ALBUQUERQUE, N.M. — Industry representatives and environmentalists launched the first round last week of what could be a raucous summer debate over forthcoming state regulations on methane emissions from oil and gas operations.
Gov. Michelle Lujan Grisham ordered the Environment and Energy Minerals and Natural Resources departments in January to create a new regulatory framework to control methane. It’s part of a broad executive order for state agencies to work on cutting greenhouse gas emissions overall by 45 percent below 2005 levels over the next 12 years.
The ED and EMNRD set three public meetings in June to gather community input this summer, including events on July 29 in Farmington, July 30 in Albuquerque, and Aug. 7 in Carlsbad.
But the public process started early last week, after the New Mexico Oil and Gas Association released its own “methane mitigation road map” outlining industry-supported proposals for controlling emissions. NMOGA said the document reflects efforts to work corroboratively with state officials through “solution-oriented” approaches aimed at improving the equipment used in oil and gas operations.
NMOGA says such measures have already proved effective in New Mexico and elsewhere.
But environmental groups immediately criticized NMOGA’s road map, foreshadowing acrimonious debate as the regulatory process moves forward.
The Environmental Defense Fund said NMOGA’s proposals reflect a minimalist approach “that would leave New Mexico with the weakest methane regulations in the nation.”
Earthworks said the only positive thing in NMOGA’s proposal is that it “finally admitted” that methane pollution rules are needed.
“Their report suggests that they are still at odds with everyone else” about creating effective, robust safeguards, said Earthworks Energy Program Director Bruce Baizel.
NMOGA worked on its road map for 18 months, hiring national industry experts to study emission levels in New Mexico, pinpoint the production processes that contribute most to emissions, and review efforts in other states to help craft regulatory measures, said NMOGA Executive Director Ryan Flynn.
In short, the road map identifies leaky equipment and other infrastructure as a main cause of methane emissions. It recommends an annual leak detection and repair program with exemptions for the smallest producers, replacement of pneumatic devices that frequently vent natural gas, new controls for storage tanks, and onsite monitoring of some operations.
It also provides a new analysis of New Mexico-specific emissions based on the U.S. Environmental Protection Agency’s Greenhouse Gas Reporting Program. EPA gathers its data from a basinwide perspective that includes emissions from other states, including Texas, in the Permian Basin, and Colorado, in the San Juan Basin.
NMOGA separated all the data by county to compile New Mexico-only methane estimates, which showed a 51 percent reduction overall in the state from 2011 to 2017, according to the report.
“We’re seeing positive trends through methane-reduction strategies that industry is already adopting,” Flynn said.
Environmental groups counter, saying NMOGA’s equipment-focused proposals will achieve minimal results, because they only address leaky infrastructure while sidestepping venting and flaring of natural gas by operators.
“The NMOGA report ignores that a large and growing part of the methane waste problem comes from industry venting and flaring,” said Thomas Singer, senior policy adviser with the Western Environmental Law Center.
Operator data from the state Oil Conservation Division shows that industry venting increased by 56 percent and flaring by 117 percent in New Mexico in 2018, Singer said.
Lack of pipelines and other infrastructure make it difficult for Permian Basin operators, who are primarily seeking oil, to get natural gas to market. Transporting it often costs more than what operators earn in return, so they treat natural gas as waste to be vented or burned off, Singer said.
NMOGA’s leakage proposals also have loopholes, said Jon Goldstein, EDF director of regulatory and legislative affairs. The road map calls for annual inspections, but quarterly inspections are needed based on experience in other states. And NMOGA’s proposal to exempt small producers means a lot of emissions will go unchecked.
“Wyoming officials have found annual inspections only lead to about a 40 percent reduction in emissions, while quarterly inspections achieve up to 60 percent,” Goldstein said.
NMOGA’s emission estimates are particularly controversial, reflecting chronic disagreement over how to establish reliable baseline data, which is needed to measure and address methane emissions going forward.
Environmental groups say the EPA significantly underestimates emissions by exempting smaller operators from reporting requirements, eliminating about one-third of the state’s oil and gas wells from data collection.
By contrast, EDF says New Mexico emits over 1 million tons of methane annually, or about five times more than NMOGA’s estimates.
Given those disagreements, state officials say they will rely on their own internal data to develop an emissions baseline.
“We appreciate NMOGA coming forward with a concerted effort to look at regulations from an equipment approach, and we look forward to hearing more from them on it,” said ED Environmental Protection Division Director Sandra Ely. “But we can’t comment on these different approaches to estimating emissions. We ourselves are seeing elevated ozone, or smog, from emissions, and we need to control it.”
Industry, environmentalists already tangling over upcoming regulations, how to measure it