Washington, D.C. -- U.S. Sen. Jim Inhofe (R-Okla.), ranking member on the Environment and Public Works (EPW) Subcommittee on Oversight, today provided the following open statement at a hearing today titled "Fugitive Methane Emissions from Oil and Gas Operations:"
As prepared for delivery:
Chairman Whitehouse, thank you for holding this hearing today, and I appreciate our distinguished witnesses taking the time to come to Washington to testify.
The issue of fugitive methane emissions is something I’ve been involved in for years. Data started being collected about this around the time the Natural Gas Star program started. NatGas Star is a voluntary program designed to allow industry to collaborate and share best practices to reduce emissions from production activities.
We all know that oil and gas firms have every incentive to reduce methane emissions. Methane is natural gas, and when a company is in the business of extracting natural gas from the earth, their shareholders rightly demand that they do this without letting millions of dollars of their product vent into the atmosphere. No one wants that to happen. But necessarily, very small amounts of gas do sometimes escape during production activities.
NatGas Star was all about EPA working collaboratively with industry to help them collect data and share best practices. It was a common goal, so everyone cooperated.
Unfortunately, EPA used the catalog of data it collected through the NatGas Star to justify some of its new oil and gas regulations. To make matters worse, EPA increased their emission estimate by assuming that methane is vented during the hydraulic fracturing process whenever there is not a state law mandating that it be flared. This is simply untrue, but it still enabled the EPA to justify a much more costly and onerous rue.
I wrote a letter pointing out this problem in April 2012, but the Agency went ahead and finalized the rule anyway.
Since then, the EPA has started to make some modifications to its inventory of methane emissions from oil and gas operations, but it has come only as a result of my personal attention to the matter. I discussed this at great length with Gina McCarthy during her confirmation process, and I’m very appreciative she made adjustments to the inventory after being shown more accurate data.
Even then, we still had major questions about the inventory data EPA had on emissions during the hydraulic fracturing process. Industry had regularly communicated to me that the estimates from EPA were too high, which was contributing to the alarm surrounding the hydraulic fracturing process.
A few weeks ago I was vindicated when the University of Texas and the Environmental Defense Fund released a landmark study that showed methane emissions during the hydraulic fracturing process had been overstated by EPA by 50 times. This study relied on real measurements as opposed to the EPA’s general computer modeling estimates, so the new data we have now is significantly more trustworthy than what we had before. Overall, the study’s measurements show that EPA’s estimate of methane emissions from all oil and gas operations are overstated by about 20-30% and still remain at less than one half of one percent of total production.
Fortunately, industry has made significant headway toward reducing even these emissions further. The industry is known for its world class research and development practices and partnerships with leading universities around the world, and as a result newer technology and process are constantly being developed. If a firm finds a better way to recover a resource without losing it to the atmosphere, the firm is going to do it as long as it makes financial sense. Hydraulic fracturing and horizontal drilling are an example of this innovation. They are the cause of the current boom we’re in; without them, we probably wouldn’t be having this hearing today. The industry is highly innovative.
Still, some critics have raised concerns about the amount of flaring that is going on in North Dakota and in other regions that are being targeted for their rich deposits of oil but often yield natural gas, too. In many of these cases, the companies simply cannot immediately justify the gathering network of pipelines needed to capture the gas and transport it to market. Since gas isn’t a liquid, it’s a lot harder to move.
One of the best ways that we can help this situation is to allow widespread LNG exports, which are currently restricted by the Department of Energy. If we were to do that, then demand for natural gas – which is currently very low relative to supply – would become more solid, and more of these gathering networks could be justified, which would reduce flaring and increase domestic gas supply. It’s truly a win win.
Regardless, it’s critical that EPA have the most up-to-date and accurate information in its methane emissions inventory. It is my hope that they will immediately make adjustments in light of the recent UT-EDF study – particularly to the hydraulic fracturing sections –so that policymakers both here and abroad can make well informed decisions.
I look forward to hearing the witnesses’ testimony and again thank the chairman for holding the hearing.