Methane Abatement in Developing Countries

2. Step 1: Building emissions national inventories and baselines

Box 2.1. EFFECT recommendations: National inventories and baselines

What can governments do?

• Develop an emissions profile to identify how much methane is emitted and determine the location of the biggest sources, measure to the extent possible and estimate the level of emissions

• Develop protocols for incorporating new data such as satellite, flyovers and on-the-ground surveys, into national inventories

• Regulators should consider new technologies such as continuous monitoring systems, aerial surveillance, and satellite instruments as independent sources of data

• Collect information on flaring and venting, by requiring oil and gas companies, including NOCs, to publicly disclose such information

• What can governments and the fossil fuel industry do together?

• Establish a collaborative process to improve national inventories reports for oil and gas methane emissions by defining the different categories of emissions, reviewing the approach to emission estimation and data compilation, and updating the process after construction of the inventory.

Source: (OECD, 2022[1]).

Developing an emissions profile

At the outset, it is critical for governments to understand the nature and magnitude of methane emissions to determine the location of the biggest sources, to measure to the extent possible and estimate the level of emissions in order to design a robust regulatory framework that responds to the specific characteristics of the upstream oil and gas sector in their jurisdiction and better target regulatory intervention. For example, Canada’s 2018 methane regulations adopts a ‘‘potential to emit’’ threshold which exempts facilities producing less than 60 000 m³ of gas per year from certain regulatory requirements (venting limits, LDAR and equipment standards) but can achieve higher total methane reductions, rather than applying the same rules uniformly across all the emitting sources (Olczak, Piebalgs and Balcombe, 2023[2]).

The measurement and reporting of methane emissions is also an important component of the EU Regulation on methane emissions reduction in the energy sector which imposes specific requirements on oil and natural gas that is imported to Europe. Oil and gas producing developing countries that intend to export oil and gas to the European Union should ensure that their regulatory framework for measuring, monitoring and reporting methane emissions is equivalent to Article 12 of the EU’s regulations or meets the requirements of OGMP 2.0 level 5 – for the requirements of OGMP 2.0 reporting levels, see Table 2.1. Article 12 of the EU’s regulations also provides that monitoring and reporting requirements ensure at least source and site level quantification, as well as regular reporting. In addition, producer governments will need to implement either a third-party verification scheme – where independent accredited verifiers review emissions reports prepared by operators to assess their accuracy and credibility; or a government verification and auditing scheme – where the government empowers a relevant regulatory agency (e.g.  an environmental protection agency) to undertake verification and auditing activities.

Table 2.1. OGMP 2.0 Reporting levels

LEVEL 1	LEVEL 2	LEVEL 3	LEVEL 4	LEVEL 5
Venture/Asset Reporting	Emissions Category	Generic Emission Source Level	Specific Emission Source Level	Level 4 + Site Level Measurement Reconciliation
Single, consolidated emissions number	Emissions reported based on IOGP and Marcogaz emissions categories	Emissions reported by detailed source type	Emissions reported by detailed source type using specific emissions and activity factors	Level 5: Integrating bottom-up source-level reporting (L4) with independent site-level measurements.
Only applicable where company has very limited information	Based on generic emissions factors	Based on generic emissions factors	Based on direct measurement or other methodologies	UNEP recommends attempts at site-level measurements with possible reconciliation for a nominal 1/3 of assets or emissions with subsequent year-over-year progress to move all material assets to L5.
				Site-level measurements: direct measurement technologies at a site or facility level on a representative sample of facilities

Source: (UNEP, 2020[3]).

Historically, methane emissions measurements were based on unquantified estimations or emission factor-based calculations (multiplying activities by emission factors), often resulting in incomplete or inaccurate information. However, in recent years with advancements in technology and increasing international co-operation, governments have access to new sources of information that can be used to improve the accuracy of methane detection and monitoring – see Box 2.2.

Box 2.2. Monitoring methane emissions by satellite

Satellites are a key tool in monitoring methane emissions and are becoming increasingly accessible to governments and companies by providing better and more transparent data to inform methane mitigation measures. However, while satellites can complement existing ground-based measurement practices, they may provide insufficient data in some situations. For example, satellites can struggle to provide readings in some environments including offshore areas, mountainous regions or at high latitudes. Satellite readings may also be negatively affected by cloud cover, and this is particularly relevant in areas with dense forests or those in equatorial regions, such as Nigeria or Venezuela.

