Nearly half of the flared or vented natural gas estimated to be produced on federal lands could be economically captured, which would boost royalties and reduce greenhouse gas (GHG) emissions, the Government Accountability Office (GAO) said in a new report.
"The venting and flaring of natural gas is the potential loss of a valuable resource and, on federal leased lands and waters, the loss of federal royalty payment," the report said, which was requested by Reps. Darrell Issa (R-CA), the ranking member on the Committee on Oversight and Government Reform, and Nick J. Rahall II (D-NY), who chairs the Committee on Natural Resources.
In 2004 GAO reported on the extent of vented and flared gas using information collected on leased federal lands and waters by the Department of Interior. Since then the Environmental Protection Agency (EPA) and the oil and gas industry have identified sources of vented and flared gas being released are "substantially" more than previously thought.
GAO's researchers used sources of venting and flaring data from 2006 to 2008 and examined "only the portions of these data related to federal leases in order to ensure comparability between them."
Most of the natural gas produced on federal leases is sold, but some is lost during production through leaks and through releases for maintenance or safety. How much gas is lost varies, noted researchers. Gas and oil operators report that about 0.1% of produced gas was vented or flared. However, the Environmental Protection Agency (EPA) and the Western Regional Air Partnership said lost gas volumes may be as much as 30 times higher.
Using currently available technologies, gas and oil operators could save nearly 40% of gas that is vented or flared at federal onshore leases, which would add $23 million to the federal royalty coffers, the 57-page report found. Gas and oil development on public lands generated about $9 billion in royalties in 2009, according to GAO.
Based on their findings, GAO researchers recommended that Interior improve its gas venting and flaring data, and address limitations in its regulations and guidance to reduce greenhouse gas emissions. According to the report, capturing vented and flared gas would reduce carbon dioxide emissions by the equivalent of 16.5 million metric tons per year, which is the amount generated by 3.1 million vehicles.
In response to the report, Interior's Bureau of Land Management plans to develop standards to require operators use new technologies that "economically capture vented and flared natural gas used in lease operations," wrote Interior's Wilma Lewis, assistant secretary for land and minerals management. The updated standards are to be part of an "onshore order" on waste prevention and beneficial use.
©Copyright 2010 Intelligence Press Inc. All rights reserved. The preceding news report may not be republished or redistributed, in whole or in part, in any form, without prior written consent of Intelligence Press, Inc.