The Reality of Flaring

Transcription

1 The Reality of Flaring Susann Nordrum Chevron Energy Technology Company Richmond, California Energy Frontiers International Gas Flare Reduction and Monetization Forum June

2 Overview What is flaring? What is being done about it? Resources to understand issues and assess solutions for each unique situation Significant financial expenditures and future commitment of capital Why are we still talking about it? Technical issues Political issues Economics 2

3 What is flaring? Flaring Flare 1 A a. device flaming designed or as if flaming and operated brightly to or combust unsteadily hydrocarbons and other b. gaudy gases with highly variable <a flaring resort hotel> flow rates and compositions in a 2 controlled Opening or manner spreading outward Pilot or <flaring auto-ignite nostrils> Ground flare/elevated flare/boom flare Methane/hydrocarbon to CO 2 Oxidation of sulfur compounds (e.g., H 2 S) to SO 2 Types of flaring in the petroleum industry Stranded Gas ~90% of flaring Associated gas Nowhere to go Completions ~9% Small but numerous Operations ~1% Intermittent occurrence Variable rate 3

4 Where does flaring occur? Top 20 Countries (Update pending VIIRS calibration) Billion Cubic Meters per year (bcm/yr, equivalent to 1 million standard cubic feet per day) Source: Global Gas Flaring Reduction Initiative 4

5 Stranded gas Associated gas / Nowhere to go Gas is often found and produced along with oil Oil is relatively higher value and easier to transport Gas comes along as a byproduct Needs to be treated before it can be used/sold capital investments required for gas treatment plants Requires compression, pipeline, liquefaction or other energy intensive investments to enable transport to market Governments play a key role to set frameworks for market/commercial solutions 5

6 Completions Short-term problem but it can add up Gas is produced when a well is completed Need infrastructure to handle gas from completions Emissions can be minimized by implementing technologies/ best practices Flaring at exploration wells is to be expected--need to demonstrate reservoir potential Completions from hydraulic fracking projects have received a lot of attention recently in the U.S. but are not fundamentally different than other completions 6

7 Operations flaring Intermittent, variable Flares/relief system are required to safely run upstream and refining operations Refineries typically have flare gas recovery systems and resort to flaring only during upset conditions Flares are necessary for safe operation In some refineries, flaring may be part of startup and/or shut down processes Gas plants have flares for upset conditions Emphasis on reliability can reduce flaring due to upset conditions 7

8 What can be done about flaring? Stranded gas Use the gas Completions Capture the gas Operations Minimize upsets 8

9 Chevron s Company Standard Environmental Performance Standard on Flaring and Venting: Drive to eliminate flaring and venting over time Applies to All Business Units Stranded Gas Completions Operations No routine flaring of gas 9

10 Utilization of stranded gas Technical solutions **All require gas cleanup** Compress the gas and get it to market through a pipeline Liquefy the gas and ship as Liquefied Natural Gas (LNG) Convert the gas to liquid fuel (Gas to Liquid, GTL) Barriers Lack of market/infrastructure, cost to build pipeline, cost of compression Very significant investment for liquefaction, cost of shipping Very significant investment and energy penalty for conversion 10

11 Utilization of stranded gas: Additional barriers Commercial: most solutions are very costly Project economics are often unfavorable Partners may not agree on acceptable economics Political issues Gas ownership Local security issues Access to capital, regional resources, skilled manpower Stakeholder alignment many issues compete for attention Ideally, we need a simple, low-cost solution. 11

12 Utilization of stranded gas: Success stories Tengiz Chevroil (TCO), Kazakhstan TCO reduced flaring by Capture, treatment, compression of produced gas from existing fields Construction of pipeline to take gas to market Reinjection of sour gas in expansion project MM SCM Results 93 % 158 % Reduction in flaring Increase in production Gas Processing Expansion Project Gas Pipeline Capacity Increase Project New Gas Sales Pipeline Project Flare Tip Replacement Project Associated Crude & CTF Projects Gas Utilization Project World Bank GGFR Award Acid Gas Flaring Reduction Project SGI Liquids Handling; SGI System Purging Flaring Reduction Projects & Accomplishments Timeline 12

13 Completions: Capture the gas (if there is enough of it!) Historically, gas and oil may be vented/flared during completion of a well During flowback, the natural gas content increases with time and eventually the fluid is routed to a separator. Natural gas from the separator may be vented or flared need infrastructure Produced gas can t be used as is Meet pipeline standards before sales Meet equipment standards if used onsite Onsite treatment with portable equipment Need to look at the lifecycle: Are there more emissions associated with treatment/compression/use than with flaring? 13

14 Completions: Success stories Chevron Appalachia/Michigan Business Unit Used 100% reduced emissions completions since the beginning of 2014 No routine flaring of gas Driving toward zero venting (releases) Minimal flaring of natural gas when wells are brought into production Reduced emissions completions ( Green completions ): Implemented since the beginning of 2013, in advance of the 2015 regulatory milestone Gas separated during flowback of development wells is treated and directed to sales Exception Gas may be flared during flowback at exploratory wells 14

15 Emergency flaring Improved reliability helps reduce flaring Gas plants: Compressor reliability Monitoring Maintenance Upstream: Flow assurance Equipment maintenance Reservoir monitoring Leaking valves Flare gas recovery Leak detection and repair 15

16 Emergency flaring: Success stories Chevron gas processing plants have focused on reliable operation Minimizes flaring More product to market Japanese automation software performance since deployment in 2012 knm3 30 Working with 3rd party gas plant operators to create performance requirements for reliability TCO was first company in Kazakhstan to use automated software to reduce flaring Reduces the likelihood of flaring and volume of gas flared during an event Oct 7, 12 Jan 3, 13 Mar 26, 13 Apr 7, 13 Nov 4, 13 Acid Gas Flared, knm3 Acid Gas Avoided, knm3 16

17 Summary Eliminating flares is not a simple issue Technical issues Economic issues Political issues Chevron continues to actively pursue flare minimization 17

18 Acknowledgements Babak Fayyaz-Najafi Ainur Zhilkaidarova Janet Peargin Trip Oliver Aliya Subkhankulova Katie Neidig Chris Rabideau Anargul Kalelova Rob Motal Thank You Walt Maguire Vanessa Totten Ryan Ed Malachosky Gulmira Tulegenova Larry Byers Helen Wessel Jim Wisener Alexey Korsyuk 18

19 Questions/Comments Questions Answers 19