Advancing Methane Emissions Reductions by National Oil Companies
About this report
National oil companies (NOCs) are responsible for around half of all global oil and gas production today and their actions strongly influence methane abatement prospects. More than 30 NOCs have joined the Oil and Gas Decarbonization Charter (OGDC) and are engaging in initiatives to tackle methane emissions and flaring. There is a major opportunity for NOCs looking to implement best practices in methane management to learn from the experience of peers in order to deploy strategies that are adapted and tailored to their circumstances. Best practices include adopting measures to limit flaring and venting, implementing leak detection and repair programmes, and deploying low-emissions equipment. This report explores these opportunities in view of NOCs’ distinctive characteristics, including their ties to national policy priorities.
Executive summary
NOCs have a crucial role to play in shaping the outlook for methane emissions. Rapid and cost-effective measures to tackle methane emissions by NOCs could deliver an annual reduction of up to 30 million tonnes (Mt) of methane by 2030, an impact comparable to eliminating all CO2 emissions from the global aviation industry. This report aims to support NOCs on their methane reduction journey.
Around half of the oil and gas produced by NOCs is covered by pledges to achieve near-zero methane emissions by 2030. NOCs are tackling methane emissions in line with policy goals, to improve their sustainability credentials, and to attract financing. Key opportunities to accelerate action include:
Integrating methane management into operations. Dedicated resources and plans are key to support effective capital and operational spending on methane abatement. Half of the options to reduce emissions in the oil and gas industry could be deployed with positive rates of return, improving natural gas resource use and cash flows.
Working with host governments and partner companies to unlock synergies and align goals. NOCs can play a major role in supporting policy objectives. In over 30 countries where NOCs are responsible for more than half of oil and gas production, methane is already included in the scope of their Nationally Determined Contributions (NDCs).
Implementing best practices. This includes adopting measures to limit flaring and venting, implementing leak detection and repair programmes, and deploying low-emissions equipment. Many of these mitigation options do not require measured emissions data or large investments. Flaring reductions by NOCs could make 60 billion cubic metres of natural gas available for domestic consumption or for export.
Develop a methane monitoring, reporting, and verification system based on emissions measurements. This would enable a better assessment of abatement options and a credible way to track progress over time. It would also help meet market and regulatory requirements such as those of the European Union’s (EU) methane regulation.
Make the most of supporting initiatives. Many initiatives support oil and gas methane reductions, offering technical resources, capacity building and financing. These can help NOCs overcome existing barriers and take action that is tailored to their national contexts.