ONE Future MAC Final 6 1

EconomicAnalysisof
MethaneEmission
ReductionPotentialfrom
NaturalGasSystems
May2016
Preparedfor
ONEFutureInc.
Preparedby
ICFInternational
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EconomicAnalysisofMethaneEmissionReductionPotentialfromNaturalGasSystems
Contents
1. ExecutiveSummary............................................................................................11
2. ApproachandMethodology...............................................................................21
2.1. OverviewofMethodology...............................................................................21
2.2. IdentificationofTargetedEmissionSources...................................................22
2.3. SelectedMitigationTechnologies...................................................................25
2.4. TreatmentofLDCReductions........................................................................213
2.5. CompletionEmissionsfromHydraulicFracturing.........................................214
2.6. SourceCategoriesNotAddressed.................................................................214
3. AnalyticalResults...............................................................................................31
3.1. DevelopmentofEmissionControlCostCurves...............................................31
AppendixA.SummaryandComparisonofAssumptionsandResults........................A1
AppendixB.DataSources.........................................................................................B1
Figures
Figure212012OnshoreEmissions(Bcf)fromEPAInventory......................................24
Figure31ExampleMACCurve.....................................................................................34
Figure32NationalAggregateMACCurvebyMeasure...............................................35
Figure33NationalAggregateMACCurvebyIndustrySegment.................................35
Tables
Table21Highest(Top24)EmittingOnshoreMethaneSourceCategories.................23
Table22SummaryofMitigationMeasuresModeled..................................................25
Table23SummaryofMitigationMeasureCharacteristics(GulfCoastCostBasis).....28
Table24CalculatedEmissionReductionCostperMitigationTechnologyorPractice
(GulfCoastCostBasis)....................................................................................29
Table25LDARHourlyCostCalculation......................................................................211
Table26CostCalculationAnnualLDAR..................................................................212
Table31AnnualizedMethaneReductionandCostU.S...........................................32
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ExecutiveSummary
AcronymsandAbbreviations
Acronym/Abbreviation
StandsFor
AR4
UNFCCCFourthAssessmentReport
Bcf
BillionCubicFeet
CapEx
CapitalExpenditures
CH4
Methane
CO2
CarbonDioxide
CO2e
CarbonDioxideEquivalent
EDF
EnvironmentalDefenseFund
EIA
U.S.EnergyInformationAdministration
EPA
U.S.EnvironmentalProtectionAgency
ESD
EmergencyShutdown
FERC
FederalEnergyRegulatoryCommission
GHG
GreenhouseGas
GHGRP
GreenhouseGasReportingProgram
GWP
GlobalWarmingPotential
HAP
HazardousAirPollutant
hp
Horsepower
IR
Infrared
LDAR
LeakDetectionand Repair
LDCs
LocalDistributionCompanies
LNG
LiquefiedNaturalGas
MAC
MarginalAbatementCost
Mcf
ThousandCubicFeet
MMcf
MillionCubicFeet
MMTCH4
MillionMetricTonnesMethane
MMTCO2e
MillionMetricTonnesCO2 equivalent
scf
StandardCubicFeet
scfd
StandardCubicFeetperDay
scfh
StandardCubicFeetperHour
VRU
VaporRecoveryUnit
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ExecutiveSummary
1. ExecutiveSummary
OurNationsEnergyFutureCoalition(ONEFuture)1commissionedICFtoconductthisanalysisofthe
marginalabatementcost(MAC)ofvariousmethaneemissionabatementtechnologiesandwork
practicesforthenaturalgasindustry.ThegoalofthisMACanalysisisthreefold:(1)toidentifythe
emissionsourcesthatprovidethegreatestopportunityformethaneemissionreductionfromthe
naturalgassystem,(2)todevelopacomprehensivelistingofknownemissionabatementtechnologies
foreachoftheidentifiedemissionsources,and(3)tocalculatethecostofdeployingeachemission
abatementtechnologyandtodevelopaMACcurvefortheseemissionreductions.Thefindingsofthis
reportwillbeutilizedbyONEFuturetodevelopsegmentspecificmethaneemissionreductiongoals
that,whencombined,willachieveacollective1%(orless)emissiontargetinthemostcosteffective
manner.ThisreportwillalsoassisteachONEFuturemembertocustomizeitsabatementstrategytofit
itsparticularemissionprofile.
ThisanalysisisbasedonaMACcurvemodeldevelopedbyICFfortheEnvironmentalDefenseFund
(EDF)in2014.Thecurrentstudyincorporatesmorerecentinformationonemissionsandequipment
costsandmodifiedassumptionsprovidedbytheOneFutureparticipants.AppendixAsummarizesand
comparesthekeyassumptionsandresultsforthetwostudies.Thestudyutilizedthefollowing
approach:
ThebaselineformethaneemissionsfromthenaturalgassectorwasestablishedastheU.S.EPA
InventoryofGreenhouseGasEmissionsfor2012tomatchthebaselineyearemployedintheU.S.
methaneemissionsreductiongoals.2
Areviewofexistingliteratureandadditionalanalysiswasconductedtoidentifythelargestemission
reductionopportunities;acostbenefitestimateforeachofthemitigationtechnologieswas
calculated.
InterviewswithOneFuturemembers,industry,technologyinnovators,andequipmentvendors
wereconductedwithaspecificfocusonidentifyingadditionalmitigationoptionsandcharacterizing
thecostandperformanceoftheoptions.
InformationfromtheanalysiswasusedtodevelopMACcurvesforthemethanereduction
opportunities.
Theanalysisestimatesreductionsforeachsegmentofthenaturalgasindustry.TheMACanalysis
identifiedreductionstotaling88.3Bcf/yearofmethaneatatotalannualizedcostof$296millionor
$3.35/Mcfofmethanereducedforallsegmentsexceptthedistributionsegment.Thereductionsforthe
distributionsegmentwerecalculatedseparately,andtotal8.9Bcf.Anadditional12.3Bcfofreductions
wereprojectedfortheapplicationofreducedemissioncompletionsforgaswellswithhydraulic
ONEFutureisacoalitionofcompaniesthataimstoachieveanaveragerateofmethaneemissionsacrosstheentirenatural
gasvaluechainthatisonepercentorlessoftotalnaturalgasproduction.
2
ThisanalysiswascompletedpriortotheupdatestothemethodologiesincorporatedintotheU.S.GreenhouseGasInventory
(GHGI)onApril,15,2016.
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ExecutiveSummary
fracturing.Thiswasnotrequiredin2012butisnowlegallyrequired,andwasthereforeincludedasa
reductionfromthebaselinebutnotaspartoftheMACanalysis.Thisbringsthetotalindustrywide
methanereductionto109.5Bcffromthe2012baselineemissions.
