Canada unveils new rules to lower oil and gas methane emissions

By Amanda Stephenson

CALGARY, Dec 16 (Reuters) - Canada announced long-promised rules on Tuesday aimed at dramatically reducing methane emissions from the country's oil and gas sector.

The regulations lay out a path for Canada — the world's fourth-largest oil producer — to cut its overall emissions of the potent greenhouse gas by 75% over 2014 levels by 2035.

They fulfill a promise by Prime Minister Mark Carney to strengthen Canada's existing methane rules, but allow for a slightly longer target time frame than the previous draft rules announced under Carney's predecessor Justin Trudeau.

Trudeau's never-implemented rules called for a 75% reduction in methane emissions by 2030 and faced criticism from the oil and gas industry for being too difficult to achieve.

While methane does not last as long in the atmosphere as carbon dioxide, it can have 80 times the climate-warming impact of CO2 over a 20-year period.

Oil and gas facilities are responsible for about half of Canada's total methane emissions, according to the government. Methane — the main component of natural gas — is released directly into the atmosphere during oil and gas production through practices such as venting and flaring, and can also escape through leaks in wells and other infrastructure.

The new rules, which will take effect in 2028, prohibit venting with several exceptions and establish an inspection schedule for companies to find equipment leaks and repair them.

Operators will have the option to design their own approaches to controlling methane as long as they meet required methane intensity thresholds.

Total greenhouse gas emissions from Canada's oil and gas sector continue to grow as production increases, and Canada is not expected to reach its target of cutting greenhouse gas output by 40% to 45% below 2005 levels by 2030.

Carney, who has been criticized by environmentalists who see him as prioritizing the economy over climate, recently rolled back some of Canada's emissions policies to spur energy investment.

But on methane, the country has made progress. Previously enacted rules, which require industry to regularly inspect and repair equipment to reduce leaks, have helped put Canada on track to meet its previous methane commitment of a 40% to 45% reduction below 2012 levels by the end of 2025.

The Canadian government said the new rules will reduce emissions by 304 million tonnes of carbon dioxide equivalent while reducing oil and gas production by just 0.2% between 2025 and 2035.