Preparing for the New Rules for Fugitive Emissions at Well Sites
On June 3, 2016 EPA published a final New
Source Performance Standards (NSPS) for methane and VOC emissions from the oil
and gas sector (known as “Quad Oa”). This is the second in a series of posts discussing the new
requirements. This post outlines steps
that upstream companies may want to consider now that Quad Oa is taking effect.
More information about the requirements
is available here.
What are the new leak detection and repair
requirements for well sites?
Quad Oa regulates the fugitive emissions from new or
modified well sites. While the proposed rule would have exempted low production
well sites (well sites where the average combined oil and natural gas
productions is less than 15 barrels of oil equivalent (boe) per day), the final
rule applies to all well sites, regardless of the level of production. Operators
must create a leak detection and repair (LDAR) program designed to identify and
fix gas leaks, and must conduct an initial LDAR survey within 60 days of the
start-up of production. After the
initial survey, operators must conduct additional surveys twice a year, at
least four months 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 calendar days after detection,” unless the leak would be unsafe
to repair or would require shutting down production, which could lead to
significantly greater emissions releases. In that case, the leak must be fixed
at the next shutdown or shut-in, or within two years, whichever is earlier. Equipment that qualifies as “unsafe-to-monitor”
only needs to be surveyed in accordance with the company’s monitoring plan,
while equipment that qualifies as “difficult-to-monitor” only needs to be surveyed
once a year.
All sources of fugitive emissions that are repaired or
replaced must be resurveyed within 30 days of repair completion or replacement
to ensure that there are no ongoing fugitive emissions. Operators will 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
When do operators
need to conduct an initial survey?
Operators will have until June 3, 2017 to perform their
initial surveys. For new well sites added or modified after the first year, the
operator will have 60 days from the beginning of production to conduct the
first survey for new wells, and 60 days after the first day of production for
modified wells. Operators now have a little less than a year to create and
implement an LDAR program. During this
time, affected businesses should begin to think through how the new rules will
impact existing operations.
What can operators do
now to prepare for the new LDAR rules?
Although operators will have one year from the publication
of the rule to perform their initial leak detection surveys, operators should
begin the process of designing and implementing an LDAR program well in advance
of the deadline. When designing their
LDAR program, operators should consider the following questions:
1.Which, if any, of your sites will be subject
to the new rules?
The LDAR requirements in Quad Oa apply to all new well sites
added, or sites that are modified or reconstructed after September 18, 2015.
The rule contains a unique definition of “modification,” which states that a
well site is modified when:
(1) a new well is drilled at an
existing well site;
(2) a well at an
existing well site is hydraulically fractured; or
(3) a well at an
existing well site is hydraulically refractured.
2.What components at your well site need to be
included in the LDAR survey, and what should be included in your monitoring
The proposal requires
all “components” at a 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. The definition does not include
equipment that is supposed to vent as part of normal operations, unless the
emissions are coming from a part of that equipment that is not supposed to
An owner or operator will need to develop a monitoring plan
that would apply to each well site located within the company-defined area,
which will require visiting each well site in order to properly assess the
site. Depending on the number and location of wells within the company-defined
area, the initial site visits and development of the monitoring plan may
require a significant amount of time.
As part of the
monitoring plan, operators are required to include an “observation path” to ensure
that all fugitive emissions components are within sight of the path. If the
operator uses Method 21, the plan must also include a list of components to be
monitored and a method for determining the location of fugitive emissions
components to be monitored in the field. Under either approach, operators will
need to determine where each of their “components” is located to ensure they
are included in surveys. Operators
should also determine which components will qualify as unsafe or difficult to monitor, 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 technology and Method 21 to
perform the surveys. While OGI surveys
can be performed more quickly, many companies do not own the equipment needed
to complete an OGI survey in-house. Each
operator should assess, based on their individual 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. This will pose additional challenges for
operators whose well sites are spread out in geographically remote areas where
it may take longer for personnel to reach the site, and there may be fewer
qualified personnel or contractors available in the area. 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 well site.
4.How will you ensure that your LDAR program
is functioning properly?
gas emissions is likely to remain a high priority for EPA. Quad Oa contains detailed recordkeeping and
reporting requirements. Companies should
think about implementing strategies that will ensure these records are complete
and kept up to date. Companies 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. EPA is continuing to emphasize a
desire to use electronic reporting, and operators will want to familiarize
themselves with EPA’s online reporting system before the deadlines.
5.What future changes at existing facilities
could trigger these requirements?
with the Quad Oa LDAR requirements can impose meaningful compliance costs on a
facility. When planning future changes
at existing well sites, companies should ensure that their operations and
business teams know that adding wells, or hydraulically fracturing or
refracturing existing wells will trigger the Quad Oa requirements. Companies
will also want to consider strategies for making sure that new, modified, or
reconstructed sites are added to their LDAR program as future wells are hydraulically
fractured or refractured.