Formerly. Devon Canada Corporation Formerly Northstar Energy Corporation Voluntary Challenge and Registry Progress Report and Action Plan 2000

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1 Formerly Devon Canada Corporation Formerly Northstar Energy Corporation Voluntary Challenge and Registry Progress Report and Action Plan 2000 November 2001

2 Executive Summary Northstar Energy Corporation (Northstar), a subsidiary of U.S. based Devon Energy Corporation, is engaged in petroleum and natural gas exploration, production, and processing, primarily in Alberta. Northstar has participated in Canada s Voluntary Challenge on Climate Change since As part of our participation, we have submitted action plans and progress reports on an annual basis. Northstar is committed to taking action to reduce energy consumption and greenhouse gas emissions. Northstar has managed to control its greenhouse gas emissions through a combination of prudent operating practices and capital (equipment) modifications. Northstar is continually seeking improvements in the way we measure and report on our greenhouse gas emissions. Beginning in 1997, Northstar reported its greenhouse gas emissions, energy consumption, and measurement parameter of Production Energy Intensity (PEI) and Production Carbon Intensity (PCI) on a facility-by-facility basis. This method provides us with a better perspective on the sources of emissions, which allow us to focus our emission and energy consumption reduction efforts in future years. We continue to report on a facilityby-facility basis, in order to focus our emission reduction programs on the facilities where we can generate the largest impact for our efforts. Northstar s overall PEI for 2000 was 2.45, a decrease from 1999 s value of PCI for 2000 was 0.215, which is slightly higher than the in This was due in part to improvements in data gathering for methane venting, and to declining production during the year compared to the amount of energy used or emissions released. It should also be noted that Northstar Energy s PCI continues to be below the projected upstream oil and gas industry value of for 2000 as stated in Canada s Climate Change VCR Inc. s Annual Report Northstar s total emissions expressed as kilotonnes (kt) CO 2 Equivalent was 1,023 in 2000 compared to kt CO 2 E in 1999, a decrease of 25 kt CO 2 E. Northstar s greenhouse gas reduction efforts have proven to be successful. This is largely due to emissions reduction efforts, which resulted in 18 quantified success stories totalling more than 37 kt CO 2 E in This report, for 2000, has been researched and prepared for Northstar by Greystone Environmental Consultants, Inc. By using external parties to assist in the measurement and reporting of our greenhouse gas emissions and improvement initiatives, we are further demonstrating our commitment to full and open involvement in Canada s Voluntary Challenge Program. ii

3 Note on Reporting External Verification of Report Northstar has continued to improve its data gathering and reporting in each reporting year. In 1999, Northstar added vehicle emissions and head office emissions, and improved its data collection for electricity use. For the 2000 reporting year, Northstar has collected venting data and added venting to the emissions inventory. This additional information is not accounted for in each previous year s report. As a result, while the indicators of efficiency, PCI and PEI, appear not to be improving, in fact Northstar has made significant efforts and progress in this regard. This is reflected in their overall CO2E emissions, which have shown a net decrease from the base year, 1995, even with the additional emissions information added in to the report. This is the result of the greenhouse reduction efforts that are reflected in their success stories and report on actions taken. Evan J. Baker GREYSTONE ENVIRONMENTAL CONSULTANTS iii

4 Table of Contents 1 Company Information Overview of Northstar Company Specific Circumstances Production Profile Management Support for the Voluntary Challenge Program Philosophy Towards Climate Change Statement of Management Support Internal Practices and Management System Greenhouse Gas Emissions Emissions Baseline Emissions Targets Emissions Projections Emissions Reduction Report (Results Achieved)...12 Emissions Inventory by Gas Type, Overall Changes in Emissions and Indicators...13 Table 4. Emissions Measurements, Emissions Compared with Business as Usual...15 Emissions by Facility...16 Table 5 Report on 2000 Targets Report on 2000 Action Plan...19 Summary of Success Story Initiatives...19 Electrical Demand Reduction Opportunities...19 Direct Emission Reductions from Combustion...20 Management, Training, and Employee Involvement Additional Success Stories...22 Field Reduction Initiatives...22 Head Office Reduction Intitiatives Action Plans (Measures to Achieve Targets) Action Plan for 2001 and Electrical Demand Reduction Opportunities...26 Direct Emission Reductions from Combustion...26 Management, Training, and Employee Involvement Education, Training and Awareness Conclusions...28 Appendix Greenhouse Gas Emissions and Measurement Parameters by Facility...29 iv

