Major oil and gas companies already meeting methane regulations

by | Jan 18, 2024 | Production, Gas Prices, Investment Experts, Investors, Oil Prices, Tax Advantages

We explore the key details of the proposed rule and its potential impact on the oil and natural gas industry.

Leading Oil and Gas Companies Compliant with Methane Regulations


The Biden administration has proposed a groundbreaking rule that would require oil and natural gas companies to pay fees for methane emissions exceeding specified levels. This move aligns with the 2022 climate law and aims to address methane’s status as a potent climate “super pollutant.” In this blog post, we explore the key details of the proposed rule and its potential impact on the oil and natural gas industry.

Methane Emission Fee Structure

The proposed rule outlines a fee structure for excess methane emissions, starting at $900 per ton this year and increasing to $1,500 per ton by 2026. The fee is designed to incentivize industry players to adopt best practices, reducing emissions and avoiding financial penalties. This section delves into the specifics of the fee structure and its implications for companies.

EPA’s Comprehensive Strategy

EPA Administrator Michael Regan emphasizes how the proposed methane fee complements a recently announced final rule on methane emissions. The Methane Emissions Reduction Program aims to encourage early adoption of emission-reducing technologies before the new standards take effect. This section explores the comprehensive strategy the EPA is implementing to address methane emissions.

Industry Compliance and Exemptions

Leading oil and gas companies that already meet or exceed performance levels set by Congress are exempt from the proposed fee. This section examines how industry compliance with existing standards can influence exemption from the methane fee, providing insights for investors assessing the environmental performance of companies.

Political Perspectives

The proposed methane fee has generated varying political reactions. While Democratic lawmakers express support for the fee as a means to reduce wasteful emissions, Republicans view it as a tax that could raise natural gas prices. This section outlines the political landscape surrounding the proposed rule and its potential implications for the industry.

Industry Response

The American Petroleum Institute (API), the largest lobbying group for the oil and gas industry, strongly opposes the proposed fee. This section delves into API’s arguments against the fee, including concerns about increased costs, higher energy bills, and the potential impact on America’s energy advantage.

Environmental Advocacy

Environmental groups, including the Environmental Defense Fund, support the proposed methane fee, considering it a common-sense approach to holding oil and gas companies accountable for methane pollution. This section explores the perspectives of environmental advocates and their expectations for industry responsibility.

Reporting and Enforcement

The EPA acknowledges the need for improved reporting of methane emissions and is collaborating with industry stakeholders to enhance accuracy. This section discusses the agency’s efforts to address underreporting issues and emphasizes the importance of transparent reporting and effective enforcement mechanisms.


In conclusion, the proposed methane fee represents a significant step in addressing methane emissions from the oil and natural gas industry. Investors and individuals considering investments in this sector should closely monitor developments, industry compliance, and political reactions to make informed decisions amid evolving environmental regulations.

Environmental groups, endorsing the methane fee as a tool to hold oil and gas companies accountable, emphasize the importance of responsible industry practices. As the industry navigates this regulatory landscape, the engagement of environmental advocates and the broader public remains a critical factor in shaping future policies and fostering a sustainable energy future.

The proposed methane fee serves as a catalyst for change, pushing the industry towards cleaner practices and heightened environmental responsibility. It is an integral part of a broader strategy aimed at mitigating the impact of methane, a potent greenhouse gas. As stakeholders navigate this new regulatory environment, a collaborative approach that considers economic, environmental, and societal factors will be key in achieving a balanced and sustainable future for the oil and natural gas industry.

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