IBP1234_12 THE IMPORTANCE OF ADDRESSING METHANE EMISSIONS AS PART OF A COMPREHENSIVE GREENHOUSE GAS MANAGEMENT STRATEGY Carey Bylin1, Donald

Robinson2, Mariella Cacho3, Ignacio Russo4, Eric Stricklin5, Geir Johan Rortveit6, A.B. Chakraborty7, Mike Pontiff8, Reid Smith9

Copyright 2012, Brazilian Petroleum, Gas and Biofuels Institute - IBP This Technical Paper was prepared for presentation at the Rio Oil & Gas Expo and Conference 2012, held between September, 17-20, 2012, in Rio de Janeiro. This Technical Paper was selected for presentation by the Technical Committee of the event according to the information contained in the final paper submitted by the author(s). The organizers are not supposed to translate or correct the submitted papers. The material as it is presented, does not necessarily represent Brazilian Petroleum, Gas and Biofuels Institute’ opinion, or that of its Members or Representatives. Authors consent to the publication of this Technical Paper in the Rio Oil & Gas Expo and Conference 2012 Proceedings.

Abstract
Given the climate forcing properties of greenhouse gases (GHGs) and the current state of the global economy, it is imperative to mitigate emissions of GHGs cost-effectively. Typically, CO2 is the main focus of most companies’ and governments’ GHG emissions reductions strategies. However, when considering near-term goals, it becomes clear that emissions reductions of other GHGs must be pursued. One such GHG is methane, the primary component of natural gas. Reducing GHG emissions and generating profits are not necessarily a mutually exclusive endeavor as illustrated by the United States Environmental Protection Agency’s (EPA) Natural Gas STAR Program. The Program is a worldwide voluntary, flexible partnership of oil and gas companies which promotes cost-effective technologies and practices to reduce methane emissions from oil and natural gas operations. In an effort to meet environmental goals without sacrificing profitability, Natural Gas STAR partner companies have identified over 60 cost-effective best practices to reduce their methane emissions, which they report to the EPA. This paper discusses: 1) the importance of reducing methane emissions and its economic impact, 2) a comparison of methane emission reduction projects relative to other greenhouse gas reduction projects in the oil and gas industry, 3) the value of source-specific methane emissions inventories, and 4) methane emission reduction opportunities from hydraulically fractured gas well completions and centrifugal compressor wet seals. From the analyses and examples in this paper, it can be concluded that methane emission reduction projects can be readily identified, profitable, and effective in mitigating global climate change.

1. Introduction
Increasingly, oil and natural gas companies operating around the world are developing inventories of greenhouse gas (GHG) emissions from their operations and looking at opportunities to reduce GHGs in order to improve their environmental performance and, in some cases, economic performance and operational efficiency. GHG emissions data and information on projects to reduce emissions are reported publically in corporate sustainability reports, and submitted to such programs as the Carbon Disclosure Project and Dow Jones Sustainability Index, as companies seek to demonstrate their commitment to mitigating the risk of future climate change and their efforts to reduce GHG emissions globally.
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International Programs Leader, Oil and Gas, U.S. Environmental Protection Agency Chemical Engineer, Vice-President, ICF International 3 Industrial Engineer, Senior Associate, ICF International 4 Chemical Engineer, Analyst, ICF International 5 Chemical Engineer, Analyst, ICF International 6 Engineer, Statoil 7 Executive Director, Chief Carbon Management & Sustainability Group, ONGC 8 Regulatory Manager HSE, Newfield 9 Chemical Engineer, BP
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Historically, carbon dioxide (CO2) emissions have been the focus of climate change discussions and reduction activities, both within and outside of the oil and gas industry, given that CO2 emissions levels are the highest among the six principle GHGs targeted for reductions under the United Nations Framework Convention on Climate Change (UNFCCC) mechanisms.10 Increasingly, however, the role of methane, the second most important GHG, is being highlighted as a critical target for near term reductions in order to limit global warming to 2 degrees Celsius above pre-industrial levels, an aim recognized in the United Nations Climate Convention's Cancun Agreements. Methane is also the primary component of natural gas, and there are important economic, energy, and operational reasons to limit oil and gas industry methane emissions. Oil and natural gas sector GHG reduction projects include energy efficiency, flare and vent reduction, and carbon capture and storage. While CO2-focused projects are extremely important for long-term climate benefits, more focus on methane emission reduction projects should be encouraged as part of a comprehensive GHG reduction strategy. Methane emission projects tend to be smaller, cheaper, more easily implemented in the near term, and extremely cost-effective, making them excellent contributors to climate goals in addition to contributing to increased revenues, cost savings, and operational safety11. This paper will discuss the importance of reducing methane emissions globally, provide a comparison of methane emission reduction projects relative to other greenhouse gas reduction projects in the oil and gas industry, highlight the value of source-specific methane emissions inventories and measurement studies, and demonstrate real case studies of methane emission reduction opportunities from some of the largest sources in the industry.

