ehp greentape and csg: ‘am i crazy or is it these licence conditions?

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Approvals to Operation Seminar @ Katestone July 31, 2013

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Got approval from EHP for my CSG development, whew! Hang on, what on Earth am I going to do with these oddball conditions? This was the conundrum that Katestone’s Principal Consultant Air Quality, Natalie Shaw, explored with gas industry participants at the firm’s seminar, ‘CSG and the Air Environment – from Approval to Compliance’ held July 31, 2013. Nat shared what she had learned from meeting with Environment and Heritage Protection (EHP) department representatives in preparing her talk. “Under the new Greentape Reduction regime, if a company indicates that it can meet a draft condition, EHP will accept a company’s word and will not challenge the company’s ability to meet the condition,” Natalie said. The rapid growth of the gas industry hasn’t made it easy for the regulations to keep up. The onus rests with proponents to negotiate viable and reasonable conditions. “What’s more, there are no standard conditions yet for activities that release emissions to air for the petroleum industry under Greentape Reduction”, Natalie said. Some of the vexing requirements that Nat dug up in her research included: Monitoring stack emissions apparently for the sake of monitoring, with no release limits for comparison Having to redo modelling if monitoring shows that original modelling under-predicted actual concentrations, even by a negligible amount Annual monitoring of an auxiliary generator, that is not intended to be used Unclear actions like applying “pro-active and reactive” mitigation and management measures “Not only are some conditions nonsensical, but the number and complexity of recent conditions is inconsistent among similar facilities,” Natalie said. Nat’s research found that three similar, recently approved CSG plants received 13, 23 and 36 air conditions respectively. “We’ve estimated that the cost for these facilities to comply with their air conditions would range from $6000 a year for one facility, to as much as $455,000 up front and $80,000 per year for another,” Natalie said. The research suggests that companies can de-risk projects and remove recurrent costs if they have the nous to attend to the detail of environmental conditions and, in some cases, partly renegotiate them.

TRANSCRIPT

Page 1: EHP Greentape and CSG: ‘Am I crazy or is it these licence conditions?

Approvals to Operation

Seminar @ Katestone

July 31, 2013

Page 2: EHP Greentape and CSG: ‘Am I crazy or is it these licence conditions?

Why are we here?

Condition: Water truck must be

located on site at all

times

Compliance with

condition?

Check!

Page 3: EHP Greentape and CSG: ‘Am I crazy or is it these licence conditions?

Changes to Regulations

Environmental Protection (Greentape

Reduction) and Other Legislation

Amendment Act 2012

(the Greentape Reduction Act)

Aim: Introduce an integrated approval

process for ERAs that is proportional to

environmental risk

Page 4: EHP Greentape and CSG: ‘Am I crazy or is it these licence conditions?

Regulatory Strategy

• Improved application process by developing

eligibility criteria and standard conditions for:

– Petroleum exploration

– Petroleum pipeline

– Petroleum survey

• Streamlined approvals process

• Focus is on

– Outcomes, not process

– Compliance and enforcement

Page 5: EHP Greentape and CSG: ‘Am I crazy or is it these licence conditions?

“We will take you at your word” Greentape Reduction Training by EHP

“We will no longer hold your hand”

Rachel Burgess-Dean

Director Energy Regulation and Implementation

Energy Resources and Enforcement Branch

Environmental Services and Regulation

“EHP will no longer be challenging ability to comply with

a particular condition”

Page 6: EHP Greentape and CSG: ‘Am I crazy or is it these licence conditions?

Source: Department of Environment and Heritage Protection’s Regulatory Strategy

Applications

Page 7: EHP Greentape and CSG: ‘Am I crazy or is it these licence conditions?

Applications Pre-lodgement

meeting

Write application

Lodge application

with Department

Refused Request for

information Approved

“Poor” application “Nearly there” application “Good” application

Approved Conditions

OR

Do not rely on,

At discretion of EHP

Page 8: EHP Greentape and CSG: ‘Am I crazy or is it these licence conditions?

