Colorado Tried Methane Caps on Drillers, And They Worked

1280px-Flag_of_Colorado.svgby  and  – Aug 18, 2015

For an idea of how the U.S. government’s proposed methane rules will affect drillers, look no further than Colorado.

The state became a test case for similar controls last year when a coalition of energy companies and environmental groups agreed on measures to cut the pollution. In a bid to address smog, regulators there adopted the nation’s first requirements for oil and natural gas companies to find and fix methane leaks.

Drillers who were already voluntarily curbing emissions accepted Colorado’s rules with little opposition. Gas production in May was up 1.5 percent from the same period two years earlier, Energy Information Administration data show. A state analysis estimated that the rules cost drillers about 0.4 percent of their annual revenues.

“Methane is a product we sell, so it’s in our business interest as well as in our general interest as environmental stewards to make sure every molecule goes into the sales line,” John Christiansen, a spokesman for Anadarko Petroleum Corp., said by phone Tuesday.

Industry groups such as the American Petroleum Institute criticized rules proposed by the Environmental Protection Agency on Tuesday to curb methane emissions in the country, saying they would exacerbate an already painful price crash. Crude oil has slumped by about half in a year, while gas prices have dropped 30 percent.

“The administration is proposing a costly and complicated regulatory program for few environmental benefits,” Barry Russell, president of the Independent Petroleum Association of America, said in a statement.

Continue reading at Bloomberg Business

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