2. Importance of Oil and Gas Industry Methane Emissions
Methane is the second most important greenhouse gas after CO2, accounting for 14% of global GHG emissions and approximately one-third of current anthropogenic warming. Methane’s global warming potential (GWP), according to the Intergovernmental Panel on Climate Change (IPCC) is 25 over 100 years, meaning it is 25 times more powerful than carbon dioxide at trapping heat in the atmosphere. Evaluating GHG impacts over a 100-year timeframe is useful for comparing the impacts of different GHGs on a normalized scale, but it distorts the short-term impacts of short-lived GHGs like methane, which only lasts nine to twelve years in the atmosphere. Evaluating its impact over 20 years, a closer reflection of methane’s atmospheric life, methane is 72 times more powerful than carbon dioxide at trapping heat in the atmosphere, meaning that in the near-term it has a larger impact on global temperatures than carbon dioxide. As a result of its near-term warming impacts, methane, along with hydroflourocarbons (HFCs) and black carbon (soot), have been designated as “Short Lived Climate Forcers,” or “Short-Lived Climate Pollutants (SLCPs),” responsible for a significant portion of climate warming observed today. These impacts have led organizations such as the United Nations Environment Program (UNEP) and the Arctic Council to name SLCPs as priorities for reduction action to slow near-term warming. Ten countries, along with the European Commission, World Bank, and UNEP, have come together to form the Climate and Clean Air Coalition, which in April 2012 announced its aim to “fast track” momentum towards reducing SLCPs globally through, among other actions, promoting accelerated methane emission reduction action in the oil and natural gas sector. This focus on reducing SLCPs is anticipated to have a direct impact on global warming, with the potential to reduce the warming expected by 2050 by as much as 0.5 Celsius degrees. In addition to being a powerful GHG, methane is also the primary component of natural gas, accounting for approximately 90 to 95 percent of pipeline quality natural gas. Methane emissions occur throughout the natural gas value chain (production, processing, transmission and distribution of gas) and in upstream oil production. Emissions may be fugitive (unintentional) leaks, vented (intentional or operational releases), and unburned hydrocarbon from combustion. According to the United States Environmental Protection Agency (EPA) (2011), annual methane emissions from the global oil and natural gas industry are the second largest source of global anthropogenic (human induced) methane emissions, estimated at 1,595 million metrics tons of carbon dioxide equivalent (MMtCO2e). This amount translates to about 112,000 million cubic meters (MMm3) (3,954 billion cubic feet (Bcf)) of natural gas and represents a large loss to the oil and gas industry, equivalent to nearly 4% of total dry gas produced globally in 2010 with a market value of approximately US$ 12 billion (assuming a gas price of US$3/MMBtu).
10 The six GHG emissions subject to targets under the Kyoto Protocol are Carbon dioxide (CO2), Methane (CH4), Nitrous oxide (N2O), Hydrofluorocarbons (HFCs), Perfluorocarbons (PFCs), and Sulphur hexafluoride (SF6). 11 Discussions of economic returns and revenue enhancement throughout this paper presume that gas has a value which can be realized by the entity making the reduction. The authors acknowledge that there are instances where a market for gas does not exist or the rights to monetize gas are not in place for the entity making a reduction. In cases such as this the stakeholders will need to work together to address these constraints.

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The environmental, economic, and operational benefits that result from methane emission reduction activities make this source relatively “low hanging fruit” for oil and gas companies interested in reducing GHG emissions from their operations. Through such programs as the Natural Gas STAR Program and the multi-lateral Global Methane Initiative, EPA has worked with oil and gas companies for nearly twenty years to develop a comprehensive database of cost-effective technologies and practices to identify, quantify, and reduce methane emissions. Of the over 60 technologies and practices highlighted by the Natural Gas STAR Program, 50% pay back in less than one year and 67% pay back in less than two years, assuming a gas value of US$3/MMBtu. These mitigation options have been voluntarily implemented by the over 140 Natural Gas STAR partner companies, resulting in reductions of over 30,300 MMm3 (1,070 Bcf) of methane emissions over the life of the Program. These mitigation options are commercially available, standard operational activities that can be broadly implemented to achieve significant reductions throughout the global oil and gas industry. In fact, EPA analyses indicate that approximately one-third of global leaked and vented methane can be reduced, using existing operational mitigation options, at zero net cost assuming a gas price of US$3/MMBtu.

