Why’s It Critical? 

Despite the emergence of renewable energy sources, responsibly-produced oil and gas is expected to remain an important element of the global energy supply for decades to come. An important aspect of responsibly-produced oil and gas is reducing the intensity of greenhouse gas (GHG) emissions that arise from production, such as carbon dioxide and methane gas. Methane, which is a much more severe GHG than carbon dioxide (25 times as potent at trapping heat in the atmosphere) and  typically associated with natural gas, must be quantified, located, and mitigated when possible  in order to reduce its destructive effects during the transition to renewables. 

 

What’s LDAR?

Applied methane mitigation measures are known as Leak Detection and Repair (LDAR), which refers to the process of locating and repairing fugitive (unintentional) atmospheric methane leaks. Methane leaks can be located with many different technologies such as handheld infrared cameras, or methane sensors mounted on ground-based vehicles, drones, airplanes, or satellites. Once the leaks are detected, they must be repaired. Depending on the cause of the leak, the repair can be simple (tightening a connection) or complex (requiring a complete shut-down of a facility). LDAR can be applied across the supply chain—to upstream activities including well development, gathering, and processing, as well as downstream activities such as transmission or distribution lines.

 

Methane abatement costs vary, and typically depend on the frequency of leak detection surveys, the severity of the leaks, and the technologies used for methane emission detection and mitigation. Additionally, the cost of LDAR depends on the type of equipment or facility being inspected—surveying a complex facility for methane leaks can take much longer than surveying a well-head. In general, more frequent leak detection surveys cost more and also lead to fewer methane emissions; however, the rate of return of frequent LDAR programs eventually begins to decrease, and the point at which this happens depends on how frequently new leaks appear. The leak production rate tends to differ for every regulatory jurisdiction, producer, and production style. Detecting and measuring methane emissions in a comprehensive and cost-effective manner remains a fundamental challenge because there is a wide variety of methane detection technologies and methods available. As you can imagine, creating the perfect LDAR program that reduces emissions while keeping costs low can be a difficult task.

 

Efforts are being made to incentivize the deployment of these abatement technologies via voluntary and regulatory means. Where reduced emissions do not pay for themselves, or where barriers prevent companies from taking action that would otherwise be cost-effective, policy and regulatory interventions may serve to encourage companies to take steps to reduce their emissions.

 

How’s LDAR Being Regulated?  

Currently, the most common policy approach to address fugitive emissions is to require oil and gas producers to conduct LDAR programs at regular intervals throughout the year. While many companies already undertake LDAR, the practices and rigour of programs vary widely. Regulation can standardize practices by dictating options for detection methods, a timetable for repairing leaks based on their severity, and requirements for detailed record-keeping and reporting of leaking components. Maintaining detailed records of leaking equipment is important, as analysis of records can reveal opportunities to implement early maintenance practices for leak prevention in problem areas. 

 

The difficulty in accurately quantifying methane emissions from leaks poses a challenge to other potential policy approaches, such as market-based or performance standards, which rely on strong emissions quantification. However, as innovative detection methods such as continuous monitoring systems, aerial surveillance, and new satellite instruments, continue to progress and be deployed, new or revised policy approaches will be required. There is an opportunity for regulatory frameworks to accommodate available and emerging technologies that can identify big emitters more reliably.

 

While a number of technologies already exist to detect, measure, and abate methane emissions, this is a dynamic area with new technologies emerging. As such, it is important that policy and regulatory approaches can adapt to advances in technology so that regulatory requirements do not themselves become a barrier to methane abatement. A well-designed regulatory scheme can allow for improvements in technology, or even provide incentives for companies to seek innovative solutions. 

 

So What Can We Conclude?  

During this energy transition period, oil and gas producers must continue to demonstrate that they are taking strong action to reduce methane emissions in order to credibly argue that their resources should be preferred over higher-emission alternatives. With the help of progressive regulation, most oil and gas methane emissions could be avoided as long as all mitigation efforts—including LDAR—continue to be deployed. 

References: 

  1. Methane Tracker 2020 (International Energy Agency, 2020) – https://www.iea.org/reports/methane-tracker-2020
  2. Leak Detection and Repair, A Best Practice Guide – (Energy Protection Agency, 1998) – https://www.epa.gov/sites/production/files/2014-02/documents/ldarguide.pdf
  3. Global Methane Assessement (United Nations Environmental Program, 2021) – https://www.unep.org/resources/report/global-methane-assessment-benefits-and-costs-mitigating-methane-emissions
  4. Navigating the Landscape of Methane-Emissions Management Requires an Array of Technologies (Journal of Petroleum Technology, 2021) – https://jpt.spe.org/navigating-the-landscape-of-methane-emissions-management-requires-an-array-of-technologies