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EDF claims more regulation can cut Permian basin flaring

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As much as 40 percent of the natural gas that’s expected to be flared in the Permian Basin in 2025 could be avoided at no cost to drillers if regulators abandoned their hands-off approach to the controversial practice.

The vast majority of that would come from curbing so-called routine flaring, which is driven mainly by companies’ failure to adequately plan for the associated gas that’s produced alongside oil, the analysis by Rystad Energy on behalf of the Environmental Defense Fund (EDF) shows.

Its findings run counter to arguments put forward by the state’s powerful oil regulator, which has said the cost of stricter policies would spur producers to shut in their wells, thereby wasting natural resources. Flaring, which plunged in 2020 as the pandemic forced shale producers to curtail output, is set to rebound as oil prices recover.

“Coming at this initially, we expected there would be potentially large challenges for the industry to overcome from a financial perspective,” said Mike McCormick, a principal at Rystad. “A lot of this is avoidable.”

For more information visit www.rystadenergy.com

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