Dec. 16—The U.S. Environmental Protection Agency's proposed methane rule will cut more emissions than the agency has estimated and in turn enable the fossil fuel industry to prevent billions of dollars more in natural gas from leaking into the atmosphere, according to a study conducted by an energy and conservation think tank.

The EPA issued a revised version of its proposed rule in November that contained tougher measures to curb the climate-warming greenhouse gas at well sites, including in New Mexico's Permian and San Juan basins.

This more stringent version pleased environmentalists, who hailed the changes as good for the climate and public health, while irking industry advocates who called it onerous to operators who generate a third of New Mexico's tax revenue.

The Institute for Energy Economics and Financial Analysis, an Ohio-based nonprofit, said in a report this week the EPA has underestimated the natural gas that will be captured if operators replace leaky equipment and improve methane detection as the proposed rule requires.

That's because the agency is using outdated modeling and relying too much on data from oil companies, which often undercount the number of leaks and underreport the amount of methane emitted, the report said.

"The EPA's methane control rules could not only have a greater-than-estimated benefit for the climate, but could also generate a greater-than-estimated financial benefit for oil and gas companies," the report's author Trey Cowan wrote in a summary.

The report is titled Why the Oil Patch Should be Grateful for EPA Methane Rules.

EPA estimates its rule, when enacted, will help the industry avoid an estimated 36 million tons of methane emissions from 2023 to 2035.

During the same period, industry will capture as much as $4.6 billion more in natural gas — based on forecasted prices — that otherwise would have gone to waste, the agency said in a fact sheet.

However, the institute contends the EPA is underestimating the amount that will be recovered by more than

1.8 billion cubic feet.

In 2019 dollars, the additional captured product would be worth $4.3 billion to the industry over a 12-year period, the report said.

The study notes the exact number of leaks in the U.S. is difficult to pin down because they are sporadic and unpredictable, which means the volume of natural gas that will be captured and brought to market in the next decade isn't really known.

However, analysts involved in the study estimate the natural gas that will be recovered under the methane rule is about 70 percent more than what the EPA forecasts, largely because the agency has based its calculations on older technology and methods, the study says.

Neither the EPA nor the study offer a state-by-state breakdown of the benefits, but they are certain to affect New Mexico, the second-largest oil producer in the country.

When asked about how the findings contrast with EPA's estimates, agency spokeswoman Jennah Durant wrote in an email the EPA doesn't comment on studies it doesn't conduct.

Aaron Johnson, spokesman for the Denver-based Western Energy Alliance, didn't directly address the study's findings but argued it lacked credibility because the institute is anti-fossil fuel and funded by liberal philanthropists.

"They're not an unbiased think tank," Johnson wrote in an email. "They are an advocacy organization that's funded by the largest anti-oil-and-natural-gas philanthropies worldwide."

Another fossil fuel advocate wrote in an email, the state's operators are already investing in technology to better recover natural gas.

"Through our own innovation and technology, the industry exceeds regulatory standards with a targeted 98 percent capture rate," wrote Joe Vigil, spokesman for the New Mexico Oil & Gas Association. Vigil was referring to the state Oil Conservation Division's rule that requires operators to capture

98 percent of their methane by 2026. A conservation group applauded the study for pointing out the problems in methane reporting.

"This reconfirms what we have long known about EPA's methane data undercounting emissions," Jon Goldstein, state policy director for the Environmental Defense Fund, wrote in an email.

The study also shows why EPA toughening its proposed regulations make economic sense, Goldstein wrote.

It's in line with a recent S&P analysis, which asserts reducing preventable natural gas losses in six key export regions, including the U.S., could add more than

80 billion cubic meters of the fuel to the world market, Goldstein wrote.

That's almost 60 percent of Europe's yearly imports from Russia before it invaded Ukraine, he added.

"Minimizing wasteful methane emissions can help meet energy needs during the geopolitical crisis, even as we continue to decarbonize the world's energy systems," Goldstein wrote.