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Recent Changes to Greenhouse Gas Reporting for Petroleum and Natural Gas Systems

SPE Denver Section – HSSE Study GroupJanuary 14, 2016

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Goals

• Discuss the Requirements

• Achieving & Maintaining Compliance

• Actions

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Topics

• Background

• Previous Reporting

• Recent Revisions

• Source Types

• Applicability

• Monitoring, Recordkeeping, Reporting

• QA/QC

• Timeline

• How to prepare?

2

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Quiz Time…

What’s the best way to start out the New Year?

1st Round Bye…? Another EPA air rule…?

On October 22, 2015, EPA

finalized significant changes to

the Greenhouse Gas

Mandatory Reporting Rule for

the oil and gas industry. These

changes, which became

effective January 1, 2016,

primarily affect the upstream

and midstream sectors…

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Background

• EPA’s Greenhouse Gas Reporting Program (“GHGRP”)

• When it all began…2010 (first reporting year):

– Combustion sources only (Subpart C)

• Petroleum and Natural Gas Systems (Subpart W) added for 2011

• Pollutants of interest: CO2, CH4, N2O� Global Warming Potential (GWP):

� CO2 = 1, CH4 = 25, N2O = 298

� Assessment by Intergovernmental Panel on Climate Change (IPCC)

� 100-year time horizon

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Industries Reporting – Direct Emitters (2014 GHGRP)

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Petroleum and Natural Gas Systems: Subpart W (2014 GHGRP)

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Previous Reporting

• What’s reported?– Actual GHG emissions for calendar year

• 25,000 MT CO2e threshold;

• Once in: limited off ramps

• Which segments were previouslyreported?– Production (basin-wide emission sources

considered as one “facility”)• On/associated with single well pad

– Gas Processing (classic “facility”)

– Transmission Compression (classic “facility”)

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Source Types – Subpart W

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What Was Excluded?

• Previously excluded:

– Gathering and Boosting

• Deferred since 2010, pending further analysis

– Transmission Pipelines

– Excluded from previous Production Segment:

• Oil well completions and workovers

• Comingled fluids:

�Not on/associated with single well pad

�Excluded CTBs

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CTBs and Booster Stations

• Previously Out!

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Pop Quiz Time…

• What do Peyton Manning and Subpart W have in common…?

…They’re both back!!

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So What’s New?

• New Segments (threshold 25,000 MT CO2e):– Onshore Petroleum and Natural Gas Gathering and Boosting:

• Adds CTBs (comingled fluids), gathering lines that were previously currently exempt

• Facility definition: entire basin

– Onshore Natural Gas Transmission Pipelines

• Blowdowns

• Facility definition: entire company (nationwide)

• Production Segment (existing) adds:– Completions/workovers for oil wells (hydraulic fracturing)

– Reporting of well ID (API) numbers

• EPA’s Objective: capture previously unreported emission sources in the oil and gas industry

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Segments – Subpart W

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What Does this Mean for Operators?

• Adds more basin reporting…data collection beginning in January 2016

• Pipeline Segment: nationwide

• More data collection for oil well completions and workovers (including meter calibrations)

• More public exposure: – EPA’s Facility Level Information on GreenHouse Gases Tool

(FLIGHT):

EPA Facility Level GHG Emissions Data

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FLIGHT Data by Operator

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Rule Details(1 of 3)

• New Information needed:– Production: Oil well completions/workovers with

frac:

• Directly measure gas from flowback– Same approach as gas wells

• Requires flow meter calibrations– Completions contractor

– Gathering and Boosting:• Generally uses the same calculation methods as Production

Segment

• New: Gathering line mileage (pipeline equipment leaks)

• Blowdown vent stacks (excluded in Production segment)

• Combustion: uses fuel gas composition data (C1 - C5)

– Not Subpart C emission factors

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Rule Details(2 of 3)

Gathering and Boosting – Source Types

(1) Natural gas pneumatic device venting(2) Natural gas driven pneumatic pump venting(3) Acid gas removal vents(4) Dehydrator vents(5) Blowdown vent stacks (compressors, pig traps, gathering lines)(6) Storage tank vented emissions(7) Flare stack emissions(8) Centrifugal compressor venting(9) Reciprocating compressor venting(10) Equipment leaks(11) Gathering pipeline equipment leaks(12) Combustion equipment (fuel gas composition needed)

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Rule Details(3 of 3)

Onshore Natural Gas Transmission Pipelines – Source Types

– Blowdowns:

• Log events (when, where?)

• Volume of releases to the atmosphere:

– Dimensions of pipeline

– Pressure

– Temperature

• Composition (CH4, CO2)

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Industry Concerns

1. Definitions:– Facility– Petroleum gathering pipelines (not just gas)

2. Cost and Level of Effort!3. Meters: oil wells with hydraulic fracturing4. Reporting burden: compressor threshold (hp)5. Gathering pipeline blowdowns6. Combustion sources: fuel gas composition needed7. Superfluous information requested for reporting

(not critical to emissions)� Industry challenging some issues:

� GPA Petition for Review: blowdowns, facility definition, etc.o Filed 12/21/2015o EPA meeting 1/21/2016

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Where to Start?

• Applicability determination is the key starting point!

• Is the facility or activity in or out?

Chances are, if it was out before…it is innow (beginning in January 2016)!

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How to Prepare?(1 of 2)

Keep in mind it takes a team effort!1. Determine the new data elements needed to

calculate emissions� Decide how to track events (blowdowns!)� Pipeline mileage

2. Develop new processes and create or modify software to collect the required information

3. Update GHG monitoring plans4. Conduct training for persons responsible for

collecting and reporting data5. Revise reporting processes and update data

management software

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How to Prepare?(2 of 2)

6. Plan periodic reviews of data collected

– Avoid being inundated at end of year!

7. Develop plan for documenting and archiving data used for reporting

8. Conduct site-specific inventories (MOC)

9. Gather and analyze oil or gas samples

10.Install and calibrate flowmeters

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QA/QC Is Important!

• Review and verify

• Does it make sense?

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Is there a way out?

• Yes, but…only for a limited time!

• Beginning in 2017…

EPA allows the use of the Best Available Monitoring Method (BAMM) for all of 2016.

…You must collect the

required data inputs

for emissions

calculations! You can

no longer “get out of

jail free”!

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Timeline

1/1/2016

1) Monitoring Plan

2) Calibrated

meters

3) Begin data

collection

12/31/2016

BAMM Ends

1/30/2017

1) Assign DR

2) New segment

registration

3) File COR

3/31/2017

Report RY2016

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Questions?

http://www.epa.gov/ghgreporting