Methane and VOC Emissions from Oil & Gas Systems: Implications of the Withdrawal of the EPA Information Request

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• Methane and VOC Emissions from Oil & Gas Systems: Implications of the Withdrawal of the EPA Information Request
  
  
  NOTE: Although the federal rule was specifically for methane emissions, the same technologies work for the volatile organic carbon (VOC) emissions that contribute to ground-level ozone. Emissions sources can be narrowed down by the content of the emissions such as alkane gas ratios and presence of components such as carbon monoxide which indicate post-combustion emissions such as those from compressors and motors or xylenes which may indicate emissions from condensate tanks. In some cases tank emissions could even be flared to reduce their climate impacts.
  
  
  While industry advocacy groups and likely many oil and gas companies are cheering the recent withdrawal of the EPA information request for potential emissions sources and emission control from oil and gas systems, what are the real world implications? 
  
  
  1)      From a scientific perspective data is the food of understanding and if the gathering of data ceases then accurate knowledge and understanding is undermined. If companies abandon such data gathering who will know much methane and VOCs are being emitted? It makes sense to know your emissions and it makes sense to know the emissions of the industry as a whole. Knowledge is power.
  2)      Companies that specialize in leak detection and repair (LDAR) will lose business in a big way, after ramping up in anticipation of a widespread and broad assessment of emissions.
  3)      Development of better, cheaper, and more portable detection devises and technologies may be slowed as it is no longer a requirement. Many new ideas and tech solutions to emissions problems are being developed, tested, and implemented. Will such innovation slow? While the proposed emissions reductions requirements for new wells seemed reasonable to me, similar requirements for legacy wells did seem excessively burdensome. However, one potential upside was that as LDAR costs and technology costs dropped over time legacy wells could eventually be addressed economically.  
  4)      Will company corporate websites that proudly display commitments to emissions reductions simply fade away? These statements serve to show shareholders and others that they have environmental concern. Perhaps this will be interesting to see. If such statements are removed it would pretty much prove that such display of commitments were only for show. However, many companies are still concerned with their reputations as well as with the environment so I doubt that much will change.
  5)      Without a broad and accurate assessment of emissions there will likely be a weakening of industry positions that methane emissions are low and a strengthening of environmentalist positions that emissions are much higher than depicted. I believe the current knowledge suggests very strongly that they are indeed low but there will be little to back that up and environmentalists can rev up their “go to” argument that methane emissions in particular make natural gas use unsustainable in terms of the climate. That could hurt the industry and its public acceptance.
  6)      Many new technologies have been developed and have even become standard on certain equipment like compressors and other facilities. Will companies abandon some of this equipment to save money? Will dirtier options become more attractive? How will we know? We probably won’t since companies are not likely to advertise that they are opting for higher pollution rates.
  7)      Will companies take a longer-term view that perhaps the political system will move back to the left and keep things the same in anticipation of reversal of the current reversal? I predict that many will, especially since many have come to accept the fact that emissions reduction is good business for three reasons: 1) it saves product from being wasted, 2) it gives leverage for public acceptance, and 3) it has a positive effect on the environment and climate change.
  8)      There is also the very real possibility that states will develop methane and VOC emissions reduction requirements. Some have and some have announced plans to do so. This makes it risky to rollback emissions reduction programs. Perhaps some states could react by making a similar information request. One issue with states, however, with such broad development is that they are often low on funds and manpower to handle such data gathering and analysis.
  9)      Since the information request and much of the data is gathered by the companies there is ample opportunity to err on the side of lower emissions although third party contracted companies and industry studies have also been done and continue to be done. I think the EPA’s methodology included counting equipment, facilities, and current controls and then calculating mathematical probabilities on that basis. What would become of the data submitted, gathered, and analyzed so far?
  10)   In the history of environmental protection the trends have nearly always been from lesser to greater protection. These Trump administration rollbacks buck most of the trends of the past. There is not much precedent for decreased environmental protection and perhaps most of all for decreased data accumulation. Ignorance (of emissions rates) leaves plenty of room for speculation from extremists. They can’t be properly debunked if the data is limited.
  11)   Regulatory certainty is often stated to be desirable by industries regulated. Since global trends are clearly towards decarbonization that is the most likely future for regulations. Many companies are already well in compliance of the federal methane rule and are unlikely to lapse practices to go out of compliance. I predict that most or all of those companies will continue with their current practices.
  12)   In summary, I don’t think emissions data gathering will be abandoned nor do I think emissions reduction will be abandoned. This is perhaps a great opportunity for the oil and gas industry to show its commitment to the environment and its ability to self-regulate in a significant and verifiable way. If companies continue to assess, address, and emphasize emissions reductions despite not being required to do so – it may be a boon toward public acceptance. Radical environmentalists will still use the lack of data to their advantage and companies that do not emphasize environmental protection may slow down their adoption of emissions reduction technologies. However, those that keep up their commitments through over-compliance will be both better set-up for possible future rollback of the rollback or new state requirements and be able to actively demonstrate their commitment to the environment. In that sense the rollback of the federal requirements may end up being a net benefit to those companies and even possibly a net benefit to the environment. I predict that widespread non-compliance won’t occur and if it is found that certain companies are scaling up to capture less methane and VOCs then such findings will generally not bode well for those companies.         
  
  
  Southwestern Energy touts LDAR as cost-effective and enhancing reliability. “Methane rules spur methane innovation and methane rules create methane-cutting jobs,” says Ben Ratner of Environmental Defense Fund, which has collaborated with industry and academia to assess methane emissions. He also notes importantly that the market for methane emissions reduction technology is global. Automated continuous detection systems are desirable for mitigation, safety, and product capture reasons. Limiting methane emissions enhances the climate benefits of natural gas production, plain and simple. The E & P magazine article referenced below is quite informative and supports my observations that methane and VOC emissions assessment and reduction through LDAR technology will continue regardless of the rollback of the federal methane rule. Of note is the list of the various ways methane and VOCs are being mitigated by Southwestern Energy (and other companies): green completions where gas is separated out from frack flow back water, the move toward low-bleed and no-bleed pneumatic controllers and eventually to fuel cells and air pneumatics, utilizing automated gas systems and artificial plunger lift systems to lower emissions associated with liquids unloading, and replacing pneumatic pumps with solar pumps. State rules strictly limiting gas flaring in oil wells are also unlikely to be relaxed and have also led to technology improvements with lower costs forecasted down the road.  Southwestern also noted that cost savings with emissions reduction are initially very good but eventually slow as there are less leaks to fix. However, automated continuous monitoring is still a good strategy and they have begun to focus more on leak prevention and prediction. There are many ongoing assessment and mitigation projects, pilots, and collaborations and these are not likely to fall away although they could be subject to reduced funding, particularly at the federal level.   
  
  
  References:
  
  
  Politics Aside, Methane-Emissions Fighting Mission Continues – by Velda Addison, in Hart Energy E & P Magazine, March 6, 2017
  
  
  Advanced Analytics for Air Emissions Measurement at Oil and Gas Operations – by Dr. Susan Stover, GSI Environmental Inc., presented at RPSEA Onshore Technology Conference, Pittsburgh, PA, July 20, 2016