Tech Watch: Stop profit leaks

Throughout the natural gas sector, pneumatic devices are used to control pressures and flows of gases and chemicals. In the US, there are nearly one million of these devices currently in use. Often, they are powered with produced gas on site. As part of normal operations, “high-bleed” pneumatic devices release or bleed natural gas to the atmosphere and consequently, are a significant source of methane emissions from the industry.

Pneumatic devices are most commonly used as liquid level controllers, pumps, and pressure regulators in the production, processing, and transmission of natural gas. In the US, most pneumatics are deployed within the production sector, where an estimated 598,000 pneumatic controllers are used to control and monitor gas and liquid flows and levels in dehydrators and separators, temperature in dehydrator regenerators, and pressure in flash tanks.

Before 1990, pneumatic devices used as controllers were designed with typically high bleed rates. Generally, the US Environmental Protection Agency (EPA) regards any device that bleeds more than 6 standard cubic feet per hour (scf/h) as “high-bleed” pneumatics. Although it now has become relatively common to use low-bleed (less than 6 scf/h) pneumatic controls in new construction in oil and gas, sources have estimated that hundreds of thousands of high-bleed pneumatics still remain in service throughout the production segment. As a result, high-bleed pneumatic controllers are among the largest sources of vented methane by equipment type in the domestic oil and natural gas industry, according to the EPA.

Reducing emissions
Operators that decide to reduce emissions from high-bleed devices can either retrofit them so they operate as low-bleed devices or replace them with new low-bleed devices. The EPA estimates that atmospheric emissions of approximately 250 mscf/yr or 100 metric tons of CO₂ equivalent (CO₂e) of methane per year could be avoided for each high-bleed controller converted. However, despite the existence of low-bleed technology and the energy and environmental benefits offered, conversions of existing high-bleed controllers remain uncommon across the industry, with only a few large producers having performed large-scale conversions.

Retrofitted controllers were observed closely to allay concerns about potential failures and ‘upset’ conditions resulting from retrofit activity.(Images courtesy of Devon Energy)

Devon Energy and Verdeo Group recently completed the first stage of a greenhouse gas (GHG) reduction project involving the reduction of fugitive methane emissions at Devon’s production facilities. When complete, the project is expected to eliminate a significant source of methane emissions at Devon’s production facilities and exceed the company’s required hurdle rate for capital investment.

The company evaluated the economics of a large-scale conversion to determine if the initiative could be justified from an operational perspective. Like most oil and gas producers, Devon’s primary focus is on expanding reserves, increasing production, and lowering costs while maintaining environment, health, and safety standards. Capital and human resources often are directed to projects that materially impact oil and gas production. Because of this, smaller efficiency-oriented projects can be less of a priority. Further, given the importance of managing costs in a commodity energy business, it is unusual to allocate limited resources to fix equipment like a high-bleed controller that is not broken.

Upgrades take the field
Devon’s Environmental Health and Safety (EHS) team, under the guidance of Darren Smith, EHS environmental manager, decided to partner with Verdeo Group and pursue the generation of GHG offset credits as a mechanism to infuse momentum and interest into the initiative. Given the potential increase in costs that proposed GHG regulations and legislation could have on oil and gas producers like Devon, the value of reducing emissions internally became a catalyst for the project.

The first challenge was the absence of established methodologies and protocols to allow generation of GHG offset credits from the project. Devon and Verdeo worked with the American Carbon Registry (ACR) to develop the first US carbon offset methodology for fugitive methane emission reductions in the oil and gas sector.

One key challenge they had to contend with was how to establish a baseline emission value without requiring direct measurement and emissions from each operating pneumatic controller at the many thousands of well sites. Using representative sampling and statistical analysis to derive conservative emission factors for pneumatic controllers, the methodology allows for a cost-effective and conservative approach to baseline measurement. With this technique and existing inventory data, Devon was able to determine a conservative estimate of emissions from pneumatic devices within its operations.

After a rigorous evaluation process, including multiple independent industry expert reviews, the ACR approved the “Conversion of High-Bleed Pneumatic Controllers in Oil & Natural Gas Systems” methodology in March 2010. This allowed the Devon initiative to be eligible for carbon offsets. The potential added value of the carbon offsets was then used to sell the project internally at Devon.

The EPA estimates that atmospheric emissions of approximately 250 mscf/yr or 100 metric tons of CO₂ equivalent (CO₂e) of methane per year could be avoided for each high-bleed controller converted.

The project was certified by the ACR in March, and Devon began infield execution of the retrofit program. Devon rolled out the retrofit program in a phased manner, with the initial phase targeting production wells in the Washakie Basin in Wyoming.

Leak measurements were taken by an independent third-party testing company using a Hi-Flow Sampler before and after the retrofits. Sampling allowed Devon to quantify emissions reductions resulting from the retrofit.

Devon’s Wyoming field operations team completed several hundred retrofits within a month. Field training was provided to Devon’s local technicians to assure successful implementation, and retrofitted controllers were observed closely to allay concerns about potential failures and “upset” conditions resulting from retrofit activity.

Based on the operating performance of the retrofitted controllers, Devon will proceed with the subsequent phases of the program later this year. These phases will target production operations in Oklahoma and Texas.

Devon and Verdeo have begun verifying emission reductions from the first phase of the program. The companies are auditing emission reduction calculations and expect the first phase to be verified by the end of August. The entire program is expected to reduce the equivalent of approximately 65,000 to 80,000 metric tons of CO₂e per year when all phases have been completed. This reduction is equivalent to eliminating the GHG emissions from three large compressor stations each year.