3. Oil and Gas Industry GHG Reduction Projects: A Comparison
For many oil and gas companies, especially those with refining operations, carbon dioxide emissions make up the largest portion of their total GHG emissions. It is therefore very important to continue efforts to reduce oil and gas industry CO2 emissions. Due to the importance of methane emissions for near-term warming, as discussed above, such efforts should be complemented with immediate action to undertake methane emission reduction projects. While methane is often a smaller contributor percentage-wise, it is also much simpler to address from a cost and technical perspective given that reduction activities often involve relatively simple operational changes or maintenance activities, enabling companies to make progress in their emissions reduction efforts in the very nearterm. Methane reduction projects such as performing reduced emission completions on hydraulically fractured gas wells, converting natural gas powered pneumatic devices to reduce bleed rates, and capturing wet seal degassing emissions from centrifugal compressors typically have capital costs well under US$1 million, positive net present values, and payback periods within months. Of the over sixty technologies and practices highlighted by the Natural Gas STAR Program, nearly one-fourth are estimated to cost less than US$1,000 to implement, and nearly 50% are less than US$5,000 to implement for individual sources. Projects addressing multiple sources therefore have capital costs in the tens to hundreds of thousand dollar range and can be easily scaled according to available resources. Because of these low costs and the potency of methane emissions in terms of GWP, most projects that address the largest methane emissions sources also have an extremely low costs per tonne of CO2 equivalent (tCO2e) reduced, ranging from US$1/tCO2e to US$8/tCO2e reduced. For example the capital cost and cost effectiveness for capturing natural gas emissions from wet seal degassing venting for a single centrifugal compressor, according to Reid Smith (2012), is about US$22,000 and US$0.17/tCO2e reduced respectively. These numbers are very conservative, in that they do not consider the value of the gas that is being saved. The cost per tCO2e reduced is improved even further, often becoming negative, when considering the additional revenue stream from the recovered gas. Table 1 presents average economics for a sampling of methane emission reduction projects for some of the largest emission sources in the industry, based on technical documents available from the Natural Gas STAR Program website. Table 1. Sample Methane Mitigation Project Economics (From Natural Gas STAR Program Technical Documents)

Project 
Retrofit 1000 High Bleed Pneumatic  Devices to Convert to Low Bleed  Install Plunger Lifts on 100 Natural Gas  Wells  Install Wet Seal Degassing Capture  System(s) on 5 Centrifugal Compressors  (2 seals per compressor) 

One‐time  Costs  (US$) 
$675,000  $647,700 

Annual  Costs  (US$) 
‐  ‐ 

Methane  Reductions  (TCO2e/yr) 
92,920  29,829 

Costb  (US$/  tCO2e) 
$1.92  $5.73 

Payback  (months)a 
12  3 

$110,000 

‐ 

167,458 

$0.17 

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Install Vapor Recovery Units on 5 Crude  Oil Storage Tanks  Reduce Methane Emissions from 10  Reciprocating Compressors by  Replacing the Rod Packing (2 seals per  compressor)  Perform Directed Inspection and  Maintenance at a Gas Processing PlantC 

$349,243 

$60,515 

84,483 

$1.81 

$32,400 

‐ 

5,794 

$1.48 

$40,000 

$58,600 

28,970 

$3.40 

a. Assumed payback based on a natural gas value of US$3 per MMBtu.  b. Costs were annualized in the cost per metric ton calculation on a 5 year basis; calculation does not include  revenue from natural gas savings.  c. Upfront Costs for DI&M at a gas processing plant account a contractor surveying a plant with 40,000  components at US$1 per component.  Other more CO2-focused GHG emission mitigation projects such as gas flaring reduction, electrification of oil and gas operations with centralized power production and distribution, efficiency upgrades for fuel burning equipment, and implementing renewable energy sources can achieve significant GHG emission reductions, but also have very large capital costs and higher costs per tonne of CO2 equivalent reduced. Gas flaring reduction projects reported by companies to the UNFCCC, according to Farina (2010), have upfront capital requirements between US$30.8 million and US$300 million and costs per tCO2e reduced that range from US$77 to US$117. Carbon capture and sequestration (CCS) projects, without enhanced oil recovery, provide no offsetting revenue without regulatory or voluntary incentives such as carbon taxes and carbon credits. Some eight large CCS projects are currently in operation, while about 10 times as many large projects are being matured worldwide (mainly in North America and Europe).These early projects have widely different costs due to the CO2-source, technologies, and location varying largely. Precise and general cost-levels of CCS are difficult to state, but a recent publication by Worley Parsons (2011) indicate these CCS cost-levels to range from US$19 to US$103per tCO2e avoided. Early projects, first-of akind or demonstration may face higher cost-levels. Except for taxes or incentives, upsides to such projects are normally tied to increased recovery of hydrocarbons.

