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Exxon supports federal methane standards at new, existing oil, gas facilities

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Exxon supports federal methane standards at new, existing oil, gas facilities

Exxon Mobil Corp. supports the U.S. federal government's developing methane emissions standards for both new and existing oil and gas facilities, the international energy company told the U.S. Environmental Protection Agency.

The EPA is revising Obama-era rules for new and modified oil and gas sector methane emissions sources, a move that has largely been welcomed by the industry as a way of lifting regulatory burdens.

Addressing the EPA's plans, Exxon said it encourages the agency to continue pursuing cost-effective rules, noting that it approves of national regulations to curb methane emissions for "both new and existing source oil and gas facilities."

"In that regard, we support maintaining the key elements of the underlying regulation, such as leak detection and repair programs, enhanced pneumatic device standards, control requirements on regulated storage tanks, and reduced emission completions on new wells," Exxon said in a Dec. 17 letter to the agency. "We believe the correct mix of policies and reasonable regulations help reduce emissions, further supporting the benefits of natural gas in the energy mix."

Exxon itself has established plans to reduce its methane emissions, including a control program that U.S. oil and gas production subsidiary XTO Energy Inc. launched in 2017 that includes regular leak detection and repair work and changes to facility designs and key components.

The company said it appreciates the EPA's effort to "make this comprehensive rulemaking more cost-effective" and supports the American Petroleum Institute's recommendations for how the agency could reduce the cost of complying with methane emissions rules.

On the whole, the industry and environmental groups have pushed opposing ideas as the EPA has moved to revise its oil gas methane rules.

The American Petroleum Institute has offered support for the revised elements of the EPA's 2016 New Source Performance Standards, while environmental groups said the changes would weaken important safeguards against leaks of methane and volatile organic compounds. The industry group also wants to see the EPA further cut requirements and costs for the sector by dropping the frequency of certain leak survey requirements from twice annually to annually, among other changes.

The Obama administration in May 2016 finalized its rule limiting methane emissions from new and modified oil and gas industry sources, saying at the time that it was expected to reduce 510,000 tons of methane emissions in 2025, which would have the same impact as curbing 11 million tonnes of carbon dioxide emissions. The agency had said implementing the standards was expected to cost about $530 million in 2025 but would result in $690 million in climate benefits that because of the decreased methane emissions.

The Trump administration is revising the rule to cut "unnecessary and duplicative red tape" for the energy sector, the EPA said in September. Under President Donald Trump, the EPA has dropped Obama-era plans to regulate existing methane emissions sources from the oil and gas sector.

Despite the regulatory walk-back, an industry-led methane emissions reduction program called the One Future Coalition targets a group methane emissions intensity of 1% by 2025, compared to a national 2012 emissions intensity of 1.44%. For 2017, the group of 16 companies had an emissions intensity of only 0.552%, according to the coalition. Methane intensity is the ratio of methane emissions to the total amount of methane produced, processed or transported.

Neither Exxon nor XTO is a member of the group.

"We have gained considerable experience from our efforts, and would welcome the opportunity to discuss these comments with EPA and further share our views on the importance of reasonable regulations to manage methane emissions for both new and existing sources prior to the final rule," Exxon told the EPA.