5 1 Company Information 1.1 Overview of Northstar Northstar Energy Corporation (Northstar) is a Canadian subsidiary of U.S. based Devon Energy Corporation. Northstar is engaged in petroleum and natural gas exploration, production, and processing, primarily in Alberta. Its main operating areas include Chinchaga, Hamburg and Pouce Coupe in the Peace River Arch, Smoky Bear in the north, Hangingstone/Surmount and Dover in the northeast, Olds, Gilby and Halkirk in central Alberta, the Turin region in the south, and the foothills of both southern Alberta and northeast B.C. In October of 2001, Northstar merged with Anderson Exploration within Canada, under Northstar s parent company, Devon Energy Corporation, based in the United States. Following the merger, the new combined company will take on the name Devon Canada Corporation, as a wholly owned Canadian subsidiary of Devon Energy Corporation. This will be reflected in future submissions to VCR Inc. 1.2 Company Specific Circumstances Northstar is committed to improving its data gathering and reporting for VCR Inc. For the preparation of our Progress Report and Action Plan 2000, Northstar has included data not previously gathered or reported in previous submissions, such as vented gas gathered from S 2 reports. This addition affected our PCI value, and the total CO 2 E produced by Northstar. 1.3 Production Profile Production is presented as gross throughput for all Northstar operated facilities. This includes throughput of product owned by other companies, but processed through a Northstar facility. Non-operated oil, gas and liquids production is not included in the data for this report. This is the standard for reporting as presented in the Canadian Association of Petroleum Producers (CAPP) VCR Guide. Northstar anticipates continued growth in the coming years through both acquisition and development. Substantial increases in production combined with declining reservoir pressures and greater energy requirements will mean that absolute reductions in our emissions inventory will be difficult to achieve. As detailed in sections following, Northstar will continue to strive for emissions reductions on a per production basis. The following table and figure presents the annual production (throughput) for Northstar in 2000 and the overall change in total production from 1995 through Note that production is presented as gross throughput for all Northstar operated facilities only. 5

6 Non-operated oil, gas and liquids production are not included as per CAPP reporting guidelines. Figure 1. Annual Production as Gross Facility Throughput ,000,000 Cubic Metres 5,000,000 4,000,000 3,000,000 2,000,000 1,000,000 C3-C5+NGL (OE m3) Sulphur (OE m3) Oil (m3) Gas (OE m3) Year Table 1. Annual Throughput for Northstar, Year Oil (m 3 ) Gas (m 3 OE) C3-C5+ (m 3 OE) 1 Sulphur (m 3 OE) Total (m 3 OE) N.R N.R OE = oil equivalent N.R. = not reported 1 C3-C5+ INCLUDES NGL MIX includes combined Northstar Energy, Devon Energy and Morrison Petroleums data. These were amalgamated in the 1998 report, but had been reported separately in previous years. 3 Production differs slightly from what was reported in the 1998 report ( ) as a result of data entry corrections. 6

7 2 Management Support for the Voluntary Challenge Program 2.1 Philosophy Towards Climate Change Northstar is a signatory to the Voluntary Challenge and Registry (VCR Inc), and has submitted action plans and progress reports to the Registry since Northstar believes that real progress towards reducing greenhouse gas emissions can be achieved through voluntary actions. To this end, Northstar will strive to reduce greenhouse gas emissions on a per unit of production basis, and will attempt to reduce absolute greenhouse gas emissions wherever economically feasible. We believe that many answers can be found in education and subsequent actions. Our employees are encouraged to participate in greenhouse gas reduction initiatives. 2.2 Statement of Management Support Northstar is committed to reducing greenhouse gas emissions. This report, the emission projections and future action plans will be circulated throughout the corporation for review. Management has approved the contents of this report and has provided the Environment and Safety Department with the mandate to co-ordinate the implementation of this plan with the support of other operating groups. Northstar has dedicated manpower resources to improve our emissions inventory, and has allocated capital for projects that result in CO 2 Equivalent reductions. John Richels President and Chief Executive Officer November 30, 2001 Date 7

8 2.3 Internal Practices and Management System Since becoming a participant in Canada s Voluntary Challenge program, Northstar has instituted a number of practices related to greenhouse gas emissions reduction. 1. Training and Awareness Northstar has initiated employee training and awareness programs, to encourage all employees to provide input into finding solutions to reduce greenhouse gas emissions. Northstar regularly solicits ideas for reduction initiatives from its operations staff through regularly scheduled safety and environmental meetings. 2. Flaring Reduction Initiatives Northstar is taking action to comply with the Alberta Energy and Utilities Board (EUB) Guide 60, Upstream Petroleum Industry Flaring Requirements. We have conducted a detailed inventory of all flares and vent stacks and have applied a decision tree analysis to determine the most appropriate actions to reduce flaring emissions. Northstar is also investigating the procurement of gas turbine electrical generators and is planning our first installation in This will have a combined benefit of reducing various flaring emissions, and will offset emissions resulting from the purchase of electricity from coalfired generation. We are also continuing to install vapour recovery units, which will result in reduced venting of various greenhouse gases. 3. Resource Allocation Northstar is using external consultants to review and verify our greenhouse gas emissions, electricity usage and production. Our consultants assist us in measuring compliance and progress towards meeting our greenhouse gas emissions reduction targets. In 1999, Northstar initiated a major energy use study that was completed in The results of that study have driven many of the initiatives and success stories that we are reporting on this year. Other recommendations from the study are still being implemented. 4. Management Review The Corporate Safety and Environment Committee (CSEC) review targets and progress on greenhouse gas emission reductions annually. The CSEC is made up of environment and safety professionals and operations management, and is chaired by the Vice President of Production Operations for Northstar. The Vice President is responsible for reporting environmental performance to the senior management committee. 8