 

4. Steps to Identifying and Prioritizing Methane Emission Reduction Projects
Despite the extremely cost-effective and operationally beneficial opportunities to reduce oil and gas sector methane emissions (assuming there is a market or use for the saved gas), barriers must be addressed to promote wider implementation of these mitigation options. Barriers to reducing methane emissions include the fact that such emissions are distributed throughout the natural gas value chain, and specific sources and volumes of emissions cannot easily be evaluated without focused study. It is commonly understood that venting and leakage occurs from some oil and gas operations and equipment, but it is not possible to understand the quantity and location of gas going to the atmosphere without conducting detailed, source-specific methane inventories or physical detection and measurement studies. Many companies have found that specific, detailed study of methane emissions from their operations, either through development of source-specific inventories or physical detection and measurement efforts, allows for evaluation and prioritization of economically and environmentally beneficial reduction projects. The most powerful tool in raising awareness of methane emissions has been the infrared gas imaging camera, which allows otherwise invisible gas leaks to be visually seen and recorded with the camera. Seeing is believing, and many companies completely change their approach once they see the gas leaks and vents in real time. Corporate GHG inventories are undertaken for a variety of reasons such as for measuring progress against a corporate-wide reduction goal or to determine a baseline before implementing specific reduction measures. When conducting an inventory there is always a tradeoff between levels of resources required for inventory development versus the accuracy of the inventory estimate. A company must find the correct balance so that an inventory is a useful endeavor. IPCC describes several tiers of inventory estimates, representing progressively more detailed methodologies, which have been useful for country-level reporting, with the most detailed being used for company inventories. Those tiers are described below. • Tier 1 is using default data characteristic of the oil and gas sector, such as emissions per unit of throughput through the industry.

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• •

Tier 2 is using default data characteristic of the oil and gas sector and the country, such as emissions per unit of throughput through industry paired with country-specific gas composition data. Tier 3 is using advanced methods and detailed country-specific data for oil and gas emissions, such as equipment counts paired with equipment-specific emission factors that are have a basis either in previous studies or studies undertaken by the company.

Common company inventory protocols such as the American Petroleum Institute (API) Compendium and UNFCCC protocols for carbon credits are related to the tiers, and in particular company level inventories are typically performed on a tier 3 basis. The API Compendium provides tier 3 estimation methods. UNFCCC stipulates tier 3 methods to certify baseline estimates prior to projects to reduce emissions for carbon credits. The benefits of sourcespecific methane emission inventories include the ability to identify and prioritize potentially profitable reduction opportunities and the corresponding ability to create accurate project feasibility cost estimates based on estimated source-specific emissions volumes, which is not possible with tier 1 and tier 2 inventories. Tier 3 inventories themselves can vary in accuracy depending on the quantification methodologies employed which may range from generally accepted emission factors to company specific factors based on measurements taken of a sample of company equipment. Inventory accuracy can improve as understanding of methane emission volumes improves, due to the availability of better emission detection and measurement technologies and more data. EPA recently revised emission factors for methane emissions from centrifugal compressors operating wet seals and hydraulically fractured natural gas well completion flowback. The former emission factor for centrifugal compressor emissions was based on a 1996 EPA/GRI study, still the basis for most emission factors used today, which did not differentiate between compressors operating wet seals or dry seals. The change was made to reflect increased understanding of the relatively larger volumes of vented emissions due to wet seal degassing, as compared to compressors operating dry seals. The original gas well completion venting emission factor was also based on the 1996 EPA/GRI study. The 1996 EPA/GRI study estimated an emission factor for gas well completions by making several key assumptions, including the following: gas well completions last one day; the flow rate during the completion is assumed to be the average gas production rate per gas well in 1992 based on the American Gas Association’s Gas Facts; and all completion emissions are flared (reducing the methane emissions from each completion by approximately 99 percent). EPA determined these assumptions are not valid for hydraulically fractured natural gas well completions, and subsequently developed a revised emission factor for hydraulically fractured gas well completion that more closely reflects emissions from that source. Company-specific emission factors offer the additional advantages of increased accuracy in that emissions profiles of equipment more closely match actual operating conditions and practices. As will be seen with the case studies below, a tier 3 level company inventory or physical detection and measurement studies can be useful to identify methane emissions reduction projects. 4.1 Case Study: Newfield Development of an Internal Methane Inventory Newfield Exploration Company recently developed a company-wide process for quantifying and recording greenhouse gas (GHG) emissions from each facility through a methane emissions management system, according to EPA (2010). The main purpose of this inventory tool is to provide the company with an “evergreen program that provides near real time data” which can be used for decision making on air emissions and emissions reduction. The inventory tool has two components which collect, aggregate, and store a variety of data streams already being generated by Newfield. The first component of Newfield’s inventory tool is the Carbon System Interface which collected a variety of existing Newfield data streams and sends them to the third party enterprise software package, allowing operators to access daily/monthly data and any new equipment or process changes. The second component is a third party software package that displays the aggregated data in a useful format. The software assists with determining emission sources to include, develops emission profiles, and has a process for data management. A benefit of this system is its ability to aggregate information from varying levels of infrastructure within the company, allowing emissions performance to be assessed across different geographic areas and across different types of emissions source including equipment leaks, offshore emissions, and stranded gas vents. The combined two components of Newfield’s inventory tool include both direct emissions (those sources which Newfield has direct control of in its field operations) and indirect emissions (typically associated with third party activity). One feature of the inventory tool is its ability to generate emissions profiles specific to the requirements of state, permit, business unit, or other reporting activities. The tool accomplishes this by building a library of
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calculation methodologies over a period of time which can be applied to the Newfield data. Combined with standard accepted manufacturer emissions factors, or state- or regional-specific factors, different profiles are generated for different contexts. As a result of the increased ability to quantify emissions and associate emissions volumes with specific equipment, Newfield is able to benefit from operational efficiency and safety improvements as well as create value by capturing methane emissions. Newfield has used this inventory tool as a reference to identify the most promising methane emissions capture and use best practices. These methane saving opportunities are difficult for a company to pursue unless the savings potential is quantified via a rigorous inventory. In conjunction with its inventory efforts, Newfield has completed projects ranging from leak detection and repair at gathering compressor stations, vapor recovery from tanks, reducing emissions during gas well liquids unloading, and replacing high bleed pneumatic devices. 4.2 Case Study: ONGC Detection and Measurement Campaigns The experience of the Oil and Natural Gas Corporation Ltd. (ONGC) provides another example of dedicated effort resulting in significant benefits for the company and the climate. ONGC, a state-owned company responsible for over 70% of oil and natural gas production in India, joined the EPA’s Natural Gas STAR Program in August 2007. Prior to this time, GHG reduction efforts were focused on flare reduction projects and joining the Program was their first step in addressing methane emissions. Working with EPA, ONGC conducted measurement studies using the infrared leak imaging cameras at eight of their largest installations and gained experience and training to develop their own internal measurement study teams, which have since conducted measurements at fifty other installations. In a short amount of time, ONGC has reduced methane emissions from their operations by nearly ten million cubic meters to date, over one-third of the approximately thirty million cubic meters of methane emissions identified and measured thus far. In addition to helping the company to meet their GHG emission reduction goals, the recovered methane, fuel gas, and other hydrocarbons represent over US$3.4MM worth of saved product (considering actual value in India).

