Regulatory framework to mitigate methane emissions in North America : the lessons learned for Europe.
Date: 2020-03-12
Institutions: European University Institute
Subjects: European Union, North America, energy policy, hydrocarbon, natural gas, reduction of gas emissions

Issue 2019/24
December 2019

Regulatory Framework to Mitigate 
Methane Emissions in North America.  
The Lessons Learned for Europe 
By Maria Olczak, Andris Piebalgs  
Florence School of Regulation 

Highlights 

•  The discussions on setting the EU long-term target to reach carbon-
neutrality by 2050 are ongoing. So is the debate on the future role of 
gas in Europe. One of the issues under discussion is how to reduce 
methane emissions across the natural gas value chain. 

•  Most of the natural gas consumed in the EU is produced outside 
its  borders.  While  EU’s  strategic  plan  for  methane  is  still  under 
preparation  it  is  important  to  understand  the  impact  of  methane 
regulation in the main natural gas producing countries.

•  Between  2016  and  2018,  the  US,  Canada  and  Mexico  adopted 
policies and regulatory frameworks addressing methane emissions 
in  order  to  meet  the  pledge  of  their  leaders  to  reduce  methane 
emissions from the oil and gas sectors by 40 to 45% from 2012 levels 
by 2025. 

•  Despite  the  significant  differences  in  the  scope  of  regulations 
and  allowed  exemptions,  the  three  countries  introduced  sets  of 
performance standards and requirements that build upon the Best 
Available Techniques and practices to minimize methane emissions 
from  three  categories:  fugitive,  vented  emissions  and  emissions 
resulting  from  incomplete  combustion,  i.e.  flaring.  Moreover,  all 
countries introduced regular Leak Detection and Repair programs, 
which  direct    operators  to  regularly  inspect  and  repair  leaking 
components, such as valves or pumps, and to monitor and report 
their emissions. 

•  The  analysis  of  these  countries’  regulations  provides  important 
information on the most effective and robust approaches to reduce 
methane emissions in the gas value chain.

•  For  the  EU  the  availability  of  transparent  and  accurate  methane 
emissions data is of key importance to estimate the GHG footprint 
of the energy it consumes. 

•  The  cooperation  between  methane  regulatory  frameworks  could 
provide for additional dynamic to minimise methane emissions.

fsr.eui.eu

POLICYBRIEF 
Introduction

From Political Declaration to Methane Regulation

Laying  down  foundations  for  the  decarbonisation 
of the gas sector is one of the top priorities for the 
European Commission led by Ursula von der Leyen. 

For  this  reason,  the  reduction  of  methane  emis-
sions associated with the production and transport 
of  natural  gas  is  increasingly  important  in  Europe. 
However,  the  challenge  lays  partly  in  the  fact  that 
the majority of gas consumed in the EU is produced 
outside  the  Union.  In  the  first  quarter  of  2019,  the 
EU net gas imports increased by 15%, compared to 
the first quarter of 2018. In the same period, due to 
the  converging  LNG  prices,  the  EU  LNG  imports 
rose dramatically, up by 126% year-on-year, mainly 
at  the  expense  of  “traditional”  imports  through 
pipelines  from  Algeria  and  Libya1.  The  data  from 
Q2  2019  demonstrate  that  in  April  and  May,  LNG 
imports  surpassed  pipeline  imports  from  Norway, 
and became the second largest import source for the 
EU after Russia2. 

On the other side of the Atlantic, the North Amer-
ican  leaders  made  a  joint  commitment  to  reduce 
their 2012 levels of methane emissions from the oil 
and gas sectors by 40 to 45% by 2025. The 2016 US, 
Canada and Mexico declaration included the com-
mitment  to  develop  and  implement  federal  regula-
tions  aimed  at  reducing  methane  emissions.  With 
the publication of new regulations in Mexico on the 
6th  of  November  2018,  North  America  became  the 
first  region  with  the  up-to-date  regulatory  frame-
work for methane in place. 

The shale gas revolution turned North America, and 
the US in particular, into the top energy-producing 
region  in  the  world.  This  year,  the  US  became  the 
world’s  third-largest  LNG  exporter3.  For  the  EU 
–  the  major  energy  consumer  and  more  and  more 
often, the destination of US LNG cargos – it is essen-
tial to understand how this main gas provider deals 
with the issue of methane emissions at home. More-
over, it is of utmost importance to reflect on the les-
sons learned in the context of discussions on the EU 
long-term climate strategy and the new EU methane 
strategy to be announced in the early 2020s4. 

Taking  this  into  account,  this  Policy  Brief  seeks  to 
address the following questions:

•  How  robust  is  the  regulation  of  methane  gas 

emissions in North America?

•  How transparent is it from the perspective of the 

EU consumers? 

•  How promising is the potential for global coop-

eration on methane emissions?

This  paper  has  the  following  structure:  Section  1 
provides detailed data on the key trends and sources 
of  the  methane  emissions  in  North  America.  Sec-
tion 2 analyses the regulatory frameworks targeting 
methane emissions in the US, Canada and Mexico. 
In Section 3, the authors address the three research 
questions. The final part draws conclusions. 

1. 

 In Q1 of 2019, the main sources of extra-EU gas imports were: Russian pipeline supplies (40%), Norway (31%), LNG imports 
(22%) and pipeline imports from North Africa (7%). The main sources of LNG were: Qatar (22% of total LNG imports), Rus-
sia (21%) and the US (13%). Data source: Quarterly Report on European Gas markets, DG Energy, Volume 12 (1), first quarter 
of 2019. 

2. 

 Quarterly Report on European Gas markets, DG Energy, Volume 12(2), second quarter of 2019.

3. 

 LNG Monthly, US Department of Energy Office of Oil & Natural Gas, September 2019. 

4. 

 The European Commission has commissioned a study on “Limiting Methane Emissions in the Energy Sector” to a consor-
tium composed of Wood with support from TNO, Carbon Limits, and The Sniffers). The final report is due in August 2020. 