Developing countries can benefit from the increasing availability of methane detection satellites and associated detection programmes to monitor methane emissions in their jurisdictions. Some of the more prevalent methane detection satellites and providers include:

• GHGSat – a satellite-based and aerial remote sensing company with expertise in monitoring methane emissions. In 2023, GHGSat’s satellites carried out around 13 000 daily observations at specific oil, gas and coal facilities across Eurasia, North America, the Middle East and Australia. In 2021, GHGSat partnered with OGCI to detect and characterise previously unknown persistent methane emissions sources. Operators provided on the ground confirmation for several persistent large sources detected through satellite monitoring. Data is free and available upon request.

• Methane Alert and Response System (MARS) – UNEP’s MARS programme was launched at COP27 to facilitate the use of satellites to detect major methane emission events and to then alert government authorities and relevant operators. In 2023, MARS detected 500 large methane emissions events from global oil and gas operations and delivered approximately 80 notifications to relevant countries and operators. Data is free and publicly available.

• MethaneSAT – backed by the Environmental Defense Fund (EDF), MethaneSat was launched in March 2024 to provide frequent and high spatial resolution coverage of methane emissions from oil and gas facilities. MethaneSat is designed to regularly monitor roughly 50 major regions accounting for more than 80% of global oil and gas production. Data is free and publicly available.

• Sentinel programme – the European Space Agency’s Copernicus programme aims to achieve a global, continuous, autonomous and high-quality Earth observation capacity. Central to this programme are the Sentinel satellites which provide optical imaging for land services, and monitoring of weather and atmospheric conditions. Several Sentinel satellites, in particular, Sentinel-2 and Sentinel-3 and Sentinel‑5P, provide detection/monitoring of methane emissions, and are used by several public and private actors including the IMEO and analytics firm Kayrros. For example, in 2023, using data from Sentinel‑5P, Kayrros released a tool that quantifies large methane emissions and provides country-level oil and gas methane intensities. Kayrros detected 152 methane super-emitter events in the United States from oil and gas operations. Data is free and publicly available.

Source: (IEA, 2024[4]); (OGCI, 2024[5]).

Governments can use two approaches to measure methane emissions:

• National inventory approach (bottom-up) – this approach is already used by countries to submit their emission inventories to the UNFCCC. Under the UNFCCC process, governments are expected to track and report national-level GHG emissions through the development of inventories. These inventories cover methane as well and can be used as a basis for building a specific methane emissions inventory. While the Intergovernmental Panel on Climate Change (IPCC) has issued guidelines to ensure that methane emission factors account for local characteristics (e.g. surface versus underground mine) (Vernon et al., 2022[6]), these inventories normally use estimates via bottom-up approaches where a typical emissions factor is applied to the total number of oil and components (e.g. wellheads, pneumatic devices, storage tanks) to estimate total emissions, rather than direct measurements;

• Atmospheric observations approach (top-down) – this approach uses remote sensing from towers, aerial surveys and satellites to monitor emissions of individual facilities and regions. This approach has been used to infer historical global emission trends, and can lead to better confidence in the outcomes of specific emissions reduction efforts (Vernon et al., 2022[6]; UNEP, 2022[7]; IEA, 2021[8]).

Recent studies in the oil and gas sector have identified discrepancies between inventories compiled with bottom-up and top-down emission methods, based directly on empirical, atmospheric data of emitting units or facilities (e.g. aerial surveys and satellites). For example, satellite-based estimates of methane emissions from the oil and gas sector in Mexico are 100% higher than emissions presented in the Mexican national greenhouse gas inventory (UNEP, 2022[7]; CLDP, 2023[9]). One possible explanation for such discrepancies is that most inventories generated by countries and companies rely on bottom-up approaches that are not based on recent measured data. These inventories may be underestimating potential emissions sources, and in particular may be missing “super-emitting” events which are often responsible for an outsized share of overall emissions levels (IEA, 2024[4]).

