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The US is offering $850 million in subsidies to clean up methane emissions from the oil sector

By Valerie Volcovici

WASHINGTON (Reuters) – The U.S. government on Friday opened a competing bid that will close on Aug. 26 for $850 million in subsidies to help small oil and gas producers monitor and reduce methane production from their operations, a key part of the the Biden administration’s plan to crack down on leaks of the potent greenhouse gas.


The funding, made available through the administration’s signature climate bill, called the Inflation Reduction Act, will specifically help small oil and natural gas operators reduce methane emissions and access methane detection and reduction technologies. It will be open to industry, academia, NGOs, Native American tribes, and state and local governments.


Some smaller, independent U.S. oil and gas operators had strongly opposed the Environmental Protection Agency’s new methane standards, which target hundreds of thousands of existing wells across the country, because they would place a financial burden on low-yielding wells, as well as the the agency proposed methane tax on producers.

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‚ÄúThese investments from President Biden’s Investing in America agenda will drive the deployment of available and advanced technologies to better understand where methane emissions come from. That will help us more effectively reduce harmful pollution, tackle the climate crisis and create good-paying jobs. said EPA Administrator Michael Regan.


Oil and gas production is the source of about a third of the country’s methane emissions and is a key target for the Biden administration as it seeks to combat climate change. The United States is among more than 100 countries that have pledged to reduce their methane emissions by 30% from 2020 levels by 2030. Low-producing oil and gas wells, which represent just 6% of total U.S. production, are responsible for the half of methane emissions from all U.S. well sites, a 2022 report shows.

(Reporting by Valerie Volcovici; Editing by Jacqueline Wong)

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