2 ■  Robert Schuman Centre - Policy Brief ■ Issue 2019/24 ■ December 2019

Methane Emissions in North America

The  US,  Mexico  and  Canada  are  among  the  major 
methane emitters globally. In 2014, US emitted 652.47 
MtCO2e  (Million  metric  tons  of  carbon  dioxide 
equivalent),  Mexico  191.17  MtCO2e  and  Canada 
109.22  MtCO2e.  Methane  emissions  account  for 
roughly 10% of all GHG emissions in US and Canada, 
and around 20% of Mexican GHG emissions.5

Methane  emissions  in  North  America  are  mainly 
driven by emissions from three sources: agriculture; 
energy,  including  emissions  related  to  production 
and  extraction  of  fossil  fuels;  and  waste.  The  data 
collected by the International Energy Agency (IEA) 
shows  that  methane  emissions  in  North  American 
oil  and  gas  sector  measured  17.3%  of  total  global 
methane  emissions  from  this  sector  in  2017,  com-
pared  to  a  3.3%  share  of  methane  emissions  from 
European oil and gas sector6. 

Where do the majority of emissions occur and what 
type of emissions (fugitive, vented or flared) domi-
nate? The IEA estimates that, downstream gas (fugi-
tive and vented) is the biggest source of emissions in 
Mexico,  followed  by  offshore  oil  and  onshore  con-
ventional  oil  production.  In  Canada,  onshore  con-
ventional oil and unconventional gas production are 
the key sources of emissions, with a clear predomi-
nance of emissions from venting. In the US, uncon-
ventional gas is by far the largest source of emissions 
(mainly  vented)  followed  by  the  downstream  gas, 
with the prevalence of fugitive emissions7. 

It  should  be  noted  that,  in  contrast  to  Canada,  the 
emissions from flaring constitute a substantial part 
of  methane  emissions  in  Mexico  and  the  US.  It 
is  estimated  that  in  2018,  roughly  14.1  bcm  of  gas 
has  been  flared  in  the  US  and  3.9  bcm  in  Mexico, 
which places them among the top 10 flaring coun-
tries. Moreover, between 2014 and 2018, the flared 
volumes in the US increased by 5.1%, whereas both 
Mexico  and  Canada  recorded  a  decrease  in  flaring 
volumes, by 1.0% and 0.7%, respectively8.

In  fact,  the  substantial  methane  footprint  of  these 
three  North  American  countries  has  prompted  the 
decision-makers  and  regulators  to  create    concrete 
policies  and  a  regulatory  framework  to  tackle  this 
problem. 

Methane Regulatory Framework in the US

The  US  efforts  to  reduce  methane  emissions  at  the 
federal level should be analysed in the broader frame-
work  of  the  Obama  administration’s  Clean  Action 
Plan  released  in  20139. The  Plan  consisted  of  three 
pillars: the mitigation of GHG emissions, adaptation 
to the impacts of climate change, and the promotion 
of  American  leadership  in  global  efforts  to  tackle 
climate change. Moreover, it postulated the develop-
ment  of  an  “interagency  methane  strategy,”  which 
was presented one year later. The 2014 “Strategy to 
Reduce Methane Emissions” targeted  major sources 
of US methane emissions, including the oil and gas 
sector10. 

5. 

 CAIT Climate Data Explorer (consulted on 30/09/2019). 

6. 

 International Energy Agency Methane Tracker (consulted on 30/09/2019).  

7. 

 Ibid.

8. 

 The World Bank Zero Routine Flaring by 2030 program. Top 30 flaring countries – tables (2013-2018). 

9. 

 The President’s Climate Action Plan. Executive Office of the President, June 2013. 

10. Climate  Action  Plan  Strategy  to  Reduce  Methane  Emissions,  March  2014. The  Strategy  focuses  also  on  emissions  from: 

landfills, coal mines and agriculture. 

3 ■  Regulatory framework to mitigate methane emissions in North America. The lessons learned for Europe.

The  Strategy  directed  the  Environmental  Protec-
tion  Agency  (EPA)  to  review  available  mitigation 
technologies and to expand the industry’s voluntary 
efforts via the existing Natural Gas STAR program. 
In addition, the strategy invited the Bureau of Land 
Management (BLM) to modify standards to reduce 
venting and flaring on public lands. It also aimed at 
identifying  the  “downstream”  methane  reduction 
opportunities  via  the  Quadrennial  Energy  review 
and the roundtable discussion organised by Depart-
ment  of  Energy.  Finally,  the  US  methane  strategy 
called  for  improved  methane  measurement  and 
monitoring through the development of new meas-
urement technologies and the cost-effective technol-
ogies to reduce emissions11. 

The Strategy was ultimately criticised for suggesting 
changes that would not achieve the Obama adminis-
tration’s promises. The inadequacy of these measures 
was reinforced by the President Obama announce-
ment  in  January  2015  of  an  overarching  objective 
to  reduce  methane  emissions  from  the  oil  and  gas 
sector  by  40-45%  by  202512.  EPA  received  a  clear 
mandate “to initiate a rulemaking effort to set stand-
ards for methane and VOC emissions” and adopted 
the respective methane regulations in May 2016.  

The  final  New  Source  Performance  Standards 
(NSPS)13,  builds  upon  the  2012  rule  to  curb  Vola-
tile  Organic  Compounds  (VOCs),  and  applies  to 
new, reconstructed and modified sources only14. The 
2016  NSPS  covers  hydraulically  fractured  oil  wells 

and other actions related to oil and gas production, 
processing,  transmission  and  storage,  but  with  an 
exception of distribution. 
The 2016 rule: 

• 

• 

• 

sets  emission  limits  for  methane  and  Volatile 
Organic Compounds (VOC) (see Table 1)

requires  owners/operators  to  find  and  repair 
leaks: the owners/operators of new and modified 
well sites must conduct an initial survey within 
a year after the publication of the rule, or within 
60 days following the start of production. After 
a first survey, the monitoring is conducted twice 
per  year  at  well  sites  and  four  times  annually 
at  gathering,  boosting  and  transmission  com-
pressor stations. 

allows the use of EPA “Method 21”15 as an alter-
native  to  the  optical  gas  imaging  (OGI)  for 
finding  leaks.  Moreover,  the  regulation  allows 
the  use  of  innovative  technologies  to  monitor 
leaks, as it specifies which information needs to 
be submitted in seeking technology approval. 

