Senate must vote against roll back of BLM methane waste rule

Before we invest in a sector, we try to identify companies best positioned to deliver strong, stable financial returns. We are dedicated to our clients who trust us to manage their money for the long-term. We look at whether a company is efficient in its business practices, and whether it adheres to strong positive environmental and social policies, which may increase company profitability and give it a competitive edge. 

That’s why it concerns us that Congress is working to roll back U.S. Bureau of Land Management (BLM) rules aimed at reducing methane pollution – an especially potent greenhouse gas – from oil and gas production on federal and tribal lands. These rules provide the necessary encouragement for companies to be prudent with public energy resources, rather than squander a saleable product. Prior to the rule’s implementation, oil and gas investors saw more than $1 million worth of natural gas wasted every day by venting and flaring methane into the atmosphere. Billions of dollars of product was lost over the last decade.

{mosads}The Congressional proposal – approved by the House and now under consideration in the U.S. Senate – would scuttle these investor- and environment-friendly rules and would also prevent the BLM from making similar positive rules in the future. 

The BLM standards are really just common sense: requiring companies to check for and reduce methane leaks, the main component of natural gas. Methane leaks from oil and gas operations are odorless and invisible to the naked eye; they can happen anytime, anywhere. Without effective practices to regularly inspect facilities, companies continue to have natural gas escaping into the air, leaving meaningful revenue on the table. 

This rule also requires companies to significantly reduce the amount of natural gas that is vented (intentionally released into the atmosphere) and flared (burned off from these public lands). Through venting and flaring, companies knowingly and purposefully release valuable energy resources into the air. While some parties have attributed high volumes of venting and flaring to a lack of infrastructure, the U.S. Government Accountability Office (GAO) found that only 9 percent of flaring occurs due to lack of necessary infrastructure.

Methane emissions on public lands represent lost natural gas that could have been used to heat American homes and run American industries. Fortunately, making substantial reductions to this waste is achievable. When companies want to prevent emissions, perhaps when cracking down on methane leaks, they can turn to U.S. companies in the methane mitigation sector. While providing good paying jobs, these companies exist to help find these leaks and provide technology and employees to reduce the emissions. We have seen the methane mitigation sector’s services deployed with great success by leading companies and in pioneering states like Colorado, Wyoming and Ohio.

The flaring provisions in the BLM’s rules were modeled after successful standards that North Dakota enacted to reduce the state’s flaring problem, which had been burning off as much as a third of all natural gas produced. California is expected to implement similarly strong standards to reduce such waste soon.

The BLM rule simply makes straightforward financial and economic sense, and it also helps to reduce risks by lessening climate warming pollution, smog and toxic carcinogens like benzene. As investors, these common-sense and cost-effective rules help secure the industry’s social license to operate, mitigate our investment risks, and provide us with additional confidence to invest in the U.S. energy industry.

The Senate has an important choice in front of it. One is to preserve, protect and defend the nation’s treasured natural resources. The other is to vote for more waste and pollution – most of which is avoidable.

Just as we expect and urge companies we invest in to continue to strive to do better, Senators need to take their responsibilities to taxpayers and our global climate seriously.  

We call on all Senators to vote against nullifying the BLM methane waste rule, a rollback that would harm taxpayers, investors and our air.

Jonas Kron is Senior Vice President, Director of Shareholder Advocacy at Trillium Asset Management. Luan Jenifer is Executive Vice President of Miller-Howard Investments. Will Morgan is Head of Impact at Sonen Capital.

The views expressed by this author are their own and are not the views of The Hill.