Greater development of liquefied natural gas (LNG) and pipeline facilities in the U.S. and overseas could provide the incentive for energy firms to capture gas that is wasted during production as a result of flaring and venting, according to a new report issued by the congressional Government Accountability Office (GAO).

“A robust natural gas market, along with a supporting [pipe and LNG] infrastructure, would have the most significant impact on the reduction of flaring and venting,” which causes greenhouse gas emissions, concluded the GAO report. The study was commissioned by Sen. Jeff Bingaman (D-NM), the ranking Democrat on the Senate Energy and Natural Resources Committee.

“Greater opportunities to sell the gas [bolster] the economic incentive to minimize flaring and venting,” Mark Gaffigan, assistant director with GAO and one of the writers of the report, told NGI. Burning natural gas is known as flaring, while releasing gas directly into the atmosphere is called venting. These are often done when no local market exists for the gas and transporting it to market may be uneconomical.

While very little gas currently is flared in the U.S., the escalating domestic gas demand presents a ripe opportunity for foreign countries to market their gas that has been wasted through flaring and venting in the past.

The GAO suggested that the federal government identify and address the market barriers that are causing natural gas produced outside the United States to be flared and vented, and work with foreign countries. At the outset, ” the government could identify regulatory barriers to economically feasible infrastructure development, such as building pipelines or LNG facilities for transporting gas that is usually flared or vented.”

Currently, there are more than 15 federal permit applications for LNG facilities awaiting approval from either the Federal Energy Regulatory Commission or the U.S. Coast Guard, the agency noted. The U.S. government also “could investigate the public’s perceptions of the risk associated with new infrastructure…Some communities have resisted LNG facilities because they are worried about the safety and security procedures in place to protect them from an accidental explosion or terrorist attack. Finally, the federal government could continue to work with other countries and corporations to reduce flaring and venting.”

The amount of natural gas flared and vented annually is conservatively estimated by the World Bank to be more than 100 billion cubic meters (bcm) worldwide, or about 3% of all gas marketed in the world, the GAO said, adding that it is enough gas to meet the needs of both France and Germany for a year. Eight nations account for 60% of the estimated gas flared and vented: Algeria, Angola, Indonesia, Iran, Mexico, Nigeria, Russia and Venezuela.

Of these countries, Nigeria flared and vented the most gas (17.2 bcm) in 2000, which represented 16% of the world total, the agency noted. But four years later Nigeria is going “gangbusters” to develop LNG trains to market the country’s gas, Gaffigan said. Nigeria was followed by Russia in wasted gas (11.5 bcm) and Iran (10.5 bcm) in 2002. The U.S. flared and vented just 2.8 bcm that year.

“Corporations operating in Nigeria currently have six LNG projects in development and have also begun using gas that otherwise would have been flared or vented to operate the platform equipment, as well as to produce cement and fertilizer and gas that is usable as fuel for automobiles,” the GAO report said.

The Department of Energy’s Energy Information Administration (EIA) estimates that the United States flares or vents only about 0.4% of its production, representing just 3% of the world’s total amount of natural gas flared and vented. The GAO credits the low flaring/venting number to the well-developed infrastructure in the U.S. to bring gas to market.

Within the U.S., flaring and venting have occurred in the active oil and gas production states, including Alaska, Louisiana, Texas and Wyoming and in the Gulf of Mexico, the agency noted. In 2002, most of the flaring and venting occurred in Texas (27,379 MMcf) and Gulf of Mexico (20,092 MMcf), which was less than 1% of the total gas produced in both areas.

With respect to greenhouse gas emissions, the GAO reports that flaring and venting contribute about 4% of the total methane emissions and about 1% of the total carbon dioxide emissions.

In addition to the construction of more infrastructure, Interior Department’s Minerals Management Service (MMS) and Bureau of Land Management (BLM) could consider enacting tighter regulations to reduce emissions associated with flaring and venting, and improve the oversight of oil and gas production on federal lands and offshore areas, the GAO said.

Specifically, “the agencies could require the use of flare and vent meters at production facilities, which could improve oversight by detecting how much gas is actually flared and vented.”

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