9 3 Greenhouse Gas Emissions Northstar has continued to acquire producing properties in Any production and emissions data from facilities that were sold during 2000 have been included for the time prior to the sale. Facilities that were purchased in 2000 have been taken into account for the portion of the year following the acquisition. The emissions inventory for 2000 was calculated from a breakdown of all equipment generating emissions in Northstar's operations. All wells were attributed to a primary facility as listed in the following tables and appendices. At each facility, actual CO 2 emissions and CO 2 Equivalent (CO 2 E) emissions from methane and nitrous oxide were determined using the equations and conversion factors supplied in the Global Climate Change Voluntary Challenge Guide (Canadian Association of Petroleum Producers, June 2000). Emissions sources included petroleum-fuelled equipment (e. g., treaters, dehydrators, boilers and reboilers, compressors, catadyne heaters, furnaces, incinerators), flares, and indirect emissions from electricity usage. Production Energy Intensity (PEI) and Production Carbon Intensity (PCI) are conventions selected by CAPP in 1995 as a method of standardizing reporting across the petroleum industry. These indicators provide a method of expressing energy and emissions per unit of production. The details of their calculation are provided in the CAPP guide. As we did in the 1999 report, CO 2 E emissions were calculated from electricity usage in the Calgary office and emissions from fleet vehicles. New for the 2000 report, emissions produced from venting were included to better reflect Northstar s total CO 2 E for the year Not included, however, are fugitive emissions. As part of our continuous improvement efforts, this and other sources will be reviewed for inclusion in future reports. 3.1 Emissions Baseline Northstar underwent a substantial expansion in the 1990 s through mergers including Devon Energy Canada (Devon) and Morrison Petroleum. Both Northstar and Devon had previously established 1995 as their baseline year for VCR reporting. Accordingly, 1995 was selected as the baseline year due to the company s significant growth during the previous five years and because the 1990 baseline would not be representative of the scale of operation of the company. 9

10 Table 2. Individual and Combined Baseline for Emissions, Production Energy Intensity (PEI) and Production Carbon Intensity (PCI) Baseline (1995) Measures Measurement Northstar Devon Combined CO 2 Equivalent (ktonnes/yr) PEI PCI Northstar and Devon production in 1995 was focused primarily on light oil and sweet and sour natural gas. Northstar and Devon s baseline year PEI is within the range typical for these types of operations and calculated by CAPP. These industry average PEI values are: Sweet natural gas 1.4 Sour gas/natural gas 2.2 Light oil 2.12 Northstar has since diversified its operations to include thermal extraction of heavy oil, which has an industry average PEI of 14.6 due to the much greater energy input required in the extraction. 3.2 Emissions Targets The following targets have been developed for 2001 and beyond. Further details of specific actions to achieve these targets are presented in Section 4, Action Plans. 1. For the year 2001, submit a combined VCR Report for Devon Canada representing both Northstar and Anderson Exploration information. 2. For the year 2001, Northstar proposes to identify at least 10 projects accounting for a further reduction of between to tonnes of CO 2 Equivalent. 10

11 3. Northstar s goal is to continue to reduce solution gas flaring where it is economically feasible to do so. In 1999, Northstar implemented a solution gas conservation goal of 90% to 95%. In 2000 Northstar was able to conserve approximately 90% of all solution gas; our target for 2001 is 94% conservation. Northstar will reduce flaring as of 1999 and beyond based on the EUB Guide 60 flaring reduction guidelines. 4. Northstar s goal is to be within the top 20% of upstream oil and gas producers as ranked by VCR Inc., reflected in their Champion Reporting Program. 5. Northstar will strive to decrease emissions on a per unit of production basis as indicated by our Production Carbon Intensity (PCI) and Production Energy Intensity (PEI) measurements. However, property acquisitions may increase the corporate PEI and PCI due to increased production and associated emissions from newly acquired properties. 3.3 Emissions Projections Northstar is taking active steps to reduce greenhouse gas emissions. A number of examples of these actions are detailed below. However, Northstar is also anticipating overall growth and therefore an increase in our production. As a result, we are projecting that our total greenhouse gas emissions will remain relatively flat, just over kilotonnes (kt) of CO 2 Equivalent per year. Our PCI and PEI, will be affected by changes due to growth. The general sources of emissions are expected to remain the same; these sources include natural gas fired equipment such as boilers, heaters and treaters, dehydrators, natural gas-fired drivers (compressors), venting, flaring, and emissions from purchased electrical power. As a result of our efforts to decrease emissions, the proportion of emissions from these sources may change. Emissions from flaring are expected to decrease as we implement gas conservation and improve flaring equipment standards. Venting emissions will decrease as gas conservation (venting reduction) measures are implemented. Emissions from purchased electrical power will decrease as some flares are tied into on-site electrical generation. Efforts will be made to decrease emissions from all sources. The energy audit conducted by Optimum Energy Management Incorporated (Optimum Energy) will continue to guide us in making informed decisions and taking appropriate action on energy conservation. As shown in the following sections, Northstar is reporting emissions on a facility-specific basis, which will allow us to better identify and manage emission sources in the future. On a per facility basis the PEI and PCI will be reduced where economically feasible. 11

12 3.4 Emissions Reduction Report (Results Achieved) Emissions Inventory by Gas Type, 2000 Emissions by gas type for 2000 are shown in the following table. These emissions were calculated based on emissions factors for the various equipment emissions sources as provided in the CAPP Global Climate Change Voluntary Challenge Guide (2000). Table 3. Northstar Emissions by Gas Type for 2000 Gas Type (tonnes) Direct On-Site Emissions (tonnes) Emissions from Purchased Electricity Consumption (tonnes) Total Emissions (tonnes) Proportion of CO 2 E Emissions Carbon Dioxide Nitrous Oxide Nitrous Oxide as CO 2 Equivalent Methane 754, , ,506 90% , % 2, Methane as CO 2 Equivalent 56, ,103 6% *Total CO 2 E Emissions 853, ,015 1,018, % Proportion of CO 2 E Emissions 84% 16% 100% * Total emissions CO 2 E calculated by gas type and total emissions CO 2 E calculated from production information vary slightly. This variation does not affect the overall magnitude of emissions. The greatest proportion of Northstar s emissions is from CO 2 (917,506 tonnes or 90%), and the greatest proportion of CO 2 emissions is generated from on-site operations. However, reductions in purchased electricity can have a substantial effect in reducing overall CO 2 E emissions. Likewise, due to the high CO 2 E value of nitrous oxide and methane, any reduction in emissions of these gases will also help to lower overall CO 2 E emissions. 12

