Article from: OGEL 2 (2022), in Editorial
This special issue examines and discusses the legal, regulatory, and economic implications of gas flaring in the evolving low-carbon contexts globally and selected countries and regions. It seeks to highlight best practices and solutions to the identified challenges. Associated natural gas is often flared during oil production when economic, regulatory, or technical barriers to utilization via gas markets and infrastructure create bottlenecks. Another common reason is when operational or technical challenges to reinjection or alternative use arise. Rather than shut down a producing oil and gas well, which will stop the production of other 'valuable' resources, the unconnected and uncontracted gas volumes are typically evacuated through flare stacks, then ignited and combusted. Such combustion leads to emissions of carbon dioxide and water. At the same time, methane, the primary component of natural gas, may also be released if there is incomplete combustion or, in some cases, through venting. In considering the legal and policy dynamics of flaring and venting, this OGEL Special comprises the following articles:
1. The Regulatory Complexities of Gas Flaring and Venting in the US, Tade Oyewunmi
In this paper, Tade Oyewunmi opines that the process of regulating the flaring and venting of natural gas often creates an energy policy trilemma. This paper discusses the intricacies of regulating gas flaring and venting in the US and highlights the energy trilemma that arises as a result. Such complexities are manifested in the need to curb upstream emissions arising from flaring and venting while at the same time realizing the value of production and supply systems for delivering affordable, low, or carbon-neutral energy. One way of addressing the complexities created as a result is to consider the application of energy justice principles and industry best practices to resolve issues ex ante and ex post. Energy justice principles could be applied in balancing the economics (costs and affordability) with environmental regulation and security of energy supply issues. The paper highlights the emerging bottlenecks to market access which become relevant considering the recently proposed and existing rules that require the capture and sale of gas that would otherwise be flared. It also points to industry best practices and guiding principles that may provide helpful tools for curbing harmful emissions and ensuring more sustainable operations.
2. Regulating Natural Gas Venting and Flaring as Waste: A Review of the New Mexico Approach, Joseph A. Schremmer
In this essay, Joe Schremmer discusses the regulation of routine venting and flaring of natural gas as a source of prohibited "waste," using New Mexico's recently adopted Waste Rule as an example. It begins with a survey of both the environmental and economic benefits to be achieved by limiting or eliminating venting and flaring and the direct and indirect costs of doing so, including the forgone opportunity to produce crude oil. Schremmer explains the common law and statutory definitions of "waste" to demonstrate that the concept involves balancing the costs and benefits of any given production practice to determine whether it is justified or wasteful. Finally, Schremmer applies existing law to routine venting and flaring of associated gas in the Permian Basin, which the Waste Rule has effectively banned. The result of this analysis is that the Waste Rule prohibits some venting and flaring that would not necessarily constitute waste under existing law. In conclusion, the essay argues that waste is the wrong legal rubric for reducing or eliminating methane emissions from oil and gas operations. Instead, policymakers should seek other legal tools and avenues that would better align with their true purpose: fighting climate change.
Kim Talus and Cheri Hasz provide an account of Texas's regulatory framework for gas flaring. They examine pre-and post-1990 regulatory practice by the Railroad Commission and explain some of the causes for the more relaxed approach of the Railroad Commission towards flaring of associated gas. The paper discusses critical issues regarding obtaining the exception to flare, regulatory competence over flaring in Texas, and the recent litigation and policy developments.
4. Rebuilding the Texas Railroad Commission, James W. Coleman
This article explains the role of the Railroad Commission of Texas as the oil and gas industry regulator. It describes the crisis now facing the industry-overproduction of oil and gas is wasting resources that will be worth more in the future. Texas currently produces far more oil than any other state. As a result, the eyes of the global oil industry are again on Texas. The article lays out a plan for rebuilding a world-class oil and gas regulator, explaining how better data and smart limits can protect both the economy and the environment.
5. Improving Regulatory Approaches for Abating Upstream Gas Emissions in a Low Carbon Era: Case Study of Algeria, Egypt, and Nigeria, Magnus C. Abraham-Dukuma, Okechukwu C. Aholu, and Susan Nakanwagi
This study uses a doctrinal and comparative legal methodology in analyzing the applicable regulatory regimes in Africa's prominent petro-states of Algeria, Egypt, and Nigeria to identify the weaknesses and opportunities for abating flare-related emissions. Drawing on best practices in Canada and the United States of America, the study identifies margins of analysis and regulatory improvement areas. These include adopting sector-specific incremental emission reduction targets, gas monetization, and flaring intensity requirements, and the implementation of leak detection and repair programs for addressing critical components that contribute to emissions. These can be adapted to be context-specific in addressing Africa's gas flaring dilemma. The study also stretches into a socio-legal dimension by reflecting briefly on the political economy issues of oil dependence, rent-seeking, and corruption as some of the significant hurdles to the effective regulation of gas flaring in Africa's petro-states.
