Decarbonisation Technology August 2025 Issue

Methane is produced across the whole oil and gas value chain (see Figure 1 ), with emissions released into the atmosphere through the intentional flaring and venting, as well as through the unintentional release of fugitive methane emissions. Fugitive emissions also occur during the production and transportation of natural gas, as leaks and unintentional releases into the atmosphere. Venting can happen due to non-functioning flaring equipment and unlit flares. However, in cases where there is no flaring equipment or the infrastructure to deliver the gas to off-takers for use, some operators opt for venting gas deliberately and routinely. Associated gas is the natural gas co-produced during oil extraction. Relevant volumes of associated gas are flared on a yearly basis at oil production sites worldwide, and flares are a “ The main drivers of the market for methane emissions abatement technologies include environmental regulations, technological advancements, and industry commitments to sustainability ” direct source of methane emissions, as flares do not completely combust all the hydrocarbons in the gas stream. Global burning problem For more than a decade, gas flaring around the world has been dominated by 10 countries: Russia, Iran, Iraq, the US, Venezuela, Algeria, Libya, Nigeria, Saudi Arabia, and Mexico. In 2023, these top 10 flaring countries were responsible for more than 75% of global gas flare volumes, while they accounted for around 50% of oil production. Globally, small-medium flares account for a majority of the total emissions released into the atmosphere. Africa leads with 1,979 MMscfd across 339 flares, with Algeria, Nigeria, and Libya as the countries with the highest emissions. The Middle East contributes 1,905 MMscfd across 320 flares, primarily from Iran, Iraq, Oman, and Saudi Arabia. Russia and the Caspian region account for 1,647 MMscfd across 297 flares, while Central and

South America represent 790 MMscfd across 152 flares. Most flares occur in onshore fields. This is because, globally, there are more onshore oil and gas facilities than offshore, and also because onshore facilities often have a more extensive infrastructure, including pipelines and processing plants, which increases the likelihood of situations in which flaring can occur. Market transformation accelerates The perception of associated gas flaring has evolved over the last few years. Once viewed as an operational solution to a site-specific problem of how to deal with an unwanted by- product of oil production, it is now recognised as an undesirable activity with global GHG impacts. Upstream operators, governments, financial institutions, non-governmental organisations, and technology providers have undertaken initiatives aimed at raising awareness and facilitating beneficial uses of associated gas, with a goal of reducing the quantity of associated gas that is flared. Under various scenarios, there is a consensus that emissions abatement spending will increase and accelerate in the coming years. In April 2023, Rystad Energy estimated that the emissions abatement tech market could hit $85 billion by 2030. In upstream and midstream, the concentration of spend will be on flare and venting reduction (45% of 2022 spend), with a subsequent shift towards further equipment upgrades along the value chain. Methane reduction projects in the oil and gas industry are often profitable. Aside from keeping the gas in the line, more waste-to-value projects are expected where industry is leveraging its infrastructure and expertise to create win- win propositions. Areas where emissions are quantified (flaring, combustion, and operational venting) will be prime candidates for investment. The main drivers of the market for methane emissions abatement technologies include environmental regulations, technological advancements, and industry commitments to sustainability. environmental, social, and governance criteria will continue to drive investor and stakeholder pressure on companies to reduce flaring, leading to increased transparency and investment in sustainable practices.