Moreover, the US EPA undertook efforts to regulate 
emissions from existing sources. The Agency sent an 
Information  Collection  Request  (ICR),  asking  for 
additional information from the oil and gas compa-
nies to develop regulations for the existing sources. 
It should be noted that  the EPA withdrew the ICR 
on 2 March 2017 on the grounds it could create an 
excessive administrative burden on the companies16.

11.  Climate Action Plan Strategy to Reduce Methane Emissions, op. cit., pp. 7-11. 

12.  Fact Sheet: Administration Takes Steps Forward on Climate Action Plan by Announcing Actions to Cut Methane Emis-

sions, 14 January 2015. 

13.  The US EPA published the final rule on 3 June 2016. The rule took effect on 2 August 2016. 

14.  The 2016 NSPS applies to crude oil and natural gas facilities that are new, reconstructed and modified after 18 September 

2015. 

15.  EPA Method 21 is used to determine VOC emissions from process equipment, and involves the application of a portable 

VOC monitoring instrument, such as an organic vapour analyser (a “sniffer”). 

16.  L. Tsang (2018), EPA’s Methane Regulations: Legal Overview, Congressional Research Service Report, 24 January 2018, p. 6. 

4 ■  Robert Schuman Centre - Policy Brief ■ Issue 2019/24 ■ December 2019

In  addition  to  regulations  proposed  by  EPA,  the 
Bureau  of  Land  Management  put  into  place  rules 
to  reduce  waste  from  venting,  flaring  and  leaks  on 
onshore  Federal  and  Indian  leases,  the  so-called 
Onshore Order 917. In particular, the rule targeted:  

•  Venting and flaring: venting of natural gas is pro-
hibited, except in certain conditions, such as an 
emergency. The operators are required to reduce 
wasteful  flaring.  The  operators  are  obliged  to 
capture 85 percent of their adjusted total volume 
of gas emissions produced each month (starting 
from 18 January 2018) and this threshold rises to 
98 percent in 2026. In cases when the flared gas 
qualifies as waste, it is subject to royalties. 

• 

Implementation  of  Leak  Detection  and  Repair 
(LDAR)  programs  to  reduce  fugitive  emissions 
(based on 2016 NSPS). 

•  Reduced  venting  from  equipment  (e.g.  pneu-
matic  controllers  and  pumps,  storage  vessels, 
well  maintenance  and  liquids  unloading)  by 
updating  old,  inefficient  equipment  and  fol-
lowing best practices to minimise waste through 
venting. 

To sum up, the 2016 NSPS introduced federal regu-
lations targeting methane emissions from the oil and 
natural gas sector for new and modified sources at 
well sites, compressor stations and processing plants. 
In  addition  to  this,  some  states  such  as  California 
and  Pennsylvania,  adopted  separate  methane-spe-
cific regulations. The developments in the US, both 
at  state  and  federal  levels  were  observed  closely  by 
Canadian  and  Mexican  regulators,  who  embarked 

on developing their own domestic rules on methane 
emissions. 

Methane Regulatory Framework in Canada

The 2016 Canadian commitment to reduce methane 
emissions  from  the  oil  and  gas  sector  was  reaf-
firmed  through  the  domestic  legislation18.  As  part 
of  its  Nationally  Determined  Contribution  (NDC), 
Canada  expressed  the  intention  to  develop  regula-
tions  tackling  methane  emissions  from  the  oil  and 
gas sector and to continue cooperating with  “con-
tinental trading partners”, the US in particular19. In 
fact,  one  of  the  regulatory  approaches  considered 
upon  the  development  of  the  methane  regulations 
was  to  align  them  with  the  abovementioned  2016 
New  Source  Performance  Standards.  However,  this 
approach  was  rejected,  partly  because  these  stand-
ards  were  perceived  as  an  “unnecessary  adminis-
trative burden” for the regulated companies on the 
one  hand,  and  incapable  of  reaching  the  Canadian 
reduction objectives on the other, because they did 
not cover existing facilities20. 

In  the  end,  the  federal  regulations  in  Canada  were 
based  on  performance  standards,  allowing  some 
degree  of  flexibility  for  provinces  and  territories 
through  equivalency  agreements.  These  provinces 
are permitted to develop their own regulations, pro-
vided they result in a similar or better environmental 
outcome.  Moreover,  the  requirements  concerning 
well  completion  involving  hydraulic  fracturing  do 
not apply to the provinces of British Columbia and 
Alberta, as those jurisdictions have already adopted 

17.  Waste Prevention, Production Subject to Royalties, and Resource Conservation. Final Rule. Bureau of Land Management, 

18 November 2016. The rule became law on 17 January 2017. 

18. Pan-Canadian Framework on Clean Growth and Climate Change: Canada’s plan to address climate change and boost the 

economy, 2016. Strategy on short-lived climate pollutants, 2017. 

19.  Canada’s INDC Submission to the UNFCCC, submitted on 05/10/2016 (consulted on 18/09/2019). 

20.  Regulations Respecting Reduction in the Release of Methane and Certain Volatile Organic Compounds (Upstream Oil and 

Gas Sector) (SOR/2018-66). Regulatory Impact Analysis Statement, p. 57

5 ■  Regulatory framework to mitigate methane emissions in North America. The lessons learned for Europe.

equivalent regulatory measures21. It should be noted 
that  British  Columbia  and  Alberta    accounted  for 
almost 97% of Canada’s natural gas and natural gas 
liquids national production in 201722 and, together 
with Saskatchewan’s output,  constitute the major oil 
and gas producing regions in the country.23 

The Canadian Regulations were published on the 26 
of April 2018. The majority of provisions should be 
implemented by the 1st of January 2020, with excep-
tion  of  requirements  concerning  general  facility 
production venting and provisions on venting from 
pneumatic devices,  applicable as of the 1st of January 
2023. 