13 Overall Changes in Emissions and Indicators As shown in the following graph and table, total CO 2 Equivalent emissions increased from 1036 kt in 1998 to 1048 kt in 1999, but then decreased to 1023 kt of CO 2 Equivalent emissions in Production Energy Intensity (PEI) decreased from 2.57 in both 1998 and 1999, to 2.45 in Production Carbon Intensity (PCI) has increased from in 1999 to in 2000, which can be attributed to facilities acquired and to declining production during the year compared to the amount of energy used or emissions released, as well as the addition of methane vented in our reporting. Figure 2. Emissions Measurements, CO 2 Equivalent (Kilotonnes) PEI and PCI Index Value CO2 Equiv. PEI PCI Northstar has put forth considerable effort to reduce our overall greenhouse gas emissions. Through our efforts we were able to conserve some tonnes (t) of CO2 Equivalent emissions in 2000 (see Sections 3.6 and 3.7, Report on 1999 Actions and Further Actions and Success Stories). This exceeded the 2000 target of to tonnes as reported in last year s report. 13

14 Some of the apparent increase in 1999 and 2000 emissions is directly attributable to improvements in data capture. Specifically, our reporting of fuel gas and flared gas has been improved as part of our continuing efforts to improve the data supplied to the AEUB. Additionally, as part of our continuous improvement efforts, Northstar has begun to capture and report vented gas that contributes to greenhouse gas emissions. The total CO 2 E and the PCI are affected by the addition of vented gas. The changes in CO 2 Equivalent emissions, PEI and PCI are quantified in the following table. Table 4. Emissions Measurements, Measurement , % Change from Previous Year (1999) % Change from Base Year (1995) kt CO 2 E /yr % -0.3% PEI % 31.0% PCI % 7.5% 1 Base year used short form method for calculations includes combined Northstar Energy, Devon Energy and Morrison Petroleums data. These were amalgamated in the 1998 report, but had been reported separately in previous years totals differ from that reported in last year s report due to a recalculation of the 1998 data kt CO 2 E/yr = kilotonnes of CO 2 Equivalent emissions/year PEI = Production Energy Intensity PCI = Production Carbon Intensity 14

15 Emissions Compared with Business as Usual Actual emissions as a result of Northstar s emissions and energy conservation efforts have been compared to a business as usual case as if no initiatives were undertaken in Based on a 1997 facility throughput to emissions ratio and adding the cumulative total of emissions savings from actions taken, a business as usual scenario would be 1,076.3 kt CO 2 E in 2000, rather than the 1,023.1 kt per year actual CO 2 E for As indicated in the previous section, we believe that actual savings have been greater, but improvements in data gathering have made it difficult to compare directly to previous years. Additionally, in 1998 Northstar acquired heavy oil operations at Dover. This is a much more energy intensive operation than any that Northstar had owned in 1997, accounting for approximately 10% of company-wide CO2E emissions on its own. Northstar has made significant strides in reducing energy consumption at Dover (see next section), but these are not accounted for in the business as usual scenario. For 2001, we project that our emissions will be further reduced from the business as usual scenario. Our target is to reduce emissions by another to t of CO 2 E. Emissions compared with the business as usual case are shown in Figure 3, based on measured 2000 facility throughput of m 3 OE and 2001 estimated facility throughput of m 3 OE, and assuming a 15 tonne reduction in emissions for Figure 3. Measured Emissions versus Business as Usual CO 2 E Emissions (Kilotonnes) , , est. Business As Usual With Reduction Measures 15

16 Emissions by Facility With the 1997 VCR Report, Northstar started reporting emissions on a per facility basis. By reporting for each facility starting in 1997, we are now able to better understand where the greater opportunities exist for greenhouse gas reduction. Examining data for each facility also results in better quality control of the data as potential data errors tend to be highlighted quickly rather than being lost in a larger number. We feel that this has improved our overall data integrity, has increased our understanding of our greenhouse gas emissions sources and will facilitate greater focus in our action planning. The five largest facilities in terms of their CO 2 E greenhouse gas emissions for 2000 are shown in Figure 4 below. This illustrates the great diversity in energy input compared to emissions possible between facilities. Figure 4. Emissions and PEI for Five of the Largest Greenhouse Gas Emitting Facilities, 2000 PEI Coleman (Gas Plant) Dover (Heavy Oil) Goodfish (Gas Plant) Thompson Lake (Oil Battery) Turin (Gas Plant) CO2E for Facility Total CO2E Emissions for Facility Production Energy Intensity (PEI) 16