Although bottom-up inventories often underestimate overall emissions, they can still provide a useful starting point for methane emissions measurement. The creation of a granular asset and equipment level inventory can be an important first step and can encourage collaboration between the NOC and/or energy ministry, who may hold some of this data, and the environment/climate change ministry that may not. Furthermore, the creation of a bottom-up inventory can help the country to identify and prioritise next steps – for example, where regulatory action can proceed without having to wait for top-down emissions data. The results of this bottom-up equipment inventory, even with generic emission factors, can also help the country understand where to focus measurement studies to improve upon generic emission factors. Finally, the top-down site level measurement technologies can help validate the results of the bottom-up inventory, highlight areas of discrepancy needing more research, and potentially track reductions associated with regulatory compliance. Governments can make use of publicly available tools to guide them through the process of setting up a bottom-up equipment inventory – see Box 2.3.

Box 2.3. CATF’s Country Methane Abatement Tool

The Country Methane Abatement Tool (CoMAT) is a tool designed to make it easier for countries to quickly estimate their methane emissions and abatement potential, develop comprehensive mitigation approaches, and design methane reduction policy strategies.

Launched in 2019, CoMAT lets users develop initial and refined estimates of their jurisdictions’ emissions and reduction potential using the best information the users have available and provides access to a digitised library of leading methane policy and proven best practices.

CoMAT’s emissions calculations and inventory tools can help countries understand what information is needed to put together a bottom-up inventory of emissions. Furthermore, CoMAT can assist countries to continually refine their emissions inventories and explore variables and specific policy and regulatory options that can drive pollution reduction.

Source: (CATF, 2019[10]).

Ensuring regulations can accommodate new technologies to supplement national inventories

Governments can rely on a number of traditional and new technologies to inform the development of national inventories. In recent years a number of technologies that can detect and measure methane emissions have been developed, including sensors that can be mounted on satellites, aircraft, drones, or vehicles, as well as sensors that can be permanently installed at a single site/facility to provide more near-continuous monitoring of methane emissions.

Governments should ensure that regulations are crafted to accommodate the use of new technologies. This could be done through the inclusion of emissions reduction performance standards, as opposed to prescribing the deployment of specific technologies. In this regard, governments should monitor developments in methane measurement technologies to ensure that regulatory requirements do not inadvertently lock in old technologies and prevent uptake of new options (IEA, 2021[8]). For example, no-fly zones around production sites or other oil and gas infrastructure may limit drones and non-government use of satellite imagery from being used to detect methane emissions. Governments may also need to ensure that regulators are empowered and resourced to engage with third-party technology providers to conduct aerial or satellite monitoring, and to engage with international organisations and non-governmental organisations that provide free aerial surveys and satellite monitoring of methane emissions – for example, the OGCI’s Satellite Monitoring Campaign (SMC) and the CCAC Methane Science Program (CLDP, 2023[9]). Regulators may also need to build capacity to interpret the results and make effective use of the data.

Setting corporate disclosure requirements to inform emissions baselines and national inventories

Governments should work with the oil and gas industry to establish a collaborative process to improve national inventories reports for oil and gas methane emissions. This process should include defining the different categories of emissions, reviewing the approach to emission estimation and data compilation, and updating the process after construction of the inventory.

Box 2.4. Addressing super-emitter events through regulation

The U.S. Environmental Protection Agency (EPA) developed the super-emitter programme in response to studies indicating that large, irregular emissions events contribute almost 50% of methane emissions from the oil and gas sector.

As set out in the U.S. EPA’s 2023 Final Rule to Reduce Methane and Other Harmful Pollution from Oil and Natural Gas Operations, that entered into force on 7 May 2024, the super-emitter programme serves as a backstop to other reporting provisions of the Final Rule in that it allows EPA-certified third parties to supplement a facility’s required routine monitoring using EPA approved, remote, advanced sensing technologies capable of identifying an on-going super emissions event.

The approved third parties must notify EPA within 15 days of discovering an ongoing event and the EPA will then review the data for completeness and accuracy “to a reasonable degree of certainty”. If the data meet EPA’s criteria, EPA will notify the owners or operator of the event who must initiate an investigation with five days of notification.

Source: (Jenks, Dobie and Leahy, 2023[11]).

