EPA and Department of Energy announce $345M to reduce methane pollution from the oil and gas sector in Colorado and Wyoming

EPA and Department of Energy announce $345M to reduce methane pollution from the oil and gas sector in Colorado and Wyoming

Colorado State University, Pioneer Energy Inc, and Blue Mountain Operations among awardees receiving $850M nationwide

December 23, 2024

DENVER - The U.S. Environmental Protection Agency and the U.S. Department of Energy today announced approximately $850 million for 43 projects, including seven projects in the EPA Region 8 states of Colorado and Wyoming, selected for negotiation that will help small oil and gas operators, Tribes, and other entities across the country to reduce, monitor, measure, and quantify methane emissions from the oil and gas sector as part of President Biden's Investing in America agenda. The funding builds on unprecedented action to dramatically reduce methane emissions, with agencies taking more than 100 actions since 2023, including the finalization of an EPA rule that is expected to reduce methane emissions from covered oil and gas sources by 80% from 2024 to 2038 compared to projected emissions without the rule.

Today's investment incentivizes companies' near-term actions to conserve valuable energy resources for American consumers, improve operational efficiencies in a global market, and reduce methane emissions.

Award recipients in EPA Region 8 include:

Colorado State University, Fort Collins, Colorado ($324.6 million across three unique projects)

• Collaborative Approach to Reducing Emissions for Marginal Conventional Wells (MCWs) - Colorado State University intends to create a funding program where small operators of MCWs can enroll their MCW sites for methane emissions mitigation funding. Mitigation targets will be prioritized using on-site methane leak assessments and a regionally tuned marginal abatement cost curve analysis to maximize the cost-effectiveness of mitigation actions. The project team will identify solutions and services for operators to deploy at the operator sites. Wide community outreach will seek operator and solutions in disproportionately impacted communities for enrollment and incubation. Training programs will build capacity through community colleges and online classes.

• Full Scale Validation and Field Deployment of Comprehensive Methane Reduction Solution for NG Pipeline Engine Compressor Sets - Colorado State University intends to develop an ultra-low methane emissions retrofit system for gas compression packages in the natural gas transmission and gathering sectors to reduce methane emissions from natural gas engines and eliminate normal compressor vent gas emissions. The project is expected to reduce engine methane emissions to less than 0.5% of the methane supplied in the fuel and eliminate normal compressor vent gas emissions.

• North‐Central Methane Center - Colorado State University intends to develop consistent, accurate, granular, and transparent multi‐scale methane emission measurements focused on the region's producing basins that will inform state and federal emission inventories for the North‐Central region, including a focused effort on gathering and transmission pipelines, distribution damage, and industrial meters.

Pioneer Energy, Inc., Lakewood, Colorado ($17 million across three unique projects)

• Zero-Emission Sweetening and Stabilization Production Facilities for Sour Sites - Pioneer Energy, Inc. intends to address elimination of flaring and related emissions from oil and gas production through deployment of equipment that achieves better separation between gas and oil while eliminating nearly all emission sources. The approach is also intended to serve as a testbed for how to find, train, onboard, and support the underserved community of adults on the autism spectrum for jobs in the clean energy economy.

• Methane Emission Mitigation through Onsite Methanol Synthesis - Pioneer Energy, Inc. intends to eliminate flaring and related emissions from oil and gas production with a technology designed to use mass produced internal combustion engines as compressors and chemical reactors. The project will also serve as a testbed for how to find, train, onboard and support the underserved community of adults on the autism spectrum for jobs in the clean energy economy.

• Zero-Emission Drop-In Replacement Production Facilities for Marginal Conventional Wells - Pioneer Energy, Inc. intends to advance a new well pad processing technology to achieve better separation between gas and oil, replacing existing equipment while eliminating nearly all emissions sources. The project is also intended to serve as a testbed for how to find, train, onboard, and support the underserved community of adults on the autism spectrum for jobs in the clean energy economy.

Blue Mountain Operations, Rock Springs, Wyoming ($3.8 million)

• Scaling Solar Compressors Deployment for Methane-Free Pneumatic Solutions - Blue Mountain Operations intends to deploy and monitor a compact, fully integrated and solar-powered technology for remote oil and gas sites without grid power, designed to eliminate methane emissions and other secondary emissions. The project will also focus on investments in the development of a skilled workforce as well as a reduction in local pollution.