The scope of Canadian regulations is limited to emis-
sions from the upstream oil and gas sector, covering 
both  new  and  existing  facilities,  located  onshore 
and offshore. The focus on this segment of the value 
chain comes from the fact that almost 90% of oil and 
gas  methane  emissions  originated  from  upstream 
sources, according to 2014 data24. 

Canadian regulations introduce two types of stand-
ards:  general  facility  standards  and  standards 
applying  to  the  facilities  with  a  potential  to  emit 
above 60 000 m3 of gas per year (see Table 2).

Methane Regulatory Framework in Mexico

Just over six months after the adoption of methane 
regulations in Canada, Mexico also delivered on its 
promise.)  The  Mexican  methane  regulations  were 
published on the 6th of November 2018, and entered 
into force on the following day25. It should be noted 
that the process of developing regulations in Mexico 
was led by the Agency for Safety, Energy and Envi-
ronment  of  Mexico  (esp.  Agencia  de  Seguridad, 
Energía y Ambiente, ASEA)26 and supported by an 
international  community  of  experts.  The  Center 
for Clean Air Policy (CCAP) jointly with Clean Air 
Task Force (CATF) organised a series of workshops, 
which looked at best practices and regulatory expe-
rience on methane emissions in the US and Canada, 
including the provincial and state regulations27.

In contrast to the US and Canada, Mexican regula-
tions cover the entire value chain, including natural 
gas distribution. They are applicable to both new and 
existing onshore and offshore sources28. The regula-
tions introduce the bottom-up system building upon 
special programs (PPCIEMs), in which oil and gas 
companies  specify  their  reduction  targets  and  how 
they are going to achieve them. The scheme resem-
bles the Governance of the Energy Union and Cli-

21.  Ibid., p. 58. 

22.  Canada Energy Regulator, Provincial and Territorial Energy Profiles – Canada (consulted on 18/09/2019). 

23.  Regulatory Impact Analysis Statement, op. cit., p. 90. 

24.  Regulatory Impact Analysis Statement, op. cit., p. 47.

25.  Disposiciones Administrativas de carácter general que establecen los Lineamientos para la prevención y el control integral 

de las emisiones de metano del Sector Hidrocarburos. 

26.  Established in 2015, ASEA is a technical regulator overseeing the hydrocarbons sector. In particular, it deals with the issues 

such as industrial and operational safety and environmental protection. 

27. The event aimed at the Mexican policy-makers and the key government agencies: Energy Ministry (SENER), the Environ-
ment Ministry (SEMARNAT), the National Agency for Safety, Energy and Environment (ASEA), the Institute for Ecology 
and Climate Change (INECC), and the National Hydrocarbon Commission (CNH). For more information see:  <http://ccap.
org/programs/oil-and-gas-mitigation/> (consulted on 23/09/2019). 

28.  Art. 2 of Mexican methane regulation defines the scope of regulation in the following way: “exploration and extraction of 
hydrocarbons; treatment, refining and storage of oil; the processing, compression, liquefaction, decompression and regasifi-
cation, as well as transport per pipeline, storage and distribution of natural gas.” 

6 ■  Robert Schuman Centre - Policy Brief ■ Issue 2019/24 ■ December 2019

mate  Action  system  with  National  Energy  and 
Climate  Plans  (NECPs),  which  monitors  the  EU 
Member States’ progress towards the achievement of 
EU energy and climate targets. 

The NECPs are submitted to the European Commis-
sion,  which  assesses  the  plans  and  has  the  right  to 
issue  recommendations if the national plan in ques-
tion is not in line with  EU targets. Whereas, the plans 
prepared  under  the  Mexican  methane  regulations 
are verified by an Authorised Third Party. The regu-
lation  itself  does  not  specify  if  ASEA  has  the  right 
to  issue  binding  recommendations  to  companies, 
and  more  importantly,  what  actions  ASEA  could 
undertake  in  case  aggregated  targets  submitted  by 
the companies are insufficient to meet the regional 
pledge.  In  principle  in  such  situations,  ASEA  has 
a  power  to  issue  recommendations  and  to  impose 
administrative penalties (fines). 

The Mexican Program for the Prevention and Inte-
gral  Control  of  Methane  Emissions  (PPCIEM)  is 
developed in three steps:

•  Step 1: Emission assessment. Firstly, the compa-
nies identify the (potential) sources of emissions 
and  divide  them  into  three  groups:  equipment, 
well  operations  or  non-scheduled  activities. 
Then  the  types  of  emissions  are  categorised  as: 
destruction equipment (flaring); fugitive leaks in 
well operations, equipment and components; or 
venting emissions. Once the emissions are iden-
tified and classified, the regulated companies are 
required  to  quantify  their  emissions  based  on 
one  of  the  methodologies  listed  in  Article  18, 
including:  mass  balance,  mathematical  models, 
engineering calculations or emission factors. The 
choice of the methodology needs to be justified. 

•  Step 2: Program for the Prevention and Inte-
gral Control of Methane Emissions (PPCIEM). 

The programs prepared by the regulated compa-
nies  constitute  a  basis  of  prevention  and  con-
trol cycle. The regulated companies set out their 
percentage  reduction  target  using  the  emission 
assessments from the first step as a baseline. They 
have  a  maximum  of  six  years  to  achieve  those 
objectives,  counting from the time they submit 
their PPCIEMs to the Agency. The information 
and data provided to ASEA is considered public 
information29.

The regulation sets different obligations for new (con-
structed after the 7th of November 2018) as opposed 
to  existing facilities. The new facilities are required 
not  to  exceed  the  level  of  emissions  from  the  base 
year, whereas existing facilities are only required to 
decrease their emissions by the amount specified in 
their  targets.  The  companies  need  to  specify  how 
they are going to achieve these targets and they can 
choose from the list of technologies and best prac-
tices  suggested  in  Title  III  of  the  regulation30.  For 
instance, the facilities using reciprocating compres-
sors are required to replace seals on the compressor 
rods,  or  adjust  and  align  the  rod  packing  systems, 
capture the emissions and direct them to a Vapour 
Recovery System (VRS). 

