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  • 24
  • May
  • 2016

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Preparing for the New Methane Quad Oa: LDAR Requirements for Compressor Stations

On May 12, 2016, EPA finalized its proposed rule to regulate methane and volatile organic compound emissions from new and modified sources in the oil and gas sector (known as “Quad Oa”). This is the first in a series of posts discussing steps that upstream and midstream companies may want to consider as they prepare for Quad Oa. More information about the requirements is available here.  

How long do I have to comply?

So far EPA has released a pre-publication version of the final rule. The rules will begin to take effect 60 days after the final rule is published in the Federal Register. This may take several more weeks, but businesses impacted by the rule should keep an eye out for announcements so that they do not miss key deadlines.

EPA has included a one-year grace period in the rule, so that the first LDAR surveys do not have to be completed until the anniversary of the date the final rule is published in the Federal Register.

Fugitive Emissions Monitoring Requirements

Quad Oa regulates the fugitive emissions from new, modified, and reconstructed compressor stations. Operators must create a leak detection and repair (“LDAR”) program designed to identify and fix gas leaks. A fugitive emission is defined as any emission that is visible using optical gas imaging (“OGI”) or a reading of 500 ppm or greater using EPA’s Method 21. The rule requires operators to conduct an initial LDAR survey within 60 days of start-up or modification, and quarterly follow-up surveys spaced at least 60 days apart from each other.

Following a survey, operators must replace or repair the sources of any detected fugitive emissions “as soon as practicable, but no later than 30 days after detection.” There are several exceptions to this timeline: equipment that qualifies at “unsafe to monitor” only needs to be surveyed in accordance with the company’s monitoring plan. Equipment that qualifies as “difficult to monitor,” because it would requiring elevating personnel more than two meters above the surface, only needs to surveyed once per calendar year. There is also waiver for facilities located in regions where two out of the past three consecutive months of average temperatures is below 0° Fahrenheit.1 In addition, equipment that is unsafe or technically infeasible to repair without a shutdown can be delayed until the next shutdown, or up to two years (whichever happens soonest).

All sources of fugitive emissions that are repaired must then be resurveyed within 30 days of repair completion to ensure the repair has been successful. Operators would also be required to develop and implement monitoring plans to comply with these fugitive emission requirements, as well as meet the recordkeeping and reporting requirements in the rule. Operators can place all of their stations into a single monitoring plan, or create multiple plans based on how they internally organize their facilities.

What Can Operators Do Now To Prepare?

Although the first surveys do not have to be completed for a year, designing and implementing an LDAR program takes time. Here are five issues that operators should begin considering now.

1.Which, if any, of your facilities will be subject to the new rules?

The LDAR requirements in Quad Oa only apply to compressor stations that are new, modified, or reconstructed after September 18, 2015. The rule contains a unique definition of “modification” for compressor stations which differs from EPA’s historic practices under the Clean Air Act. A station is modified when: 

(1) An additional compressor is installed at a compressor station; or

(2) One or more compressors at a compressor station is replaced by one or more compressors of greater total horsepower than the compressor(s) being replaced.

2.What components at your compressor station need to be included in the LDAR survey?

The proposal requires all “components” at a regulated compressor station or well site that can leak methane or VOCs to be included in the survey. The definition is broad, and includes valves, connectors, pressure relief devices, open-ended lines, flanges, compressors, instruments, and meters. They do not include equipment that is supposed to vent as part of normal operations, such as natural gas driven pneumatic controllers or pumps, unless the emissions were coming from a part of the equipment that is not supposed to vent.

As part of the monitoring plan, operators are required to include an “observation path” to ensure that the OGI operator visualizes all of the components that must be monitored, or tag components if they use EPA Method 21. Under either approach, operators will need to determine where all of their “components” are located so that they are included in surveys. Operators should also determine which components will qualify as unsafe or difficult to monitor or repair, and which will be unsafe or technically infeasible to repair without a shutdown.

3.Who will perform the surveys and repairs and which method will be used?

Operators can select between OGI techonology and Method 21 to perform the surveys. While OGI is much more efficient, many companies do not own the equipment needed to complete an OGI survey in-house. Each operator should assess, based on their particular circumstances, whether surveys should be performed internally or by a third-party consultant. Industry groups have warned that there may be a shortage of qualified consultants available to perform the surveys. As a result, companies planning to use outside help should look to establish a relationship with a consultant now.

The tight timeline between surveys and repairs also means that operators should have a plan for how repairs will be made. If possible, it may be best to try to coordinate personnel so that surveys and repairs happen on the same day. That way, the resurvey mandated by the Quad Oa rules can also be performed without a second trip out to the facility.

4.How will you ensure that your LDAR program is functioning properly?

 Addressing methane gas emissions is likely to remain a high priority for EPA. Quad Oa contains detailed recordkeeping and reporting requirements. Companies should think about auditing strategies that will ensure these records are complete and kept up to date. They should also consider ways to ensure that the LDAR programs cover all of the necessary components, and are able to address leaks within the timeframes allowed by the rule.

5.What future changes at existing facilities could trigger these requirements?

Complying with the Quad Oa LDAR requirements can impose meaningfully compliance costs on a facility. When planning future changes at existing compressor stations, companies should ensure that their operations and business teams know what kind of changes will trigger the Quad Oa requirements. Companies will also want to consider strategies for making sure that additional sites are added to their LDAR program as they are modified or reconstructed in the future.

This waiver comes with additional regulatory caveats. Please see EPA’s final rule. 

 

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Author

Corinne Snow

Corinne Snow Associate