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ApproachandMethodology
2. ApproachandMethodology
2.1. OverviewofMethodology
Thissectionprovidesanoverviewofthemethodologyappliedforthisstudy.Themajorstepswere:
Establishthe2012BaselineforanalysistheanalysisstartedwiththeU.S.EPAinventoryof
methaneemissionsintheEPAInventoryofU.S.GHGEmissions(GHGI)publishedinApril2014with
datafor20123.ThemostrecenteditionoftheInventory,releasedinApril2016,includessignificant
revisions,whicharenotincludedinthisanalysis.ICFexpectsfutureinventorieswillbeupdatedto
incorporateadditionalemissionsandactivitydatacollectedfromactivitiesinclude:
GreenhouseGasReportingProgram(GHGRP)inventorydatacollectedin2016fromcompanies
inthegatheringandboostingsegment;
InformationCollectionRequest(ICR)4foradditionalregulations,whichwillrequireoperatorsto
providekeyactivityandemissionsdata;and
PrivateandGovernmentsponsoredscientificstudies,includingseveralmultimilliondollar
researchprojectsfocusedonmethaneemissionsfromoilandgasoperationssponsoredby
DepartmentofEnergy5
PotentialfutureupdatestotheGHGImayrequireafutureupdateofthisanalysistoincludethose
changes.
Identificationofmajorsourcesandkeymitigationoptionsthenextstepwastoidentifythe
largestemittingsourcesintheinventoryandthemitigationoptionsthatwouldbemosteffective
andcosteffectiveforthesesources.
Characterizationofemissionreductiontechnologiesakeypartofthestudywastoreviewand
updateinformationonthecostandperformanceoftheselectedmitigationtechnologies.
InformationwasgatheredfromONEFutureMembers,equipmentmanufacturers,otheroilandgas
companies,andotherknowledgeableparties.
Developmentofthemarginalabatementcostcurvesthetechnologyinformationwasappliedto
theemissionsinventorytocalculatethepotentialemissionreductionandcost.Theresultswere
displayedinaseriesofmarginalabatementcostcurves.
Theanalysiscalculatestheannualizedcostofemissionreductionsbasedonthecapitalandoperating
costsoftheemissionreductiontechnologiesandthevalueofrecoveredgasintheproductionsegment.
Thisannualizedcostisdividedbytheemissionreductionstocalculatetheprimaryfigureofmerit
U.S.EPA,InventoryofU.S.GreenhouseGasEmissionsAndSinks:19902012,
http://www.epa.gov/climatechange/ghgemissions/usinventoryreport.html
4
https://www3.epa.gov/airquality/oilandgas/methane.html
5
http://www.netl.doe.gov/research/oilandgas/projectsummaries/naturalgasresources
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$/unitofemissionsreduced.Thisisexpressedas$/Mcfmethanereduced,$/tonnemethanereduced,or
$/tonneCO2equivalentreduced.Thisfigureofmeritisconsistentwiththeformatusedinother
pollutioncontrolprograms(SO2,NOx,VOC,etc.),whichtypicallyfocuson$/tonofpollutantreduced.
Inthe2014reportforEDF,ICFconcludedthattheweightedaveragemethanereductioncostwas
$0.66/Mcfofmethanereduced.Theannualcostswerealsopresentedasnormalizedbygrossnatural
gasproduction,dividingtheannualcostbytotalU.S.naturalgasproduction.Sincemethaneemissions
areonlyafewpercentoftotalproduction,thisvalueisverysmalllessthan$0.01/Mcfofgasproduced
intheU.S.,dependingonthespecificassumptions.Howeverthissecondmetricisdifferentfromthe
approachtypicallyusedbyindustryandregulatorstocharacterizethecosteffectivenessofemission
reductiontechnologiesandshouldnotbecomparedtoa$/unitofmethanereduced.Inaddition,the
ONEFuturesponsorcompaniesreportedthatthemetricthatfocusesonmethanereducedismore
usefultocompaniesoperatingindifferentsegmentsinassessingtechnologiesandopportunitiesatnew
andexistingfacilitieswithineachsegment.Therefore,thisreportemploysonlythemorecommonly
usedweightedannualcostpermethanereduced.
2.2. IdentificationofTargetedEmissionSources
Table21summarizesthelargestemittingsourcecategoriesfortheoilandgassectorsbymajorsource
categoryintheEPAinventoryfor2012.Duetothelackofspecificdataontheemissionsourcesfor
offshoreoilandgasproduction,thestudyfocusedononshoreproductionandoffshoreemissionsare
excludedfromthislist.Thetop24sourcecategoriesaccountfornearly90%ofthetotal2012onshore
methaneemissionsof353Bcfandweretheprimaryfocusofthisanalysis.Theremaining100+
categorieseachaccountfor1%orlessofthetotalemissions.Althoughtherearedemonstrated
methanereductiontechnologiesthatcanprovidecosteffectivereductionsformanyofthesesmaller
sources,thesesourcecategorieswerenotincludedinthisanalysisduetotheirrelativeminor
contributiontotheoverallemissionsandreductionopportunity.Inaddition,the2014inventoryfor
2012hasalimitedrepresentation6ofthegatheringsegmentandthereforetheanalysislikelydoesnot
representthefullpotentialreductionsthatcouldbeachievedfromthissegment.
ThedistributionofemissionsourcesisshowninTable21andFigure21.Fugitiveemissionsarethe
largestemissionsourcecategoryoverallacrosstheoilandnaturalgassystems.Ventedemissionsfrom
pneumaticcontrollersandpumps,andventingfromwetsealcentrifugalcompressorsaresomeofthe
significantmethaneemissionsventingsourcesfromthenaturalgasindustry.Completionemissionsfrom
hydraulicfracturingwereasignificantsourceatthistimehoweverhavesincebeenregulated.
SeeTable1,InventoryofU.S.GHGEmissionsandSinks:RevisionUnderConsiderationforGatheringandBoostingEmissions,
February2016
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Table21Highest(Top24)EmittingOnshoreMethaneSourceCategories
2012
Cumulative
Emissions
Bcf
(Bcf)
Source
2012
Emissions
(MM
tonnes)
Percent Cumulative
Type*
ofTotal
%
ReciprocatingCompressorsFugitives
56.6
56.6
1.1
16%
16%
IntermittentBleedPneumaticDevices
28.5
85.1
0.5
8%
24%
EngineExhaust
26.6
111.7
0.5
8%
32%
CentrifugalCompressors(wetseals)
20.2
131.9
0.4
6%
37%
MeterandRegulatorStations
19.9
151.9
0.4
6%
43%
HighBleedPneumaticDevices
15.4
167.3
0.3
4%
47%
ReciprocatingCompressorsRodPacking
14.4
181.7
0.3
4%
51%
GasWellCompletionswithHydraulic
Fracturing
13.1
194.8
0.3
4%
55%
OilWelltanks
12.6
207.4
0.2
4%
59%
Regulators
9.4
216.7
0.2
3%
61%
KimrayPumps
8.8
225.5
0.2
2%
64%
StationVenting
8.4
233.9
0.2
2%
66%
LiquidsUnloading(withoutplungerlifts)
8.0
241.9
0.2
2%
69%
StationFugitives
7.9
249.8
0.2
2%
71%
MainsCastIron
7.7
257.5
0.1
2%
73%
DumpValves
7.4
264.9
0.1
2%
75%
MainsUnprotectedsteel
6.7
271.6
0.1
2%
77%
CondensateTankswithoutControl
Devices
6.6
278.2
0.1
2%
79%
ServicesUnprotectedsteel
6.4
284.6
0.1
2%
81%
MainsPlastic
6.3
290.9
0.1
2%
82%
LiquidsUnloading(withplungerlifts)
6.2
297.1
0.1
2%
84%
ChemicalInjectionPumps
5.7
302.8
0.1
2%
86%
ResidentialMeters
4.9
307.7
0.1
1%
87%
Pipelineventing
4.4
312.1
0.1
1%
88%
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Figure212012OnshoreEmissions(Bcf)fromEPAInventory
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2.3. SelectedMitigationTechnologies
Thefollowingsectionsdescribethemitigationmeasuresincludedinthisanalysistoaddressthehigh
emittingsourcecategoriesidentifiedinTable21.Thesmallersourcesindividuallywerejudgedtohave
aninsignificanteffectontheoverallemissionsanalysisevenifcosteffectivemitigationtechnologies
wereavailable.Muchofthecostandperformancedataforthetechnologiesisbasedoninformation
fromtheEPANaturalGasSTARprogram7butwasupdatedandaugmentedwithinformationprovidedby
industryandequipmentvendorsourcesconsultedduringtheEDFstudy.Furtherupdatesand
informationwereprovidedbyONEFuturemembersforthisstudy.