•  Step  3:  Continuous  improvement.  Every  year, 
the  regulated  companies  outline  their  annual 
reduction  objectives  and  actions  per  facility. 
They are required to keep track of their progress 
by evaluating the PPCIEM implementation and 
preparing the Annual Compliance Report (ACR) 
at  least  once  per  year  (internal  evaluation).  As 
part  of  the  ACR,  the  companies  re-quantify 
their  methane  emissions  and  include  the  data 
in  the  report.  The  final  ACR  is  then  validated 
by an Authorised Third Party and handed in to 
the Agency along with the opinion issued by the 

29.  Art 5. 

30.  In particular, it refers to: Vapour Recovery Systems, pneumatic pumps, compressors, pneumatic controls, dehydrators, dis-
tribution and transport, separators and tanks, well stimulation and completions operations, liquid unloading, flaring and 
LDAR programs. 

7 ■  Regulatory framework to mitigate methane emissions in North America. The lessons learned for Europe.

external  evaluator  in  the  first  quarter  of  every 
calendar  year  and  annexed  to  the  Performance 
Report applicable to the hydrocarbon sector. 

Discussion

How Robust is the Regulation in North America?

There  are  several  factors  that  could  influence  the 
robustness  of  the  regulatory  framework  in  North 
America including: political backing of regulations, 
stability  of  the  regulatory  framework,  institutional 
setting and cooperation with the industry. 

To  begin  with,  the  adoption  of  methane  regula-
tions in three North American countries within less 
than three years after the 2016 joint announcement 
should be considered an important milestone. How-
ever, looking at the recent developments in the US, 
one might say that the methane regulations are only 
as  robust  as  the  political  support  they  receive.  The 
status of the methane regulations in the US is uncer-
tain;  the  Trump  Administration  recently  initiated 
the process of repealing the federal methane rules31. 
Nevertheless, this does not mean that the regulatory 
effort is in vain. 

In  the  absence  of  federal  regulations,  some  states 
have  taken  the  initiative  and  developed  their  own 
regulations.  One  example  is  New  Mexico,  home  to 
part  of  the  Permian  Basin  and  the  San  Juan  Basin 
and thus, one of the major crude oil producing states. 
The  observed  increase  in  methane  emissions  from 
leaks, venting and flaring have been under the scru-
tiny of environmental groups for some time now32. 
In January 2019, New Mexico Democratic Governor 
Michelle Lujan Grisham issued the Executive Order 
directing  the  state  authorities  to  develop  methane 

regulations aiming at 45% reduction in GHG emis-
sion  by  2030  compared  to  2005  levels33.  Moreover, 
New  Mexico  joined  the  group  of  governors  –  U.S. 
Climate Alliance – opposing the President Trump’s 
decision to withdraw from the Paris Agreement. 

Secondly,  the  regulatory  framework  adopted  in 
the  US,  Canada  and  Mexico  incorporates  widely 
acknowledged  practices  and  technologies  aimed 
at  methane  emissions  mitigation.  Operators  in  all 
jurisdictions  are  required  to  conduct  the  LDAR 
programs,  that  is  to  find  and  fix  leaks.  Moreover, 
the  regulations  target  the  major  sources  of  emis-
sions such as pneumatic devices, compressors, well 
completion  operations  and  suggest  performance 
standards  to  ensure  the  minimization  of  methane 
emissions from their operations. In fact, the existing 
regulatory framework contains all the ingredients to 
be successful in meeting established targets. 

Thirdly, the institutional setting and the independ-
ence  of  regulatory  bodies  are  another  factor  con-
tributing to the robustness of regulatory framework. 
Here, the Mexican regulatory agency, ASEA, is a pos-
itive example of determination to adopt a sound set 
of  regulations  and  evidences  a  willingness  to  learn 
from  the  US  and  Canadian  experience.  However, 
there  are  some  challenges  that  could  influence  the 
ASEA’s  ability  to  oversee  the  implementation  pro-
cess, such as the absence of the Executive Director 
after the resignation of Dr. Luis Vera Morales in mid-
201934 and the overload of other agency work, such 
as the permit granting, and budgetary constraints. 

Fourthly, despite the general belief that the oil and 
gas  companies  are  rather  reluctant  to  be  regulated, 
the  analysis  of  the  recent  regulatory  experience  in 
North America has proved that the opposite is true.  

31.  B. Scheid, “EPA’s proposed rollback of methane regulations to impact marginal oil, gas wells”, S&P Global, 29 August 2019. 

32.  J. Goldstein, New Mexico Begins Effort to Reduce Methane Pollution and Waste, Environmental Defense Fund, 7 June 2019. 

33.  Executive Order 2019-003 on addressing Climate Change and Energy Waste Prevention, 29 May 2019. 

34.  The nomination of the new Executive Director, Ángel Carrizales López, has been announced on 25 November 2019. Some 
media highlighted the lack of experience with environmental regulation of a new nominee, see: A.  Solís, “AMLO impone a 
inexperto en la ASEA, confirma Semarnat”, Forbes México, 25 November 2019. 

8 ■  Robert Schuman Centre - Policy Brief ■ Issue 2019/24 ■ December 2019

Over the course of the last few years, these companies 
have begun to realise that a lack of concrete efforts to 
minimize methane emissions undermines not only 
their  competitiveness,  but  also  more  importantly, 
the  viability  of  natural  gas  as  sustainable    energy 
commodity. In fact, President Trump’s retrenchment 
of  methane  regulations    demonstrated  the  division 
between the US oil and gas companies. In contrast 
to the multinational oil and gas companies distanced 
themselves from the proposed changes and empha-
sised  that  “reducing  emissions  plays  a  large  role  in 
overall competitiveness in the long term”35. 

How  Transparent 
Perspective of EU Consumers? 

is  this  Regulation 

from  the 

The three countries in question gather data on GHG 
emissions, including methane and report this to the 
United Nations Framework Convention on Climate 
Change  (UNFCCC)  Secretariat.  It  should  be  noted 
that  the  measurement,  reporting  and  verification 
(MRV)  requirements  are  more  stringent  for  devel-
oped countries (US and Canada) and more lenient 
for developing countries such as Mexico.  