5. Methane Emission Reduction Project Case Studies
From the Natural Gas STAR program, it is evident that there are numerous cost-effective projects that reduce GHG emissions, provide additional revenue, and can be applied throughout the global oil and gas industry. This section describes cost-effective methane emissions mitigation opportunities based on Natural Gas STAR Program technical documents and the specific experience reported by Natural Gas STAR partner, BP. Both methane emission reduction practices and technologies will include a detailed technical description, benefits, costs, and payback information in addition to actual oil and gas company case studies. 5.1 Completions of Hydraulically Fractured Natural Gas Wells Unconventional natural gas reserves such as shale gas and coal bed methane require hydraulic fracturing in order to produce the gas that is trapped in the shale or the coal seam. In the U.S., it has been found that the process of completing these wells to clean them up for production can result in a significantly higher level of methane emissions as compared to completions of conventional natural gas wells. Reduced emissions completions (RECs) – also known as reduced flaring completions or “green completions” – capture gas produced during well completions and well workovers following hydraulic fracturing, making it available for sale instead of venting or flaring it. 5.1.1 Source of Emissions Completions of new wells or workover with re-fracture stimulation of existing wells in unconventional natural gas reserves such as shale, coal bed methane, and tight formations can be accomplished by fracturing the reservoir rock with a very high pressure mixture of water, a proppant (usually sand), and a small amount of a number of other chemicals to achieve the desired fluid properties. The proppant keeps the fractures “propped open” after water pressure is reduced. Depending on the trajectory (horizontal or vertical) of the well and the amount/lenth and characteristics of the formation to be stimulated, this process may be carried out in several stages. Hydraulically fractured gas wells are completed by flowing back the fluids at a high rate to lift the fluids and any sand to the surface and clear the well bore and clean up the formation to enable gas flow. The velocity of the flowback is mostly dependent on the formation pressure, the depth of the well (weight of the hydrostatic column), and the pressure differential which directly impacts the effectiveness of the well clean up. As such, the initial flowback is typically carried out against the smallest backpressure (i.e. the atmosphere) to effectively begin clean up the well. Typically, the gas/liquid separator installed for normal well flow is not designed for these high initial liquid
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flow rates, and three-phase (gas, liquid, and sand) flow. Therefore, a common practice for this initial well completion step has been to produce the well to a pit or tanks where water, hydrocarbon liquids, and sand are captured and gas is either vented to the atmosphere or flared. Given that completions can take anywhere from one day to several weeks, a substantial amount of gas may be released to the atmosphere or flared if flow to tanks or pits is continued throughout the completion. Based on Natural Gas STAR Partner experiences in the Lessons Learned on “Reduced Emission Completions for Hydraulically Fractured Natural Gas Wells” (2011), natural gas lost during well completion and testing can be as much as 708 thousand cubic meters (Mm3) (25 million cubic feet (MMcf)) per well depending on the well production rates, the number of zones completed, and the amount of time it takes to clean up each zone. Current emission factors employed by the EPA estimate hydraulically fractured gas well completions emit, on average, 255.9 Mm3 (9 MMcf) of natural gas per completion, to vent or flare, when the gas is not captured. 5.1.2 Emissions Control Option Natural Gas STAR Partners have reported performing RECs that recover much of the gas that is normally vented or flared during the completion process while still cleaning up the wells effectively. In general, RECs involve installing portable equipment that is specially designed and sized for the initial high rate of water, sand, and gas flowback during well completion. The objective of RECs is to capture and deliver gas to a gas gathering pipeline rather than vent or flare the gas. Gas may go directly into a sales pipeline, in which case it must meet sales quality, or more commonly it is gathered to a gas processing plant, in which case it needs to meet specifications that the gas gathering company and/or processor may impose to take the gas. Basic requirements for implementing a REC include: • Operational gas gathering pipeline • Gas must meet sales line, collection system operator, or processor’s specifications • Must be able to adequately clean up well and avoid permanent reservoir damage and lower productivity o Sufficient reservoir energy, flow, and characteristics to clean-up against pipeline backpressure or, o Much more equipment and complexity to enable clean up of low pressure/energy reservoirs. • Surface equipment capable of drying and metering gas To remove the finer solids present in the production stream, sand traps are used. Other equipment may be used to remove any large solids such as drill cuttings that could damage the other separation equipment. The piping configuration to the sand traps is critical as the abrasion from high velocity water and sand can erode a hole in steel pipe elbows, creating a “washout” with water, sand, hydrocarbon liquids and gas in an uncontrolled flow to the pad. Depending on the gas gathering system, it may be necessary to dehydrate the produced gas before it enters a sales pipeline. The gas may be routed to the permanent dehydration unit or a portable dehydrator used for dehydration during the completion process. Free water and condensate are removed from the gas in a three phase separator. Condensate (liquid hydrocarbons) collected during the completion process may be sold for additional revenue. Temporary piping is used to connect the well to the REC skid and gathering system. Figure 1 shows a typical layout of temporary REC portable equipment.