Thisanalysisattemptstodefinereasonableestimatesofaveragecostandperformancebasedonthe
availabledataandexperiencesofoperators,includingONEFuturemembers.Thecostsandperformance
ofanactualindividualprojectmaynotbedirectlycomparabletotheaveragesemployedinthisanalysis
becauseimplementationcostsandtechnologyeffectivenessarehighlysitespecific.Sometechnologies,
liketheefficiencyofplungerliftsforliquidsunloadingtoreduceemissions,dependontheoperating
conditionsofthewell.Further,certainlowproductionorlowerutilizedcompressorstationsmayhave
loweremissions.Costsforspecificactualfacilitiescouldbehigherorlowerthantheaveragesusedin
thisanalysis.
SeveralofthesourcesidentifiedinTable21donothavecommerciallyavailablemitigationtechnologies
(e.g.,engineexhaust)orarenotcurrentlycosteffective(e.g.castironmainreplacement).ICFanalyzed
variousmitigationoptionsforeachofthe24sourcesbasedoncost,reductionpotentialandmarket
penetrationandconsidered16sourcesandmitigationmeasuresforfurthermodelingandevaluation.
Table22summarizesthemitigationmeasuresappliedintheanalysisforeachofthe16majoremission
sources.
Table22SummaryofMitigationMeasuresModeled
Source
MitigationMeasure
CondensateTanksw/oControlDevices
Installvaporrecoveryunits
WellheadOilTanksw/oControlDevices
Installvaporrecoveryunits
LiquidsUnloadingWellsw/oPlungerLifts
Installplungerliftsystemsingaswells
HighBleedPneumaticDevices
Earlyreplacementofhighbleeddeviceswithlowbleed
devices
Replacewithinstrument air systemsintermittent
ChemicalInjectionPumps
KimrayPumps
ReplacepneumaticchemicalinjectionpumpswithSolar
electricpumps
ReplaceKimraypumpswithelectricpumps
http://www.epa.gov/gasstar/
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Source
MitigationMeasure
PipelineVenting
Pipelinepumpdown beforemaintenance
CentrifugalCompressors(wetseals)
Wetsealgascapture ordryseals
TransmissionStationVenting
RedesignblowdownsystemsandalterESDpractice
GasWellCompletionswithFracturing
Installflares portable
ReciprocatingCompressorRodPacking
Replacement ofcompressorrodpackingsystems
ReciprocatingCompressorFugitives8
Leakdetectionandrepair(LDAR)9
CompressorStationFugitives10
Leakdetectionandrepair(LDAR)
WellFugitives
GatheringStationFugitives
Includesblowdownandunitisolationvalves,connectors,othervalves,meters,openendedlines,andPRVsthatare
associatedwiththecompressors.
9
LDARhereisusedgenericallytomeanawiderangeofleakdetection,inspection,andrepairactivities.
10
Includesvalves,connectors,meters,openendedlines,andpressurereducingvalves(PRVs)thatarelocatedthroughoutthe
stationandnotassociatedwiththecompressors.
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Table23summarizesthekeycharacteristics(i.e.capitalcosts,operatingcostsandreductionefficiency)
ofthe16measuresmodeled.(TheassumptionsandanalyticalapproachforLDARareaddressedfurther
below.)ThecostsareforU.S.GulfCoastandareadjustedbyregionalcostfactorsintheMACcurve
analysisinSection3.ThesourcesandderivationofthesevaluesarelistedinAppendixB.Table24
showsthebaselinecosteffectiveness($/Mcf,tonnes,orCO2eofmethaneremoved)foreachmeasure
modeledwithandwithoutcreditforanyrecoveredgas.Thecreditapplieswhereemissionreduction
measuresresultingasbeingrecoveredbythecompany.Intheproductionsegment,gasthatis
recoveredcanbesoldandthereforehasaneconomicvalue.Inthatcase,thevalueofrecoveredgasis
subtractedfromtheannualoperatingcosts.
Inthetransmissionanddistributionsegments,rateregulationtypicallyrequirespipelineanddistribution
companiestopassanycostreductions,includingreducedlosses,alongtocustomers,thusthe
companiestypicallycannotcapturethefinancialbenefitofrecoveredgas.Thecontractualprovisionsfor
gathering,processing,andstoragearevariablebuttheONEFuturemembersreportedthatthese
companiestypicallydonottakeownershipofthegasbutratherarepaidafeefortheirservice.Reduced
lossescouldresultinincreasedthroughputandincreasedrecoveryofthefee(whichismuchlessthan
thevalueofthegasitself)butonlyifthemeteringpointisdownstreamofthepotentialgasrecovery.
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Table23SummaryofMitigationMeasureCharacteristics(GulfCoastCostBasis)
Capital Operating Percent

Cost
Cost
Reduction
Mitigationstrategy
devices
$3,000
$0
78%
ReplacementofReciprocatingCompressorRodPacking
Systems
$6,600
$0
31%
InstallFlaresPortable
$30,000
$6,000
98%
InstallPlungerLiftSystemsinGasWells
$20,000
$2,400
95%
InstallVaporRecoveryUnits
$50,636
$9,166
95%
$5,000
$75
100%
$10,000
$2,000
100%
$0
$30,155
80%
RedesignBlowdownSystemsandAlterESDPractices
$15,000
$0
95%
WetSealDegassingRecoverySystemforCentrifugal
Compressors
$70,000
$0
95%
ReplacewithInstrumentAirSystems Intermittent
$60,000
$17,770
100%
ReplacePneumaticChemicalInjectionPumpswithSolar
ElectricPumps
ReplaceKimrayPumpswithElectricPumps
PipelinePumpDownBeforeMaintenance
Themembersalsoreportedthatthemeteringformostofthesefacilitiesisattheentrypointofthe
facility,thuspreventingtheoperatorfromcapturingthevalueofrecoveredgas.Basedonthis
information,thevalueofrecoveredgaswasincludedonlyfortheproductionsectorinthisstudy.Thisis
achangefromthe2014EDFstudy.Thegaspricewasassumedtobe$3/Mcf11,reducedby25%to
accountforroyaltiesandfees,foranetvalueof$2.25/Mcf12.
11
12
EIAShortTermEnergyOutlook,March9,2016,HenryHubspotpricesareforecasttoaverage$3.11/MMBtuin2017.
AfuelpricesensitivityanalysisisincludedinAppendixA.
