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A proposed new BLM rule would require energy companies to capture instead of flare methane from drilling rigs on federal and tribal lands. (Wikimedia Commons)

New Methane regulations could improve NM Air Quality, Revenues

ALBUQUERQUE, N.M. – Proposed new regulations for oil and gas producers on federal and tribal lands could not only clean the air, but also could pump millions of extra dollars into New Mexico’s economy.

The Bureau of Land Management last week issued a draft rule that would require energy companies to install new technology to avoid the venting, leaking or flaring of methane at well sites.

Jason Libersky, co-founder and owner of Quantigy Engineering, says capturing the methane from wells could mean an economic boost in a down oil market.

“When oil is, say, $100 a barrel, your associated gas will be between 3 and 5 percent of the return on the well,” he points out. “And then when you’re around $30 a barrel, the associated gas can be north of 20 or 25 percent.”

The BLM is planning a series of public meetings on the draft rule in February and March. The proposal is part of President Barack Obama’s overall plan to reduce methane pollution by nearly half over the next decade.

Libersky, whose company engineers parts and systems for drilling rigs, says much of the methane released on New Mexico lands is from older wells and equipment.

He says for many producers, the cost of installing equipment to capture the methane could be quickly recovered.

“For a well that’s been out there in the elements, producing for 20 or 30 years, it can be as easy as re-plumbing the piping and then replacement of a few valves,” he explains.

The EPA reports that, as a greenhouse gas, methane is 25 times more damaging than carbon dioxide.

In addition, the loss of methane has cost New Mexico taxpayers almost $43 million in royalties since 2009. Nationally, oil and gas companies operating on federal and tribal lands waste upwards of $330 million worth of gas.

Author: Mark Richardson/Dallas Heltzell, Public News Service – NM

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