While governments have the responsibility of setting regulations, operators are likely to have better information than governments about the nature and extent of their methane emissions profile. In particular, operators may have information about the distribution of emissions at the site/facility-level – which is key in order to identify high-emitting facilities (super emitters) that provide a disproportionate contribution to total emissions in the jurisdiction (UNEP, 2022[7]).

Examples of collaborative public-private efforts to measure emissions can be seen in methane regulations in Colombia and Mexico that set out requirements for the development of an emissions profile. These include specific requirements for the establishment of a methane emissions baseline to identify, classify, and quantify methane emissions, and to serve as a reference for the comparison of methane emissions reductions in the subsequent years. For example, in Mexico operators must establish a baseline of natural gas emissions for each facility that includes a diagnosis of emissions that occur in equipment, components, and wells operations. The baseline should include: the identification, classification, and quantification of methane emissions. The emissions baseline must be reported to the regulator and will serve as a reference for the comparison and for the continuous improvement of methane emissions reductions for the subsequent years.

Similarly, Colombia’s 2018 methane regulations specify that an operator must establish a baseline of natural gas emissions for each facility and that includes all equipment and components. Operators must submit an emissions baseline to the regulator within 30 days from preparation for approval. The baseline will serve as a reference for the comparison and for the continuous improvement of methane emissions reductions for the subsequent years, as baselines must be updated every three years and re-submitted for approval. The baseline will cover emissions from: oil and gas production tests, well completions, discharge of liquids in exploration and production wells, well pilot testing, well stimulation including hydraulic stimulation and return fluid injection, well service, well abandonment and well workover activities. Article 45 provides that operators must establish a baseline within 12 months from the start of operations for new facilities and within 24 months after the entry into force of the regulation for existing facilities.

References

[10] CATF (2019), Country Methane Abatement Tool, Clean Air Task Force, https://www.catf.us/comat/.

[9] CLDP (2023), Methane Abatement Handbook, U.S. Department of Commerce, https://cldp.doc.gov/sites/default/files/2023-09/CLDP%20Methane%20Abatement%20Handbook.pdf.

[4] IEA (2024), Global Methane Tracker 2024, International Energy Agency, Paris, https://www.iea.org/reports/global-methane-tracker-2024.

[8] IEA (2021), Driving Down Methane Leaks from the Oil and Gas Industry, International Energy Agency, Paris, https://www.iea.org/reports/driving-down-methane-leaks-from-the-oil-and-gas-industry.

[11] Jenks, C., H. Dobie and R. Leahy (2023), EPA’s Final Methane Rule—Incorporating Advanced Technologies and Emissions Data to Reduce Methane Emissions from the Oil and Natural Gas Sector, Environmental and Energy Law Program, Harvard Law School, https://eelp.law.harvard.edu/wp-content/uploads/2024/08/EELP-EPA-Final-Methane-Rule.pdf.

[1] OECD (2022), Equitable Framework and Finance for Extractive-based Countries in Transition (EFFECT), OECD Development Policy Tools, OECD Publishing, Paris, https://doi.org/10.1787/7871c0ad-en.

[5] OGCI (2024), White Paper: Results of OGCI Satellite Monitoring Campaign 2022-2023 over Kazakhstan, Algeria and Egypt, Oil and Gas Climate Initiative (OGCI), https://www.ogci.com/wp-content/uploads/2024/03/SMC-Results-v4.pdf.

[2] Olczak, M., A. Piebalgs and P. Balcombe (2023), A global review of methane policies reveals that only 13% of emissions are covered with unclear effectiveness, One Earth, https://www.sciencedirect.com/science/article/pii/S2590332223001951.

[7] UNEP (2022), An Eye on Methane: International Methane Emissions Observatory, United Nations Environment Programme, https://www.unep.org/resources/report/eye-methane-international-methane-emissions-observatory-2022-report.

[3] UNEP (2020), Mineral Methane Initiative: OGMP 2.0 Framework, United Nations Environment Programme, https://ogmpartnership.com/wp-content/uploads/2023/02/OGMP_20_Reporting_Framework-1.pdf.

[6] Vernon, N. et al. (2022), How to Cut Methane Emissions, International Monetary Fund, https://www.elibrary.imf.org/view/journals/066/2022/008/066.2022.issue-008-en.xml.