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Table24CalculatedEmissionReductionCostperMitigationTechnologyorPractice(GulfCoastCostBasis)
$/Mcf*
$/Mcf
w/Credit w/oCredit
Name
$/tonne
CH4
w/Credit
$/tonne
CH4w/o
Credit
$/tonne
CO2e**
w/Credit
$/tonne
CO2ew/o
Credit
Earlyreplacementofhighbleeddeviceswithlowbleeddevices
$4.91
$7.61
$257.01
$398.49
$10.28
$15.94
ReplacementofReciprocatingCompressorRodPackingSystems
$3.36
$6.06
$175.90
$317.39
$7.04
$12.70
$0.20
$0.20
$10.37
$10.37
$0.41
$0.41
$2.33
$5.03
$121.81
$263.30
$4.87
$10.53
$0.82
$1.89
$42.72
$98.76
$1.71
$3.95
$2.16
$4.86
$112.90
$254.38
$4.52
$10.18
$1.79
$0.91
$93.98
$47.50
$3.76
$1.90
$1.14
$3.84
$59.70
$201.19
$2.39
$8.05
$4.10
$0.98
$214.62
$51.27
$8.58
$2.05
WetSealDegassingRecoverySystemforCentrifugalCompressors
$2.38
$0.32
$124.57
$16.91
$4.98
$0.68
$1.46
$1.24
$76.49
$65.00
$3.06
$2.60
ReplacePneumaticChemicalInjectionPumpswithSolarElectric
Pumps
*GasrecoverycreditisappliedonlyfortheProductionSegment
**GWP=25
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Theannualcostwascalculatedastheannualamortizedcapitalcostovertheequipmentlifeplusannual
operatingcosts.Thiswasdividedbyannualmethanereductionstocalculatethecosteffectiveness
withoutcreditforrecoveredgas.Wheregascanberecoveredandmonetizedbytheoperating
company,thevalueofthatgaswassubtractedfromtheannualcosttocalculatethecosteffectiveness
withcreditforrecoveredgas.Thecostsshownherearethebaselinecosts,whichareadjustedfor
regionalcostvariationinthelaterMACanalysis.Asnotedearlier,theseareaveragecoststhatmaynot
reflectsitespecificconditionsatindividualfacilities.
Fugitiveemissionsaretheunplannedlossofmethanefrompipes,valves,flanges,andothertypesof
equipment.Fugitiveemissionsfromreciprocatingcompressors,compressorstations(transmission,
storage,andgathering),wells,andLDCmeteringandregulatorequipmentarethelargestcombined
emissioncategory,accountingforover30%ofthehighlightedsources.Thepotentialsizeandnatureof
thesefugitiveemissionscanvarywidelybyindustrysegmentandevenbysite.
LeakDetectionandRepair(LDAR)isthegenerictermfortheprocessoflocatingandrepairingthese
fugitiveleaks.Thereareavarietyoftechniquesandtypesofequipmentthatcanbeusedtolocateand
quantifythesefugitiveemissions.TheanalysisofLDARcostandeffectivenessforthisstudyisalittle
differentfromthetreatmentofothermeasuresbecauseitislargelyafunctionoflaborrequiredfor
inspectionsandrepairs.
ExtensiveworkhasbeendonebyEPAandotherstodocumentanddescribethesetechniques,bothin
theGasSTARreferencematerialsandinseveralregulatoryanalyses,includingfortheEPAsNSPS
SubpartOOOO13andtheColoradoAirQualityControlCommissionRegulationNumber7(5CCR1001
9)14.ThisstudyusedboththeColoradoregulatoryanalysisandtheEPATechnicalSupportDocument
(TSD)15forNSPSSubpartOOOOasthebasisfortheanalyticalframework.Additionalcostinformation
wasprovidedbyONEFuturemembers.
Thekeyfactorsintheanalysisarehowmuchtimeittakesaninspectortosurveyeachfacility,howmany
inspectionsarerequiredeachyear,howmuchreductioncanbeachieved,andhowmuchtimeis
requiredforrepairs.ICFadaptedthestructure(butnotallofthespecificinputs)oftheColorado
analysis,whichcalculatesthecapitalandlaborcosttofieldafulltimeinspector,includingallowances
fortravelandrecordkeeping(Table25).Specificcostfactorswereupdatedbasedoninputfromthe
ONEFuturemembercompanies.Thecombinedhourlycostwasthebasisforthecostestimates.The
capitalcostincludesavarietyofleakdetectionandmeasurementequipment,atruckandthecostofa
recordkeepingsystem.Theseareestimatedaveragecostsandarehighlyvariabledependingonsite
13
http://www.epa.gov/airquality/oilandgas/
http://www.colorado.gov/cs/Satellite/CDPHEAQCC/CBON/1251647985820
15
U.S.EPA,OilandNaturalGasSector:StandardsofPerformanceforCrudeOilandNaturalGasProduction,Transmission,and
Distribution.BackgroundSupplementalTechnicalSupportDocumentfortheFinalNewSourcePerformanceStandards.
http://www.epa.gov/airquality/oilandgas/pdfs/20120418tsd.pdf
14
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SummaryandComparisonofAssumptionsandResults
specificconditionsandscale.Inaddition,theGatheringandBoostingsegmentisincludedinthe
ProductionsegmentintheseanalysisduetothedesignoftheEPAinventory.
Table25LDARHourlyCostCalculation
Labor
CapitalandInitialCosts
InspectionStaff
$86,155
FLIRThermalCamera
Supervision(@20%)
$17,231
RemoteMethaneLeak
Detector(RMLD)
Overhead(@10%)
Travel(@0%)
Recordkeeping(@5%)
PhotoIonizationDetector
$5,000
$0
FlameIonizationDetector
$12,000
HiFlowSampler
$21,450
$0
Fringe(@50%)
$43,078
SubtotalCosts
$159,387
Hours/yr.
1880
$84.78
TrainingHours
TrainingDollars
Miscellaneous
$22,000
Monitoringsystem
$14,500
Total
$220,150
TrainingDollars
Amortized
Capital+Training
$6,782
$59,864
AnnualLabor
$207,203
80
AnnualTotal
$267,067
$6,782
$3,000
Truck
HourlyRate
$20,000
$8,616
$4,308
Reporting(@0%)
$122,200
TotalHourlyRate
$142.06
Manyanalyseshaveusedfacilitycomponentcountsandhistoricaldataonthetimerequiredtoinspect
eachcomponenttoestimatefacilitysurveytimes.However,theuseoftheinfraredcameratechnology
allowsmuchshortersurveytimes16andtheEPAandColoradotimeestimateshavebeencriticizedastoo
long.TheestimatesherearebasedonICFandONEFuturecompanyexperience.ICFaddedadditional
timefortrainingrelativetotheColoradoanalysis.
ICFthenadoptedthebaselineemissionvaluesforwells,gatheringandtransmissionstations,and
processingstationsfromtheEPANSPSanalysis15.The2014EDFanalysishadverylimiteddataforLDC
16
Robinson,D,et.al.,RefineryEvaluationofOpticalImagingtoLocateFugitiveEmissions.JournaloftheAir&Waste
ManagementAssociation.Volume57June2007.
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programsandresultedinveryhighreductioncosts.SinceadifferentapproachwastakenfortheLDC
segmentinthisanalysis(seebelow)LDCswerenotincludedhere.
