New EPA Regulations Offer Opportunities for Waste-Gas Emissions

By Stephen Whitfield

A new federal air-quality rule from the US Environmental Protection Agency (EPA), 40 CFR Part 60 Subpart OOOO, could have an effect on how the oil and gas industry handles waste-gas emissions. Facing the specter of tougher regulations, the agency is also seeking ways to turn the challenges those regulations pose into positives. Vent-gas management has become more important for companies learning how to operate under the new rule.

At a presentation hosted by the SPE Gulf Coast Section’s Health, Safety, and Environment study group, Jeff Voorhis, a business development and regulatory specialist at Hy-Bon Engineering, and Audrey Mascarenhas, the president and CEO of Questor Technology, discussed new approaches companies could take.

Commonly referred to as EPA Subpart Quad O, the rule states that a single storage vessel in oil and gas production, natural gas processing, or natural gas transmission and storage that has the potential for six tons per year or more of volatile-organic-compound (VOC) emissions must reduce those emissions by 95%. The EPA does not stipulate a way to do that, only that companies must do it. 

One method of compliance is through vapor recovery, which was the primary focus of Voorhis’ presentation. Hy-Bon specializes in the production of vapor-recovery units (VRUs) designed to comply with regulatory standards by eliminating the emission of stock-tank vapors into the atmosphere. These units capture diverse gas streams, including methane, carbon dioxide, and hydrogen sulfide.

A vapor recovery unit. (Courtesy of Hy-Bon Engineering.)

VRUs have several benefits, Voorhis said. They can capture up to 100% of the hydrocarbon vapors that accumulate in tanks, and those recovered vapors have a much higher BTU content than pipeline-quality natural gas. The recovered vapors can be more valuable than methane alone, and the recovery can reduce regulatory and liability exposure. 

Voorhis said that, from this perspective, companies can make money off of the emissions that they have to control anyway.

“The mantra to have is what gets seen by companies, by yourself, and by agencies gets measured; what gets measured, gets controlled; and the good news is… what gets controlled, can make you money,” he said. “You can become a profit center at your companies now.”

The value, however, depends on the BTU content of the gas and the way in which the gas is used. On-site fuel is measured in terms of fuel that must be purchased. Gas coming through a pipeline is measured by the higher price for rich gas. Gas from a processing plant is measured by the sale of natural gas liquids and methane, which can be separated, Voorhis said. 

Mascarenhas’ presentation focused less on Quad O and more on the general environment fostered by tighter EPA regulations, like Quad O or other regulations that set new performance standards for sulfur dioxide, hazardous air pollutants, and fugitive emissions from compressors. Like Voorhis, Mascarenhas said she believes there is potential for a win-win situation in which regulations are met and companies can generate profit. 

The combustion of hydrocarbons lay at the center of this opportunity, as inefficient combustion leads to an increase in VOCs, as well as an increase in greenhouse gases because the global warming potential of methane is 21 times that of carbon dioxide. Mascarenhas said that clean combustion can be measured independently and consistently at 99.99% and is auditable for regulatory compliance. It is cost-effective, low maintenance, and provides an air-quality benefit.

The capture by clean combustion of the excess energy being “lost” in waste-gas offers an avenue for profit, Mascarenhas said. 

“I think there’s a great opportunity on the combustion side, especially if you can do clean combustion because there’s this enormous opportunity to use the heat wisely,” Mascarenhas said. “I think it makes business sense, not just in terms of dollars and cents.”

The heat from clean combustion of typically flared gas at 99.99% efficiency has many uses, Mascarenhas said. The recovered heat can help with water vaporization, steam generation, and can serve as an alternative to diesel generators, which would further reduce emissions on wellsites. The heat from waste-gas can also be used for hydrate prevention and for heating up oil and water. This helps in fracturing operations, where water must be hot. And there is a lot of waste heat available: Mascarenhas said that a well burning 5 million standard cubic feet per day could generate 220 million BTU per hour of waste heat.

Stephen Whitfield is a Staff Writer for Oil and Gas Facilities.