Energy In-depth: Obama administration releases first-ever rules to cut methane emissions in oil and gas industry

Editor’s note: Each Friday, Talk Business & Politics provides “Energy In-depth,” a round-up of energy and regulatory news.

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OBAMA ADMINISTRATION RELEASES FIRST-EVER RULES TO CUT METHANE EMISSIONS IN OIL AND GAS INDUSTRY
The Obama administration on Thursday proposed the first-ever regulations to address methane emissions from both new and existing sources in the oil and gas sector as a further step in the president’s mission to take action on climate change and protect public health. The U.S. Environmental Protection Agency (EPA) is finalizing a set of standards that will reduce methane, volatile organic compounds (VOCs) and toxic air emissions in the oil and natural gas industry.

Thursday’s actions are part of President Obama’s Climate Action Plan to reduce methane emissions, and keeps his administration on track to achieve its goal of cutting methane emissions from the oil and gas sector by 40% to 45% from 2012 levels by 2025. Methane, the key constituent of natural gas, is a greenhouse gas (GHG) with a global warming potential more than 25 times greater than that of carbon dioxide, the EPA said. To learn more about the new rules, including EPA fact sheets, click here.

SHELL SHUTS OIL WELL PRODUCTION IN GULF OF MEXICO AFTER OIL SPILL
Royal Dutch Shell said on Thursday that it had observed an oil sheen near two of its deepwater oil fields in the Gulf of Mexico. In a statement on its website, Shell said the likely cause of the sheen is a release of oil from subsea infrastructure and, in response, Shell has isolated the leak and shut-in production at both fields.

The global oil conglomerate estimates that 2,100 barrels of oil were released, but there were no drilling activities at its Brutus platform, which sits in water at a depth of 2,900 feet nearly 100 miles off the coast of Louisiana. Shell said it is determining the exact cause of the release by inspecting the subsea equipment and flowlines in the Glider field, a group of four subsea wells.

“The company has made all appropriate regulatory notifications and mobilized response vessels, including aircraft, in the event the discharge is recoverable. There are no injuries,” the oil giant said. “No release is acceptable, and safety remains our priority as we respond to this incident.”

EIA PROJECTS 48% INCREASE IN GLOBAL ENERGY USE BY 2040
The U.S. Energy Information Administration’s recently released International Energy Outlook 2016 projects that world energy consumption will grow by 48% between 2012 and 2040.

Most of this growth will come from countries that are not in the Organization for Economic Cooperation and Development (OECD), including countries where demand is driven by strong economic growth, particularly in Asia. Non-OECD Asia, including China and India, accounts for more than half of the world’s total increase in energy consumption over the projection period. Concerns about energy security, effects of fossil fuel emissions on the environment, and sustained, long-term high world oil prices support expanded use of non-fossil renewable energy sources and nuclear power.

Renewables and nuclear power are the world’s fastest-growing energy sources over the projection period. Renewable energy is expected to increase by an average 2.6% per year through 2040; nuclear power is expected to increase by 2.3% per year.