Climate crisis: Swathe of oil and gas industry agree ‘ambitious’ methane emissions reporting framework

Agreement paves way for stricter rules on fossil fuel accounting for one of the planets biggest contributing sectors

Oil reservoirs can contain large amounts of methane which is often flared off during drilling

(Getty)

More than 60 companies, representing almost a third of the world’s oil and gas industry, have agreed to report their methane emissions, in a move designed to improve transparency and help inform and tackle the climate crisis.

The Oil and Gas Methane Partnership (OGMP) is led by the United Nations Environment Programme (Unep), alongside the European Commission, and the Environmental Defense Fund, and claims to be the “new gold standard reporting framework that will improve the reporting accuracy and transparency of anthropogenic methane emissions in the oil and gas sector”.

The UN has described methane reductions from oil and gas companies as “one of the biggest and most solvable contributors to the climate crisis”.

Inger Andersen, Executive Director of Unep, said: “To win the race to net-zero emissions, we need everyone on board. We need ambitious action from the oil and gas industry. UNEP is committed to supporting efforts that reduce methane emissions, and we recognise the leadership of companies that have joined such an ambitious methane reporting framework.

“We look forward to seeing actions that turn commitments into actual emissions reduction.”

Methane released directly into the atmosphere is a highly potent greenhouse gas, with more than 80 times the warming power of carbon dioxide over a 20-year period.

Cuts to methane emissions can result in a “near-term reduction in the rate of warming”, Unep said, and can complement efforts to decarbonise the world's energy and transport systems while also delivering air quality benefits.

Kadri Simson, the EU energy commissioner, said: “I am very happy to see the energy industry taking immediate action on methane emissions. A clear commitment to measure and monitor emissions is an important first step for significantly reducing them and I am proud of what we have achieved together. Today's signature is the first deliverable under the Commission's recent methane strategy. There are many more steps to take to cut emissions along the entire value chain and I hope to work closely with all — European and international — partners to reach this goal.”

Unep said the new methane reporting framework will make it easier for officials, investors and the public to accurately track and compare performance across companies in ways that have not been possible to this point.

The new framework will also inform future legislative efforts in Europe. The European Commission is planning possible new laws that could require compulsory measurement, reporting and verification for all energy-related methane emissions.

The new framework also incorporates a requirement for reporting not only a company’s own operations and the methane produced, but also the numerous joint ventures responsible for a substantial share in their production.

This means methane produced by processes such as transportation, processing and refining — areas with substantial emissions potential that are often left out of reporting today.

Unep said the goal is to enable the oil and gas industry to make “deep reductions in methane emissions over the next decade in a way that is transparent to civil society and governments”.

The 62 companies that have joined the partnership have assets on five continents, representing 30 per cent of the world's oil and gas production.

The OGMP framework aims to deliver a 45 per cent reduction in the industry's methane emissions by 2025, and a 60-75 per cent reduction by 2030.

“Thanks to the 62 companies for committing to measure, report and reduce pollution from their core operations and joint ventures. This will be the basis for robust standards in Europe, and beyond, that ensure the oil industry takes the practical actions urgently needed for our climate,” said Fred Krupp, president of the Environmental Defense Fund.

According to the International Energy Agency, roughly three-quarters of methane emissions could be reduced with the technology that exists today, and close to half “at zero net cost”.

Reducing methane emissions from the energy sector by 90 per cent would shave two tenths of a degree Celsius from the forecasted rise in the planet's average temperature by 2050.

Reducing fossil methane emissions by 75 per cent can prevent up to 6 gigatonnes of carbon dioxide equivalent emissions annually — almost 10 per cent of the planet's 2019 greenhouse gas emissions, including land-use change, Unep said.

Together with the European Commission, Unep is also finalising plans to set up an independent International Methane Emissions Observatory. The organisation will aggregate and analyse multiple methane emissions data streams, including data reported by OGMP member companies, to accelerate reductions in methane emissions globally.