In this paper, Moller and Mohammed point out that the flaring of gas and consequent carbon dioxide emissions from oil and gas installations is a significant environmental problem in many countries and a key contributor to global warming and climate change. Although loosely prohibited in many countries, the global industry flares a substantial amount of associated gas during exploration and production activities. The process consumes useful natural resources and produces harmful waste that negatively impacts the environment and the economy. Current data on global gas flaring indicates that gas flaring occurs in most oil and gas producing countries, including the United Kingdom and Nigeria. Nigeria is regarded as the seventh-largest gas flaring nation globally, and gas flaring seems to be a significant problem, despite having relevant laws in place. The oil and gas industry in the UK has managed to reduce flaring and venting significantly, with the independent regulator, in collaboration with environmental agencies, adopting a much more rigorous approach to hold the industry to account for their commitment to halving their production emissions by 2030 as a pivotal part of the government's target for net-zero emissions by 2050.
This paper notes that gas flaring has been a global concern despite various strategies to combat it. The provisions of the Paris Agreement highlight both market and non-market instruments targeted at emission reduction, energy efficiency, and sustainability. The need for low-carbon economies to promote energy efficiency and decarbonization with stringent measures is advocated. Jolaosho and Olujobi adopt a comparative approach in examining the international legal regime on gas flaring and the market-based instruments (MBIs) under the Paris Agreement to ensure gas flaring reduction. The study also utilized the doctrinal legal research method and, among other things, finds that there has been laxity in implementing the anti-gas flaring legislation due to persistent flaring and weak regulatory policies. Therefore, integrating MBIs, particularly tradable permits, is recommended as an environmentally viable legal commodity to discourage and diminish gas flaring in countries such as Nigeria.
This paper notes that apart from the economic loss of energy, flaring and venting of associated gas creates local, environmental, and public health impacts and contributes to the potential for climate change and wildlife extinction. The authors appraise the up-to-date laws and institutions governing and regulating gas flaring and venting in Nigeria. They argue that the legal framework regulating the petroleum industry in Nigeria, though adequate to curtail the rate of gas flaring and venting, has underperformed due to the refusal of policy and decision-makers to implement these laws, thus allowing for continuous flaring of gas.
9. International Oil and Gas Operations and the Role of the World Bank's Global Initiatives on Natural Gas Flare Reduction, Solomon Nwaulikpe Obulor
This paper examines the World Bank's Global Gas Flaring Reduction Partnership (GGFRP) initiative, how and why the initiative has been developed, and how partnering countries like Nigeria incorporate the objectives of the initiative in their national petroleum policy and law to reduce gas flare and vent. Specifically, the paper analyses how policy and legal frameworks on oil and gas development in Norway and Nigeria incorporate the GGFRP initiative to reduce routine gas flaring and venting to achieve zero greenhouse gas emissions by 2030. The importance of analyzing the GGFRP initiative is informed by the fact that it could contribute meaningfully to the global gas flaring and venting reduction agenda by collecting and disseminating a best practice that will increase the capture of associated gas and either reinject it into the ground or process and utilize it in the oil production field, domestically or internationally to reduce and perhaps eliminate routine gas flaring and venting by 2030. Obulor argues that while the GGFRP initiative seems to hold a lot of hopes as it prescribes gas flare and vent reduction best practices, regulatory approaches adopted to implement the GGFRP initiative vary in the partnering countries. Generally, two methods have been adopted: the prescriptive or rule-based and the goal-based (performance) regulation. The approaches adopted, coupled with bureaucratic and institutional capacities and political will, account for divergent results in gas flaring and venting reduction in the partnering petroleum-producing countries.
 Visiting Assistant Professor of Law, University of Oregon School of Law, Oregon, US.
 Leon Karelitz Oil & Gas Law Professor and Assistant Professor, University of New Mexico School of Law.
 Professor and James McCulloch Chair in Energy Law at Tulane University Law School. Professor, University of Eastern Finland.
 B.A. (Cornell University); J.D. (Tulane University Law School, 2021). Attorney-advisor, the Public Utility Commission of Texas.
 Associate Professor at Southern Methodist University's Dedman School of Law in Dallas, Texas.
 Centre for Environmental, Resources and Energy Law, Te Piringa - Faculty of Law, University of Waikato, Hamilton, New Zealand.
 Faculty of Business and Law, University of West of England, Bristol, United Kingdom
 Centre for Energy, Petroleum & Mineral Law and Policy (CEPMLP), University of Dundee; Policy Analyst Intern at the Office of the Legal Counsel - International Energy Agency (IEA)
 Lecturer and Course Leader, Oil, Gas & Renewable Energy Law, Law School, Robert Gordon University, Aberdeen, Scotland, UK. University, Scotland, Solicitor (England and Wales), Legal Practitioner (Namibia)
 Part time law lecturer and PhD Candidate, Law School, Robert Gordon University, Scotland, Barrister and Solicitor (Supreme Court of Nigeria)
 Lecturer, Department of Public and International Law, Elizade University, Ilara-Mokin, Ondo State, Nigeria.
 Senior Lecturer, Department of Public and International Law, Elizade University, Ilara-Mokin, Ondo State, Nigeria.
 Lecturer 1 in the Department of Private and Property Law, Faculty of Law, University of Port Harcourt, Rivers State, Nigeria.
 Ph.D candidate at Nnamdi Azikiwe University, Awka, Nigeria.
 Legal Practitioner (Nigeria), and Doctoral Researcher and Teaching Fellow, School of Law, University of Aberdeen, UK.