New analysis quantifies natural gas waste and pollution in North Dakota

(Bismarck, ND) A new Synapse Energy Economics analysis commissioned by Environmental Defense Fund and Taxpayers for Common Sense finds oil and gas companies across North Dakota wasted over $680 million worth of natural gas in 2019. That’s enough lost gas to meet the state’s entire residential natural gas demand 16 times over, and totaling $43.3 million in lost potential tax revenue for federal, state and tribal governments. 

This waste occurs when natural gas is either flared, vented or leaked from oil and gas infrastructure and the analysis comes as the U.S. EPA and BLM move to finalize proposed rulemakings to address methane pollution and waste. These national rules provide significant upside for states like North Dakota, where wasted taxpayer resources could be saved with stronger guidelines for oil and gas operators.

"Reducing this pollution is a critical opportunity for North Dakota," said Nini Gu, EDF Regulatory & Legislative Manager, West. “Efforts by the Biden administration  to cut methane waste and pollution will create jobs and increase revenue for state priorities like education conservation, and local governments, while curbing pollution and strengthening climate security.”

Methane is a potent greenhouse gas with 84 times the warming power of carbon dioxide over a 20-year timeframe and is often accompanied by other local air pollutants. Because methane is the main component of natural gas, it also represents a waste of an energy resource when it is released from the supply chain.

This first-of-its-kind  analysis quantifies the amount of wasted gas and lost revenue from all land types — federal, state, private and tribal lands. This builds off of a January 2023 report that looked solely at federal and tribal lands.

According to the analysis, the 226 billion cubic feet of oil and gas methane wasted from North Dakota’s 17,600 active wells translated into nearly $43.3 million in lost tax and royalty revenue to the state of North Dakota in 2019 alone — including $18.6 million in lost revenue for the Three Affiliated Tribes. That lost funding that would otherwise support North Dakota’s education system, local city and county governments, and the state Legacy Fund. Instead, methane and air pollution is released into the atmosphere to harm our climate and hurt public health.

“We are losing a valuable energy resource day after day, month after month, year after year. This is true in North Dakota and across the country. Outdated policies keep billions of dollars’ worth of natural gas from getting to market at a time when budgets are tight and energy security is important as ever,” said Michael Surrusco, Director of Development at Taxpayers for Common Sense.

This analysis also highlights that flaring is a leading cause of waste, responsible for roughly 95% of all methane wasted in North Dakota. That directly translates into nearly $648 million worth of lost gas — enough waste from flaring in 2019 alone to meet the needs of every household in North Dakota for 15 years — and underscores the importance of the the EPA and BLM improving their proposals to end waste and pollution from routine flaring to keep this resource out of the atmosphere and in the pipeline.

Colorado and New Mexico have already implemented strong rules to stop pollution and waste from routine flaring, creating an important foundation for federal agencies to build upon in developing standards that serve the needs of North Dakotans.

“Methane waste and pollution is bad for the environment, bad for the state economy, and bad for the state budget," said Liz Anderson, lead organizer of Dakota Resource Council. “When the industry is allowed to waste natural gas, it robs the future of North Dakotans and revenue that would have been invested in education, conservation, and our local communities."

Reducing methane waste and pollution also creates jobs in the fast-growing methane mitigation industry. According to Datu Research, the sector already has 16 employee locations across North Dakota, manufacturing products and providing services to help operators address emissions. The methane mitigation industry provides family-sustaining jobs that typically pay 10% more than the federal average and can’t be offshored. Over 75% of methane mitigation companies say they would create more jobs with strengthened methane emission standards in place.

Additionally, reducing the needless waste of gas resources lost through methane waste is an important solution for addressing the joint energy and climate security challenges of the U.S. and its allies as we transition away from fossil fuels to a clean energy future. A recent EDF analysis revealed that reducing waste of natural gas from leaks and flaring in the U.S. could provide over half of the yearly supply of natural gas the country has pledged to European allies.