CAPP Threatens Job Losses If Ottawa Doesn’t Accept Its Methane Reduction Plan
Canada’s oil and gas producers say they’re ready to reduce emissions of methane—a greenhouse gas 20 times more powerful than CO2 over the short term—from their field and transmission operations, but only if they can do it their way. Environmental analysts say their way can’t be relied on.
Prime Minister Justin Trudeau committed Canada last year to reduce its fossil industry’s methane emissions by 40 to 45% below 2012 levels by 2025. At the time, U.S. President Barack Obama made the same commitment on behalf of the United States. Donald Trump has since frozen implementation of the initiative, and tried to rescind it.
Like this story? Subscribe to The Energy Mix and never miss an edition of our free e-digest.
Canada delayed the new rule, but is still preparing for it. Draft regulations, the Globe and Mail writes, would require companies “to visually inspect their far-flung equipment for leaks on a regular basis, and to measure emissions in each operation,” to meet the minimum reduction goal.
The Canadian Association of Petroleum Producers (CAPP) says it’s onside with the reduction goal, but claims the approach Ottawa appears to be adopting is too rigid and unnecessarily costly.
Instead, “CAPP wants companies to be able to use a ‘risk-based approach’” that would allow producers to focus remediation on operations that “are most vulnerable to major leaks,” the Globe reports. It also wants companies “to be held to an overall goal of methane emission reductions [across all their operations], giving them flexibility to pursue the most cost-effective approaches.”
According to the Globe, CAPP President Tim McMillan claims the association’s plan would cost his members C$700 million, but the federal plan “would be substantially more.” In a separate report by The Canadian Press, McMillan implies that Ottawa’s approach would cause “the cumulative loss of nearly 7,000 jobs.”
CAPP’s plan would “achieve 70% of the reductions [that Ottawa seeks] at one-third the cost,” CP reports, citing McMillan, but “would cut about two fewer megatonnes of methane.”
McMillan did not address in either news report how CAPP members would identify high-risk operations without doing the site-by-site monitoring Ottawa wants. A recent aerial survey revealed that existing industry estimates of methane emissions from its operations are severely understated.
“We are nowhere near having the measurement and reporting tools needed to make [CAPP’s plan] a credible option,” said Duncan Kenyon of the Calgary-based Pembina Institute. “The inherent problem with methane is that it likes to leak, and will leak wherever it can find a weakness.”
The International Energy Agency has judged that current technology allows operators to reduce their global methane emissions by as much as 75%. And the Globe notes that several oil majors—including ExxonMobil, Royal Dutch Shell and Saudi Aramco—“have pledged to dramatically reduce emissions that occur either intentionally as companies vent or flare gas when they produce oil, or unintentionally when the gas leaks from equipment.”
“The biggest players in the industry are looking at this as an issue of their survival,” Drew Nelson, a director with the Washington-based Environmental Defense Fund, told the Globe. “Unless industry tackles methane head on, they will lose credibility as suppliers of an energy source for the future.