Concern over climate change has brought increased focus on methane and greenhouse gas emissions associated with oil and gas production. These emissions, especially methane emissions, can diminish the greenhouse gas benefits of using gas in place of coal and represent a significant source of climate pollution. The 2021 Oil & Gas Benchmarking Report is a collaborative effort using publicly available data to develop comparable metrics that highlight the GHG performance of onshore oil and gas producers in the U.S.
In addition, a growing body of research indicates that methane emissions associated with oil and natural gas production are substantially higher than those reported in official inventories. A wide range of stakeholders, including policymakers, fuel purchasers, environmental organizations, and financial institutions, are interested in better understanding industry-wide and company-specific emissions trends. Oil and gas companies that minimize and most effectively manage their emissions will be best positioned for a low-carbon future.
Stakeholder engagement with the industry—and the industry’s ability to benchmark its own performance—has been stymied by a lack of clear and consistently calculated metrics, forcing stakeholders and companies to rely on voluntary metrics reported by companies that are often incomplete or non-comparable.
The 2021 Oil & Gas Benchmarking Report is a collaborative effort using publicly available data to develop comparable metrics that highlight the GHG performance of onshore oil and gas producers in the U.S. The report uses data reported to EPA under Subpart W of the Greenhouse Gas Reporting Program (GHGRP) and data calculated from assumptions in EPA’s annual Greenhouse Gas Inventory (GHG Inventory). The report focuses on the onshore oil and natural gas production segments and does not include emissions or production from offshore operations, gathering & boosting facilities, or other midstream or downstream segments of the oil and gas supply chains. All of the information presented in this report is based on 2019 production and emissions data.
Key Findings
Of 295 oil and natural gas producers with reported data, the top 100 oil and gas producers by total energy were responsible for nearly 80% of total reported methane and GHG emissions in 2019.
While most top 100 producers are also among the top 100 emitters, production rank does not correspond to emissions rank.
Hydrocarbon production and associated GHG emissions are concentrated in a small number of basins. In 2019, the five largest basins by total oil and gas production were responsible for 66% of total reported natural gas production, 80% of total reported oil production, 51% of total reported methane emissions, and 78% of total reported CO2 emissions.
The methane emissions intensity of natural gas production and the GHG emissions intensity of oil and gas production varies dramatically across producers. Natural gas producers in the highest quartile of methane emissions intensity have an average emissions intensity that is nearly 22 times higher than natural gas producers in the lowest quartile of methane emissions intensity. Oil and gas producers in the highest quartile of GHG emissions intensity have an average emissions intensity that is nearly 10 times higher than oil and gas producers in the lowest quartile.
Pneumatic controllers were the largest source of total reported production-segment methane emissions, making up 54% of total reported methane emissions.
Fuel combustion equipment, such as engines and heaters, were the largest source of total reported production-segment CO2 emissions, responsible for 49% of total reported CO2 emissions.
In oil-heavy basins, associated gas venting and flaring can be a significant component of GHG emissions. In the Permian basin, for example, this source contributes 25% of total GHG emissions. In gas-heavy basins, associated gas is limited or non-existent; for example, there was no reported associated gas venting and flaring in the Appalachian basin. Across all basins, associated gas venting and flaring was responsible for 19% of total reported production-segment GHG emissions.
While the Greenhouse Gas Reporting Program does not capture all GHG emissions from the oil and gas industry, the data reported to EPA provide a consistent methodology for estimating emissions and a valuable framework for comparing performance across companies.