However,  the  accuracy  of  existing  methane  inven-
tories is questionable. Konschnik and Jordan (2018) 
refer to four categories of ‘known unknowns’ related 
to  the  methane  inventories:  imprecise  emissions 
factors;  uncertainty  about  the  magnitude  of  ‘super 
emitters’;  incomplete  well  and  activity  data;  and 
the  inconsistency  between  bottom-up  inventory 
estimates  and  top-down  ambient  monitoring  of 
methane. 

First,  the  methane  emissions  factors  may  not  fully 
correspond to sector emissions. This may stem from 
the fact that the emissions factors have been calcu-
lated in the past, or that they are based on a relatively 
small sample of direct measurements, or that they do 
not  illustrate  the  advances  in  the  industry.  Second, 
the  existence  of  ‘super-emitters’  can  skew  the  data 
interpretation.    Super  emitters  represent  a  small 
number of the total facilities, but contribute dispro-
portionately  to  total  emissions.  Emissions  factors 
can also be difficult to assess due to abnormal pro-
cess  conditions  such  as  equipment  malfunction  or 
operator error36. Third, in some cases, the informa-
tion on well and activity data is fragmentary. As var-
ious organisations and states use differing taxonomy, 
even well count could be disputable. Moreover, some 
activities are overlooked: for a long time inventories 
did not include natural gas emissions from oil wells.  

Fourth, there is a discrepancy between the bottom-
up and top-down measurements37. The two methods 
have    advantages  and  disadvantages38.  Despite  the 
fact  that  bottom-up  approaches  supply  detailed 
information on the magnitude and patterns of emis-
sions from a given source, their inventories are prone 
to errors such as overlooking sources or employing 
inaccurate  or  uncertain  activity  data  or  emission 
factors.  On  the  other  hand,  top-down  estimates 
include  emissions  from  all  sources,  as  they  rely  on 
atmospheric observations. However, the attribution 
of observed emissions to specific sources is usually 
a  cumbersome  process.  Moreover,  the  accuracy  of 

35.  E. Turner, “US LNG industry sees curbing emissions as key to its long-term future”, S&P Global, 13 September 2019.  

36.  D. Zavala-Araiza et al., Super-emitters in natural gas infrastructure are caused by abnormal process conditions, Nature 

Communications, volume 8, Article number: 14012 (2017).  

37.   The main difference between these approaches refers to the starting point of measurements. Bottom-up methods draw upon 
measurements from a single facility or source, which can then be generalised to national, regional or global level. Top-down 
approach rely on atmospheric measurements, which help to assess the emissions from regions covering multiple facilities 
and sources. 

38.  National Academies of Science, Engineering, and Medicine 2018. Improving Characterization of Anthropogenic Methane 

Emissions in the United States. Washington, DC: The National Academies Press, pp. 133-138. 

9 ■  Regulatory framework to mitigate methane emissions in North America. The lessons learned for Europe.

both measures could be further undermined by spa-
tial or temporal sparsity of measurements.  

In reality, all four ‘known unknowns’ require further 
research  and  cooperation  between  various  institu-
tions  across  the  globe,  which  make  them  an  area 
suitable for global cooperation. 

How Promising is the Potential for Global Cooperation 
on Methane Emissions?

From the beginning,  the US has been  open  to  col-
laboration  with  foreign  partners  in  efforts  to  abate 
methane  emissions  related  to  the  production  and 
transport  of  hydrocarbons.  The  2014  US  Methane 
Strategy  foresaw  strengthening  its  own  function 
through  cooperation  with  well-established  inter-
national  forums  such  as  the  Climate  and  Clean 
Air Coalition and the Global Methane Initiative. It 
should  not  come  as  a  surprise  that  the  announce-
ment of a domestic methane objective evolved into a 
joint declaration with Canada and Mexico. 

The North American energy market is highly inter-
connected  and  trade  in  crude  oil,  natural  gas  and 
refined products is multi-directional39. In fact, intro-
ducing  methane  emissions  regulation  in  just  one 
country could raise the issue of domestic companies 
being  put  at  a  competitive  disadvantage.  For  these 
reason, the common declaration and the adoption of 
methane emissions regulation in three North Amer-
ican countries was the most efficient solution. 

The  analysis  of  methane  regulations  in  North 
America  shows  that  some  practices  and  technolo-
gies, such as the employment of regular LDAR pro-
grams, have proven to be effective in some jurisdic-
tions and can be used in other countries as well.  

Then the question arises, is there potential to extend 
this initiative beyond North America? In reality, this 
already happened. In May 2016, the US, along with 
five Nordic countries – Denmark, Finland, Iceland, 
Norway and Sweden – reaffirmed a commitment to 
address  the  issue  of  methane  emissions  as  part  of 
their efforts to implement the Paris Agreement40. The 
Nordic countries pledged not only to prevent their 
methane  emissions  from  rising,  but  also  to  advo-
cate the “development of a global methane emission 
goal” in the oil and gas sector.  Moreover, the issue 
of methane emissions is also the focus of the Arctic 
Council,  an  assembly  of  Nordic  countries,  the  US, 
Canada and Russia41. 

There are several factors, which could drive the regu-
latory spillover in other jurisdictions:

•  Adoption  of  a  Paris  Agreement  gives  less 
weight to the difference between the developed 
and  developing  countries.  The  latter  group 
included  some  oil  and  gas  producers  such  as 
Qatar and Algeria. Under the new transparency 
framework,  all  countries  are  required  to  mon-
itor and report their GHG emissions, including 
methane.  The  uncertainty  related  to  methane 
measurements is one of the key issues preventing 
policy  intervention.  However,  the  5-year  cycles 
of  climate  pledge  submissions  –  the  Nationally 
Determined  Contributions  (NDCs)  will  put 
more pressure on policy makers and regulators 
to introduce and revise their respective climate 
policies and regulations.   