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Figure 1. General Process Flow of Temporary REC Portable Equipment

The equipment used during RECs is only necessary for the time it takes to clean up the well; therefore, it is essential that all the equipment can be readily transported from site to site to be used in a number of well completions. A truck mounted or truck mobilized skid is ideal for transporting the equipment between sites. In a large basin that has a high level of drilling activity it may be economic for a gas producer to own or commission the building of its own REC equipment. Most producers may prefer contracting a third party service to perform flow-backs using REC practices. The Lessons Learned on “Reduced Emission Completions for Hydraulically Fractured Natural Gas Wells” (2011) indicates the cost of renting REC equipment from a service provider will vary depending on individual well requirements such as location, flow rate, gas composition, and how permanent equipment is designed at the well pad. Typical costs range between US$700 (where permanent equipment includes an over-sized gas/liquid separator) and US$6,500 per day per well. 5.1.3 Natural Gas STAR Partner Example BP began a REC program in 2001 for some of its natural gas wells in the United States. To ensure equipment availability, BP commissioned six sets of REC equipment which included 18 sand traps and six large separators. The capital cost for the six sets of REC equipment was about US$1.4 million in 2002. In 2008, BP began renting REC equipment from a service provider. In total, according to Reid Smith (2011) BP has performed almost 1,400 RECs in their Wyoming operations, recovering 354 MMm3 (12.5 Bcf) of gas and 228,300 barrels of condensate. BP also began exploring the potential of implementing RECs in low pressure reservoirs. In these reservoirs, RECs were more difficult, complex, and expensive due to the need for adding energy either through compression of the flowback or using gas lift “reverse circulation”. For gas lift “reverse circulation”, a compressor/pump is used to pump high-pressure fluid down the wellbore to provide sufficient energy to lift the hydrostatic column up the well bore along with any sand not retained in the formation. Tubing is run into the wellbore to provide separate paths for the fluid entering the wellbore and the fluid/sand leaving the wellbore. Fluid used is typically a gas (for example, nitrogen, natural gas). Using a gas results in an “underbalanced” situation (pressure in the wellbore is less than reservoir pressure). Consequently, fluid (frac gel, water, and natural gas) will flow from the reservoir into the wellbore and then out of the well. For a REC to be possible in a low pressure reservoir, a pipeline for sales gas and initial fuel/injection gas must be available. Eventually, the well begins producing gas and the excess can be sold back to the pipeline which will help offset the costs. The advantages of using RECs, as observed by BP, included: • Reducing emissions  • Additional income from sales of gas that would have been vented or flared  • No visible flares  • No mixing of air and gas  The difficulties encountered by BP included: • RECs require specialized equipment  • Possibly expensive, especially in low pressure reservoirs (approximately 30% more than a conventional cleanout unit)  • Cleanouts might not be as effective (back-pressure from the pipeline)  • Value of gas sold is roughly equal to the additional cost in low pressure flow-backs  5.2 Centrifugal Compressors Operating Wet Seals Centrifugal compressors are common throughout the natural gas industry, including offshore production and natural gas processing and transmission. Data shows that centrifugal compressors operating wet seals (i.e. oil seals) can vent a significant volume of natural gas to the atmosphere from seal oil degassing during normal operation. Historically, reducing methane emissions from this source entailed replacing wet seals with mechanical dry seals, an expensive retrofit activity. This section presents new data collected in Fall 2011 on a compressor seal oil gas separation and capture system employed on the North Slope of Alaska that would be applicable and cost-effective for both onshore and offshore compressors. This solution captures the previously vented gas at compressor pressure for recycle to fuel gas, compressor suction, or other sources, thus increasing gas utilization and nearly eliminating methane losses.

