Ottawa will work with industry and provinces – including Alberta and British Columbia, which are already proposing mitigation measures – to establish national regulations for both new and existing sources of methane, which is 20 times more powerful than carbon dioxide as a heat-trapping agent.
After meeting Thursday, Mr. Trudeau and President Barack Obama said they would work together to implement the United Nations climate agreement reached in Paris in December, including joint commitments to cut emissions of methane and other greenhouse gases, introducing new fuel-efficiency regulations for trucks and other vehicles and jointly develop clean-energy technologies.
The two countries are “responsible for a lot of the carbon pollution that is causing climate change,” Mr. Obama said. “If we don’t agree, if we’re not aggressive, if we’re not far-sighted … then other countries won’t step up and it won’t get solved.”
In a joint statement released early Thursday, the leaders said both federal governments would move to regulate methane emissions from the oil and gas sector, which – along with agriculture and municipal landfills – is a major source of the gas. The United States is the second-largest emitter of methane from the oil and gas industry in the world, while Canada is fourth.
The problem of fugitive methane emissions – both into the atmosphere and into well water – has been a major concern surrounding the boom in hydraulic fracturing and intensive drilling that has unlocked vast shale gas and oil deposits across North America. Some scientists say that, unless those emissions can be reduced, using natural gas is no better than coal-fired electricity from a climate perspective. It is also released during conventional oil and gas extraction, processing and transmission.
Industry spokesmen in Canada said it is too early to assess the impact of Ottawa’s plan, but that companies are already working with environmental groups and provincial officials in British Columbia and Alberta to identify the problem and the best approach to deal with it.
As part of its climate strategy, Alberta’s NDP government pledged to reduce methane emissions from the oil and gas industry by 45 per cent from 2012 levels by 2025. In unveiling the strategy, Premier Rachel Notley was joined on the stage by senior executives of Cenovus Energy Inc., Suncor Energy Inc., Canadian Natural Resources Ltd. and Royal Dutch Shell PLC.
A spokeswoman for Ms. Notley welcomed the federal involvement, saying the two governments should be able to come up with a joint approach. “We’re happy to have it as a national commitment because it makes us more competitive,” Ms. Notley’s director of communications, Cheryl Oates, said Thursday.
Saskatchewan Premier Brad Wall has not proposed methane rules for the industry and has suggested the lack of carbon regulation would provide an advantage to companies operating in his province. Mr. Wall was campaigning for re-election Thursday and not available for comment on the federal plan.
The Canadian Association of Petroleum Producers welcomed Mr. Trudeau’s announcement, which builds on a promise made last year by the former Conservative government to regulate the industry’s methane emissions. “It will be helpful to have the feds in the room to help maintain alignment across provincial jurisdictions,” CAPP vice-president Alex Ferguson said.
Cenovus said it is important to have a level playing field on regulations, noting that Alberta has had regulations for years while the United States is just catching up.
“The methane goal announced by the federal government is consistent with the goal announced last November as part of Alberta’s new climate plan, which we support,” Cenovus spokesman Brett Harris said in an e-mail. “We believe Alberta’s climate plan establishes Canada as a leader among fossil-fuel-producing nations worldwide and that the methane provisions in the plan will play an important role in determining Canada’s overall approach.”
Companies with a large number of old, low-volume gas wells are likely most at risk of costly remediation, said Dan Allan, vice-president at the Calgary-based Canadian Society for Unconventional Resources, which represents the shale gas and oil sector. “But there are things that can be done and probably should be done,” Mr. Allan said.
A report last year by the U.S.-based Environmental Defense Fund and Calgary’s Pembina Institute said Canada can reduce methane emissions by 45 per cent at a cost of less than 1 cent per 1,000 cubic feet of gas produced, or the equivalent of $2.50 (U.S.) per tonne of carbon dioxide.
In the joint leaders’ statement in Washington, the Obama administration said it would develop regulations for existing sources of methane emissions from the industry, complementing its current efforts to set rules for new sources. It is unlikely the administration can compete the regulatory process for existing sources before leaving office next January, leaving the job for its successor. Several states have their own regimes, and the U.S. industry slammed Mr. Obama’s effort as costly duplication that could pose risks to the shale gas and oil industry.