•  Emergence  of  a  global  gas  market.  The  shale 
gas  revolution  in  the  US  and  the  rising  role  of 
LNG,  as  a  way  to  transport  gas  over  long  dis-
tances,  is  integrating  the  regional  markets  into 
a  more  global  gas  market.  The  International 

39.  Council on Foreign Relations, North America. Time for a New Focus, Independent Task Force Report No. 71, 2014. 

40.  US – Nordic Leaders’ Summit Joint Statement, 13 May 2016. 

41.  Arctic Council Expert Group on Black Carbon and Methane - Summary of Progress and Recommendations, 2019. 

10 ■  Robert Schuman Centre - Policy Brief ■ Issue 2019/24 ■ December 2019

• 

• 

Energy Agency IEA expects that this trend will 
continue42.  The  increasing  presence  of  LNG  is 
bringing about positive effects – it increases the 
security  of  supply  and  the  potential  for  coal-
to-gas switching.  The relationship between the 
LNG buyer and exporter is much more flexible 
than are the parties involved in traditional pipe-
line deliveries. 

In  general,  the  unabated  methane  emissions 
associated  with  gas  production  and  transport 
(embedded emissions) cast some doubts on the 
environmental impact of gas and may decrease 
the demand for gas among the importers by the 
year 205043. 

In pursuit of a new leader. In the absence of the 
US climate leadership, the European Union – one 
of the key natural gas importers with the strategy 
to become the carbon-neutral economy by 2050 
and the European Green Deal in the making – is 
well-placed to become a new advocate of ambi-
tious  initiatives  to  reduce  methane  emissions, 
particularly  those  related  to  the  energy  sector. 
However,  the  challenge  for  the  EU  is  two-fold: 
first,  to  clean-up  EU  domestic  emissions  and 
second, to ensure that imported natural gas does 
not involve substantial methane leakage. 

•  The Achilles heel of the gas industry – the rising 
awareness.  The  decarbonisation  of  the  EU  gas 
sector, which is one of the energy priorities for 
the incoming European Commission, will inevi-
tably affect the EU’s major natural gas suppliers. 
There is a consensus that keeping their shares in 
European  market  will  not  be  possible  without 
clearly  demonstrating  the  environmental  ben-

42.  IEA (2019), “Global Gas Security Review 2019”, IEA, Paris.

efits  of  gas.  The  companies  are  now  embarked 
on a process to develop their own narratives. The 
Russian Gazprom  is investigating the possibility 
of producing clean hydrogen through a process 
of  a  thermal  methane  pyrolysis  and  of  trans-
porting  it,  blended  with  methane,  to  European 
consumers through the existing infrastructure44. 

US LNG exporters are concentrating on the reduc-
tion  of  methane  emissions  by  cleaning-up  the 
methane emissions at home, and by supporting the 
research into the GHG Life Cycle Assessment of dif-
ferent LNG supply chains and the available mitiga-
tion options45. 

Conclusions

This  paper  has  analysed  the  policy  and  regulatory 
framework, aimed at the reduction of methane gas 
emissions in the hydrocarbons sector. These develop-
ments followed a trilateral pledge of the US, Canada 
and  Mexico  leaders  to  decrease  their  emissions  by 
40-45% by 2025, compared to the 2012 baseline. 

The  adoption  of  methane  regulations  in  the  three 
North American countries following the 2016 polit-
ical  declaration  should  be  considered  as  an  impor-
tant milestone. The regulatory framework is robust, 
partly due to the fact that it builds upon the best prac-
tices, which have proved successful in other jurisdic-
tions. The LDAR campaigns are a case in point.

Moreover, the three countries gather data on GHG 
emissions, including methane, in national inventories 
and  report  data  to  the  UNFCCC  Secretariat. 
However,  the  accuracy  of  measurements  and 
estimations  is  questionable.  The  EU  is  well-placed 

43.  N. Tsafos, A Global Gas Strategy for the United States, Center for Strategic and International Studies Commentary, 9 May 

2019.  

44.  A. Shiryaevskaya, “Russia Looks to Hydrogen as Way to Make Gas Greener for Europe”, Bloomberg, 8 November 2018. 

45.  S. Roman-White, S. Rai, J. Littlefield, G. Cooney, T. J. Skone, “Life Cycle Greenhouse Gas Perspective on Exporting Lique-
fied Natural Gas from the United States: 2019 Update,” National Energy Technology Laboratory, Pittsburgh, September 12, 
2019.

11 ■  Regulatory framework to mitigate methane emissions in North America. The lessons learned for Europe.

to  continue  the  advocacy  for  ambitious  initiatives 
aimed  at  building  the  appropriate  measurement, 
reporting  and  verification  (MRV)  framework  for 
methane gas emissions. 

The potential spillover of methane regulations could 
be  further  influenced  by  the  following  factors:  the 
enhanced  transparency  framework  under  the  Paris 
Agreement; the emergence of global gas market and 
changing  gas  consumer  preferences;  the  potential 
leading role of the EU as an overarching arbitrator 
and the rising awareness among the oil and gas com-
panies that, without addressing methane emissions, 
their  long-term  competitiveness  and  the  competi-
tiveness of gas as an energy commodity is threatened.   

Acknowledgements

We thank Emiliano Lozano Perea, Dora Luz Llanes 
Herrera,  Ana  María  Gómez  Solares,  Fernando 
Sierra,  Jonathan  Banks,  Pablo  Lopez  Legarreta  and 
Stacey Davis and other experts who provided valu-
able insights and expertise that greatly assisted our 
research. 

12 ■  Robert Schuman Centre - Policy Brief ■ Issue 2019/24 ■ December 2019

Table 1. The summary of final standards by key emission sources under the 2016 NSPS.

SOURCE

SOURCE SUB-CATHEGORY

FINAL STANDARDS OF PERFORMANCE FOR GHGs and VOC

Wet seal centrifugal compressors 

95% reduction

Reciprocating compressors

The rod packing replacement on or before 26,000 hrs of operation 
or 36 calendar months or route emissions from the rod packing to a 
process through a closed vent system under negative pressure. 