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5.2.1 Source of Emissions Centrifugal compressors require seals around the rotating shaft to prevent gases from escaping where the shaft exits the compressor casing. These seals may use oil, which is circulated under high pressure between three rings around the compressor shaft, forming a barrier against the compressed gas leakage. The center ring is attached to the rotating shaft, while the two rings on each side are stationary in the seal housing, pressed against a thin film of oil flowing between the rings to both lubricate and act as a leak barrier. “O-ring” rubber seals prevent leakage around the stationary rings. Very little gas escapes through the oil barrier; considerably more gas is entrained and absorbed by the oil under the high pressures at the “inboard” (compressor side) seal oil/gas interface, thus contaminating the seal oil. Seal oil is purged of the entrained and absorbed gas (using heaters, flash tanks, and degassing techniques) and recirculated. The separated methane is commonly vented to the atmosphere. Because of these vented emissions, centrifugal compressors with wet seals are a significant source of methane emissions in the oil and natural gas industry. According to previous measurements of seal oil degassing reported in Bylin et al. (2009), the emissions can be as high as 5.24 cubic meters (m3) (185 cubic feet (cf)) methane per minute per compressor, with an average value of 1.784 m3 (63 cf) methane per minute per compressor 5.2.2 Emissions Control Option One existing mitigation option reported by many Natural Gas STAR Partners is to retrofit a compressor with dry seals, which replaces the wet seal system with spring-loaded, grooved seals that create hydrodynamic gas pressure as a barrier to prevent gas leaks along the shaft. Dry seals reduce methane emissions and have other process benefits, such as lower operating and maintenance costs attributed to the seal oil circulation system. However, conducting a dry seal retrofit involves a significant capital investment and compressor down-time. The control option explored here is capturing the seal oil degassing stream and routing it to beneficial use. A diagram illustrating this new method is shown in Figure 2. Seal oil contaminated with gas that is typically sent to the atmospheric degassing separator is instead degassed at a new separator operating at seal oil pressure with an outlet, controlled by a critical orifice and choke flow physics, to a lower pressure (e.g. fuel gas) system. The entrained and absorbed methane vaporizes out of solution in the seal oil degassing separator and is used in a facility’s fuel gas system or routed to lower pressure compressor suction. The seal oil then flows to the final degassing stage where a minimal volume of absorbed methane is degassed to the atmosphere and the regenerated seal oil is recirculated to the compressor. Sites must meet several operating requirements to implement this recovery and use of seal oil disengaged gas. Onsite equipment to achieve separation of the seal oil and gas, and a fuel gas system or routing to compressor suction for recycle must be nearby that can accept and use/handle the lower pressure separated gas stream. The flash gas stream will entrain small amounts of seal oil, requiring a demister/filter or fuel gas knock-out vessel to remove this entrained oil and yield an acceptable fuel gas specification.

Figure 2. General Process Flow of Seal Oil Gas Capture System

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5.2.3 Natural Gas STAR Partner Examples BP has implemented the seal oil gas capture solution on its centrifugal compressors operating on the North Slope of Alaska and has also conducted measurements to assess the effectiveness. Preliminary results were gathered at BP’s Central Compressor Plant (CCP) using a combination of flow meter readings and degassing tank vent composition analyses. To measure the effectiveness of a compressor’s recovery system, one has to determine how much process gas (typically mechanically entrained with the seal oil) flows into a seal oil trap from a compressor seal. This flow is then compared to the amount of gas emitted to the atmosphere from the degassing tank. The CCP has fifteen centrifugal compressors total, each compressor with two traps routed to the facility gas recovery system. Nine compressors have low pressure compression, four have high pressure compression, and two have tandem stages (both low and high pressure). Two compressors, a low and a high stage, were selected for preliminary analysis. All atmospheric degassing tanks at this facility have a nitrogen purge to maintain a positive vent flow and ensure air does not enter the tank leading to a potentially explosive atmosphere. Determining how much process gas is flowing (with the seal oil) from each seal first required knowing the amount of total gas recovered from all fifteen compressors. The recovered gas at CCP is directed to one of four options: low-pressure process heaters, high-pressure turbine fuel gas, low pressure compressor suction, or normally closed required sweep gas in the low-pressure flare. Each of these lines has a flow meter, so the volume of gas flowing to each option is known. Since each of the fifteen compressors has two seals (thus two traps), the volumetric flow rates can then be summed and divided by 30. This yields the total flow of process gas recovered. BP personnel recorded 18.09 m3/minute (639 scf gas/minute) to the process heaters, 73.29 m3/minute (2,588 scf gas/minute) to turbine fuel gas (at ~265 psig and 60°F), and 0 m3 gas/minute to flare. As a result, the approximate amount of process gas flow per trap is 108 scf (3,277 scf gas/minute divided by thirty traps). This equates to 3.06 m3/minute (108 scfm gas/seal)12 that is being recovered into the process by employing low-cost measures of an installed seal oil degassing separator, filter, and tubing/piping. While BP’s compressors were originally installed with this system, the investment to recover seal oil degassing emissions in this way would include the cost of the seal oil gas separator, new piping, gas demister/filter, and possibly a pressure regulator for the fuel gas line. Using Guthrie’s modular method of equipment cost estimation from Biegler et al. (1997), and assuming a typical seal oil flow rate of 3.75 gallons per minute, the installed cost of equipment would be about US$22,000. Operating and maintenance costs are expected to be minimal. Operating cost savings for capturing seal oil degassing emissions are realized by reducing consumption of site fuel gas. For one wet seal compressor, potential savings can be estimated at 1.78 MMm3 per year (63 MMcf methane per year), displacing this same volume in fuel gas. At US$176.55 per Mm3 (US$5 per Mcf), savings from reduced site fuel gas consumption will approach 100 percent of the seal oil emissions or $315,000.

