Analysis provides the most accurate public,
basin-wide estimate of methane emissions for the Permian
HOUSTON, Dec. 23,
2024 /PRNewswire/ -- Annual methane emissions
stemming from oil and gas production operations in the Permian
Basin decreased 26% in 2023 from the previous year—equal to the
total amount of carbon emissions avoided by every electric vehicle
on the road in the United States
that year, according to a new analysis by S&P Global Commodity
Insights.
The data show that methane emissions from upstream oil and gas
operations in the Permian Basin fell by more than 34 billion cubic
feet (bcf) in 2023, the most recent year that data is available.
Given that methane is a potent greenhouse gas, the reduction was
equivalent to 18.5 million tons of carbon dioxide emissions avoided
(100-year equivalency factor of 28*).
The findings of the latest analysis for Permian upstream
methane, produced in partnership with leading methane management
firm Insight M, are based on high frequency observation data that
include nearly 700 high-resolution aerial surveys covering 88% of
the basin's active wells to provide the most accurate, basin-wide
estimate of methane emissions.
"The sheer scale of this single-year improvement represents
significant progress and demonstrates the potential for what
lies ahead," said Daniel Yergin,
Vice Chairman, S&P Global. "Continued improvements in the
Permian—an area roughly the size of Great
Britain that is responsible for almost half of all U.S. oil
output—is providing a path to make meaningful contributions that
lower overall U.S. emissions."
To put the numbers into perspective, the size of the 2023
reduction in methane emissions was:
- More than the total 2023 driving emissions avoided by every EV
ever sold in the United States,
even if all the vehicles were powered 100% by zero-carbon
electricity.
- Roughly the same as the total GHG emission from all sources for
the state of Hawaii during the
same period.
The decline in emissions occurred even as total oil and gas
production in the Permian increased, the analysis says. As a
result, the basin's methane intensity (ratio of total methane
emissions to total output) registered an even more pronounced
decline, exceeding 30%.
The analysis attributes the emissions decline to ongoing
improvements in equipment as well as increasing deployment of new
technologies—from AI-driven analysis of operational data to
on-the-ground sensors, aircraft overflights and satellites—that
make it possible to detect leaks with greater speed and
accuracy.
"Improvements and increased accessibility of remote sensing
technologies is providing a better understanding of U.S. methane
emissions, and more actionable information, said Kevin Birn, Head of the Center for Emissions
Excellence, S&P Global Commodity Insights. "Leaks that
previously might have persisted for weeks or months can now be
addressed in a matter of days."
Additional findings from the analysis:
- Methane emissions measured as a percentage of the basin's total
natural gas output fell 33%. Methane emissions constituted 1.36% of
the region's total 2023 production of over 23 bcf per day—roughly
1/5 of all U.S. gas production.
- In terms of total energy (barrel of oil equivalent)
produced—notable because Permian production is heavily oil-focused,
with associated gas occurring as part of the process—the 2023
methane intensity for the Permian was 0.63% of total
production.
- In terms of lost economic value (i.e. had the gas been captured
and sold), 2023 methane emissions accounted for just 0.12% of
upstream revenues, a 70% drop from prior year as gas prices fell
relative to oil. While this revenue loss is minor in the context of
total revenues, given ongoing improvements in technology fixing
leaks can still deliver positive returns.
"For oil and gas operators, evaluating spending on methane
emissions reduction is a dynamic exercise as technologies and data
steadily improve, regulations change, and mitigation progress
continues," said Raoul LeBlanc, Vice
President, Global Upstream, S&P Global Commodity Insights.
"Obviously, the economics tighten as the leaks get smaller and
harder-to-find. However, detecting and mitigating fugitive methane
usually turns a profit simply from the sale of the recaptured gas,
even in a lower natural gas price environment."
About the analysis
Produced by S&P Global Commodity Insights Center for
Emissions Excellence in partnership with Insight M, the Permian
upstream methane analysis combines near-total coverage of the basin
and high frequency observations to provide the most accurate
public, basin-wide estimate of fugitive methane leaks and venting
released to date.
Frequency:
- The 2023 observed data is derived from roughly 700 survey
flights which took place on 185 separate days spread over the
course of the year.
Coverage:
- 88.2% of the 162,000 active Permian wells, (85.1% of
conventional wells and 95.6% of unconventional wells)
- Assets supplying 96.3% of the 3.5 billion boe produced in
2023.
Resolution:
- Overflights offer a level of resolution that is up to 5 times
greater than that of satellites, providing reliable attribution not
only by facility, but in most cases to specific assets or pieces of
equipment.
Threshold:
- Measurements taken detect emissions as low as 10 kg/hr, which
account for more than 72% of total methane released to the
atmosphere from upstream oil and gas operations. The volumes from
all sources below this threshold were estimated using the
Rutherford model developed by Stanford
University. More information on the methodology employed by
Insight M can be found here.
Global Warming Potential Factor:
- S&P Global Commodity Insights conversion of methane to CO2
equivalency are based on a Global Warming Potential (GWP) factor
for 100 years of 28 tons of CO2 per ton of methane. Using the
20-year factor of 86 would thus increase both the emissions
reduction and the continuing emissions to 3.07 times the figures
cited in this report.
* Compared with a ton of CO2, a ton of methane (CH4) absorbs
more energy and thus has a greater impact on earth's warming.
However, methane stays in the atmosphere for only about a decade,
whereas CO2 persists for hundreds of years. When looked at on a
100-year basis, methane thus has a Global Warming Potential of
27-30 times that of the same mass of CO2.
Media Contacts:
Jeff Marn +1-202-463-8213,
Jeff.marn@spglobal.com
Global/EMEA: Paul Sandell + 44 (0)7816 180039,
paul.sandell@spglobal.com
Americas: Kathleen Tanzy + 1
917-331-4607, kathleen.tanzy@spglobal.com
Asia: Melissa Tan
+ 65-6597-6241, melissa.tan@spglobal.com
About S&P Global Commodity Insights
At S&P
Global Commodity Insights, our complete view of global energy and
commodity markets enables our customers to make decisions with
conviction and create long-term, sustainable value.
We're a trusted connector that brings together thought leaders,
market participants, governments, and regulators and we create
solutions that lead to progress. Vital to navigating commodity
markets, our coverage includes oil and gas, power, chemicals,
metals, agriculture, shipping and energy transition.
Platts® products and services, including leading
benchmark price assessments in the physical commodity markets, are
offered through S&P Global Commodity Insights. S&P Global
Commodity Insights maintains clear structural and operational
separation between its price assessment activities and the other
activities carried out by S&P Global Commodity Insights and the
other business divisions of S&P Global.
S&P Global Commodity Insights is a division of S&P
Global (NYSE: SPGI). S&P Global is the world's foremost
provider of credit ratings, benchmarks, analytics and workflow
solutions in the global capital, commodity and automotive markets.
With every one of our offerings, we help many of the world's
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plan for tomorrow, today. For more information visit
https://www.spglobal.com/commodityinsights.
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