Pneumatic controllers/pumps at 
NG processing plants

Pneumatic controllers at locations 
other than NG processing plants

Zero natural gas (NG) bleed rate

NG bleed rate ≤ 6 standard cubic feet per hour (scfh)

Compressors
(excl. those 
located at well 
sites)

Pneumatic 
devices

Pneumatic pumps at well sites

95% control if existing control or process is located on site. Not 
required if routed to an existing control or if technically infeasible. 
Limited-use pneumatic pumps – those that operate for less than 90 
days per year – are exempt from the requirements. 

Subcategory 1: Non-wildcat and 
non-delineation wells

Well 
completions

Subcategory 2: Exploratory and 
delineation wells and low pressure 
wells

From well sites and compressor 
stations

Fugitive 
emissions 

Reduced Emission Completion (REC) combined with a completion 
combustion device: venting allowed in areas where combustion would 
present safety hazards
Initial flowback stage: route to a storage vessel or completion vessel 
and separator
Separation flowback stage: route recovered gas from the separator 
to a flow line or collection system, re-inject the gas into the well, use 
the gas as an onsite fuel or use in other way. If technically infeasible, 
combust the gas. 
The operator is required to have a separator onsite during the entire 
flowback period. 

The operator not required to have a separator onsite. Either: (1) 
route all flowback to a completion combustion device; or 2) route all 
flowback into one or more well completion vessels and commence 
operation of a separator unless it is technically infeasible for a sepa-
rator to function. Capture and direct recovered gas to a completion 
combustion device. 
In some cases, the combustion is not advised e.g. fire hazard or explo-
sion. 
Monitor and repair fugitive emission components using OGI or 
Method 21 at 500ppm (parts per million). 
Develop and implement monitoring plan. Repair time: 30 days from 
discovery of  fugitive emissions, unless the repair requires shutting 
down of production. In the latter case, the leak must be fixed at the 
next shutdown or within 2 years. 

Equipment leaks at NG processing 
plants

Leak and detection program is required if the concentration ema-
nating from a leak is 500 ppm or greater.
This does not apply to  open-ended valves or lines.

13 ■  Regulatory framework to mitigate methane emissions in North America. The lessons learned for Europe.

Table 2. The summary of performance standards adopted in the Canadian Regulations Respecting 
Reduction in the Release of Methane and Certain Volatile Organic Compounds (Upstream Oil and Gas 
Sector).

APPLICATION

All facilities

EMISSION 
SOURCE

Venting from 
well comple-
tions involving 
hydraulic frac-
turing

PERFORMANCE STANDARD

EXEMPTIONS

No venting
Conservation of natural gas for re-use on site or for 
sale, or flaring / clean incineration of natural gas
Date of implementation: January 1, 2020

Alberta and British Columbia; 
cases where the gas does not have 
sufficient heating value to support 
combustion

Annual measurements of emissions of natural gas 
from compressor vents
Vent limit of 0.68m3 per minute per compressor in 
case of large centrifugal compressors with a power 
rating > 5MW
Vent limit of 0.001 m3 per minute for new recipro-
cating compressors
Corrective action when emissions are higher than 
the applicable limit 
Date of implementation: January 1, 2020

Implementation of a leak detection and repair 
(LDAR) program to stop natural gas leaks
Inspections for leaks three times per year, 
Standards repair period: within 30 days
Corrective action when leaks are found
Date of implementation: January 1, 2020

Venting limit of 1,250 m3 of natural gas per month 
(15,000 m3 per year)
Conservation of natural gas for re-use on site or for 
sale, or flaring / clean incineration of natural gas
Date of implementation: January 1, 2023

Venting limit of 0.17 m3 of natural gas per hour for 
pneumatic controllers
No venting at sites where liquid pumping exceeds 
20L/day
Conservation of natural gas for re-use on site or for 
sale, or replacement with non-emitting or low-
bleed pneumatic device
Date of implementation: January 1, 2023

The compressors with a rated 
brake power below 75 kW

Single wellheads and valve sites 
on transmission pipelines

Not applicable to non-routine 
venting (e.g. emergencies and 
blowdowns)

Not applicable if emissions are 
directed to control equipment or 
if the need for a higher-emitting 
controller is demonstrated

All facilities

Venting from 
compressors

Facilities 
handling 
> 60.000m3 of 
gas

Facilities 
handling 
> 60.000m3 of 
gas

Fugitive leaks

Facility produc-
tion venting

Facilities 
handling 
> 60.000m3 of 
gas

Venting from 
pneumatic 
devices

Source: www.canada.ca 

14 ■  Robert Schuman Centre - Policy Brief ■ Issue 2019/24 ■ December 2019

Florence School of Regulation
Robert Schuman Centre  
for Advanced Studies

European University Institute
Via Boccaccio, 121
50133 Florence
Italy 

Contact:
email: fsr@eui.eu  website: fsr.eui.eu

Robert Schuman Centre for Advanced Studies
The Robert Schuman Centre for Advanced Studies, created in 1992 and directed by Professor Brigid Laffan, aims to develop 
inter-disciplinary and comparative research on the major issues facing the process of European integration, European socie-
ties and Europe’s place in 21st century global politics. The Centre is home to a large post-doctoral programme and hosts major 
research programmes, projects and data sets, in addition to a range of working groups and ad hoc initiatives. The research 
agenda is organised around a set of core themes and is continuously evolving, reflecting the changing agenda of European inte-
gration, the expanding membership of the European Union, developments in Europe’s neighbourhood and the wider world.

The Florence School of Regulation 
The Florence School of Regulation (FSR) was founded in 2004 as a partnership between the Council of the European Energy 
Regulators (CEER) and the European University Institute (EUI), and it works closely with the European Commission. The 
Florence School of Regulation, dealing with the main network industries, has developed a strong core of general regulatory 
topics and concepts as well as inter-sectoral discussion of regulatory practices and policies.

Complete information on our activities can be found online at: fsr.eui.eu

15 ■  Robert Schuman Centre - Policy Brief ■ Issue 2019/24 ■ December 2019

Content © Maria Olczak, Andris Piebalgs© European University Institute, 2019Views expressed in this publication reflect the opinion of individual authors and not those of the European University InstituteQM-AX-19-024-EN-Ndoi:10.2870/43128ISBN:978-92-9084-801-1ISSN:2467-4540