The People of America's Oil and Natural Gas Indusry

Report: Industry’s $252 Billion Environmental Investment

Mark Green

Mark Green
Posted December 14, 2012

A new API report estimates that the U.S. oil and natural gas industry has invested more than $252 billion trying to improve the environmental performance of its products, facilities and operations since 1990 – about 65 percent of that directed toward cleaner air and water.

The report is based on spending data from representative companies that was used to estimate industry-wide performance. Highlights:

  • Industry spent about $13 billion in 2011, the report says, including $11 billion to implement new technologies, create cleaner fuels and fund ongoing environmental initiatives. An additional $1.9 billion was spent on research and development, corporate environmental programs and spill remediation efforts. In 2011, 35 percent of industry environmental spending was directed toward cleaner air.
  • Industry’s upstream (pre-refining stage) sector has spent $46 billion since 1990 (aside from remediation and spills) – almost $4 billion in 2011.
  • The refining sector has spent $132 billion since 1990 (aside from remediation and spills) – nearly $5 billion in 2011.
  • Transportation expenditures (mainly pipelines) doubled from 2010 to a record $2 billion in 2011.

Here’s how the spending breaks down in terms of specific environmental area, for the 1990-2011 time frame:

And for 2011:

Note: In both charts “other” includes recurring activities not reported under air, water or wastes such as removing abandoned production platforms and supporting oil spill cooperatives.

Clearly, a major focus of industry spending related to the environment is on reducing air pollution – and in 2011 industry met or surpassed the requirements of federal clean air statute. The report:

"The emphasis on air pollution control is driven by the requirements of the 1990 Clean Air Act Amendments and subsequent regulations to reduce emissions from so-called “stationary sources” (industrial facilities such as refineries) and “mobile sources” (cars, trucks, etc.). Federal and state environmental programs aimed at reducing carbon monoxide, smog, and air toxics require the sale of oxygenated, reformulated, and low-volatility (evaporates more slowly) gasolines in certain parts of the country."

Certainly, industry recognizes environmental protection in its products and operations is a continuing responsibility that is taken seriously – reflected in this report and others detailing industry’s investments in greenhouse gas-reducing technologies.

ABOUT THE AUTHOR

Mark Green joined API after a career in newspaper journalism, including 16 years as national editorial writer for The Oklahoman in the paper’s Washington bureau. Mark also was a reporter, copy editor and sports editor. He earned his journalism degree from the University of Oklahoma and master’s in journalism and public affairs from American University. He and his wife Pamela live in Occoquan, Va., where they enjoy their four grandchildren.