The proposal postpones certain importer obligations and methane intensity provisions, citing rising costs and strained energy supply.

By Alexander Buckeridge-Hocking, Michael D. Green, John-Patrick Sweny, James Bee, Toon Dictus, and James Thompson

Key Points:

• Proposed amendments to the EU Methane Regulation are progressing through the EU legislative process, with both the Commission and the Parliament having now adopted their positions.
• The Commission proposed that the importers’ obligation to demonstrate that supply contracts are subject to equivalent MRV measures would first need to be reported by 31 May 2029 (in respect of 2028 supplies) rather than applying from 1 January 2027.
• Under the Commission’s proposal, methane-intensity reporting for importers and EU producers would move to 5 August 2029 (from 2028), and demonstration of compliance with maximum methane-intensity values to 5 August 2031 (from 2030).
• The European Parliament has since adopted its position supporting an extended, three-year postponement, with the importer MRV deadline moved to 31 May 2031 and first methane-intensity reporting to 5 August 2031.
• The Parliament would exclude imports from countries subject to EU sanctions restricting fossil fuel imports from the extended timeline.

On 14 October 2026, the European Commission (Commission) adopted a proposal to postpone specific provisions of the EU Methane Regulation. The targeted amendment concerns the monitoring, reporting, and verification (MRV) obligations for importers of natural gas, oil, and coal, as well as the methane-intensity reporting requirements for both importers and EU producers. The Commission frames the proposal as a measure to relieve pressure on European industry and national administrations amid increased energy prices as a result of global energy supply disruption, especially in relation to liquefied natural gas (LNG) and oil.

On 22 October 2026, the European Parliament (Parliament) adopted its position on the proposal, endorsing the need for a postponement but supporting a longer, three-year delay and introducing additional conditions.

Background

Building on the EU Methane Strategy adopted in October 2020 under the European Green Deal, the EU Methane Regulation entered into force on 4 August 2024. It targets methane emissions from the energy sector, covering crude oil, natural gas, and coal, as well as biomethane once injected into the gas network. It introduces mandatory MRV requirements, requires operators to conduct regular leak detection and repair (LDAR) surveys, and bans routine venting and flaring except in emergencies or unavoidable circumstances.

A notable feature of the Methane Regulation is the extension of its scope to methane emissions from imported fossil fuels. Since 5 May 2025, importers have been required to provide competent authorities with information on the methane emissions of crude oil, natural gas, and coal placed on the EU market.

Under the current text, from 1 January 2027, importers would be required under Article 28 to demonstrate that contracts concluded or renewed after 4 August 2024 are subject to MRV measures equivalent to those applying to EU producers. Further, under Article 29, by 5 August 2028 and every year thereafter, EU producers and importers must report on the methane intensity of their production and, by 5 August 2030 and every year thereafter, demonstrate that methane intensity is below maximum values established by the Commission by delegated act.

The Commission’s proposal is said to respond to concerns about the implementation timeline raised by several Member States, third countries, and the oil, gas, and coal sectors. The additional year is intended to allow Member States to complete their national penalty regimes, national accreditation bodies to accredit verifiers, and competent authorities to assess and recognise compliance-solution providers.

The Commission proposal states that the amendment does not introduce new requirements and is not aimed at changing the regulatory objectives of the Methane Regulation.

Proposed Timeline

The Commission’s proposal, which amends Articles 28 and 29 of the Methane Regulation, would push back each of these obligations by one year. The table below sets out the current position alongside the timelines proposed under each of the Commission and the Parliament’s adopted proposals.

	Current Position	Commission’s Proposed Timeline	Parliament’s Proposed Timeline
MRV Measures	From 1 January 2027	By 31 May 2029 (for 2028 supplies) and every year thereafter	By 31 May 2031 and every year thereafter
Methane-Intensity Reporting	By 5 August 2028 and every year thereafter	By 5 August 2029 and by 31 May every year thereafter	By 5 August 2031 and by 31 May every year thereafter
Compliance With Maximum Methane-Intensity Values	By 5 August 2030 and every year thereafter	By 5 August 2031 and by 31 May every year thereafter	By 5 August 2031 and by 31 May every year thereafter (no amendment)

Notably, under the Parliament’s position, energy imports from countries the EU has sanctioned would not benefit from the extended timeline. Importers would be required to report these volumes separately, including in mixed cargoes, and the Commission would publish and update an indicative list of the countries concerned.

Impact of the Parliament’s Position

If retained, the Parliament’s position would give importers, producers, and operators significantly more time to prepare for compliance. However, the sanctions carve-out would in practice create a two-tier regime: volumes from sanctioned countries would face earlier deadlines and would need to be reported separately.

The Parliament also wants the Commission to report by 1 July 2029 on how importer and methane intensity provisions are being implemented, with the possibility of proposing future changes if implementation problems continue, or security of supply is threatened. However, similar concepts and discussions that have been introduced in recent years, such as the controversial “kill switch” for the EU Carbon Border Adjustment Mechanism (CBAM) — which would have allowed the Commission to exempt certain imported goods from CBAM during serious and unforeseen market disruption — have resulted in significant controversy and ultimately been rejected. The broader scope of the Parliament’s amendments also diverges from the Commission’s stated intention to confine the proposal to a targeted one-year delay, and will likely be a topic of discussion in upcoming negotiations.  

Potential Impacts for Exporters, Offtakers, and Project Financings

For producers and LNG exporters selling into Europe, the proposal postpones the compliance timetable but leaves the substance of the obligations unchanged. While the importer obligations apply to EU importers, in practice they are passed upstream through supply contracts. Sellers should therefore expect EU buyers to continue to seek MRV-related representations, data-sharing undertakings, cooperation covenants, and cost-allocation or price-adjustment provisions in new and renewed sale and purchase agreements, particularly because contracts concluded or renewed on or after 4 August 2024 remain within scope.

The proposed delays provide importers and Member States with additional preparation time. EU Methane Regulation compliance and reporting will therefore remain relevant in offtake negotiations, lender due diligence, and financial models.

Next Steps

The Parliament is now ready to start negotiations with the Council on the final shape of the law. Once the Council has adopted its own negotiating mandate, interinstitutional negotiations between the Parliament, the Council, and the Commission can begin. Any provisional agreement would then require formal adoption by both co-legislators before publication in the Official Journal. Given the 1 January 2027 application date of the current importer obligations, the co-legislators will need to reach agreement and complete adoption within a compressed timeframe for the postponement to take effect before that date.

The Commission emphasised at the time of its original proposal that further amendments fall outside the scope of the proposal and has called for swift agreement to maintain regulatory certainty. The Parliament’s position, which extends both the length and the scope of the postponement, will therefore be a central point of discussion in trilogue negotiations. During the postponement, the Commission will monitor implementation and security of supply, with any issues to be considered in the Methane Regulation’s periodic review under Article 36, due by 1 January 2028.

This article was prepared with the assistance of Samantha Banfield at Latham & Watkins.

Latham & Watkins will continue to monitor developments relating to EU sustainability regulation and the broader energy efficiency and ESG landscape.