Biden faces a critical decision about the Permian Basin and its methane emissions from oil and gas.
Around 265 million years ago, much of modern-day Texas was underwater, and the vast region known as the Permian Basin was a flourishing coral reef. Today, the organisms that once thrived there have been transformed into enormous deposits of fossil fuels — and they have made the area one of the most treacherous front lines in President Joe Biden’s domestic fight against climate change.
The Permian Basin, which stretches hundreds of miles across West Texas and southeast New Mexico, accounts for 40 percent of US oil production and 15 percent of its natural gas, according to February data. Less than a year after oil prices dipped into negative territory because of the Covid-19 pandemic, production in the region has bounced back almost to pre-pandemic levels. Already, the region is the nation’s No. 1 source of methane, a greenhouse gas that warms the planet far more efficiently than carbon dioxide in the short term.
The US oil and gas industry has pinned much of its future hopes on the region, especially in the next decade: If it gets its way, the Permian Basin will still grow through 2029, outranking every country except for Saudi Arabia in liquid fuel production, according to one analysis from Oil Change International. At this rate, by 2050, it would account for 39 percent of the world’s new oil and gas emissions.
The world can’t afford this if it is to meet international climate goals. That’s what the International Energy Association recently made clear in a report that argued for halting new investment in fossil fuel production, starting in 2021. Yet under Biden, the Permian could undergo expansion if the industry sees through its plans to export its gas and oil. That means any credible US response to the climate crisis will need to include a plan for the West Texas Permian Basin.
But wrangling Texas oil and gas emissions could test President Biden’s powers like nothing else. When Biden signaled early in his presidency that fighting climate change must involve reining in the fossil fuel industry, Texas Gov. Greg Abbott immediately signaled that he would protect the state’s oil and gas industry at all costs. On January 28, Abbott signed an executive order to direct every state agency to use all lawful powers and tools to challenge any federal action that threatened the Texas energy sector.
Biden has committed to slash US climate pollution in half by 2030 to contain the worst of global warming, but the administration has few levers to limit pollution in a red state infamous for deregulating the industry. The Texas side of the Permian is the biggest challenge. The land is entirely state- and privately-held, compared to the federal lands in New Mexico, which makes it hard to discourage future oil production by blocking new leases. And unlike New Mexico, the state regulators and politicians have shown no interest in coming to terms with the Permian’s pollution.
That leaves the Biden administration with a thorny choice: It could take a gentler approach and regulate the Permian’s climate emissions but risk not doing enough. Or it could swing a political sledgehammer by declaring a climate emergency and cutting off the Permian from its global customers — which could provoke intense backlash from Abbott, industry, and voters in upcoming elections.
Sharon Wilson, an environmental activist with Earthworks, worries the Biden administration is underestimating the challenges, estimating it’s “going to take something like an army” to enforce environmental rules in West Texas. “The Texas regulatory agencies are underfunded, and they are understaffed, and they’re not really motivated. I don’t think that the Biden administration has a realistic picture of what it’s going to take to enforce these methane rules,” she says.
There is no easy answer here, but environmentalists intend on pushing Biden to go bigger and bolder in the Lone Star State. As Abbott has made clear, Texas won’t go along without a fight. Perhaps nowhere in the country captures the test of political will to address climate change — and the limits of the Environmental Protection Agency under Biden — better than the Permian Basin.
The Permian Basin is a ticking climate bomb
When Biden first said he would issue “stronger standards like controls from methane leaks,” in January, he never named the nation’s No. 1 source of methane pollution. The Permian Basin tops the list — and this runaway pollution is the primary reason why gas can be as bad for climate change as carbon-intensive coal.
Methane was once a mostly ignored greenhouse gas because it is less prevalent in the atmosphere than carbon dioxide. But methane concentrations rose to new heights in 2020, with the largest jump since records began in 1983, and it’s now impossible to ignore. Compared to carbon, methane is about 80 times as effective at trapping heat in the atmosphere over a 20-year period (though it lasts in the atmosphere for a shorter time — decades as opposed to centuries).
Not all human-caused methane emissions come from oil and gas production — landfills and cattle are major sources too. But those are harder to address, and we already have plenty of readily available fixes to address runaway methane emissions from oil and gas. That was the conclusion of the United Nations’ Climate and Clean Air Coalition’s May report, which singled out oil and gas as a sector that countries should tackle aggressively, and soon.
To help avert 1.5 degrees Celsius of global warming, the report found, the world needs to cut methane emissions 40 to 45 percent by 2030. An astounding 30 percent of those urgently needed reductions could be achieved by fixing leaks from oil operations.
