Bloomberg News

Colorado Fracking Deal Means Drillers Join Activists on Methane

November 18, 2013

Colorado Drilling

By specifically targeting methane emissions, the Colorado rules will force the capture of more of that gas, said Dan Grossman, regional director for Environmental Defense in Colorado. Photographer: RJ Sangosti/The Denver Post via Getty Images

Colorado will become the first U.S. state to limit methane emissions from the production of natural gas and oil, addressing an issue that climate watchdogs say is a downside of the boom in hydraulic fracturing.

Colorado Governor John Hickenlooper announced an agreement between oil-and-gas producers Anadarko Petroleum Corp. (APC:US), Noble Energy Inc. (NBL:US) and Encana Corp. (ECA:US) and the Environmental Defense Fund, a watchdog group, to have the industry track and eliminate methane gas leaks from tanks, pipelines and other production equipment.

“The rules will help Colorado prepare for anticipated growth in energy development, while protecting public health and the environment,” Hickenlooper said in a statement. The joint proposal will be subject to outside comment and a hearing in February 2014 before becoming a formal rule, according to the statement from Hickenlooper’s office.

In hydraulic fracturing, or fracking, water, sand and chemicals are shot underground to break apart rocks and free up trapped natural gas or oil. Use of the technique has led to a boom in production in states such as Pennsylvania, Texas, North Dakota and Colorado.

Leaks in the production and transport processes undermine the climate benefits of using natural gas for electricity. While natural gas emits half the carbon dioxide as coal when burned at a power plant, methane leaks can undercut those climate benefits, critics say.

Green Completions

Methane, the main component of natural gas, is 21 times more potent at trapping heat in the atmosphere than carbon dioxide, according to the U.S. Environmental Protection Agency. A boom in U.S. natural-gas supplies brought on by hydraulic fracturing has opened a debate over whether expanding the use of gas sets back efforts to fight climate change.

The EPA in 2012 issued the first rules to fight air pollution from gas drilling. The regulations require operators to use a technology known as green completions in which escaping gas is captured. Those national rules don’t apply to oil wells, which would be covered in Colorado.

By specifically targeting methane emissions, the Colorado rules will force the capture of more of that gas, said Dan Grossman, regional director for Environmental Defense in Colorado. He said the three companies in the agreement are the state’s largest oil and gas producers.

To contact the reporter on this story: Mark Drajem in Washington at mdrajem@bloomberg.net

To contact the editor responsible for this story: Jon Morgan at jmorgan97@bloomberg.net


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Companies Mentioned

  • APC
    (Anadarko Petroleum Corp)
    • $90.98 USD
    • -1.19
    • -1.31%
  • NBL
    (Noble Energy Inc)
    • $57.43 USD
    • -1.05
    • -1.83%
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