Table26summarizestheassumptionsfortheoverallLDARcalculation.Thisanalysisassumesannual
emissionsurveysforallfacilities.Thereductionisassumedtobea40%reduction,consistentwiththe
experienceofONEFuturemembers.Inadditiontothesurveys,theestimateincludesoneinitialvisitto
eachsitetoinventorytheequipment(equivalenthourstotwoinspectionvisitsforeachsitewithcost
averagedoverfiveyears)andadditionalvisitsforrepairs.Gasprocessingplantsarealreadysubjectto
someLDARrequirementsforconventionalpollutants,whichresultincobenefitmethanereductions.
Themiscellaneousfugitiveemissionsforgasprocessingwerebelowthesizethresholdforthisanalysis
butthecostsdevelopedhereforgasprocessingareappliedtocompressorsinthatsegment.
Table26CostCalculationAnnualLDAR
WellPads Processing
15
3,057 5,986
MethaneMcf/yr
Transmission
3,605
40%
40%
40%
1,223
2,394
1,442
5.5
40
32
AnnualInspectionCost
$781
$5,682
$4,546
InitialSetUp
$156
$1,136
$909
RepairLaborCost
$781
$5,682
$4,546
$1,719
$12,501
$10,001
$3,303
NA
NA
$1,584
$12,501
$10,001
$1.30
$5.22
$6.94
%Reduction
ReductionMcf
HourseachInspection(includessurvey,
travel,recordkeeping,reviewand
training)
Frequency(peryear)
TotalCost/yr
RecoveredGasValue*
NetCost
CostEffectiveness($/McfCH4reduced)
*Gasat$3/Mcfminusroyalty=$2.25/Mcf
Somerepairscanbemadeatthetimeofthesurvey,suchastighteningvalvepackingorflanges,but
otherswillrequireadditionalrepairtime.Thisanalysisassumesrepairtimeequivalenttoonesurvey
visitforeachfacilityforrepairseachyear.Thecapitalcostoflargerrepairsisnotincludedonthe
assumptionthattheserepairswouldneedtobemadeanywayandtheLDARprogramissimplyalerting
theoperatortotheneed.Thislowerrepairestimatetakesintoaccountthat:
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Theseareaveragevaluesacrossfacilitiesnoteveryfacilitywillrequirerepairs.
Theseareaveragevaluesovertimenoteveryfacilitywillneedrepairseveryyearwhilebeing
monitoredonacontinuingbasis.
Someorallofcostofmajorrepairsisassumedtobepartofregularfacilitymaintenance.
Replacementcostsforlargediameter,highpressurecomponentsaresignificantlygreaterthanthese
averageannualrepaircosts.Thereplacementfrequencyforlargediameter,highpressurecomponents
atanyindividualfacilitycannotbeaccuratelypredictedorestimated.
Thevalueofreducedgaslossesiscreditedtotheprogramforproductiononly.Thesefinalreduction
costvalueswereusedfortheanalysis.
2.4. TreatmentofLDCReductions
The2014EDFstudyfoundthatmethaneemissionreductionsfromLDCswereextremelyexpensive,
mostlyduetothelowbaselineemissionsandthehighcapitalcostofsomeoptions,suchascastiron
pipereplacement.Castironmainshavebeenidentifiedisasignificantemissionsource,howeverthey
areprimarilylocatedincongestedurbanareaswherereplacementorrepairisveryexpensive,reported
as$1millionto$3millionpermile.Thismakesforaveryexpensivecontroloptionbasedpurelyon
emissionreduction.Moreover,theseexpendituresmustbeapprovedbystateutilitycommissions,
whosepurviewtypicallydoesnotextendtoenvironmentalremediationofthistype.Thatsaid,
approximately3%ofcastironmainsarebeingreplacedeachyearforsafetyreasons,sotheemissions
aregraduallydeclining.
Forthisstudy,aseparateanalysisofemissionreductionswasdevelopedfortheLDCsegmenttoaccount
forreductionsthatwillbeundertakeneventhoughtheymaynotbecosteffectiveasemissioncontrol
measuresalone.Theanalysisassumedthreetypesofactivities:
Castironmainreplacementat3%peryear
Unprotectedsteelpipereplacementat3%peryear
Miscellaneousotheremissionreductionmeasuressuchas:servicelinereplacement,blowdowngas
recovery,hottapping,M&RStationupgrades,anddiginmitigations,assumedtobe6%ofthe
remainingemissions(excludingcastironandunprotectedsteelmains)between2012and2025.
UsingthebaselineemissionsandtheemissionfactorsfromtheEPA2012inventory,theseemission
reductionswerecalculatedas:
Castironmainreplacement2.9Bcf
Unprotectedsteelpipereplacement2.5Bcf
Miscellaneousotheremissionreductionmeasures3.5Bcf
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2.5. CompletionEmissionsfromHydraulicFracturing
Gaswellcompletionemissionsfromhydraulicfracturingwereestimatedat13.1Bcfinthe2012
inventory.Theseemissionswereregulatedduringthesecondhalfof2012andareassumedtobe
controlledgoingforward.ThereforetheyarenotincludedintheMACanalysisbutarecountedasa
reductionof12.3Bcfintheoverallreductionsfromthebaseyear.
2.6. SourceCategoriesNotAddressed
Severalsourcecategorieswithrelativelylargeemissionswerenotaddressedintheanalysis.Thesources
andthereasonsfortheirtreatmentaresummarizedbelow.
OffshoreoilandgasproductionAsnotedearlier,theEPAinventoryprovidesverylimiteddataon
offshoreemissions,whichwerenotadequatetoapplythemethodologyusedforothersources.This
isanareainwhichfurtheranalysiswouldprobablyyieldadditionalopportunitiesforreduction.
EngineexhaustTheexhaustfromgasburningenginesandturbinescontainsasmallamountof
unburnedmethanefromincompletecombustionofthefuel.Whileitisasmallpercentage,itis
significantinaggregate.Oxidationcatalystdevicesareusedtoreduceunburnedemissionsofother
hydrocarbonsintheexhaustbuttheyarenoteffectiveatreducingemissionsofmethaneduetoits
lowerreactivity.However,newcatalystsarebeingdeveloped,inpartfornaturalgasvehicles,which
maybeapplicabletothesesources.Thisisatopicforfurtherresearchandtechnologydeployment.
OthersourcesThereareadditionalcosteffectivemeasuresformethanereductionthathavebeen
identifiedbytheEPAGasSTARprogramandothers.Theyarenotincludedherebecausethisreport
focusesonlyonthelargestemittingsources.However,theiromissionshouldnotbetakento
indicatethatthemeasureslistedherearetheonlycosteffectivemethanereductionmeasures.
GatheringandBoostingThegatheringandboostingsegmentisnotcalledoutasaseparate
segmentinthe2014editionoftheEPAinventoryfor2012andthereforewasnotaddressedasa
separatesourceofpotentialreductionsinthisstudy.The2016editionhasdevelopednewemission
factorsandsignificantlyincreasedtheactivitycountsinthegatheringsegment,howeverthese
higheremissionsandpotentialreductionswerenotincludedinthisanalysis,whichwascompleted
priortothatrelease.SincetheGHGRPnowmandatesreportingofemissionsdatafromsuch
facilities,andwiththedatatobegatheredbyEPApursuanttotheICRprocess,weexpectfurther
updatesinfutureGHGIreleases.Further,severalkeygovernmentsponsoredstudiesofemissions
fromgatheringandboostingfacilitieswillbepublishedbytheendof2016.Allofthisdatawill
supportfutureupdatestothemethaneemissionsprofilefromthissegmentandavailable
abatementpotential.