17 The same five facilities are included in both the 1999 and 2000 reports. Total CO 2 Equivalent reductions have been achieved at all facilities except the Goodfish Gas Plant, which showed an increase of just under 3 kilotonnes. The largest decrease was at the Turin Gas Plant, which decreased CO 2 E emissions by approximately 35 kilotonnes. CO 2 E emissions from flaring were reduced by 36% at Turin over 1999 levels, while gas production increased by 8%. Key changes to the PEI for the emitting facilities are as follows: The flaring reduction at Turin, coupled with an increase in gas production of about 8% resulted in a PEI of 5.18 in 2000, down from the 1999 level of The Coleman Gas Plant fuel use is down from 1999 by about 22%. PEI dropped to 2.92 in 2000 from the previous year s level of At Thompson Lake the PEI decreased from 2.40 in 1999 to 1.98 in CO2E emissions from flaring were reduced by 64% from 1999 levels, and fuel use was down by 26%, while gas production increased by 24%. Dover PEI was significantly higher, up to in 2000 from 6.59 in At Dover, both fuel gas use and flaring are up substantially over that reported in Fuel gas use was not measured in 1999 for January to May, which has resulted in a substantial increase in the reported fuel gas calculation in A detailed summary of emission statistics from all Northstar facilities is provided in Appendix 1. 17

18 Table 5 Report on 2000 Targets Table 5 summarizes the status of the targets identified in Northstar s Progress Report and Action Plan 1999 (1999 Report) submitted to VCR Inc. in November Target Results Consequences For the year 2000, Northstar proposes to identify at least 10 projects accounting for a further reduction of between to tonnes of CO 2 Equivalent. Northstar s goal is to continue to reduce solution gas flaring where it is economically feasible to do so. Northstar has implemented a gas conservation goal of 90% to 95% of all solution gas. Northstar will follow The EUB s Guide 60 in its flaring reduction initiatives. Northstar s goal is to be within the top 25% of upstream oil and gas producers as ranked by VCR Inc., reflected in their Champion Reporting Program. Northstar will strive to decrease emissions on a per unit of production basis as indicated by our Production Carbon Intensity (PCI) and Production Energy Intensity (PEI) measurements, and will continue to reduce overall total greenhouse gas emissions unless acquisitions or growth substantially increase the production portfolio. A total of 31 projects were undertaken in Some projects were completed; others will be carried forward into CO 2 E emissions were reduced by tonnes. Therefore this target was exceeded by more than tonnes. Flaring was reduced from 75,112 in 1999, to 55,446 in 2000, a 26% reduction. Some vented gas previously reported as flared is now reported separately as vented. Solution gas conservation was approximately 90% in 2000 and is targeted for 95% in Northstar was awarded a Gold Reporter Champion status for the second year in a row by VCR Inc, one of only 89 Gold Reporters among the 777 Action Plans registered with VCR Inc. Emissions on a per unit of production basis increased slightly in This was due in part to improvements in data gathering and to declining production during the year compared to the amount of energy used or emissions released. Northstar has renewed its target to reduce CO 2 E emissions by an additional 10,000 to 15,000 tonnes in 2001 from its 2000 total. Northstar will continue its flaring reduction efforts into 2000 and Northstar has improved its target to be within the top 20% of upstream oil and gas producers as ranked by VCR Inc. Northstar will continue to use the Champion Reporting Program as the measure of this target. Northstar will continue to strive to decrease emissions on a per unit of production basis as indicated by our Production Carbon Intensity (PCI) and Production Energy Intensity (PEI) measurements. However, property acquisitions, and their accompanying production and emissions increases, may raise the overall corporate PCI and PEI. 18

19 3.5 Report on 2000 Action Plan Summary of Success Story Initiatives Overall, Northstar initiated 29 projects for emissions reduction, of which some we were unable to quantify or are being carried over into Emissions reductions resulting from action plans and further actions and success stories, total 37,356 tonnes of CO 2 Equivalent for The following actions were initiated in 2000, as identified in our 1999 Voluntary Challenge Report. Many of these are multi-year programs, or have carried over into 2001, and will be completed in the coming year. These actions resulted in emissions reductions totalling tonnes CO 2 Equivalent per year Electrical Demand Reduction Opportunities 1. Optimum Energy conducted detailed facility and field energy audits in The evaluation included an examination of energy efficiency, energy optimisation, and recommendations for the future. 10 facilities were audited in the year 2000 as follows: Long Coulee Field, Taber field, Gilby field, David North, Metiskow, Halkirk, Thompson Lake field and battery, Airdrie-Olds, Turin, Retlaw plant and battery. Results of the evaluation and subsequent actions will form the basis for determining further greenhouse gas reduction opportunities. Results: The initial phase of the study was completed in Detailed energy audits of high potential facilities were conducted. Recommendations for specific facilities are being evaluated for energy and cost effectiveness. See section 3.7 for results from projects implemented at the audited facilities. 2. At the Gift Lake Battery, tying in all gas to an electrical generator will eliminate all routine flaring. This will convert approximately m 3 of flare gas to gas used for high efficiency electricity generation. The primary CO 2 E savings are in offsetting electricity purchased. Based on typical generators used in this type of situation, the electricity offset is expected to be approximately kw/yr, which equates to approximately 280 tonnes of CO 2 Equivalent emissions. Results: This project was carried over into In 2000 at the Dover Plant, a pulse meter with readout in the control room was to be installed to reduce peak demand of electrical power. Results: This project was never completed. 19

