(WASHINGTON, DC) A new analysis from the Environmental Defense Fund titled,“Taking aim: Hitting the mark on oil and gas methane targets” presents the business and environmental case for oil and gas companies to set sound methane targets. Natural gas, or methane, has emerged as the potent paradox for the energy industry. How companies manage preventable oil and gas methane emissions will determine the climate credibility of natural gas.
Methane is a fundamental challenge for the global oil and gas industry because of how much industry emits and how intensely methane impacts warming. Methane is responsible for one quarter of the warming we experience today and the oil and gas industry is one of its largest manmade sources. With proven, low-cost technology solutions, minimizing methane emissions is a strategic opportunity that industry and society cannot afford to miss.
“Setting strong methane emission targets can help oil and gas producers differentiate themselves on climate and compete with other energy options,” said Ben Ratner, EDF Director and lead author of the paper. “Producers must prioritize methane emissions from both oil and gas production to credibly address the full scope of the problem.”
Last year, several oil and gas industry leaders committed to tackle their methane emissions and have released or made plans to announce reduction targets soon. This paper comes at a key moment in the debate over whether gas can play a constructive role in the low-carbon economy.
“Setting and achieving methane emission reduction targets is critical to a stable climate future,” said Michael Cappucci, a Senior Vice President at Harvard Management Company. “EDF’s report provides a framework for strong, attainable methane emissions targets to help investors assess their investment choices.”
>Only six companies, representing three percent of global oil and gas production report quantitative methane emissions goals, according to the paper. Companies face increasing pressure from a wide variety of stakeholders to demonstrate sincerity on climate action. As leaders in industry take important steps to answer their calls, EDF’s paper provides five key criteria for companies to craft robust methane targets, and for stakeholders to evaluate them.
The analysis makes five recommendations, one of which is that methane targets feature broad coverage across operations and geographies. This includes a focus on reducing oil methane emissions – data indicates that roughly half of industry’s upstream methane problem stems from oil development. Failure by industry to account for and adequately address oil side emissions in addition to the methane associated with marketed gas undercuts the long-term effectiveness of methane reduction strategies.
Further, the paper provides recommendations on absolute versus intensity-based targets, timeline to achieve reductions and the need for consistent, verifiable and robust data to evaluate progress over time.
A diverse group of industry experts – including institutional investors in Europe and the United States – served as peer-reviewers of the paper, representing the Columbia University Center on Global Energy Policy, Harvard Management Company, Hermes Investment Management, the Center for Strategic and International Studies, Rocky Mountain Institute and other organizations.
# # #
Environmental Defense Fund (edf.org), a leading international nonprofit organization, creates transformational solutions to the most serious environmental problems. EDF links science, economics, law and innovative private-sector partnerships. Connect with us on EDF Voices, Twitter and Facebook.