The Methane Regulations You Need to Know in 2024

2023 brought a flurry of methane rulemaking, and that trend is expected to continue into 2024. Here are a few of the recent methane regulations and proposed legislation.

United States

U.S. EPA issues final versions of NSPS Subpart OOOO series rules

The EPA issued the final versions of the New Source Performance Standard (NSPS) Subparts OOOO, OOOOa, OOOOb, and OOOOc in December 2023. NSPS Subpart OOOOb requires a much higher level of methane emissions control and monitoring for sites that are constructed, reconstructed, or modified after December 6, 2022. NSPS Subpart OOOOc will trigger additional methane requirements that are at least as stringent as NSPS Subpart OOOOb for existing sites; the new requirements must be enforced by 2027.

U.S. EPA issues draft rulemaking on Waste Emissions Charge (WEC) for Petroleum and Natural Gas Systems

The US EPA released draft rulemaking for the WEC in January 2024. As proposed, the WEC would apply to facilities reporting under U.S. EPA Greenhouse Gas Reporting Program Subpart W. The WEC will apply to emissions that exceed allowable emission levels calculated based on production levels and a segment-specific methane intensity level. It is proposed to begin at $900 per metric ton of methane emissions, beginning in the reporting year 2024, increasing to $1,200 per metric ton in the reporting year 2025, and $1,500 per metric ton beginning in the reporting year 2026.

U.S. EPA to revise Greenhouse Gas Reporting Program Mandatory Reporting Rule (GHGRP MRR)

The EPA is expected to release revised GHGRP MRR reporting requirements by mid-2024. Subpart W, which regulates reporting for the oil and gas industry, will be used to determine the methane waste emissions charge. The revised Subpart W is expected to allow more provisions for sites to develop measurement-informed emissions inventories than the current rule.

Colorado adopts the greenhouse gas intensity verification rule

In June 2023, Colorado approved a rule that requires upstream oil and gas operators to use direct measurement to inform their emissions inventory and calculate their GHG intensity. State-certified third-party auditors will be required for some operators. The rule is designed to ensure accuracy in emission calculations and reporting and the state will incorporate its own aerial and ground monitoring into the calculations. The rule will go into effect in 2025.

California AB1167 passes orphaned well legislation

AB1167 requires companies that purchase idle or low-producing wells to set aside enough money to cover the entire cost of cleanup. This rule is intended to prevent the creation of orphaned wells.

Canada

Canada announces national emissions cap-and-trade

Canada announced a national emissions cap-and-trade system targeting the oil and gas sector. It intends to publish draft regulations in mid-2024, finalize them in 2025, and require annual reporting as early as 2026. 

Canada publishes draft to reduce methane emissions

Canada’s Environment and Climate Change Canada (ECCC) published a draft rule to reduce O&G methane emissions by 75% below 2012 levels by 2030.

Global

European Union pushes methane emissions reduction strategy

The EU reached a provisional agreement on a Methane Emissions Reduction Strategy that builds upon OGMP 2.0 requirements in November 2023. It is intended to reduce methane emissions both in Europe and in their supply chain. After the formal adoption of the strategy, it will be published in the EU Official Journal and become effective 20 days later.

COP28 participants commit to reducing methane emissions

50 oil and gas companies launched the Oil and Gas Decarbonization Charter (OGDC), which commits to 0.2% methane intensity by 2030, net-zero Scope 1 & 2 emissions by 2050, and the elimination of routine flaring.

Where to go from here

In addition to regulatory requirements, oil and gas companies are feeling increased pressure from other stakeholders to set methane emissions reduction goals and transparently report progress within voluntary differentiated natural gas frameworks or other sustainability initiatives. 

Feeling like you can’t keep up? Wondering how you are going to get through all of the new regulatory text and determine what it means for your company? Curious if there are synergies to be had between the regulatory requirements and voluntary frameworks such as OGMP 2.0 or MiQ? Rest assured that Montrose knows methane. We take a comprehensive approach to methane emissions measurement, management, and reduction, from strategy and program development to boots-on-the-ground methane detection and measurement. We assist companies in addressing their toughest climate and broader sustainability challenges, including transitioning to a low-carbon economy while continuing to thrive in the oil and gas marketplace.