20 4. Also at the Dover Plant, capacitors were to be installed in electrical substations in June of 2000 in order to reduce electrical demand by improving the power factor. Results: This project was never completed. Direct Emission Reductions from Combustion 5. The Optimum Energy study included examining fuel consumption. Results: Results from the audits were applied to fuel savings listed in the success stories in the following section. 6. A steam generator efficiency study at Dover was conducted to reduce fuel consumption and emissions by improving combustion efficiency in boilers. Flow meters and other instruments were installed and the steam generators are reviewed regularly, beginning in July Results: Load is shifted between the generators to reduce gas consumption as much as possible. However, because the generators had to be run close to full rates, there was little room to adjust the load, resulting in reduced savings. Over one year, m 3 /day may be saved, therefore, m 3 /day x 365 days x 2.4 / 1000 = 876 tonnes CO 2 E/yr. GHG reduction 876 tonnes CO 2 E/yr 7. A flare gas recovery project at Dover began continuous operation in September Through this project, flare gas is converted to steam generator fuel. Results: Presently, flare gas recovery is reducing fuel gas consumption by approximately m 3 /day x 122 days (Sept Dec) x 2.4 / 1000 = 878 tonnes CO 2 E/yr GHG reduction 878 tonnes CO 2 E/yr 8. A Vapex pilot project is underway to test propane rather than steam as a solvent. This is a longer-term project, anticipated to determine whether permanent heat loss can be replaced by recoverable propane by Results: The project is currently in the design phase. 9. An emissions survey of all the burners at Gift Lake was conducted in 2000 to establish a baseline to quantify future emissions reductions. Results: Emission reductions were made to a line heater, two flare knock outs and two treaters in March and April 2001, and will be quantified in 2001 VCR. 20

21 10. At Gift Lake, economizers were installed to reduce fuel consumption and adjust fuel-air mixtures to enable more complete combustion. Results: Greenhouse gas savings have not been quantified. 11. At Gift Lake, three propane-fuelled wellsite engines were converted to use casing gas instead. The casing gas was previously flared. Results: Total CO 2 E for the three engines is m 3 /day x 365 days x 2.57 tonnes CO 2 E x 95% time utilization = 4866 tonnes CO 2 E/yr GHG reduction tonnes CO 2 E/yr 12. At the Turin Gas Plant, installation of a fuel to flare control system was done in mid This resulted in a decrease in fuel consumption. Results: In 1999, total fuel to flare was 12, m 3 and in 2000, total fuel to flare was 9, m 3, which generates a fuel reduction of 2, m 3 x 1.91/1000 = 5,399.6 tonnes CO 2 E/yr. GHG reduction tonnes CO 2 E/yr 13. At the Stettler Plant a study was completed to determine if flash tank vapours could be used as burner fuel. The requirement for a continuous pilot on the flare stack was also being studied. Results: This study was unsuccessful as make-up gas is utilized to move glycol through process and resulted in higher make-up gas usage. Flash tank vapours continue to vent to flare, thereby eliminating the need for pilot gas. Management, Training, and Employee Involvement 14. Northstar has established an ongoing independent verification program for its greenhouse gas initiatives as reported herein in the year Results: Northstar continues to retain Greystone Environmental Consultants, Inc. (Greystone) as a third party to provide input into data collection, review calculations and prepare this report. This provides a level of independence in the data collection and verification of information. Northstar also retained Optimum Energy Management Corporation (Optimum Energy) to conduct an energy management study for the company. Optimum Energy gathered energy use information for the entire company to calculate facility-specific energy efficiency calculations, and prepared energy reduction plans for various facilities. 21

22 15. Northstar has established an employee incentive program for greenhouse gas reduction ideas in the year Results: Northstar has included greenhouse gas emissions reduction goals for production operations teams by operational area. Through this initiative, area teams have goals to achieve and incentives to do so. Total greenhouse gas emissions reductions based on action plans identified in the 1999 report = tonnes CO 2 Equivalent per year. 3.6 Additional Success Stories The following additional actions were initiated in 2000 with a resulting emissions reduction of 25,336 tonnes CO 2 Equivalent per year. Field Reduction Initiatives 16. Three lean burn, 1478hp compressors were shut down in Surmont May 1, 2000, and one 70 hp engine was shut down April 30, Results: Previously, each compressor ran 100% of the time, producing 5698 tonnes CO 2 E/yr each. During the year 2000, each engine produced 2218 tonnes CO 2 E/yr each. This results in a savings of 10,440 tonnes CO 2 E/yr. The smaller 70hp engine saves 30.6 tonnes CO 2 E/yr based on utilizing only 10% of time in a year. GHG reduction tonnes CO 2 E/yr 17. At Taber North, W4M battery was shut in and the battery wells were tied into CNRL. Electrical usage, flaring, and treater burner usage (negligible) were eliminated. Results: Eliminated125hp of electrical usage (125hp x kW/hp) for the year 2000 = kwh/yr x tonnes CO 2 E/yr x 95% time utilization = 781 tonnes CO 2 E, plus a reduction of ( m 3 /yr x 2.57 tonnes CO 2 E) 844 tonnes CO 2 E of flared gas. GHG reduction tonnes CO 2 E/yr 22

