Annual methane emissions stemming from oil and gas production operations in the Permian Basin decreased 26% in 2023 from the previous year—equal to the total amount of carbon emissions avoided by every electric vehicle (EV) on the road in the United States that year, according to a new analysis by S&P Global Commodity Insights.
The data show that methane emissions from upstream oil and gas operations in the Permian Basin fell by more than 34 Bcf in 2023, the most recent year that data is available. Given that methane is a potent greenhouse gas (GHG), the reduction was equivalent to 18.5 million tons of carbon dioxide emissions avoided.
The findings of the latest analysis for Permian upstream methane, produced in partnership with leading methane management firm Insight M, are based on high-frequency observation data that include nearly 700 high-resolution aerial surveys covering 88% of the basin’s active wells to provide the most accurate, basinwide estimate of methane emissions.
“The sheer scale of this single-year improvement represents significant progress and demonstrates the potential for what lies ahead,” said Daniel Yergin, vice chairman for S&P Global. “Continued improvements in the Permian—an area roughly the size of Great Britain that is responsible for almost half of all US oil output—is providing a path to make meaningful contributions that lower overall US emissions.”
To put the numbers into perspective, the size of the 2023 reduction in methane emissions was:
- More than the total 2023 driving emissions avoided by every EV ever sold in the United States, even if all the vehicles were powered 100% by zero-carbon electricity
- Roughly the same as the total GHG emission from all sources for the state of Hawaii during the same period
The decline in emissions occurred even as total oil and gas production in the Permian increased, the analysis says. As a result, the basin’s methane intensity (ratio of total methane emissions to total output) registered an even more pronounced decline, exceeding 30%.
The analysis attributes the emissions decline to ongoing improvements in equipment as well as increasing deployment of new technologies—including AI-driven analysis of operational data and on-the-ground sensors, aircraft overflights, and satellites—that make it possible to detect leaks with greater speed and accuracy.
“Improvements and increased accessibility of remote sensing technologies is providing a better understanding of US methane emissions and more actionable information,” said Kevin Birn, head of the Center for Emissions Excellence, S&P Global Commodity Insights. “Leaks that previously might have persisted for weeks or months can now be addressed in a matter of days.”
Additional Findings From the Analysis
Methane emissions measured as a percentage of the basin’s total natural gas output fell 33%. Methane emissions constituted 1.36% of the region’s total 2023 production of over 23 Bcf/D—roughly one-fifth of all US gas production.
In terms of total energy (barrels of oil equivalent) produced—notable because Permian production is heavily oil-focused, with associated gas occurring as part of the process—the 2023 methane intensity for the Permian was 0.63% of total production.
In terms of lost economic value (i.e., had the gas been captured and sold), 2023 methane emissions accounted for just 0.12% of upstream revenues, a 70% drop from the prior year as gas prices fell relative to oil. While this revenue loss is minor in the context of total revenues, given ongoing improvements in technology fixing leaks can still deliver positive returns.
“For oil and gas operators, evaluating spending on methane emissions reduction is a dynamic exercise as technologies and data steadily improve, regulations change, and mitigation progress continues,” said Raoul LeBlanc, vice president of global upstream for S&P Global Commodity Insights. “Obviously, the economics tighten as the leaks get smaller and harder to find. However, detecting and mitigating fugitive methane usually turns a profit simply from the sale of the recaptured gas, even in a lower natural gas price environment.”