What to do about Leak Detection & Repair

Transcription

1 What to do about Leak Detection & Repair For Upstream and Midstream Oil & Gas Operators ERM Webinar July 16, 2015

2 ERM 2015 Webinar Series 2

3 Agenda Leak Detection The Lay of the Land What is LDAR, and its Challenges & Risks? Enforcement Examples Moving Forward with a Plan Q&A 3

4 Why are We Here? Leak Detection is Popular 4 Leak Detection Technology Improvements Voluntary Actions Subpart W Leak Surveys NSPS Subpart OOOO NSPS Subpart KKK EPA National Enforcement Initiative Consent Decrees

5 5 Shale Boom Varying State Responses Some States are requiring varying degrees of LDAR in air permits Appalachia Pennsylvania Exemption 38 (well sites), GP-5 (compressor stations), Ohio GP-12 (well sites) West Virginia Evolving GPs Rockies / West Colorado Reg 7 - Wells, Compressor Stations Wyoming Utah California Texas Voluntary for OGS PBRs, Mandated for SPs above 10 TPY All States Responding to ENGO pressure to do more and barrage of methane studies Responding to FLIR videos, etc.

6 NSPS OOOO Current LDAR Facilities Affected NSPS Facilities Underground Natural Gas Storage Onshore Oil & Natural Gas Production Gathering Booster Stations Onshore Natural Gas Processing Onshore Natural Gas Transmission Compression City Gate Natural Gas Distribution 6

7 NSPS OOOO - Likely LDAR Expansion Affected NSPS Facilities Underground Natural Gas Storage Onshore Oil & Natural Gas Production Gathering Booster Stations Onshore Natural Gas Processing Onshore Natural Gas Transmission Compression City Gate Natural Gas Distribution Plus Potential Long-term Storage Vessel / Closed Vent System Requirements? 7

8 The Proliferation of Leak Detection Imaging 8 Fly over example:

9 Why are We Here? Insights from the Past REFINING CHEMICAL OIL & GAS 2001 to Present 95% of U.S. refining capacity Agreements to pay: $142MM civil/seps $5B on controls 2007 to Present 7 Consent Decrees Multi-facility to individual plant CDs 2009 to Present 243 Air quality enforcement actions NEI for Energy Extraction initiated in 2011 Lead to Enhanced LDAR Subpart VVa Introduced Low Leak Technology provisions for valves and connectors Merit Energy CD Pending LDAR CDs for two more gas plants 9

10 The Devil is in the Details If my voluntary program is more comprehensive than rule requirements, I should be fine, right? Aren t these all LDAR? Directed Inspection & Maintenance Leak Detection and Repair Leak Surveys FLIR Method 21 10

11 LDAR Program Objectives Why? LDAR is a work practice standard designed to reduce fugitive emissions from equipment such as valves and pump seals through a standardized inspection and repair program Designed as a work practice standard pursuant to CAA Title I (ozone NAAQS) and Title III (air toxics) to address emission sources that are not suited to emission/operating limits Focuses on non-routine operation of equipment (i.e. process fluid leaks to the atmosphere that are not associated with normal operation) Traditionally incorporates economic feasibility to establish appropriate action levels for triggering corrective action commensurate with a defined leak rate 11

12 Methane Losses by Equipment Type Blowdowns 0.8% Pressure Regulators Pump Seals 0.4% 1.9% Other Flow Meters Pressure Relief Valves 0.2% 3.5% Orifice Meters Control Valves 0.1% 4.0% Crankcase Vents 4.2% Valves 26.0% Open-Ended Lines 11.1% Compressor Seals 23.4% Connectors 24.4% Source: Clearstone Engineering,

13 LDAR Program Basic Concepts LDAR Component Conditional Exclusions Inspection versus Monitoring Leak Definition Repair Definition 13

14 The LDAR Process Applicability definition Inspections and Monitoring Repair attempts (e.g. 5/15 day) Recordkeeping Delay of Repair (DOR) Repair attempt verification monitoring Reporting Management of Change Auditing 14

15 Common LDAR Challenges 15 Applicability: stream designations, routine (inherent to design) versus non-routine fugitive losses, overlapping programs, industry segment demarcation Complex logistics, communications, and work flows Significant increase to Operations and Maintenance workload with short deadlines (e.g. 5 calendar day initial repair attempts) Operational disruptions for repair attempts and DOR qualification MOC: additions/deletions to program, initial monitoring deadlines Mixed solutions data management Step-wise increase in enforcement risk potential due to granularity of compliance data (100,000 s of data points and potential opportunities for non-compliance)