Many of the large companies, including ExxonMobil, Shell, and BP, have promised to reduce their methane intensity. Of course, there are reasons this hasn’t been fixed by now. One is that gas has been so plentiful and cheap in the United States. In the Permian, where the majority of producers are interested in making bigger profits from oil, gas is little more than a waste product.
Even with some industry support, methane regulations have faced nothing but setbacks. Until it faced renewed pressure under the Biden administration, the oil lobbying group American Petroleum Institute was dead set against methane rules. A front group for gas companies, Texans for Natural Gas, still falsely claims that methane emissions are falling.
Producers often say they already have an incentive to conserve methane, because natural gas can be sold for use in heating and powering homes. But scientists have observed the opposite phenomenon. There has been rampant growth in methane emissions from booming oil fields like the Permian Basin. In the absence of regulations, companies continue to intentionally release methane, either by releasing it to the atmosphere with unlit flares or burning it off. These flares contribute not only to climate change but also to smog.
Even when methane is not released on purpose, the gas escapes from pipelines, tanks, and refineries throughout the supply chain for oil and gas, at the site of extraction. As Texas saw in its massive February blackout, the gas kept flowing when equipment was frozen offline or not working because of power outages, resulting in a big release of methane. Even worse: We don’t have a great sense of how big these methane releases are because Texas doesn’t regulate it, and former President Donald Trump reversed reporting requirements. The Environmental Defense Fund, for instance, flew planes over the Permian and found that methane levels were three times the EPA’s official estimates.
An EDF report published in the journal Science Advances in April 2020 found “the highest emissions ever measured from a major U.S. oil and gas basin. There’s so much methane escaping from Permian oil and gas operations that it nearly triples the 20-year climate impact of burning the gas they’re producing.” The methane that’s lost, EDF estimates, could supply power to 7 million households.
Methane is a problem everywhere oil and gas are thriving, and even in areas where oil is long gone, because abandoned wells can continue to leach the gas. The problem is especially acute in Texas, where the industry has been left to regulate itself.
The EPA has been struggling to enact common sense methane regulation for years
Biden has promised to fix the methane crisis, and Congress is expected to reinstate former President Barack Obama’s first regulation of methane from oil and gas operations — a fairly limited rule that forced companies to install the latest technologies to monitor and limit leaks from a portion of new oil and gas wells. Trump reversed it, replacing it with a rule that would actually increase emissions. Using the Congressional Review Act, the Senate voted 52-42 to nix Trump’s rule, and it faces a vote next in the House.
But if the US is going to get really serious about climate change in the next 10 years, as Biden has promised, it’s even more important to fix hundreds of thousands of wells — and more than a million miles of pipeline — that already exist. By September 2021, Biden’s EPA plans to issue its first draft rule to strengthen national standards for methane emissions from new, reconstructed, and modified oil and gas sources. Importantly, it will exercise its authority to tackle methane emissions from existing sources as well.
This process takes a long time, thanks in part to public hearings and a revision process that aims to strengthen regulations against inevitable court challenges. Then the EPA imposes deadlines for states to come up with plans for implementation, often missed by lagging red states. Even in a best-case scenario, the fight over methane regulations will likely last years beyond the Biden administration.
This is time we don’t have, given the extreme urgency of reducing emissions immediately to avert worsening climate change. Environmentalists, including the US Clean Air Task Force, have converged on a target they want the Biden administration to adopt, and that’s a 65 percent methane reduction from oil and gas by 2025.
Getting to that level requires a range of approaches, from “sensing methane from specialized road vehicles, towers, aircraft, or even satellites; or, alternatively, developing low-cost sensors that can detect emissions in real-time and be widely dispersed for use at individual wellpads or on vehicles servicing oil and gas sites,” the Clean Air Task Force wrote in a white paper.
Companies have promised to make some of these changes on their own, and states can go above and beyond federal standards. New Mexico’s new rules — directing operators to capture most of their natural gas waste — went into effect this week. Texas has gone the other way, showing how difficult it is to control the climate crisis in the Permian Basin.
Enforcing climate rules in Texas is going to be a mess
Wilson has spent decades trying to pressure Texas to take pollution from the oil and gas sector seriously, and she thinks any Biden methane rule is bound to be a Texas-size mess. Her organization, Earthworks, has monitored the pollution coming from the Permian Basin, with Wilson visiting sites using a specialized optical imaging camera to detect the gases. “Just because you come up with a rule doesn’t mean that that’s going to reduce anything … it has to have people to enforce it, and strong penalties,” Wilson said.
Instead, she and other environmentalists want the EPA to take more aggressive action sooner by revoking the state’s authority to enforce the Clean Air Act and invoking the EPA’s power to enforce a federal plan.
