The US Environmental Protection Agency finalized a long-awaited rule to rein in methane emissions from the oil and gas industry, with measures the agency said will keep the equivalent of 1.5 billion metric tons of carbon dioxide out of the atmosphere between 2024 and 2038.

Biden administration officials announced the new regulations at the COP28 climate conference in the United Arab Emirates on Dec. 2, a global summit where nations are meeting to assess their pledges to slow global warming. Held in the coastal city of Dubai, COP28 also seeks to rally signatories to the Paris Agreement on climate change to rapidly ramp up their decarbonizing efforts.

"Even as we press to phase out our reliance on fossil fuels, we must work to clean up existing operations rapidly and rigorously," Ali Zaidi, US President Joe Biden's national climate adviser, told a news conference in Dubai. The methane reduction rule will reduce annual US greenhouse gas emissions by nearly 2% in 2030, Zaidi said, "further moving us along the trajectory we need to be on."

In all, the new mandates under the US Clean Air Act are projected to eliminate nearly 80% of methane emissions the industry would otherwise have released over the next 15 years, the EPA said. The rule is also expected to eliminate millions of tons of smog-forming volatile organic compounds and air toxics that affect communities near oil and gas operations, the agency said.

The US announcement came the same day that 50 major oil and natural gas companies, including Exxon Mobil Corp., Occidental Petroleum Corp. and EQT Corp., pledged to end routine flaring of natural gas by 2030 and reach net-zero emissions for their operations by 2050.

The voluntary industry initiative — which does not include indirect, or Scope 3, emissions from the fuel the companies sell — has been a key priority for COP28 President Sultan Ahmed Al Jaber. The climate summit's president is also the CEO of his country's state-owned Abu Dhabi National Oil Co.

Once released, methane traps more than 80 times the heat of carbon dioxide over the first 20-year period. The gas is responsible for nearly one-third of the global temperature rise the world is experiencing today and must be reined in to keep warming to the critical 1.5 degrees C from pre-industrial levels, scientists say.

The US oil and natural gas sector is the country's largest source of industrial methane, with the Permian Basin producing area topping the chart, a 2021 study by the Environmental Defense Fund found.

A 'complex rule'

The EPA estimates that the cost of the new mandates for US oil and gas producers to detect and prevent equipment leaks, end flaring and curb "super-emitting" events will reduce oil output by about 41.4 million barrels by 2038, around 1% of the nation's total oil production. Natural gas production would drop by about 0.75%.

The American Petroleum Institute, the industry's largest trade group, said "smart" federal regulation should take into account the growing need for oil and natural gas.

"To be truly effective, this rule must balance emissions reductions with the need to continue meeting rising energy demand," API said in a statement. "We are reviewing the complex rule to ensure it meets that dual objective."

The trade group had been pushing to give oil and natural gas producers more flexibility in implementing the new mandates, something federal officials said the final rule offered.

In its cost-benefit analysis, the EPA found the new regulations will yield net climate and ozone health benefits of about $98 billion between 2024 and 2038. The agency used an updated metric pegging the social cost of methane to be $1,900 per metric ton in 2024.

EPA sought to balance industry concern

Operators are getting two years to eliminate routine flaring of natural gas from new oil wells and one year to phase in process controllers and pumps that eliminate emissions, administration officials told a Dec. 1 press briefing. Earlier versions of the rule had tighter deadlines.

The final rule will allow flaring at some low-emitting wells where the abatement cost "would be significant relative to the benefits in terms of emission reductions," officials said. Operators may also combine technology solutions for detecting leaks.

The rule will give states and tribes the option to implement and manage the new regulations themselves, per the Clean Air Act, and two years to implement such a program, noting that some states already have such programs underway.

The regulations work in tandem with the 2022 Inflation Reduction Act, which imposes the first-ever methane emissions fee for oil and gas companies. Operators managed by a state program, or that can prove their emissions do not exceed 25,000 metric tons of greenhouse gases annually, are exempted from the fee.

"We've been able to ... bring everyone to the table and create a successful and very aggressive technology standard," EPA Administrator Michael Regan said at COP28. "This is probably one of the most innovative standards EPA has ever produced."

Like keeping 1 billion cars off the road

The rule was modeled in part from New Mexico's oil and gas regulations, which Gov. Michelle Lujan Grisham said have already cut methane pollution 70% since going into effect in May 2021. Speaking alongside Biden administration officials in Dubai, Lujan Grisham said state action alone cannot tackle the country's methane problem.

"Having federal rules means that my border states and the very same companies who operate in those states will adhere to the same standards ... and protect the individuals who have long deserved better protections from their state leaders and, quite frankly, from their federal government," the governor said.

In all, the EPA's final methane rule is expected to keep 58 million tons of methane out of the atmosphere over the next 15 years. That is equivalent to keeping 1 billion cars off the road for one year, according to Fred Krupp, president of the Environmental Defense Fund, a group that has long pushed for stricter industry standards.

"This is not only going to affect oil and gas in the United States," Krupp said, "it's going to be influential and affecting how oil and gas is produced everywhere around the world."

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