"Our region is home to some of the largest-producing oil and gas operations in the country, and unfortunately many of our neighboring communities are overburdened with polluted air," said EPA Regional Administrator KC Becker. "These grants will ensure the reduction of harmful greenhouse gases and volatile organic compounds while allowing operators to upgrade equipment and employ an underserved workforce."

"The public health of our nation depends greatly on our ability to drastically reduce harmful pollution from America's largest source of industrial methane - the oil and gas sector," said U.S. Secretary of Energy Jennifer M. Granholm. "This historic investment made possible by the Inflation Reduction Act is helping energy communities and deliver long-lasting health and environmental benefits across the country. At the same time, it will support small operators' ability to replace and upgrade old equipment, reducing emissions from marginal conventional wells, improving their supply chains to meet the growing market expectations for cleaner fuel sources."

"Colorado has been a national leader in addressing methane pollution from the oil and gas industry," said Senator Michael Bennet. "This funding helps ensure Colorado will continue leading the way towards cutting dangerous air pollution, slowing the rate of climate change, and growing our clean energy economy."

"We are proud to be able to support deployment of innovative solutions to methane emissions that will support small operators, contribute to workforce development, and improve conditions for communities," said Colorado State University Vice President for Research Cassandra Mosele.

The selected projects funded by the Inflation Reduction Act, the largest climate investment in history, represent a significant step in addressing climate change and improving air quality. By mitigating legacy air pollution and supporting small oil and natural gas operators, the projects will help reduce methane emissions through available and innovative technologies. Additionally, they will create partnerships to enhance emissions measurement and provide transparent data to affected communities. One Tribal consortium, 11 universities, and 20 private companies were selected for projects across the Nation to deploy and test new and existing methane mitigation technologies.

In total, EPA and DOE are partnering to provide $1.36 billion in financial and technical assistance as part of the Inflation Reduction Act's Methane Emissions Reduction Program. DOE's National Energy Technology Laboratory, under the purview of DOE's Office of Fossil Energy and Carbon Management, will manage the selected projects. Learn more about the selected projects.

Today's selections build on the $350 million in grant funding to states that EPA and DOE announced in December 2023 to support industry efforts to voluntarily reduce emissions at low-producing wells, monitor emissions, and conduct environmental restoration at well pads. Together, these investments are a key step in implementing the Methane Emissions Reduction Program.

About the Methane Emissions Reduction Program

Methane is a potent greenhouse gas that contributes to approximately one-third of the global warming we are experiencing today. Over 100 years, one ton of emitted methane traps 28 times as much heat in the Earth's atmosphere as one ton of emitted carbon dioxide. The oil and natural gas sector is the largest industrial source of methane emissions in the United States. A rapid reduction in methane emissions is one of the most important and cost-effective actions the United States can take in the short term to slow the rate of rapidly rising global temperatures.

The Methane Emissions Reduction Program, created by the Inflation Reduction Act, directed EPA to take action to tackle wasteful methane emissions from the oil and gas sector. The financial and technical assistance, implemented through a partnership between EPA and DOE, work in concert both with the recently finalized Waste Emissions Charge and with Clean Air Act standards issued in March 2024 to limit methane emissions from new and existing oil and gas operations. The Methane Emissions Reduction Program also advances the Biden-Harris Administration's Justice40 Initiative, which sets a goal that 40% of the overall benefits of certain federal climate, clean energy, and other investments benefit disadvantaged communities that are marginalized by underinvestment and overburdened by pollution.

Combined, these actions will help position the United States as the most efficient producer of oil and natural gas in the world and ensure that the industry remains competitive in overseas markets that require a minimum level of emissions performance. Together, DOE and EPA's methane actions will advance the adoption of cost-effective technologies, reduce wasteful practices, and yield significant economic, health, and environmental benefits, while driving continued innovation in methane detection, monitoring, and mitigation techniques.

Visit the EPA website for more information about the Methane Emissions Reduction Program, and the EPA or DOE website for more information about financial assistance under the Methane Emissions Reduction Program.

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