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3. AnalyticalResults
3.1. DevelopmentofEmissionControlCostCurves
Section2identified16discretecontroltechnologiesandtheassociatedcosts,reductionpotential,and
costeffectivenessintermsofannualizedcostpertonorMcfofmethanereducedbasedonGulfCoast
regioncapitalcosts.InthisSection3,wemodelthecumulativereductionsandmarginalabatement
costsfroma2012U.S.methaneemissionsbaselinefortheoilandnaturalgassector,employingthe
technologyleveldatageneratedinSection2.EmployingdatafromtheEPA2012GreenhouseGas
Inventoryandsource/controltechnologydatapresentedinSection2,adjustedforregionalcost
differences,ICFcomputedthemethaneabatementpotentialfromthenaturalgassectorfroma2012
baseline.
Themodeldevelopedforthistaskincludestheindividualsourcecategoriesforeachsegmentoftheoil
andgasindustry.Mitigationtechnologiesarematchedtoeachsourceorindividualmeasureinvarious
segmentsoftheoilandgasvaluechain.Themodelcalculatesthereductionachievedforeachsource
withineachsegmentandcalculatesthecostofcontrolbasedonthecapitalandoperatingcosts,the
equipmentlife,andwhereappropriate,thevalueofrecoveredgas.Keyglobalinputassumptions
include:whetheraparticularsegmentisabletomonetizethevalueofrecoveredgas,thevalueofgas,
andthediscountrate/costofcapital.Asdiscussedabove,thevalueofrecoveredgaswasincludedonly
fortheproductionsegmentandthegaspricewasassumedtobe$3/Mcfminus25%forroyaltiesand
fees,foranetvalueof$2.25/Mcf.A10%discountratewasusedfortheanalysis.Thesecalculations
includetwofactorsthatwerenotincludedinthebaselinecostspresentedinSection2:
Aconstructioncostindexisusedtoaccountforregionalcostdifferences,whichaverages15%
higherthanthebaselineGulfCoastcosts.
Themethanecontentisadjusteddependingonwhethertheapplicationisupstreamordownstream
inthevaluechain.Thisadjustmentaffectsthevalueofrecoveredgaswherethegasvaluecanbe
monetized.
ThesetwofactorsresultinsomeofthecostsintheMACcurveresultspresentedinthischapterbeing
higherthanthebaselinecostspresentedinSection2.Theseandotherkeyassumptionsarelistedin
AppendixA.
Table31liststheemissionreductionmeasuresbyindustrysegmentwiththeirreductionandcost,
depictedinseveralformats.Thetotalreductionis88.3Bcf/yearofmethanefromtheU.S.oilandgas
segmentatatotalannualizedcostof$296millionor$3.35/Mcfofmethanereducedfromthe2012
baseline.ThereductionsfortheLDCsegmentcalculatedseparatelytotal8.9Bcfandthereductionsfrom
reducedemissionwellcompletionsresultinatotalreductionof109.5Bcfofmethanereduction.
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Table31AnnualizedMethaneReductionandCostU.S.
SegmentMitigationOption
GasProcessingLDARProcessing
GasProcessingReplaceKimrayPumpswith
ElectricPumps
GasProcessingReplacementofReciprocating
CompressorRodPackingSystems
GasProcessingWetSealDegassingRecovery
SystemforCentrifugalCompressors
GasProductionEarlyreplacementofhigh
bleeddeviceswithlowbleeddevices
GasProductionInstallPlungerLiftSystemsin
GasWells
GasProductionInstallVaporRecoveryUnits
GasProductionLDARWells
GasProductionReplaceKimrayPumpswith
ElectricPumps
GasProductionReplacePneumaticChemical
InjectionPumpswithSolarElectricPumps
GasProductionReplacementofReciprocating
GasStorageEarlyreplacementofhighbleed
deviceswithlowbleeddevices
GasStorageLDARTransmission
GasStorageLDARWells
GasStorageRedesignBlowdownSystemsand
AlterESDPractices
GasStorageReplacewithInstrumentAir
SystemsIntermittent
GasStorageReplacementofReciprocating
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BcfCH4
Reduced
7.4
GgCH4
Reduced
141.8
MMTonnes
CO2e
3.6
$/McfCH4
Reduced
$5.98
$/McfNatural
GasReduced
$4.98
$/Tonne
CO2e
$12.43
0.1
2.5
0.1
$1.04
$0.87
$2.16
0.3
6.0
0.2
$6.94
$5.78
$14.42
7.5
144.7
3.6
$0.37
$0.31
$0.77
5.3
101.9
2.6
$6.02
$5.23
$12.50
2.3
1.6
3.3
43.9
30.1
64.2
1.1
0.8
1.6
$3.06
($0.54)
($1.09)
$2.66
($0.47)
($0.95)
$6.35
($1.12)
($2.26)
4.3
81.8
2.1
($1.66)
($1.45)
($3.45)
2.7
51.4
1.3
$2.86
$2.49
$5.95
0.6
11.2
0.3
$4.24
$3.69
$8.81
0.1
2.9
0.2
1.8
56.2
4.4
0.0
1.4
0.1
$8.72
$7.95
$1.61
$8.14
$7.42
$1.50
$18.11
$16.51
$3.35
1.2
23.4
0.6
$1.12
$1.05
$2.33
0.1
2.2
0.1
$1.42
$1.33
$2.95
0.4
6.9
0.2
$6.94
$6.49
$14.42
32
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AnalyticalResults
SegmentMitigationOption
BcfCH4
Reduced
GasStorageWetSealDegassingRecovery
SystemforCentrifugalCompressors
GasTransmissionEarlyreplacementofhigh
GasTransmissionLDARTransmission
GasTransmissionPipelinePumpDownBefore
Maintenance
GasTransmissionRedesignBlowdown
SystemsandAlterESDPractices
GasTransmissionReplacewithInstrumentAir
SystemsIntermittent
GasTransmissionReplacementof
ReciprocatingCompressorRodPacking
Systems
GasTransmissionWetSealDegassing
RecoverySystemforCentrifugalCompressors
OilProductionEarlyreplacementofhigh
OilProductionInstallVaporRecoveryUnits
OilProductionLDARWells
OilProductionReplacePneumaticChemical
InjectionPumpswithSolarElectricPumps
OilProductionReplacewithInstrumentAir
SystemsIntermittent
Total
GasProductionReducedEmission
Completions
GasDistributionCastIronMainReplacement
GasDistributionBareSteelReplacement
GasDistributionMiscellaneous
GrandTotal
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GgCH4
Reduced
MMTonnes
CO2e
$/McfCH4
Reduced
$/McfNatural
GasReduced
$/Tonne
CO2e
0.8
14.5
0.4
$0.37
$0.35
$0.77
0.5
14.0
9.5
268.5
0.2
6.7
$8.72
$7.95
$8.14
$7.42
$18.11
$16.51
2.8
53.9
1.4
$4.40
$4.11
$9.14
6.4
122.5
3.1
$1.12
$1.05
$2.33
0.6
11.2
0.3
$1.42
$1.33
$2.95
1.8
35.4
0.9
$6.94
$6.49
$14.42
7.4
141.6
3.6
$0.37
$0.35
$0.77
4.6
6.0
0.0
88.5
114.7
0.3
2.2
2.9
0.0
$6.02
($0.54)
($1.09)
$5.01
($0.45)
($0.91)
$12.50
($1.12)
($2.26)
1.9
36.1
0.9
$2.86
$0.00
$5.95
1.1
88.3
20.6
1,699.8
0.5
0.9
($1.28)
$0.00
($2.66)
12.3
2.9
2.5
3.5
109.5
236.4
55.6
47.9
67.1
2,106.8
5.9
1.4
1.2
1.7
11.1
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
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AnalyticalResults
TheresultscanalsobepresentedasaMarginalAbatementCostCurve(MACcurve),showninError!Not
avalidbookmarkselfreference..Thisrepresentationshowstheemissionreductionssortedfromlowest
tohighestcostofreductionandshowstheamountofemissionreductionavailableateachcostlevel.