6. Conclusion
The environmental impacts of methane, combined with its economic value as an energy resource and the relative ease of mitigation, make it an excellent area of focus for oil and gas companies as they look to reduce their GHG emissions and improve efficiency and economic co-benefits. Although methane is a smaller contributor to total GHG emissions for most oil and gas companies, reducing methane emissions requires less capital and is more costeffective to address than reducing CO2 emissions, and is an excellent complement to CO2 reduction projects. Oil and natural gas companies participating in the Natural Gas STAR Partner partnership have identified over 60 best practices - ranging from simple no- or low-cost maintenance changes to more capital intensive projects - that reduce methane emissions and pay back investments in less than two years. As illustrated through partner examples, these companies have found that conducting detailed methane emission inventories or physical detection and measurement studies can help them understand priority emission sources, and evaluate cost-effective and environmentally beneficial reduction projects. These projects, in addition to capturing valuable natural gas and condensates, reduce GHG emissions, enhance operational safety and efficiency, and increase profitability through cost reduction and revenue increases.

12 This assumes eight high pressure seal traps vent as much as twenty-two low pressure seal traps (i.e., equal emissions) and represents the gas recovered for fuel (since no gas was routed to flare).

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7. References
BIEGLER, et al. “4.3.1 Guthrie’s Modular Method.” Systematic Methods of Chemical Process Design. Ed. Neal R. Amundson. Saddlewood: Pearson, pages 133 to 135. 1997. BYLIN, C. et al. Methane's Role in Promoting Sustainable Development in the Oil and Natural Gas Industry, World Gas Conference Paper, (PDF). <www.epa.gov/gasstar/documents/best_paper_award.pdf> October 2009. EPA, “DRAFT: Global Anthropogenic Non-CO2 Greenhouse Gas Emissions: 1990-2030, U.S. Environmental Protection Agency.” <www.epa.gov/climatechange/economics/downloads/EPA_NonCO2_Projections_2011_draft.pdf> August 2011. EPA, Natural Gas STAR Lessons Learned. “Reduced Emissions Completions for Hydraulically Fractured Natural Gas Wells”. 2011. EPA, Natural Gas STAR “Recommended Technologies and Practices” <www.epa.gov/gasstar/tools/recommended.html> 2012. EPA, “Partner Profile: Newfield Exploration Company” Natural Gas STAR Partner Update: Winter 2010. <www.epa.gov/gasstar/newsroom/partnerupdatewinter2010.html#story2> 2010. FARINA, M., Flare Gas Reduction. GE Energy. GEA18592. Figure 21. pg. 43, 2010. IPCC, Fourth Assessment Report: Climate Change 2007. Table 2.14. www.ipcc.ch/publications_and_data/ar4/wg1/en/ch2s2-10-2.html, 2007. SMITH, R., Centrifugal Compressor Wet Seal Oil De-gassing & Control. Natural Gas STAR Annual Workshop: Denver. Slide 20. 2012. SMITH, R., GMI— Oil and Gas Subcommittee Meeting. <www.globalmethane.org/documents/events_oilgas_101411_tech_smith.pdf> October 14, 2011. UNEP, Press Release, “New Climate and Clean Air Coalition Expands to 13 Members”, <www.unep.org/newscentre/Default.aspx?DocumentID=2678&ArticleID=9116&l=en> April 24, 2012. WORLEY PARSONS/GCCSI, Economic Assessment of Carbon Capture and Storage Technologies. 2011 update, <cdn.globalccsinstitute.com/sites/default/files/publications/12786/economic-assessment-carbon-capture-andstorage-technologies-2011-update.pdf>, March 2011.

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