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Summary Global Methane Pledge, signed by 159 countries,, aims to cut methane emissions 30% by 2030 Permian Basin saw a 50% fall in methane intensity and 42% drop in absolute emissions Trump administration pressuring the EU to weaken its Methane Emissions Regulation Oil majors are rolling back climate pledges and expanding LNG capacity Nigeria stands out for regulatory action but needs $1.5bln investment in methane mitigation November 11 - When the United States and European Union launched the Global Methane Pledge four years ago, they turned a spotlight on one of the most effective ways to slow global warming in the short term. That’s because methane, which leaks from oil and gas operations and landfills and is produced by the agriculture sector, is a very powerful but short-lived greenhouse gas. Scientists estimate it’s responsible for about a third of the warming we’ve experienced so far. Methane also makes for poor air quality. The pledge to cut methane emissions by 30% below 2020 levels by 2030 has been signed by 159 countries plus the EU. Many of them have developed, or are working on, methane action plans, and billions of dollars have been committed to the effort. Until the Trump administration started dismantling policy, the U.S. had developed stringent standards and planned to impose a fee on methane emissions. While the obligation remains, for now, in the Inflation Reduction Act, implementation has been delayed until 2034. Now, the U.S. has got its sights on the EU’s Methane Emissions Regulation, which came into force last year. The regulation is viewed as a game-changer because it targets both domestic production and imports of fossil fuels, so pushing producers everywhere to tackle their methane emissions. Data from RMI, a U.S. non-profit focused on the energy transition, reveals that the amount of energy used at all stages, from extraction to delivery and the amount of methane leaked along the way, varies wildly between and within nations. The regulation will drive transparency on those emissions, gradually ratcheting from reporting on the origins of fossil fuels to proving that upstream producers are complying with EU rules on monitoring, reporting and verification of emissions. From 2030, a maximum methane intensity will apply, but the Commission hasn’t yet set the number. The oil and gas sector offers the best hope for a quick win on methane reduction. And for the industry it makes sense because the gas can be sold. “Methane is the only waste product that's actually a commodity,” says Deborah Gordon, RMI’s methane lead. The International Energy Agency estimates that over 120 million tonnes of methane is emitted every year by the fossil fuel industry – even as oil and gas companies explore for new sources of gas. The latest report from the 12 members of the Oil and Gas Climate Initiative (OGCI) shows how quickly methane can be tackled. In the past seven years they have collectively lowered the methane emissions from operations (including flaring, venting and leaks) by 63% and the volume of natural gas flared by 72% since 2018. Methane intensity of operations fell to 0.12% – below their headline target of 0.2%. Other figures released recently by S&P Global paint a similarly encouraging picture for America’s largest oil- and gas-producing region, the Permian Basin. It estimates a 50% fall in the methane intensity of upstream operations, which translates into a 42% fall in absolute methane emissions, even as output has risen. But methane has become a political football as concerns about energy security come to dominate the agenda, pushing aside climate. The Trump administration’s pressure on the EU to revisit its methane regulation follows months of lobbying by U.S. companies who say the legislation is unworkable, pressure on the EU to end imports of Russian energy, and a U.S. trade deal that committed the EU to increasing its energy purchases from the U.S. to $250 billion a year. Some of those exports will come in the form of liquefied natural gas (LNG), where methane leaks at every step of the production and supply chain. It’s difficult to interpret the logic because as the Permian data shows, U.S. operators are making big inroads into tackling methane emissions. While U.S. LNG supply chains are complex, LNG exporting companies are working hard to document their emissions “because their whole business model is largely centred around European LNG", says Jonathan Banks, who leads international efforts by the Clean Air Task Force (CATF) to cut methane. “It's a price-premium market, so you get a lot more for the gas.” He adds that CATF’s research “shows that the costs associated with complying [with EU rules] especially between now and 2027, and even for 2030, are pretty minimal”, compared with rerouting an LNG tanker to Asia, for example. But European industry associations have also been lobbying hard – they want the timelines relaxed for importers’ obligations on monitoring, reporting and verification. The EU’s energy commissioner Dan Jorgensen says the Commission is willing to discuss how it can help supplier countries, including the U.S., to implement the legislation so long as this doesn’t impact the overall objective of lowering methane emissions. Bjorn Otto Sverdrup, chair of OGCI’s executive committee, told The Ethical Corporation that as a group “we don’t have a view on specific regulations”, but added that if some companies are commenting “it doesn’t mean they ignore the topic”. They could be among the keenest to address methane but “they’re just mindful that maybe the way the regulations are done are not seen as helpful”. RMI’s Gordon hopes that the financial sector will maintain pressure on the EU to stay the