Lifecycle of a Flare Gas Recovery Project

Hemant Mallya

San Antonio February 24, 2015

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Agenda

Flare Gas Recovery Opportunities

Identification of Flare Gas Sources

Quantifying Flare Gas Volumes

Flare Gas Capture

Flare Gas Treatment

Beneficial Uses of Flare Gas

Economics of Flare Gas Recovery Projects

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Flare Gas Recovery Opportunities

U.S. oil and gas industry flared an estimated 260 Bcf of gas in 2013 – At $3/Mcf this amounts to annual loss of $780 million – Texas flares an estimated 76 Bcf

Multiple reasons for flaring – No access to markets (stranded gas) – Low volumes of associated gas – Waste gas from processes – Process upset conditions

Recovering flare gas provides incentive for capturing vents – Vents can be directed to the flare gas capture unit

Reduces criteria pollutants (especially PM) – important for non-attainment areas

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Identification of Flare Gas Sources

Stranded gas not the only source of flare gas – Engineered vents are often routed to a flare – For example compressor seals

Some flare gas sources can be mitigated – Leaky pressure safety valves can be fixed to reduce gas to flare

Addressing some of the flare gas issues can reduce the volume of gas being sent to flare – Reduces capital investment for flare gas recovery project

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Quantification of Flare Gas Volumes

Determining volume of flare gas is important first step – Needed to establish recovery project economics – Determines sizing of recovery equipment and associated costs

Variations of flare gas volumes need to be accounted – Changes in composition need to be tracked

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Variations in Flare Gas Volumes - Processing Plant

Peak Load

Base Load

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Flare Gas Measurement Techniques – Thermal Mass Flow Meters In-line measurement using orifice, turbine, or ultrasonic meter is the best

option – However, most existing facilities do not have meters on flare headers

Portable thermal mass flow meters can be used to quantify flare gas volumes – Need a port on the flare header

where the flow is steady/ laminar – Continuous monitoring of flare

volume is possible – Only constraint is water condensate

in flare gas

Source: Sage Metering

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Flare Gas Measurement Techniques – Tracer Gas Technique Tracer gas technique uses tracer gas to determine flow rate

– Known quantity of tracer gas, such as acetylene, is injected upstream of the flare header

– A tracer gas sensor monitors the composition of gas downstream of the injection point

– The tracer gas injection rate and volume percent tracer gas in flare gas can be used to estimate flare gas flow rate

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Flare Gas Capture – Vapor Recovery System

Flare gas can be captured using vapor recovery compressors – May be rotary vane, rotary screw, or scroll type compressors – Can handle wet gas and liquid dropout

Ejector technology can be used for relative low volumes of flare gas – Need source of high pressure motive gas

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Flare Gas Treatment - Dehydration Options

Glycol dehydration units are typically not well suited for small volumes of flare gas

Dessicant dehydrator

provides a cheaper option

Dessicant salts, usually calcium, potassium, or lithium chlorides are used for moisture absorbtion

Wet salt solution (brine) needs to be disposed

Source: EPA Natural Gas STAR Program

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Flare Gas Treatment - Membranes to Remove CO2, N2, Heavy Hydrocarbon, and Water Permeate membranes rely on axial

diffusion of gases to separate product from waste stream

Molecular sieve membranes rely on selective adsorbtion of gas molecules

Used for bulk removal of waste gases

Permeate Membrane

Molecular Sieves

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Flare Gas Treatment - Joule-Thomson (JT) Skid

Gas is depressurized with a drop in temperature

Condensate drops to the bottom of separator while gas flows out the top

Gas is recovered for sales or utilization while liquids can generate additional revenue

JT skids use the Joule-Thomson effect to condense heavier hydrocarbons out of a gas stream

Source: Newfield Exploration Company

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Beneficial Uses of Flare Gas

Re-injection – Depends on reservoir characteristics; feasible if there is a gas cap

Develop Infrastructure - Gathering/Processing/Transmission – Expensive for low volumes of stranded gas

Tube-Truck CNG transport to end user

Gas to Wire - captive power generation

Mini-GTL – Syn-crude product blended with produced crude

Mini-methanol or mini-LNG are other alternatives

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Beneficial Use – Compressed Natural Gas

Tube-truck transport from remote areas – Temporary while pipelines are being built – Long term where pipelines are not justified

Compressor needed for CNG

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CNG Station Locations

Source: CNGnow.com

Over 900 public CNG stations – Does not include private fleets across the country

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Beneficial Use – Captive Power

Large volumes of flare gas can be used in a conventional generator for captive power production – Power can be fed back into the grid where possible

Microturbines can be used for smaller generation capacity (<1 MW)

Source: Flex Energy

– can handle large variation in gas quality; 350 – 2,500 Btu/scf

– Can be used for CHP applications with steam or hot water generation

– More efficient than its class of conventional gas turbines

Captive power can be used to displace gas-powered equipment – E.g. gas-powered pumps with electrical

pumps

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Beneficial Use – Mini-GTL Most people think of huge GTL

plants

Not to be confused with LNG (Liquefied Natural Gas)

New technology miniaturizes the Fischer – Tropsch process to convert natural gas to syn-crude – Consists of miniaturized reactors

(channels or sheets) coated with catalyst

– Modular design allows for scalable capacity

– Produces paraffinic crudes that can be blended with crude oil

Scale Comparison of Conventional versus mini-GTL Courtesy - Velocys

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Economics of Flare Gas Recovery Projects

Typically flare gas recovery projects are net positive – Costs are recovered in 2-4 year timeframe, gas recovered subsequently generates

revenues

Economics improve when projects are optimized over assets in upstream operations – Individual flare at well sites do not provide economies of scale

Need to consider intangible benefits – Reduced GHG footprint – Better relations with public and regulatory authorities

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In conclusion….

Large opportunities exist for flare gas recovery

Benefits include increased revenues and better compliance with air regulations

Multiple technologies exist for capture, treatment, and use of flare gas

Each project has unique challenges and solutions need to be customized

Optimization is necessary at a site and asset level