HOUSTON, April 30 (Reuters) - Operators drilling for oil

in Texas are scrambling to dispose of their excess natural gas

amid a supply glut and weak prices, prompting an uptick in

flaring requests.

The Railroad Commission of Texas (RRC), which regulates the

state's oil and natural gas industry, last week approved 21

exemption requests from operators, mostly in the Permian and

Eagle Ford shale fields, to flare, more than four times the

level it approved this time last year.

Flaring, or the burning of unwanted gas, has come under

greater regulatory scrutiny in recent years amid pushes by

environmental groups and others to clamp down on the practice

that releases greenhouse gases to help slow climate change.

Producers, however, now face a dilemma with crude oil prices

trading above $80 a barrel, but gas remaining depressed

and in some places falling into negative territory.

"We think that operators will basically use all the tools in

their tool box to try and keep producing oil because the oil

returns are pretty strong right now", said Jason Feit, advisor

to energy data provider Enverus.

"Flaring is becoming more challenging everywhere, so I think

that is something they are probably not wanting to do, but it

would be preferable to shutting in any wells for sure", he

added.

Operators can seek an exemption from Texas' flaring rule for

safety reasons, maintenance or emergencies, and during the first

ten days of production when bringing on a new well, the RRC

said.

Devon Energy ( DVN ) requested 12 of those exemptions for

its operations in the Eagle Ford in south Texas, while Callon,

which was acquired by Apache in early April, made six

request for assets in the Permian. All of those were approved.

Devon declined to comment, and Apache did not respond to a

request for comment.

Gas prices in many states, including Texas, have traded

below zero several times over the past month or so due to low

demand, ample renewable power supplies and pipeline outages and

other work that has trapped gas in the country's top oil

producing state.

Spot natural gas at the Houston Ship Channel

in Texas, the price the industry uses for the

Eagle Ford, have averaged $1.68 per million British thermal

units (mmBtu) so far this year, according to SNL Energy data on

the LSEG terminal.

That compares with an average $2.26 per mmBtu in 2023 and

$4.07 per mmBtu over the five year period from 2018 to 2022.

Meanwhile, prices at the Waha hub in west

Texas closed as low as negative $2.99 per mmBtu in mid-April,

its lowest since December 2022, according to data from LSEG,

meaning operators must pay to have their gas taken away.

While Waha prices have recovered some, they remain

depressed.

The supply of associated gas is not likely to subside

soon, as more producers continue to chase profitable barrels of

oil in the Permian.

Permian gas output is forecast to rise by 140 million cubic

feet per day (mcfd) to 25.2 billion cubic feet per day (bcfd)

next month, according to the Energy Information Administration

(EIA).