Theverticalaxisshowsthecostperunitin$/Mcfofmethanereduced.Anegativecostofreduction
indicatesthatthemeasurehasapositivefinancialreturn,i.e.savesmoneyfortheoperator.The
horizontalwidthofthebarsshowstheamountofreduction.Theareawithinthebarsisthetotalcost
peryear.Theareabelowthehorizontalaxisrepresentssavingsandtheareaabovetheaxisrepresents
cost.Thenetsumofthetwoisthetotalnetcostperyear.
Figure31ExampleMACCurve
Figure32showsthereductionforeachmeasureacrossallindustrysegmentsintheMACcurveformat.
Figure33showsthereductioninmethaneemissionsbyindustrysegment.Thetransmissionand
productionsectorshavethegreatestreductions.Thecostsforeachsectordependontheparticular
mitigationoptionsavailableineachandtheiraggregatecost.
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Figure32NationalAggregateMACCurvebyMeasure
Figure33NationalAggregateMACCurvebyIndustrySegment
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AppendixA.
Thissectionsummarizesandcomparesthekeyassumptionsandresultsforthisstudyandthe2014EDF
study.Theassumptionsforeachstudywerelargelyspecifiedbytheclientsforeach.TableA1
summarizessomeofthekeyassumptionsandresults.Theprimarydifferenceintotalreductionvolume
isthelowerreductionfromlessfrequentLDARandthesmallerbaselineinthecurrentstudyduetoa
differentbaseyearandexclusionofthedistributionsegment.
TableA1SummaryofBaselineAssumptionsandMACCurveResults
InventoryBaseline
ONEFuture2016
EPAInventory2012353Bcf
methane
NaturalGasPrice
$2.25/Mcf($3/Mcf25%
royaltyandfeepayments)
Annual40%
LDARFrequencyand
reduction
GasValueCreditfor
Reductions
NetAnnualizedCost
Annualreduction
Averagecostofreduction
Productionsegmentonly
$296million
88.3Bcfmethane
$3.35/Mcfmethanereduced
EDF2014
EPAInventory2011modifiedand
projectedto2018404Bcf
methane
$4/Mcf
Quarterly60%
Allexcepttransmissionand
distribution
$108million
163Bcfmethane
$0.66/Mcfmethanereduced
Theprimarydriversofthedifferenceintheaveragecostofreductionbetweenthetwostudiesarethe
differentgaspriceandtheassumptionsonwhichsectorscanmonetizethevalueofrecoveredgas.Table
A2providesasensitivityanalysisofthegaspriceeffectontheannualizedcostofreductionperMcf.
TableA2CostperMcfofMethaneReducedGasPriceSensitivity
GasPrice
$2.25/Mcf
$3.00/Mcf
$4.00/Mcf
$5.00/Mcf
ONEFuture2016
$3.35
$3.01
$2.55
EDF2014
$1.48
$0.66
$0.15
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TableA3MitigationTechnologyCharacteristicsONEFuture2016
Mitigationstrategy
Capital Operating Percent

Cost
Cost
Reduction
devices
$3,000
$0
78%
Systems
$6,600
$0
31%
$7.61
$3.36
$6.06
$30,000
$6,000
98%
$0.20
$0.20
$20,000
$2,400
95%
$2.33
$5.03
$50,636
$9,166
95%
$0.82
$1.89
$5,000
$75
100%
$2.16
$4.86
$10,000
$2,000
100%
$1.79
$0.91
$0
$30,155
80%
$1.14
$3.84
$15,000
$0
95%
$4.10
$0.98
Compressors
$70,000
$0
95%
$2.38
$0.32
$60,000
$1.46
$1.24
$17,770
100%
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$4.91
ReplacePneumaticChemicalInjectionPumpswithSolar
ElectricPumps
$/Mcf*
$/Mcf
w/Credit w/oCredit
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AnalyticalResults
TableA4MitigationTechnologyCharacteristicsEDF2014
Name
CapitalCost
Operating
Cost
Percent
Reduction
$/Mcf
w/Credit
$/Mcf
w/oCredit
Earlyreplacementofhighbleeddeviceswithlowbleeddevices
$3,000
$0
97%
$3.08
$1.99
Earlyreplacementofintermittentbleeddeviceswithlowbleeddevices
$3,000
$0
91%
$0.58
$5.65
ReplacementofReciprocatingCompressorRodPackingSystems
$6,000
$0
35%
$1.82
$6.89
InstallFlaresCompletion
$50,000
$6,000
98%
N/A
$1.86
InstallFlaresVenting
$50,000
$6,000
98%
N/A
$0.26
LiquidUnloadingInstallPlungerLiftSystemsinGasWells
$20,000
$2,400
95%
$0.05
$5.03
$100,000
$7,500
95%
$0.51
$4.57
$15,000
$0
95%
$4.10
$0.98
$5,000
$75
100%
$0.22
$4.86
$10,000
$2,000
100%
$4.17
$0.91
$0
$12,000
80%
$4.67
$0.41
$50,000
$0
95%
$4.87
$0.21
LDARWells
$169,923
$146,250
60%
$2.52
$7.60
LDARGathering
$169,923
$146,250
60%
$0.91
$5.98
LDARLargeLDCFacilities
$169,923
$146,250
60%
$10.03
$14.45
LDARProcessing
$169,923
$146,250
60%
$0.98
$4.10
LDARTransmission
$169,923
$146,250
60%
$2.28
$2.15
InstallVaporRecoveryUnitsonTanks
TransmissionStationVentingRedesignBlowdownSystems/ESDPractices
ReplacePneumaticChemicalInjectionPumpswithSolarElectricPumps
PipelineVentingPumpDownBeforeMaintenance
WetSealDegassingRecoverySystemforCentrifugalCompressors
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TableA5AnnualizedCostandReductionComparison
EDF2014
Source/Measure
Annualized BcfMethane
Cost
Reduced/yr
($million/yr)
ONEFuture2016
$/MCF
Methane
Reduced
Annualized
Cost
($million/yr)
BcfMethane
Reduced/yr
$/MCF
Methane
Reduced
$23.4
5.8
$4.05
$7.0
4.4
$1.58
Compressors
$58.7
19.1
$3.07
$5.8
15.7
$0.37
$4.5
1.5
$3.03
$67.4
25.4
$2.65
CompressorStations(Storage)LDAR
Earlyreplacementofhighbleeddeviceswithlow
bleeddevices
ReciprocatingCompressorFugitivesLDAR
IncludedinTransmission
$64.9
10.5
$6.17
IncludedinTransmission
$10.5
32.3
$0.33
CondensateTanksw/oControlDevicesVRU
$0.1
0.4
$0.21
StrandedGasVentingfromOilWellsFlares
$2.4
8.2
$0.30
NA
OilTanksVRU
$1.8
5.5
$0.33
IncludedwithCondensateTanks
$2.3
4.2
$0.53
$12.4
2.8
$4.40
ReplacePneumaticChemicalInjectionPumpswith
SolarElectricPumps
$2.7
4.8
$0.57
$13.1
4.6
$2.86
$1.2
1.6
$0.74
$7.0
2.3
$3.06
$7.5
5.9
$1.27
$8.5
7.6
$1.12
GatheringandBoostingStationsLDAR
$5.0
3.3
$1.51
IncludedinProduction
$20.9
12.1
$1.72
NA
IntermittentBleedPneumaticDevicesLowBleed
ReplacewithInstrumentAirSystemsIntermittent
OilWellCompletionswithFracturingFlares
CompressorStations(Transmission)LDAR
WellFugitivesLDAR
ICFInternational
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$4.1
NA
7.6
$0.4
$0.54
1.8
$0.22
NA
$14.5
6.8
$2.13
$7.7
2.8
$2.79
$134.3
16.9
$7.95
$43.9
12.5
$3.51
$3.3
3.6
$0.92
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AnalyticalResults
Systems
$22.3
3.6
$6.11
LDCMetersandRegulatorsLDAR
$140.6
7.1
$19.75
GrandTotal
$108.3
162.9
$0.66
$20.0
A5
$6.44
88.3
$3.35
NA
$295.9
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AppendixB.
