Colorado close to banning venting, flaring from oil and gas wells in most cases

Under rules given preliminary approval Thursday, Colorado will be one of only two states to prohibit companies from routinely venting and flaring natural gas from well sites.

The Colorado Oil and Gas Conservation Commission also gave initial approval to a rule requiring companies and regulators to assess the cumulative impacts of oil and gas development locally and on a broader scale. The COGCC and other state agencies will evaluate the ongoing effects on air and water quality, greenhouse gas emissions and provide reports.

The rules, up for a final vote Nov. 20, are part of the implementation of Senate Bill 181, a 2019 law mandating that oil and gas be regulated in a way that protects public health, safety and the environment.

The provisions on flaring and venting prohibit routine releases of natural gas from oil and gas equipment. Alaska is the only other state that bans the releases, said Dan Grossman, the regional director of the Environmental Defense Fund.

“The draft that you all are considering now would be among the strongest in the nation, with perhaps the exception of Alaska, as far as flaring regulations go,” Grossman said.

Flaring occurs when companies producing oil burn associated natural gas as waste, usually because there are no pipelines to ship the natural gas to market or because it’s uneconomical to ship it. Gas is also flared during maintenance or for safety when the pipeline pressure rises.

Efforts to prevent the flaring and venting of natural gas from wells have taken on urgency as the impacts of climate change have intensified. Methane, the main component of natural gas, is a potent greenhouse gas and is 84 times more effective than carbon dioxide at trapping heat over the short term.

Flaring and venting also emit nitrogen dioxide and volatile organic compounds, which contribute to ground-level ozone pollution.

“Having Colorado continue to serve as a model for eliminating that practice is just terrific. It’s really important for our climate goals because methane is a very serious climate pollutant,” said Kelly Nordini, (executive director of Conservation Colorado.

In 2014, Colorado approved the nation’s first state-level methane regulations. A federal rule recently rolled back by the Trump administration was modeled after Colorado’s law, which was developed by state and industry officials and environmentalists.

The average volume of natural gas vented and flared in Colorado is 24 times below the national average, Dan Haley, president and CEO off the Colorado Oil and Gas Association said in an email.

“Colorado companies are committed to keeping product in the pipe, venting or flaring only 0.2 percent of its natural gas in 2019,” Haley said. “Quite frankly, there was no evidence presented that demonstrates a need for new venting and flaring rules, because it’s incredibly rare in Colorado.”

It’s a different picture nationally. The World Bank says four countries — Russia, Iran, Iraq and the U.S. — are responsible for nearly half of the gas flaring worldwide. Flaring in the U.S. rose 48% from 2017 to 2018, according to the World Bank. Activity in North Dakota’s Bakken oil and field and the Permian Basin in southeastern New Mexico and Texas accounted for the overwhelming majority of the flaring, according to the U.S. Energy Information Administration.

In Colorado, companies must submit a form seeking permission to vent and flare and must regularly report the volumes of gas.

Under the new rules, companies will have to ship the gas in a pipeline or put it to some kind of beneficial use, such as generating energy. Operators can seek approval of flaring or venting gas under certain conditions and must notify regulators.

Companies will have a year to submit plans to bring existing sites into compliance. Environmental and community groups argued that a six-month grace period was long enough because the COGCC made it clear a year ago that the change was likely.

The industry argued for consistency between the COGCC and the Air Quality Control Commission, which also regulates oil and gas, said Carrie Hackenberger, associate director of the American Petroleum Institute-Colorado. She said after discussions and input from the various parties, the industry “is largely OK with where the rules ended up.”

But the industry will continue to seek more clarity when it comes to some of the details, Hackenberger said.

Most of Colorado’s oil- and gas-producing areas have pipelines and other infrastructure to transport natural gas. One exception is Jackson County in northern Colorado, where drilling has grown the past few years.

Barbara Vasquez has lived in Jackson County since 2005. She said the amount of natural gas being flared has substantially increased. Large combustion units are used to flare the gas.

“They’re wasting a natural resource and opportunities for royalties and tax benefits for the state and local governments — and putting unknown amounts of pollutants in the air,” said Vasquez, who testified in favor of the ban on flaring.

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