Orbio Earth finds methane leaks that could cost oil companies $9 billion this year

When it comes to greenhouse gasses, people tend to zero in on CO₂, which is responsible for the majority of global warming. But then there’s methane, which has driven about 30% of climate change, according to the IEA. It’s a big enough threat that the U.S. government is going to fine polluters $900 for every metric ton they release this year. By 2026, it’ll be $1,500 per metric ton.

Methane, which is the main component of natural gas, is a potent greenhouse gas that causes 83 times more warming than one molecule of carbon dioxide. Leaks are one of the main sources, both from aging natural gas infrastructure and oil and gas fields.

But tracing leaks of the odorless, colorless gas has been challenging. Reporters have been able to trace more than 1,000 so-called super-emitters, but that’s just the tip of the iceberg. The U.S. alone has more than 4 million active and inactive oil and gas wells, any number of which might be leaking as you read this.

“The key issue why there’s so many emissions is because there’s no real global scale measurement technology out there that can actually operate on the scale of the oil and gas industry,” Robert Huppertz, co-founder and CEO of Orbio Earth, told TechCrunch.

And with the EPA’s new methane rule, there’s finally financial incentive to develop one.

The company has been able to observe a significant portion of estimated oil and gas methane emissions in the U.S., the IEA said in a report released Wednesday. Orbio estimates that about 10 million metric tons of methane were released from onshore oil and gas exploration and production in 2023. If that rate continues this year, oil and gas companies are likely to be fined a few billion dollars. In 2026, it could be much higher.

Orbio’s pitch is that it’ll be cheaper to pay the startup to find those leaks so oil companies can lock them down. It’s a business model that has drawn investor attention, too. Orbio has raised a $4 million seed round from the European Space Agency, Initialized Capital and Y Combinator. The startup was a part of the accelerator’s spring 2023 cohort.

There are two basic approaches to measuring methane emissions: bottom-up and top-down. The bottom-up approach would probably require sensors installed at key points in oil and gas infrastructure; it would provide pretty accurate figures, but it would likely be very expensive to install. The top-down approach would use one or a handful of sensors that can oversee broad swaths of the planet; the results would be less accurate, but the costs would be substantially lower.

Orbio Earth is one entrant in the emerging methane-tracking market, and it’s taking the latter approach. Huppertz and co-founder Jack Angela have developed a suite of algorithms to detect methane emissions using freely available satellite data.

Though the satellite that Orbio uses, Sentinel-2, wasn’t designed to detect the gas, the results are impressive: Researchers testing different methane reporting techniques, both commercial and academic, found that Orbio caught every leak they threw at it, except one that was below 1 metric ton per hour.

Until last week’s successful launch of MethaneSAT, no satellites specialized in the detection of methane. In fact, until just a few years ago, experts thought that more general-purpose remote-sensing satellites like Sentinel-2 wouldn’t be able to pull enough signal from the noise to find methane leaks. That’s because methane and water, including cloud cover, can be hard to distinguish.

To make the distinction, Orbio watches the entire Earth’s surface, looking for anomalies over time. When one pops up, it determines whether the anomaly is likely a methane release, and if it is, whether an oil and gas facility is the source. Orbio delivers emissions data to end users within 48 hours, often less, Huppertz said. The startup processes 10 to 20 terabytes of data daily.

Orbio’s customers subscribe to its data product and analysis for a variety of reasons. Oil and gas companies might want to keep an eye on their assets, while investors might want to assess the performance of their portfolios or benchmark their competitors’. Thanks to the satellite data it taps, Orbio’s data stretches back to 2016.

The startup is working to apply its algorithms to other satellite data and begin evaluating other greenhouse gasses. “Natural gas will be very much needed for energy transition,” Huppertz said. “And so making sure that methane and natural gas stays within infrastructure and does not leak into the atmosphere will always be a crucial point until the last drop of natural gas is used.”

Correction: This article has been updated to reflect facility-based exemptions for methane fines.