course. Indeed, a group representing almost 5 trillion euros in assets globally have urged the EU to keep the regulation as it is. “The insurance and the reinsurance sector are very keen to do something, because they see they just aren't going to be able to keep up with it (climate change). They’re seeing it already live on their books,” adds Gordon. Swiss-based insurer Chubb has said it expects its big clients to achieve a methane emissions intensity of 0.2% or less across their global operations by 2030. Smaller companies are expected to show they are implementing emission reduction plans. While OGCI members are making big inroads on methane emissions they represent less than 2% of the sector’s emissions. Progress needs to be made with the national oil companies, says Sverdrup. The Oil and Gas Decarbonisation Charter, which launched two years ago at COP28, has 56 companies representing almost half of global oil and gas production signed up to target zero methane emissions by 2030. OGCI is training engineers, sharing technologies, best practice and providing funds. Its actions are effective because it’s done peer-to-peer, observes Sverdrup. “They are fierce competitors, but they have always collaborated because it's a way of sharing risks.” OGCI is using satellite data from GHG-SAT to alert sites to methane plumes. “It's amazing to see how many of them are actually able to remove those emissions in a short period of time,” he notes. Information from satellites is proving key, so it was a huge blow earlier this year when the most powerful satellite in the world’s methane armoury, MethaneSAT, lost power. It’s not expected to be recovered. Unlike many others, its data was freely available. The U.N. Environment Programme’s Methane Alert and Response System (MARS), gathers data from other satellites and alongside UNEP’s International Methane Emissions Observatory (IMEO) is pulling together data to alert governments and companies to emissions sources. Non-profit Carbon Mapper is using its new Tanager-1 satellite to alert U.S. states and operators to leaks, and finding willingness to address them. But turning data into action is still a huge challenge. Some countries just don’t have enough people in their ministries to cope with the information they’re getting, Banks of CATF observes. “We have to figure out ways to develop more capacity, to create platforms that help them digest it and methodologies for people to take the data they're getting and incorporate it into their own inventories.” This is especially true in some parts of Africa, where many recent natural gas discoveries have been made and millions of tonnes of methane are flared every year. Just three countries – Ghana, Ivory Coast and Nigeria have developed methane action plans. Nigeria stands out for its regulatory action. Alongside methane guidelines, a methane emissions tracker is in development “trying to instil a culture in the operators (and) alignment with international standards”, with an eye on meeting EU standards, says Mahmoud Ibrahim Mahmoud, a scientist working with the Africa Policy Research Institute on reducing methane emissions there. But, he adds, “there is a major elephant in the room”, namely the financial and technical support for workforce training and technology transfer, including access to satellite data. The country needs $1.5 billion investment in methane mitigation by 2030. The EU’s push on methane becomes more critical as oil and gas majors roll back their climate pledges, committing to invest in production in response to Trump’s exhortation to “drill baby drill”. Their projection of a slower transition than expected risks being a self-fulfilling prophecy (as ExxonMobil’s review of its 2015 outlook demonstrates) as they invest more in fossil fuels to meet shareholder demands for profits. Shell, for example, is expanding its LNG shipping fleet and says it will add another 12 million tonnes of LNG capacity by 2030. OGCI companies have set targets to reduce the energy they consume in their own operations and cut the carbon intensity of those operations, but in recent years the downward trajectory has stalled. At the same time, companies like BP and Shell are cutting investments in renewables. Sverdrup says some OGCI members are ready to develop hydrogen plants, but customers aren’t willing to pay for it. The U.S. administration has axed two clean hydrogen hubs, and other hydrogen projects are on uncertain ground. More investment is expected to go into carbon capture, a focus of oil majors including ExxonMobil and Occidental, who see it as a means to cut the carbon intensity of their products. The Trump administration has expanded 45Q tax credits for uses of carbon dioxide such as enhanced oil recovery so that they’ll now get the same $85 per metric tonne credit as permanent storage. But companies in the sector clearly don’t see it as their responsibility to cut emissions outside of their own operations. For that to materialise demand must shift, they say. The energy transformation won’t happen, says Sverdrup, without industry, government and finance all working together. “There are periods where you have a sweet spot, where things are aligning, and then there are periods where there will be more difficulties.” The crucial question is: when will the next sweet spot arrive? This article is part of our in-depth briefing Climate at a Crossroads, which 10 years on from the Paris Agreement assesses whether COP30 can plot a safe path for the planet. To download the PDF for free, click here Opinions expressed are those of the author. They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias. Ethical Corporation Magazine, a part of Reuters Professional, is owned by Thomson Reuters and operates independently of Reuters News.