DataSources
Thefollownotesexplainthesourcesandderivationofthecapitalcost(Capex),operatingcost(Opex),
andemissionreductionpotentialoftheemissionreductionoptionsassessedinthisstudy.Theprimary
sourcesareavarietyofEPAsourcesparticularlydatafromtheGasSTARprogram,theGreenhouseGas
Reporting,andsupportdocumentsfromNSPSOOOO,aswellasindustrycommentsreceivedduringthe
2014EDFstudy,andcommentsfromtheONEFuturesponsorsofthisstudy.Eachemissionreduction
optionisdiscussedbelow:
EarlyreplacementofhighbleeddeviceswithlowbleeddevicesCapex$3,000,Opex$0,
Reduction78%.TheCapexandOpexwerebasedonGasSTARdataupdatedbyindustryreviewin
bothstudies.ThereisnoincrementalOpexforpneumaticdevices.Thereductionestimatewas
basedontheperformanceofhighbleedandlowbleedpneumaticdevicesfoundintwofield
measurementstudiescompletedbytheUniversityofTexas17,18andsponsoredbyindustry
participantsandEDF.
ReplacementofReciprocatingCompressorRodPackingSystemsCapex$6,600,Opex$0,
Reduction31%.TheCapexwasbasedonGasSTARdataupdatedbyindustryinbothstudies.Thereis
noincrementalOpexforthismeasure.ThereductionestimatewasbasedonananalysisbyICFthat
calculatesthereductionsduetomorefrequentreplacementofrodpackingsealsrelativetoless
frequentreplacement.
InstallFlaresPortableCapex$30,000,Opex$6,000,Reduction98%.TheCapexandOpexwere
basedonindustryinputduringboththeEDFandONEFuturestudies.ThereductionisanEPAGas
STAR/inventoryassumptionof98%flarecombustionefficiency.Additionalinformationwasderived
fromGHGRPSubpartW.
InstallPlungerLiftSystemsinGasWellsCapex$20,000,Opex$2,400,Reduction95%.These
valueswerebasedonindustryinputduringbothstudies.Theydonotincludethevalueofincreased
production,whichistypicallytheprimarydriverforliquidsunloading.Thecostandeffectivenessof
plungerliftsarehighlyvariabledependingonthewellcharacteristics.Plungerliftscanbean
effectivemitigationmeasureforcertainwellsatcertaintimesovertheiroperatinglifebutmaynot
17
Allen,DavidT.etal.MeasurementsofMethaneEmissionsatNaturalGasProductionSitesintheUnitedStates.Proceedings
oftheNationalAcademyofSciencesoftheUnitedStatesofAmerica110.44(2013):1776817773.
18
MethaneEmissionsfromProcessEquipmentatNaturalGasProductionSitesintheUnitedStates:PneumaticControllers.
DavidT.Allenetal.EnvironmentalScience&Technology201549(1),633640.DOI:10.1021/es5040156.Availableonlineat:
http://pubs.acs.org/doi/abs/10.1021/es5040156
ICFInternational
B1
May2016
AnalyticalResults
beeffectiveorfeasibleforotherwellsorevenforthesamewellatadifferentpointinitsoperating
life.ApplicabilityinformationwasderivedfromGHGRPsubpartW.
InstallVaporRecoveryUnitsCapex$50,636,Opex$9,166,Reduction95%.Thesevalueswere
basedonEPAGasSTARdata,independentICFanalysis,andupdatesfromvendorsandindustry
commentersinbothstudies.
ReplacePneumaticChemicalInjectionPumpswithSolarElectricPumpsCapex$5,000,Opex$75,
Reduction100%.ThesevalueswerebasedonEPAGasSTARdatawithupdatesfromvendorsand
industrycommentersinbothstudies.
ReplaceKimrayPumpswithElectricPumpsCapex$10,000,Opex$2,000,Reduction100%.These
valueswerebasedonEPAGasSTARdatawithupdatesfromvendorsandindustrycommentersin
bothstudies.
PipelinePumpDownBeforeMaintenanceCapex$0,Opex$30,155,Reduction80%.Thesevalues
werebasedonEPAGasSTARdatawithupdatesfromvendorsandindustrycommentersinboth
studies.TherequiredequipmentistypicallyleasedsothereisnoCapex.
RedesignBlowdownSystemsandAlterESDPracticesCapex$15,000,Opex$0,Reduction95%.
ThesevalueswerebasedonEPAGasSTARdatawithupdatesfromvendorsandindustry
WetSealDegassingRecoverySystemforCentrifugalCompressorsCapex$70,000,Opex$0,
reduction95%.ThesevalueswerebasedonEPAGasSTARdatawithupdatesfromvendorsand
industrycommentersinbothstudies.
ReplacewithInstrumentAirSystemsIntermittentCapex$60,000,Opex$17,770,Reduction
100%.ThesevalueswerebasedonEPAGasSTARdatawithupdatesfromvendorsandindustry
LDARCostsThestructureoftheLDARcostanalysisisdifferentfromtheothermeasures,as
discussedinthebodyofthereport.Thecostanalysisstructureisbasedontheregulatoryanalysis
fortheColoradomethanerulebutmostofthevalueshavebeenupdated.TheONEFuturesponsors
providedextensiveinputonthelaborandinstrumentationcosts.Thebaselinelaborcostswere
increasedandthenumberofmeasurementdeviceswasincreasedfromtheColoradoassumptions.
Thetimeallocatedforinspectionswasalsoincreasedrelativetothe2014EDFreportbasedoninput
fromthesponsors.ThebaselineemissionswerefromtheEPATechnicalSupportDocumentforNSPS
OOOO.
ICFInternational
B2
May2016

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