23 18. At the W5M Battery in the Gilby area, a Union QD-5240 pump was shut down due to reduced water injection requirements for the entire year of Results: Reduction for one 200 hp pump (200hp x KW/hp = kW) over 1 year = kWh/yr shut down x 95% time utilization x tonnes CO 2 E/kWh = 1250 tonnes CO 2 E. GHG reduction tonnes CO 2 E/yr 19. All electrical pumpjack motors were checked in the Crossfield Area for any potential reductions. Reductions in horsepower connections, (ranging from 2.5 hp to 5 hp) were made at seven different sites. Results: Total reduction in horsepower = 20hp x.7457kw/hp x 24hrs x 365 days x 95% time utilization x tonnes CO 2 E = 125 tonnes CO 2 E. GHG reduction 125 tonnes CO 2 E/yr 20. Gilby Battery ( W5). The glycol heat system that supplies heat to the process building was shut-in during the summer months. This system has two 5 hp glycol pump motors, four Ruffneck model HP5, twenty 18 kw heaters and five Ruffneck model HP kw heaters. Results: Reduction for the glycol heat system is 2 x 5hp x kW/hp = 15 kw x 2208hrs x 95% efficiency x tonnes CO2E = 15.8 tonnes CO 2 E for the two 5 hp glycol pump motors, tonnes CO 2 E for the four 18 kw heaters, and tonnes CO 2 E for the five 15 kw heaters. GHG reduction 327 tonnes CO 2 E/yr 21. Gilby Battery and Field ( W5). Several catadyne heaters were shut off from mid-may to September 1 ( kw; kw; and kw) Results: This practice increases energy efficiency from reducing the amount of fuel gas used. The reduction for 12, 24,000 BTU/hr heaters = 288,000 BTU/hr x kwhr/btu = 84 kw x 30% time utilization / (70% efficiency x 46 GJ) x E 6 sec/yr x 1.91 kg/m 3 = 47.4 tonnes CO 2 E/yr 3, 12,000 BTU/hr heaters = 5.9 tonnes CO 2 E/yr; 2, 36,000 BTU/hr heaters = 11.8 tonnes CO 2 E/yr. GHG reduction 65 tonnes CO 2 E/yr 23

24 22. Lanaway Battery ( W5). Four 48,000 BTU/hr and four 12,000 BTU/hr catadyne heaters were shut down from mid-may until the beginning of September. Results: This practice increases energy efficiency from reducing the amount of fuel gas used. The reduction for the 4-48,000 BTU/hr heaters = 192,000BTU/hr x kWhr/BTU = 56.3kW x 30% time utilization / (70% efficiency x 46GJ) x E 6 sec/yr x 1.91 kg/m 3 = 31.6 tonnes CO 2 E/yr 4-12,000 BTU/hr heaters = 8 tonnes CO 2 E/yr. GHG reduction 40 tonnes CO 2 E/yr 23. Used only 4 out of the 6 catadyne heaters at the Pritchard Lake s Plant, and reduced usage from 50% to 40% for all 8 heaters at Pritchard Lake (Field and Plant). Results: The two heaters that were shut down used to produce 3.24 tonnes of CO 2 E/yr each, therefore, we save 6.48 tonnes CO 2 E/yr. When used 50% of the time, 6 heaters produced 4.11 tonnes CO 2 E/yr each, and the other 2 produced 8.22 tonnes CO 2 E/yr each. At only 40% time utilization, 6 heaters produce 3.24 tonnes CO 2 E/yr each, and 2 produce 6.47 tonnes CO 2 E/yr each. This results in a total savings of (41.1 tonnes) (32.38 tonnes) or 8.72 tonnes CO 2 E/yr. GHG reduction 15 tonnes CO 2 E/yr 24. At Craigmyle, the sales and boost units were converted from fuel to air driven. Results: The two units (K-600 & K-610) have 2 pumps each that run about 72 times a year for 4 minutes, and used to use 77scfm of fuel. Therefore, 77scfm = m 3 /min x 72 times/yr x 4 min x 4 pumps = m 3 /yr x 2.4 = 6,028 tonnes CO 2 E/yr. GHG reduction tonnes CO 2 /yr 25. Optimum Energy conducted an electrical usage field audit at Long Coulee, Taber, Gilby, David North, Metiskow, Halkirk, and Crossfield, which reduced electrical consumption by reconnecting motors at a lower horsepower and installing capacitance. Results: Based on Optimum Energy s data, the total reduced tonnes CO 2 E/yr for the above facilities is 1,875,585 kwh/yr x kg/kwhr = tonnes CO 2 E/yr. GHG reduction tonnes CO 2 E/yr 24

25 26. At Taber North, Northstar tied in W4M battery to a third party, eliminating flared gas and electric and fuel gas use. Results: 165,150 kwh/yr x kg/kwhr = tonnes CO 2 E/yr m 3 /yr flared gas x 1.91 = 17 tonnes CO 2 E/yr 1, m 3 /yr x 2.57 = tonnes CO 2 E/yr. GHG reduction tonnes CO 2 E/yr 27. Northstar improved its inventory and reporting by including vented gas in the 2000 VCR and will continue to do so. Results: Greenhouse gases produced from venting are recorded in the 2000 report. Emissions reductions are not quantified, as 2000 is the first year these emissions have been reported. (Affected total CO 2 E and PCI) 28. At the well in Halkirk/Marion Lake a methanol pump and all other fuel gas driven instruments were set up in the fall of 2000 to use air instead of fuel gas. Results: Greenhouse gas savings have not been quantified. Total greenhouse gas emissions reductions based on Success Stories = 25,336 tonnes CO 2 Equivalent per year. Head Office Reduction Initiatives 29. The photocopiers throughout the Calgary office meet Energy Star Guidelines for energy efficiency. The products are designed to reduce the environmental impact associated with copying equipment by means of energy saving features such as Low Power mode, Auto Off mode, and Duplex mode. Results: Greenhouse gas savings have not been quantified. 25