Typically, under the Clean Air Act, state regulators are responsible for implementing the EPA’s national regulations. They develop a state implementation plan that meets the requirements the EPA has laid out. But when a state is falling short of the EPA’s minimum benchmarks or — as could happen under Abbott’s leadership — refuse to draft an implementation plan at all, the EPA steps in with a federal plan.
There’s plenty of data that could empower the EPA to escalate its efforts in Texas. While New Mexico has taken some action to restrain methane, Texas only nominally regulates its oil and gas industry. The state has an abysmal record of enforcement for the regulations that are on the books, which are limited and full of loopholes. State data shows oil and gas regulators rubber-stamped over 35,000 requests to flare gas since 2013, without a single denial. “This is an area the EPA has clear authority to act and lead,” said Rosalie Winn, an Environmental Defense Fund attorney.
But there are plenty of obstacles. First, the EPA has limited resources for implementation. Second, and most importantly, even trying to see methane regulations through in Texas doesn’t address the larger issue. The intensity of its greenhouse gas emissions may decrease if companies are burning off less gas, but the cumulative pollution will rise as long as production keeps expanding, because flaring will never be completely eliminated. It’s a simple matter of math: The methane emissions the Permian is pumping out still are more than the atmosphere can handle, if we’re going to hit the Paris agreement’s 1.5 degrees of warming target and reach net-zero greenhouse gas emissions by the middle of the century.
Beginning to regulate the industry will help, but doesn’t amount to the war on methane that Wilson and other environmentalists hope for. That’s why environmentalists are also pushing hard to cut off the Permian from the global market.
There’s one last option: Biden could go all-in and declare a climate emergency
Many countries are already rejecting West Texas gas because of its massive methane footprint. Last October, the French government intervened when the French trading firm Engie sought to sign a $7 billion, 20-year contract with a US liquefied natural gas company. As a part-owner of the firm, the French government delayed the deal, citing flaring as “a major source of negative attention for gas production globally and for Permian oil producers in particular.” In Ireland, a plan to import liquefied natural gas, originally from the Permian Basin, fell through because of the country’s climate commitments.
The US market is already saturated with gas and oil — a 2019 white paper from the University of Houston put it bluntly: “[There] is no domestic U.S. customer for the incremental crude projected to come out of the Permian Basin.” So the industry can’t risk a global backlash against Permian Basin exports.
“There are outside pressures bearing down on industry, and why [the industry itself] would perhaps not want to see Texas viewed as out of compliance and not following the rules,” said Colin Leyden, who oversees the Environmental Defense Fund’s work on methane emissions from Texas oil and gas.
That has made some of the operators in the region, including Pioneer Natural Resources and Devon Energy, eager to demonstrate their efforts to limit methane emissions to improve the Permian Basin’s reputation as a ticking climate bomb.
It’s not the kind of transformational change many environmentalists expect to see this late in the game on climate. “I can’t believe this is what they’re flagging as progress,” said Lorne Stockman, a senior researcher at Oil Change International. “We’ve been hearing for the last five years that the industry can keep all this methane from escaping at zero cost to itself. But they haven’t done that. We all know the technology’s there; we all know that the incentives should be there.” Stockman called the last decade of methane policy a “complete abject failure.”
Biden has one more option to rein in the Permian Basin, albeit the most drastic one. He can declare a national climate emergency to cut off producers from their global customers. While the most politically controversial of his options, it may become the only feasible option if Congress fails to pass climate measures.
There is a narrow pathway to do this. In 2015, Congress lifted a crude-oil export ban but kept a “get-out” clause. It allows a president to suspend these exports by declaring a national emergency. Other kinds of exports, like liquefied natural gas, would require permitting from FERC, an independent energy regulatory agency, and the Department of Energy.
The political drawbacks are clear even to environmentalists who say it may become necessary. Biden would face serious backlash, especially in a state that Democrats hope to win in a future presidential election and that some say is turning purple.
“An overnight ban on crude oil exports would, obviously, have serious economic disruption for the industry and communities in Texas and elsewhere that are built around those exports,” said Stockman. “It would be much better to have a five-, 10-year, and beyond plan to wind this part of our economy down in a just and fair way.”
Effective methane regulation is only a first step, because the climate crisis requires more unprecedented action. And that’s convincing the famously individualistic state to sunset one of its leading industries.
“Regulating emissions is just not enough,” said Rebekah Hinojosa, a Sierra Club organizer based in Brownsville, Texas, citing the other impacts of oil development in West Texas on the entire state’s air quality and groundwater pollution as well as the safety hazards from pipelines and trucks.
“We’re going to actually need to wind down the industry, not just clean it up,” Stockman said.
Author: Rebecca Leber