22 nd World Gas Conference, June 1 5, 2003, Tokyo.

Transcription

1 22 nd World Gas Conference, June 1 5, 2003, Tokyo. Reduction of green-house gases in the natural gas industry. What can be done, in physical and economical terms. Stig Bergseth, Statoil 1. Introduction. All activities of the oil and gas industry, from exploring for oil and gas through construction and operation of facilities to the end use of our products, affect the environment. The impact may be due to emissions to air, discharges to water or ground or land use threatening biodiversity or cultural heritage. Impact on the environment is determined by type of activity, state and capacity of the affected, technology applied and operational standards. It is an established and accepted objective throughout the oil and gas industry today that a minimized environmental foot-print is an objective in itself and it also represents a potential competitive advantage. It is however a fact that exploration, production and transportation of natural gas represents less than 10 % of the emissions to air foot-print. Additional treatments (converting to LNG or GTL) may increase this with an additional 10 %. The scope of this discussion paper is targeted on alternative measures available along the value chain of an oil and gas company to limit impact on the environment through reduced emissions of green-house gases. The end use effect of the products remain a challenge beyond the scope of this discussion. The statements made in this paper is based on a comprehensive study of potential measures for limiting CO2-emissions from field operated by Statoil on the Norwegian Continental Shelf, viewgraphs supporting this paper are likewise based on this study. 2. The natural gas industry value chain. The natural gas industry value chain involves a number of activities taking place in a wide variety of environments, each location however with its own specific characteristics and sensitivities. Awareness about and recognition of these sensitivities are on a rising curve in the industry and today it is established as best practice that activity should not be initiated until appropriate environmental impact analysis (EIA) has been carried out, acceptance criterias established and adequate technological and operational measures implemented to satisfy the criterias.

2 2.1. Exploration and sub-surface management. Exploring for oil and gas faces the largest environmental challenges on other issues than emissions to air. The utilisation of the best equipment available, i.e. seismic ships and drilling rigs will contribute. Of particular interest however will be a well designed exploration and deleniation program that minimizes the need for wells to be drilled and tested, usage of the most environmentally friendly drilling muds, etc., but at the same time satisfying the requirements wrt. building the best reservoir model possible in order to design the optimum drainage strategy for the field. Reservoir management strategy is decisive for the design and functional requirements of the production facilities to be installed, hence a high impact on all environmental parameters, emissions to air included. The overriding principle should be to conserve reservoir energy and content, to achieve this close cooperation, interaction and mutual respect has to be in place between the different disciplines comprising the team charged with the task to develop new fields Production facilities. The quality and characteristics of any production facility is decided by the basic design objectives and engineering standards applied. Any element introduced late in the process, environmental or others, will incur extraordinary costs and most likely yield sub-optimum solutions, i.e. little value for money! Conserving reservoir content and energy is in the context of this paper the most representative example of a basic design objective that should guide the construction of any production facility design in order to secure high degree of energy efficiency. World wide it is estimated that more than 125 G Sm3/year is flared or vented. This is primarily a consequence of associated gas being produced when recovering the oil. May be the pure natural gas industry does not feel guilty for this waste of energy or unnecessary magnification of the environmental footprint made by the oil and gas industry it should nevertheless be seen as a tremendous opportunity for business good and environmental sound business. Often we see a correlation in the areas or countries where this unnecessary flaring occur between the following elements: old/well established and mature production provinces, no local gas utilisation or market development, limited regulatory capacity as well and a presence of the international oil and gas industry. To overcome and avoid this unnecessary effect on the global climate and waste of resource oil and gas companies should adopt a no flaring policy as basic design objective and government should likewise increase their capacity to establish and enforce such policies. Limiting emissions to air is also influenced by choices of equipment, lay-out, material qualities, wall thickness in piping/process equipment/etc. The choices made for power generation and drivers are however the elements with the highest effect on the emissions of green-house gases. Careful design of drivers and power generating systems, including waste heat recovery from turbines/engines gas and utilisation of this heat in the process has in our experience yielded as much a 30 % reduction in fuel gas. The Åsgard gas field was developed