26 4 Action Plans (Measures to Achieve Targets) 4.1 Action Plan for 2001 and 2002 The following actions are proposed for 2001 and As other opportunities arise, Northstar may undertake additional actions. Electrical Demand Reduction Opportunities 1. At the Gift Lake Battery, previously flared battery solution gas will be tied into a large electrical generator in April The anticipated net annual change in emissions is 19, 385 tonnes CO 2 E. Northstar will tie in several (approx. 17) single well batteries to a central battery at W6M in the Spirit River Area in April All solution gas from the single well batteries was previously flared. The solution gas will now be conserved and sold via compression at the new battery location. The anticipated net annual change in emissions is 17, 437 tonnes CO 2 E. 2. At Halkirk, all new pumpjack installations in Feb/March 2001 will be balanced and capacitors will be installed on all wells to reduce electrical demand. Direct Emission Reductions from Combustion 3. Two pumpjack motors will be replaced with lower horsepower motors in September 2001, at W4M and W4M at Taber. This will save 39,194 kwh/yr or 39 tonnes CO 2 E/yr. [2] 4. At Halkirk/Marion Lake a gas boot will be installed to collect vapours off tanks and recompress back into system to improve gas recovery off oil. This in turn, will reduce flare, and is planned to be running by July At Halkirk/Marion Lake a heated flare knock out was installed in 2000 and started in January This will reduce the amount of heat needed to treat all production at Battery. 6. A Vapex pilot project is underway to test propane rather than high energy steam as a solvent. This is a longer-term project, anticipated to determine whether permanent heat loss can be replaced by recoverable propane by year A Vapour Recovery Unit (VRU) is to be installed in 2001 at Gift Lake Battery. 26

27 8. An evaluation to install a VRU is to be done for the Chinchaga Gas Plant during the summer of Existing VRU will be modified in April 2001 at Central Retlaw s Oil Battery to capture vapours from trucks while loading and unloading oil volumes. It is not feasible to estimate the reduction in vented gas. [2] 10. At Halkirk, methanol injection pumps as well as all other instruments at and well sites are to be air driven rather than fuel gas driven in the spring of An exhaust gas processor will be started in 2001 in Dover. This will capture engine emissions, which will reduce methane entering the atmosphere, and in turn greenhouse gases. 12. At the Turin Gas Plant the catadyne heaters were previously shut down for 6 months every year and will now be shut down for 7.5 months every year. This presents a savings of m 3 /yr of fuel gas or 53 tonnes CO 2 E/yr. [2] 13. In May of 2001, two water injection pumps will be reduced in horsepower from 1100 hp to 800 hp at Thompson Lake. By doing this Northstar is saving 2,365,227 kwh/yr or 2,382 tonnes CO 2 E/yr. This will also be done to one other water injection pump in December 2001, which will save an additional 1,182,613 kwh/yr or 1,191 tonnes CO 2 E/yr. [2] 14. A gas plant energy use audit is planned for September 2001 in Coleman and at Dover SAGD. This audit is expected to reduce both fuel gas and electric use at both these facilities. Management, Training, and Employee Involvement 15. Northstar will continue with an employee incentive program for greenhouse gas reduction ideas in the year As noted in Section 3.6, Northstar has included greenhouse gas emissions reduction goals for production operations teams by operational area. Through this initiative, area teams have goals to achieve and incentive to do so. 16. Northstar will create an Enviro Tips bulletin and distribute it throughout the company for the months of June, July and August in the year The bulletin will provide employees with helpful tips on how to reduce the amount of greenhouse gases we produce as individual Canadians, as well as interesting facts about environmental issues. 27

28 5 Education, Training and Awareness In 2000 and 2001, Northstar s field operations personnel will participate in the company s greenhouse gas emissions reduction initiatives program. As a CAPP member, Northstar also contributes to public education through CAPP s programs. This includes support of the Petroleum Communication Foundation, which prepares public education information and school programs addressed at reducing energy consumption. 6 Conclusions Northstar has undertaken a planned program that has achieved over tonnes of CO 2 Equivalent emissions reductions for This reduction resulted from the implementation of 29 emissions reduction projects. Northstar will continue to explore operational and capital ways of reducing its direct and indirect greenhouse gas emissions on a per production basis. Northstar has managed to control its greenhouse gas emissions through a combination of prudent operating practices and capital (equipment) modifications. However, with a slightly declining production portfolio requiring more energy to extract reserves, overall corporate PEI has decreased and PCI has increased slightly from 1999 data. Northstar has demonstrated that voluntary actions can produce real results, and we remain a committed supporter of VCR Inc. and the voluntary approach to greenhouse gas emission reductions. 28

29 Appendix Greenhouse Gas Emissions and Measurement Parameters by Facility Facility Type Total Combustion CO 2 E Emissions CO 2 E From Flaring CO 2 E From Venting Power Usage (kwh/yr) CO 2 E from Electrical Power Total CO 2 E for Facility Production Energy Intensity (PEI) Production Carbon Intensity (PCI) Bellshill Lake Oil Battery ,577, Bonanza/Pouce Coupe Gas Plant , Boundary Lake Oil Battery Calgary Office Corporate Office ,550, NA NA Carstairs/Crossfield Battery 6-25 Carstairs/Crossfield Battery Oil Battery , Oil Battery Carmangay Battery Oil Battery ,228, Chinchaga Gas Plant Coleman/N Coleman Field Gas Plant ,328, Corrigal Lake Compressor Stn Craigmyle Gas Plant Dover SAGD Site ,052, Dovercourt Oil Battery , Enchant Gas Plant ,