Conditions

Outcome

focused

Set based on:

• Application type

(standard application =

standard conditions)

• Information supplied in

the application

(if management of risk not

demonstrated conditions

may be onerous)

Approach

based on

risk

Responsibility EA holder to work

out how to meet condition

Page 9: EHP Greentape and CSG: ‘Am I crazy or is it these licence conditions?

Conditions may be influenced

by the person setting them

Reasonable

conditions

Onerous

conditions Random

Page 10: EHP Greentape and CSG: ‘Am I crazy or is it these licence conditions?

Why not just accept conditions?

• Thirty party audits

• Plan of operations

• EHP’s compliance strategy

• Enforcement tools

• Non-compliance register

• Effort

Page 11: EHP Greentape and CSG: ‘Am I crazy or is it these licence conditions?

Public perception R

E

P

U

T

A

T

I

O

N

P

U

B

L

I

C

I

T

Y

Page 12: EHP Greentape and CSG: ‘Am I crazy or is it these licence conditions?

Let’s look at some

conditions

Page 13: EHP Greentape and CSG: ‘Am I crazy or is it these licence conditions?

Case studies

Facility 1

Petroleum lease

Pipeline licence

ERA 9

ERA 15

Authority took effect May 2013

Facility 2

Petroleum lease

Pipeline licence

ERA 14

ERA 15

Authority took effect June

2013

Facility 3

Petroleum lease

Petroleum facility licence

ERA 10

ERA 14

ERA 15

Authority took effect April

2013

Page 14: EHP Greentape and CSG: ‘Am I crazy or is it these licence conditions?

Facility 1

Page 15: EHP Greentape and CSG: ‘Am I crazy or is it these licence conditions?
Page 16: EHP Greentape and CSG: ‘Am I crazy or is it these licence conditions?

Facility 2

Page 17: EHP Greentape and CSG: ‘Am I crazy or is it these licence conditions?
Page 18: EHP Greentape and CSG: ‘Am I crazy or is it these licence conditions?
Page 19: EHP Greentape and CSG: ‘Am I crazy or is it these licence conditions?
Page 20: EHP Greentape and CSG: ‘Am I crazy or is it these licence conditions?
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Page 22: EHP Greentape and CSG: ‘Am I crazy or is it these licence conditions?
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Page 24: EHP Greentape and CSG: ‘Am I crazy or is it these licence conditions?
Page 25: EHP Greentape and CSG: ‘Am I crazy or is it these licence conditions?
Page 26: EHP Greentape and CSG: ‘Am I crazy or is it these licence conditions?
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Page 29: EHP Greentape and CSG: ‘Am I crazy or is it these licence conditions?
Page 30: EHP Greentape and CSG: ‘Am I crazy or is it these licence conditions?
Page 31: EHP Greentape and CSG: ‘Am I crazy or is it these licence conditions?

Complaints

monitoring

Page 32: EHP Greentape and CSG: ‘Am I crazy or is it these licence conditions?

Facility 3

Page 33: EHP Greentape and CSG: ‘Am I crazy or is it these licence conditions?

What is the monitoring

being compared to?

If no outcome, why

monitor?

Page 34: EHP Greentape and CSG: ‘Am I crazy or is it these licence conditions?

Complaints

monitoring

Page 35: EHP Greentape and CSG: ‘Am I crazy or is it these licence conditions?

Summary of conditions

Facility 1

ERA 9

ERA 15

13 conditions

Cost =

$12,000

(every 2 years)

Effort = Low

Facility 2

ERA 14

ERA 15

36 conditions

Cost =

Every year $80,000

One off $400,000

Verification $55,000

Additional stacks $600

Effort = high

Facility 3

ERA 10

ERA 14

ERA 15

23 conditions

Cost =

Every year $18,000

Verification $55,000

Additional stacks $600

Effort = medium to high