3 based on this approach resulting in a reduction of tons of CO2 pr. Year compared with conventional solutions. It is also a general experience that operating the gas turbines to fit variation in needs for power or pressure increase is not straightforward. This can be overcome by interconnecting different parts of facility or different facilities with the objective of sharing the capacity generated. In most locations emissions of NOx has a greater influence on the local foot-print than the CO2-emmissions. New and improved technologies are available today with low NOx emissions. For new facilities this is an obvious choice to make, however as we often experience when dealing with environmental issues the low NOx-turbine technologies often has relative higher CO2-emmissions. Revamping or replacing the vast number old turbines is prevented by the costs and production interruptions involved. Research and development into new technologies should be encouraged to continue. Research has demonstrated that cost effective and environmental friendly solutions can be developed and applied injection of small volumes of fresh water into the gas turbines is a result of such research and yielding a result almost as good as the most advanced low-nox technologies offered by new constructions. If you enjoy the availability of sufficient energy, heat and/or electricity generated from renewable sources or hydro-power you may be able to reduce the emissions to air from the production operations almost to zero Transportation, refining and manufacturing Natural gas is well known for its excellent characteristics when used as a domestic or industrial fuel. It is also an excellent feedstock for other industrial purposes. All application always requires large quantities of gas to be transported over large distances. Historically pipeline transport has been the only way available it still holds the dominating position. Methods for compressing, liquefying (LNG), converting to liquids (GTL) or even to bioproteins are however becoming more and more in use. Environmental elements and objectives in design principles; material/construction/ commissioning should play the same role when designing and operating these facilities as described for the production facilities above. Diffuse leaks from pipe-line systems are assumed to be significant source for methane entering the atmosphere. Precise volumes can only be guesstimated, improvements in design, construction, regular inspections and proper maintenance procedures will easily overcome this un-necessary pollution. 2.4 Operations Basic conditions for plant operation and maintenance is determined by the engineering and design standards. However, within this context environmental impacts can still be influenced through the way operations are planned and executed. Good procedures, motivated and well trained staff are core elements in order to avoid unplanned discharges or emissions.

4 3. Economical constraints. Reducing environmental impact is possible through a number of measures at first glance they all appear to have added costs as a consequence. Any measure applied must stand the scrutiny of cost versus benefits. Cost are easily identified and quantified benefits harder to demonstrate and assign a value to. Experience tells that on the environmental side emotional benefits can be listed in pages, however still not enough to make a difference in the decision processes. Excellence in environmental performance and sustainability in operations will not come as a result of econometrics alone, nor will the emotional elements as emotional elements only - be sufficient, they will have to be converted into corporate values in order to drive the decisions systematically in the right direction. This again will make the corporations business suite of activities more sustainable. Regulatory elements of operational or fiscal character will add to this. These elements added together represents the business case for active and eager efforts to limit the emissions of green-house gases. The Norwegian continental shelf is an area where these different measures have been applied since oil and gas-activities started: i.e. no flaring as regulatory requirement, technological and operational strong and reputable operators, strong and capable regulator and CO2-tax. This has resulted in low-intensity CO2-emissions-operations in comparison with other producing provinces. Abatement measures listed in chapter 2 of this paper if applied on NCSfields have a cost/benefit curve as shown in the following graph. NOK /ton CO 2 - tax 45 USD per % CO2 Reduction Tech. dev. potential

5 The cost picture demonstrates that most of the measures cannot be justified, not from an economical point of view, nor will the strongest value-based arguments carry them through the decision process. Most of the measures would in fact yield little environment for a lot of money. The curve does however demonstrate that there is potential in improved technologies, i.e. research and development initiatives should be directed towards these challenges. The curve also supports and underpin the logic in the Kyoto-mechanisms (CDM and JI) and quota trading as an efficient measure to be supported by the oil and gas industry.. 4. Carbon capture and sequestration. During the World Summit on Sustainable Development in Johannesburg 2002 it was recognised that reasonably priced and easily available energy is a basic requirement to overcome poverty in the world. For the foreseeable future no alternatives to fossil sources due to cost, availability and technological constraints can be visualised. It was at the same summit also recognised that further increases of the CO2-concentration in the atmosphere from the burning of fossil fuels will influence on the global climate. CO2-management; capture and sequestration offer opportunities for limiting the releases of CO2 from the production and usage of fossil fuels. At the Sleipner field in the North Sea 1 mill. Tons a year of CO2 recovered from the well stream is re-injected into a water bearing sandstone 1000 meters below sea bed. The same methodology will be applied at the Snøhvit LNG-development in the Barents Sea where tons of CO2 will be recovered from the well stream and re-injected into the sub-surface. Currently technology is being developed to transport CO2 by pipelines or ships and application of CO2 as medium to enhance recovery from oil reservoirs. This development may result in significant reduction of released CO2 and improved utilisation of the valuable resource in the reservoir as a result of the improved recovery. 5. Summary and conclusions. A number of opportunities excist to limit the emissions of green-house gases from the operations of the natural gas industry. Eliminating emissions completely is beyond reach, but that should not be used as an excuse not to implement measures that are achievable. In order to succeed companies must take a value based approach as well as en economical and technological approach to the challenge when designing and developing projects. Best environmental performance is achieved when environmental impact assessments and environmental design objectives are integrated into the engineering basis from the outset of any project. Research and development into new technologies must have sustainability as an overriding objective. Regulators must develop their capacity to develop and enforce regulation balancing a number objectives that are in conflict; industrial activity, environmental concerns and societal development.

6