Highlights of Colorado’s New Oil and Gas Highlights of Colorado’s New Oil and Gas Hydrocarbon Emission Reduction Rules - Hydrocarbon Emission Reduction Rules - Adopted February 2014Adopted February 2014

Presentation to WESTARPresentation to WESTAR

May 2014May 2014

Will AllisonWill AllisonColorado Department of Public Health and EnvironmentColorado Department of Public Health and Environment

04/20/23 1Highlights of Colorado's Oil and Gas Emission Reduction Rules

• Directive from Governor Hickenlooper to find ways to reduce leakage from natural gas production– Responsible development– Reduce waste– Maximize climate change benefits of natural gas usage

• Ensure benefits from existing rules for petroleum storage tanks

• Proactively address non-compliance with ozone National Ambient Air Quality Standard while also reducing methane emissions which contributes to global climate change

Rationale for New RulesRationale for New Rules

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2004 Controls 2008 Controls2006 Controls

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• Establishes leak detection and repair requirements for compressor stations and well production facilities

• Expands control requirements for storage tanks• Improves capture of emissions at controlled tanks• Expands control requirements for glycol dehydrators• Requires capture or control of the gas stream at well production

facilities• Establishes requirements to minimize emissions during well

maintenance• Expands pneumatic controller requirements statewide• Requires auto-igniters on all combustion devices

Overview of Emission Reduction StrategiesOverview of Emission Reduction Strategies

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• Estimated annual cost of new rules for industry is approximately $42 million

• State will administer rule using existing resources

• Significant reduction of volatile organic compounds and methane– Approximately 94,000 tpy of VOC– Approximately 64,000 tpy of methane– Overall cost effectiveness for the entire package is

approximately $450 per ton of VOC reduced

Costs and Benefits of New RulesCosts and Benefits of New Rules

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• Requires capture or control of the gas stream at well production facilities from the date of first production

• New production facilities (after October 15, 2014) must test for leaks no sooner than 15 days and no later than 30 days after facility commences operation

• Existing well production facilities must be inspected within 90 days following the phase-in schedule unless emissions >50 tpy then 30 days

• Establishes requirements to minimize emissions during well maintenance

Well Production FacilitiesWell Production Facilities

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• Leak Detection and Repair requirements - the plumbing around the gas wells, separators, and ancillary piping is subject to “LDAR”– Establishes comprehensive leak detection program for oil

and gas facilities– Frequent monitoring using Method 21 or infra-red (IR)

cameras– Tiered monitoring schedule to focus on the highest emitting

facilities and reduce the burdens on smaller facilities

Well Production FacilitiesWell Production Facilities

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• All storage tanks statewide - air pollution control requirements reduced from 20 tpy to 6 tpy of VOCs– Includes crude oil and produced water storage tanks– Control device must achieve an average control

efficiency of 95%

Storage Tank ControlsStorage Tank Controls

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• Improve capture of emissions at controlled tanks– Controlled tanks must be operated without

venting to the atmosphere– Establishes requirements for Storage Tank

Emission Management systems (STEM)– Emissions associated with the top of the storage

tank (pressure relief valves, thief hatches, control devices/piping) are addressed through STEM

– Certified design to minimize emissions– Extensive instrument based and AVO monitoring – Again, a tiered monitoring schedule focuses on

the highest emitting facilities and reduces the burdens on smaller facilities

Storage Tank InspectionsStorage Tank Inspections

04/20/23 9Highlights of Colorado's Oil and Gas Emission Reduction Rules

04/20/23 10Highlights of Colorado's Oil and Gas Emission Reduction Rules

Infra-Red Camera ImagingInfra-Red Camera Imaging

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Leak on loose hammer union on pipe leading to Flare Combustor

Infra-Red Camera ImagingInfra-Red Camera Imaging

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• First attempt at repair required within 5 working days with provisions for good cause (parts availability or full shut-down)

• Instrument monitoring following the repair(s) are required within 15 working days to determine effectiveness

• Operators must maintain records– Initial approved instrument monitoring method– List of leaking components and monitoring method used to

determine the leak– Date of first repair attempt and if necessary additional

attempts, and many other records

Repairing Leaks & RecordkeepingRepairing Leaks & Recordkeeping

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• Glycol Dehydrators - air pollution control requirements reduced from 15 tpy to 6 tpy of VOCs – 2 tpy requirement for

Dehydrators located within 1320’ of building unit or designated outside activity

– Control device must achieve an average control efficiency of 95%

Glycol DehydratorsGlycol Dehydrators

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• Existing natural gas compressor stations must be inspected within 90 days after January 1, 2015 for leaks unless emissions >50 tpy then 30 days.

• Ongoing LDAR inspections depends on the emissions from the facility

Natural Gas Compressor StationsNatural Gas Compressor Stations

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Natural Gas Pneumatic ControllersNatural Gas Pneumatic Controllers

• After May 1, 2014 must reduce VOCs emitted equal to or less than a low bleed pneumatic controller

• No-bleed controllers where onsite electrical power is used

• Existing high-bleed controllers must be replaced or retrofitted by May 1, 2015

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• Expands Colorado’s existing program and establishes innovative new strategies that address each of the most significant sources of hydrocarbon emissions from the oil and gas production sector

• Maintains Colorado’s leadership role in regulating air emissions from oil and gas production

• Establishes a rigorous set of requirements to ensure responsible development of Colorado’s oil and gas resources

Summary of Key PointsSummary of Key Points

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