16 Business Implications for LDAR Challenges Changing regulatory guidance leading to potential for over/under-defining boundaries of LDAR program increasing operational burden and/or compliance risk Can result in significant new OPEX Failure to realize work flow efficiencies despite increased CAPEX/OPEX for data management solutions Increased oversight responsibilities for contractors and potential compliance risk created by non-company personnel Enforcement investigations impact human capital which can lead to disruption in production targets and failure to realize ROI on development plans Internal relationship strain between HSE and Operations/Maintenance Operations morale impact due to increased workload coupled with difficult commodity price markets and OPEX reduction pressures 16

17 Lessons Learned Monitoring/inspections is just Step 1 Uncharted territory for upstream and gathering. No one size fits all solution Successful programs are customized for your organization. Focus on program objectives and definition of success, not relying on canned approaches that require significant modification of Operations and Maintenance processes Crucial to understand assets and existing maintenance processes and systems to evaluate business impact and actively participate in advocacy efforts Numerous stakeholders, communication pathways, and data sources necessitate preparing clear communication plan with defined roles and responsibilities Training and QA/QC is essential to a successful LDAR program LDAR becomes part of your daily lives. Evaluate creating incentives around high performance Start planning early 17

18 Leak Detection as Credible Evidence IR Cameras becoming increasingly prevalent in the oil patch Increased adoption by federal and state regulatory agencies through site visits and fly-overs Qualitative indication only (no quantitative mass or concentration provided) Increased business risk in light of recent affirmative defense court decisions Agencies using IR camera inspections to initiate information gathering on the forefront of enforcement investigations Part of EPA s Next Generation compliance tools for enforcement 18

19 Merit Energy Finding of Violation Findings of Fact Subpart KKK Violations One Open-Ended Line 16 Untagged Valves 4 Valves Not Monitored Monthly 12 Insulated Valves Unable to Monitor 14 Leaking Valves Not Tagged Method 21 Calibration Not Performed During Inspection Method 21 Not Followed Properly Late Semi-Annual Reports 19

20 Merit Energy Finding of Violation 20

21 What is EPA Looking For? 21

22 Optical Gas Imaging Study & Protocol Thorough Written Protocol to Achieve Pilot Study Objectives: Understanding Your Vulnerabilities Evaluating the Scale of Your Monitoring Program Do you calibrate the OGI? Do you record the entire survey, or just the leaks? Do you also perform Method 21 monitoring? Do you measure mass or calculate mass emissions? Do you report emissions? How do you repair leaks and confirm success? 22

23 Building a Robust LDAR Program Key Elements Applicability Assessment and Stringency Determination Management of Change Equipment Data Management Transactional Data Management Developing & Identifying Your Component Inventory Training, Communications, and Coordination Internal vs. Contractor Implementation? Management of Change Contractor Management Capacity Building Compliance Assurance Program Stakeholder Management Records QA/QC Reporting 23

24 Identifying Subject Components 24

25 Example LDAR Management of Change 25

26 Evaluating Your LDAR Program Regulatory Applicability Reviews Identification of Subject Components and Exemptions Field Reviews of Open-Ended Lines Tagging/MOC Evaluations OGI/Comparative Monitoring Surveys Training in OGI/Method 21 Techniques and LDAR Practices LDAR Monitoring Data Analysis Quarterly Implementation Reviews Comprehensive Program Audits 26

27 Conclusions Know where you stand Understand the impact and urgency to the business Carefully consider objectives, risks, outcomes when developing LDAR strategy and program Inform Advocacy Efforts Understand and communicate the compliance program A B 27

28 Today s Speakers & Other LDAR Contacts Andy Woerner, P.E Philadelphia, PA [email protected] Ryan Alam Denver, CO [email protected] Deever Bradley, P.E Houston, TX [email protected] Toby Hanna, P.E Ewing, NJ [email protected] John Butow, P.E Philadelphia, PA [email protected] Paul Chinuntdet Charleston, WV [email protected] Justin Carter Fort Collins, CO [email protected] David Salazar Houston, TX [email protected] 28