industrial methane, leading to long-lasting health and environmental benefits for communities across the country.”

Oil and gas companies also criticised the ‘Super Emitter Response Programme’, a part of the proposed rules, which will allow private groups to monitor and report leaks, as they claim that they will give too much power to environmental advocacy groups.

Additionally, Republicans put forward a bill in the House of Representatives last month seeking to remove the per tonne methane fee from the IRA. It is unlikely that the bill will gain sufficient support from the Senate to become law.