Reducing direct—or Scope 1—emissions associated with exploration and production is considered one of the fastest and most affordable ways to slow climate change. Scope 1 emissions occur from the well pad to the refinery and make up about 10% of all anthropogenic greenhouse gas (GHG) emissions. And the fact that these emissions arise from processes such as methane releases and flaring associated with (but not inherent to) hydrocarbon makes their abatement a welcome and logical quick win for decarbonization and a more balanced approach to sustainable, affordable, and secure energy.
The natural gas conundrum
The natural gas industry could very well thrive over the next stages of the energy transition. Rapidly growing economies need stable energy sources, and those needs cannot be fully met today by intermittent alternative energy sources such as solar and wind power. Natural gas has an inherent advantage as the lowest-carbon source of stable power, with half the carbon dioxide footprint of coal.
Unfortunately, today, gas has a much higher methane footprint than coal, eroding some of its climate advantage. By quickly reducing methane emissions, we can firmly establish natural gas as a critical fuel during the transition to a zero-carbon economy.
Methane: Public enemy #1
Methane is a particularly important decarbonization target. It is the main component of natural gas and also a potent GHG. Historical methane emissions are responsible for 0.5°C of the 1.1°C that our planet has already warmed, and the oil and gas industry is one of the largest sources of methane emissions today. Over a 20-year period, one ton of emitted methane causes as much global warming as 84 tons of emitted carbon dioxide, making the climate-related economic damage from methane emissions significantly higher than the typical market price for selling the gas.
Scientists and policymakers have prioritized methane reduction, and our industry faces immense pressure from many directions to comply. Under voter pressure, government policy is tightening quickly. Mandatory leak detection and repair requirements, zero- or low-emission technology standards, and a ban on non-emergency flaring and venting are well established in North America and Europe and are emerging elsewhere. On March 8, 2022, the Oil and Gas Climate Initiative (OGCI) members announced an ambition to achieve zero methane emissions from oil and gas operations by 2030, demonstrating the commitment to act fast and act now.
In 2020, a liquified natural gas (LNG) project intended to ship gas from Texas to France was blocked in France due to concerns about GHG emissions that would have occurred in Texas. Additionally, responsibly sourced gas standards are being developed to create a market where consumers can pay a premium for gas with low methane emissions.
Investors are applying similar pressure. In 2021, 168 investors, managing over $6.23 trillion in oil and gas assets, signed a statement backing the need for methane reduction rules and called for more stringent Environmental Protection Agency (EPA) regulations. Additional requirements were proposed in November of 2022 for sources not covered by the original proposal.
Flaring: The runner-up
In addition to methane, flaring is recognized as a large source of GHG emissions, and it is the most criticized activity in the oil and gas industry due to its visibility. There are many causes of flaring, including emergencies where gas needs to be flared to ensure safe operating conditions.
From an environmental perspective, the focus is on phasing out routine flaring, which occurs because the economic value of selling the associated gas is less than the cost of transporting it to market. Nearly 100 countries and companies have committed to a program organized by the World Bank aiming to achieve zero routine flaring by 2030.
What can operators do to manage their methane emissions?
Emissions management is a fast-evolving specialty. Many technologies are available today to identify and quantify methane emissions and to reduce those emissions once sources have been identified. Mobile monitors from satellites, airplanes, and drones can be used to detect leaks from a macro to a more granular level. Fixed monitors measure emissions nearly 24/7 from a single facility.
Vapor recovery units (VRUs), instrument air systems (IASs) that substitute compressed air for pressurized natural gas, and low-emissions (Low-E) valves are being used to reduce the fugitive emissions or methane released from venting.
Many solutions involve technologies foreign to the oil and gas industry and require specialist advice to select and integrate. However, that selection must be made with their oilfield application in mind, which requires oil and gas expertise. Setting strategy, understanding regulation, evaluating both available and emerging technologies, choosing vendors, combining solutions, and scaling them globally—it's a complex challenge.
Plan. Measure. Act.
Operators, governments, and regulators can take advantage of a holistic, end-to-end approach to emissions reduction. Step 1 is to plan, step 2 is to measure, and step 3 is to act, with a dedicated digital platform as the underlying enabler across all.
Step 1: Plan
Eliminating more methane emissions, including flaring faster and with less cost, begins with a good plan. A wide range of technologies including methane and flare monitoring and abatement can help identify the most effective plan and approach for any operator’s assets. Additionally, tech solutions that convert flared or vented gas to liquified and compressed natural gas, power, and various saleable commodities are being developed. Identifying the tech that's most effective for a particular asset, location, or business objective depends on local factors such as facility size, type, density, location, and climate (among others).
Step 2: Measure
Once a plan is developed, the next step is to measure baseline methane and flare emissions across an entire asset. Service providers, operators, tech start-ups, and academia have engaged each other over the last few years to better map the latest developments in oil and gas emissions detection and quantification. These include drones, airplanes, satellites, handheld devices, and sensors. The resulting combination of curated, best-in-class technologies gives producers access to a full range of tech solutions that meet their needs.
Step 3: Act
Once measurements are complete and high-emitting sources are identified, it’s time to act. At this stage, operators must turn their attention to reducing the previously measured emissions from their sources. Reducing emissions involves field work to repair leaks and install low-emitting equipment as well as tech solutions that convert gas to valuable products. Some service providers deliver actionable information by informing the operator where emissions occur, while others take it one step further by both finding and fixing emissions.
Real-time, visible results (both internally and externally)
Today's tech not only allows for emissions management, but it also enables analytics on a never-before-seen scale. By introducing a robust digital platform as part of their strategy, operators, governments, and regulators alike can benefit from a single, secure place for integrating multisource emissions data. A platform like this enables a way for users to fully comprehend the emissions profile of their business, while simultaneously fostering increased levels of insights, collaboration, and opportunities for continuous improvement. This further accelerates the reduction of methane and flaring from operations, and enables an ongoing balance of energy sustainability, affordability, and security.