The Easiest Way To Make $50 Million

Alexander C. Hart


It’s always an exciting opportunity when the federal government can raise revenue and protect the environment while simultaneously increasing profits at private businesses. That’s why a recent Government Accountability Office (GAO) report on waste from the energy production processes is encouraging, even if it’s irritating.

When energy companies like Shell, BP and the hordes of other, smaller firms drill for oil and natural gas, some gas inevitably bubbles to the surface or seeps out through leaky pipes and ineffective storage systems. The companies burn off some of the bubbles. That’s called “flaring.” The rest escapes into the air. That’s called “venting.”

The companies are required to report how much gas they flare and vent. But, according to the GAO, companies wildly underreport the amounts. From 2006 to 2008, for example, companies reported venting or flaring about 0.13 percent of natural gas produced. But the real amount, according to EPA estimates, was actually 30 times higher—approximately 4.2 percent of production or around 126 billion cubic feet of gas.

That’s enough gas to heat 1.7 million homes for an entire year.

Wait a minute—natural gas is really valuable. Venting and flaring it lowers local air quality and contributes to climate change. So why are energy companies releasing so much of it?

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