Methane Emissions from Marginal Wells: How Much? What Should the Regs Be? Current Status (Aug. 2017)

Methane Emissions from Marginal Wells: How Much? What Should the Regs Be? Current Status (Aug. 2017)

The federal methane emissions reduction rule enacted by the Obama administration was set to go into effect earlier this year but the Trump administration EPA gained a stay on the rule. This month that stay was overruled by a federal court. Before the rule was finalized last year conventional legacy wells, often marginal wells, were unexpectedly added to the leak detection and repair (LDAR) requirements.

The EPA made unverified assumptions about methane emissions from marginal wells as part of their New Source Performance Standards (NSPS). The Research Partnership to Secure Energy for America (RPSEA) has recently announced plans to study and quantify the emissions from marginal wells in order to more accurately assess them and to indicate whether the EPA estimates are accurate or not. They are currently seeking funding and expect to partner with industry groups, oil & gas producers, state and regional associations, and academia as they have done for previous air emissions assessments. If results show that the EPA estimates are inaccurate then the EPA will also be advised to readjust its estimates for total methane emissions from oil & gas systems. EPA had recently re-estimated them upward based on their assumptions developed for NSPS.

I think the RPSEA assessment of marginal wells is important. I think the methane emissions reduction requirements for new wells are fair especially since states are developing similar requirements. Many companies are already far in compliance. Industry professionals have stated that pursuing emissions reductions is worthwhile and is also good PR. Some individual projects such as owners of specific marginally economic hydrocarbon processing facilities have argued that compliance will be difficult for them in order to keep the projects running. The same is true of marginal wells, especially those produced by low-cost/low-return producers. I also think that marginal wells should be exempt from the requirements at least for an adequate time period for two reasons: 1) They give the producers more time to do their own proactive assessments, LDAR, and compliance planning, and 2) They give time for the methane emissions compliance industry to develop and allow newly developed air emissions detectors and protocols to become more widely available and come down in cost making future LDAR cheaper for marginal producers. It could even help the LDAR industry bringing in more work later when it could be appreciated after all the backlogged initial assessment work for new unconventional wells shifts to maintenance and newly turned on wells. Some sort of direct financial aid or tax advantage for marginal producers could speed up compliance as well.

RPSEA partners are experienced with air emissions studies and know how to conduct them. Two of their main partners for air emissions studies are Houston Advanced Research Center and GSI Environmental, Inc. Along with their research partners they are involved in developing air emissions data collection standards. One important difficulty with marginal wells will be what wells to sample since there are nearly a million of them to choose from. Perhaps a strategy of airborne or drone-based infrared camera assessments over fields followed by more specific assessments at well facilities targeted to common emissions sources is how they will proceed.

References:

RPSEA Study Will Determine Emissions Profile of Marginal Wells – by staff, in Offshore Mag, Aug. 21, 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

Methane and VOC Emissions from Oil & Gas Systems: Implications of the Withdrawal of the EPA Information Request – by Kent C. Stewart, in Blue Dragon Energy Blog, March 6, 2017