EPA proposes gas capturing requirements for E&P operations

Nick Snow, OGJ Washington Editor

The US Environmental Protection Agency proposed new air pollution standards for oil and gas exploration and production operations on July 29 in response to a court order. The standards would require operators to capture natural gas which currently escapes into the atmosphere, the agency indicated.

EPA said the proposal would cut volatile organic compounds (VOCs) emitted during several processes, including a 95% reduction during completion of new and modified hydraulically fractured wells. Capturing gas that currently escapes into the air would make it available for sale through technology and processes several producers already use and some states require, EPA said.

US gas production is increasing with more than 25,000 new and existing wells fraced or refraced each year, it noted. EPA said it anticipates the proposed VOC reductions would reduce ozone nonattainment problems in many oil and gas production areas. They also would yield a significant environmental benefit by reducing emissions of methane, a greenhouse gas 20 times more potent that carbon dioxide, from new and modified wells, according to the agency. The proposed changes also would lower cancer risks from emissions of benzene and several other air toxics, it added.

EPA said its analysis of the proposed changes, which also include requirements for storage tanks and other equipment, show that they are highly cost-effective, with a net savings to the industry of tens of millions of dollars annually from the value of gas that would no longer escape into the atmosphere.

It said the proposal included reviews of four air regulations for the oil and gas industry as required by the Clean Air Act: a new source performance standard for VOCs from equipment leaks at gas processing plants; a new source performance standard for sulfur dioxide emissions from gas processing plants; an air toxics standard for oil and gas production; and an air toxics standard for natural gas transmission and storage.

Final rule by February 2012
The agency said that it was under a consent decree requiring it to sign a proposal by July 28 and take final action by Feb. 28, 2012. It said as part of the public comment period, EPA would hold three public hearings, in Dallas, Denver, and Pittsburgh, Pa. Details on the hearings will be announced soon, it said.

Industry groups initially reacted cautiously to the proposals. “EPA has already imposed stringent emissions limitations on engines used in oil and gas operations,” Howard Feldman, the American Petroleum Institute’s scientific and regulatory policy director, said on July 28. “API will review these proposed rules to ensure that they don’t inadvertently create unsafe operating conditions, are cost effective and truly provide additional public health benefits, and don’t stifle the development of our abundant natural resources.

He said API also would like EPA to extend the final rule deadline beyond February 2012 by a minimum of 6 months to allow adequate time to collect and analyze comments on the proposed rules.

A spokeswoman for the Independent Petroleum Association of America said it would take a closer look at EPA’s proposal once it was published in the Federal Register before commenting. “The information that we have seen from the EPA is very vague,” she told OGJ in a July 29 e-mail. “Many oil and gas producers already use green completion technologies; however, we do not know whether they are the same as those proposed by EPA.”

Environmental organizations applauded the proposed rules. “Natural gas drilling has been spewing vast amounts of toxins into our air every day without limits, sickening families and communities,” Deb Nardone, who directs the Sierra Club’s natural gas reform campaign, said on July 28. “This proposed protection would help reign in life-threatening pollution from gas drilling for the first time and is a significant step forward in cleaning up a dirty industry.”

Contact at nicks@pennwell.com.

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