The wastage of oil & gas by Louisiana was revealed in a report by the Environmental Defence Fund to the tune of more than $82 million worth of natural gas in 2019, which is more than two-thirds of the state’s yearly residential consumption. More than $82 million worth of natural gas was lost by Louisiana in 2019 due to leaks, venting, or flaring at production sites, according to a study released Thursday by an environmental group & government watchdog organizations.
A consulting firm, Synapse Energy Economics Inc., conducted a study as it lists various environmental groups & municipal, state, & federal agencies among its clients. The report by the EDF (Environmental Defence Fund) said that state fossil fuel producers wasted more than 27 billion cubic feet (760 million cubic meters) of gas in 2019.
According to the report, the state government lost $2.5 million in tax & revenue receipts that year. The percentage of wasted gas was : more than 81% due to leaks, less than 1% from purposeful fuel venting, & 9% due to flaring. Small amounts of gas are vented or burned for a variety of possible reasons involving safety & economics.
A statement accompanying the report said : “That’s enough lost gas to meet more than 2/3 of residential natural gas demand in the state for a year.” A major component of natural gas is methane, which is a major contributor to climate change, making it an environmental hazard. Methane causes much more harm to the atmosphere in the short term as compared with carbon dioxide.
As a natural byproduct of exploration, natural gas is found at virtually every oil well. As it is colorless & odorless, natural gas is difficult to detect without expensive thermal imaging equipment. As such imaging technology becomes more accessible, scientists have begun finding significant methane leaks across the globe. As the federal Environmental Protection Agency considers rules aimed at preventing gas releases, including inspection requirements for well sites, the EDF report is considered timely.
Louisiana state is also setting in motion a process for developing rules to deal with the issues. The government of Louisiana missed out on an estimated $2.5 million in lost tax & royalty revenue in 2019 due to the 27 billion cubic feet of oil & gas methane wasted from Louisiana’s 31,000 active onshore wells.
EDF was joined by two watchdog groups in calling for policies to address the issue. Autumn Hanna, Vice President at Taxpayers for Common Sense, said in a statement, “Outdated policies keep billions of dollars’ worth of natural gas from getting to market at a time when budgets are tight & energy security is important as ever.”
Jan Miller of the Louisiana Budget Project added, “When the industry is allowed to waste natural gas, it robs the state of important tax revenue, which then has to be made up through other taxes or else leave the state without the revenue it needs to fund critical programs”.
A leading cause of methane waste in the state is flaring, which is the combustion of a gas prior to releasing it. Regulators prefer flaring over venting because it‘s less harmful to the atmosphere when a facility absolutely has to release methane.