SpeakingOilGas

Burying pipelines onshore and through inter-tidal inshore zones is common practice. Offshore pipelines connecting with land facilities are commonly fed through horizontal holes drilled under coastal dunes and cliffs to avoid disturbance of the shoreline. The offshore end of the line is usually tunnelled down beyond the surf zone and the landward portion emerges well inland.

Restoration of sites after use, including re-contouring to the natural line and re-sowing natural vegetation is common practice. The industry also pays special attention near sensitive areas such as mangroves, coral reefs, fauna breeding grounds and heritage areas. In many instances directional long-reach drilling is used so that drilling rigs and platforms are located well away from these sensitive areas.

Flare-stack control — flaring of gas from a production area is rarely done as this represents an ineffective recovery of hydrocarbons from the well and a loss of revenue. However, where flaring excess gas is required as a safety measure at treatment facilities and refineries, new generation flare tips have been installed. These use the rush of gas to suck air into the flare burner and create more complete combustion. There is also less smoke and less heat radiation produced than from earlier flare types.

Sites of significance — petroleum companies work under heritage agreements that may call for liaison with relevant indigenous owners (Aboriginal, First Nation, Traditional) before any exploration or development programs begin. Consultation may occur at every step in an exploration program to ensure there is ample time to relocate seismic lines and drill sites, if necessary, to avoid any sites of significance in a region. The liaison may also be maintained during the project life, sometimes also during the operational and restoration phases.

Cetacean avoidance — offshore seismic survey operators take a range of measures to avoid interfering with whales and other marine mammals. The most common is to time surveys to avoid significant cetacean activity, such as migration paths and calving grounds.

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In addition, before commencing operations (day or night), visual observations are taken for a set period of time to check for cetaceans in a precautionary zone. Australian Government regulations set the time at 90 minutes and the zone at a three kilometre radius around the front of the seismic vessel. If a cetacean is seen within that zone, the vessel must wait until the animal has moved further than three kilometres or, if it can no longer be seen, wait for 30 minutes after the last sighting within the zone before commencing operations. If a cetacean is seen within the precautionary zone during a survey, the vessel must shut down operations immediately.

So-called ‘soft-starts’ are the norm in seismic operations. This involves activating a small section of the sound-producing and recording equipment and slowly adding other streamers and more devices over time, thus allowing marine mammals to move out of the area.

Oil spill control — any oil spill has the potential to damage the environment. For instance a land spill can get into groundwater or rivers and lakes. Marine spills can cause a serious impact, especially in coastal areas because they can spread over a wide area. However the impact of a marine spill is not only to do with volume of oil involved, but also the type of oil, the climate, the prevailing weather and the geographic area.

Light oil spilt at sea in a warm climate will rapidly evaporate. Heavy oil in a cold climate will be much slower to dissipate. Calm seas will make the job of the oil spill response team easier than trying to deploy booms and dispersants in rough water. Oil spilt in coral reef or mangrove areas is more difficult to remove than oil coming ashore on sandy beaches.

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There have been a number of well-documented oil spills around the world over the past few decades, most of them from tanker accidents. These incidents have led to a world-wide cooperation of petroleum industry, shipping industry and non-government enterprises in preventing and if necessary combating marine oil spills. Some of those bodies involved are:

•International Petroleum Industry Environmental Conservation Association (IPIECA)

•International Association of Oil and Gas Producers (OGP)

•Oil Companies International Marine Forum (OCIMF)

•International Tanker Owners Pollution Federation (ITOPF)

•International Association of Independent Tanker Owners (INTERTANKO)

•International Maritime Organisation (IMO).

Today there are a number of large, specially equipped oil spill response centres located around the world. Each is close to major airports and available for call out on a 24 hour, 365 days a year basis. The equipment is pre-packed and always at the ready. It is customs-secured for rapid transport to anywhere in the world at very short notice. These key centres are:

•Australian Marine Oil Spill Centre (AMOSC) in Geelong, Victoria, Australia

•Clean Caribbean and Americas (CCA) in Fort Lauderdale, Florida, USA

•East Asia Response Pte Ltd (EARL) in Singapore

•Fast Oil Spill Team (FOST) in Paris, France

•Oil Spill Response Ltd (OSRL) in Southampton, England

•Petroleum Association of Japan (PAJ) in Tokyo, Japan.

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In addition, many countries have established their own government authorities, such as coastguard services, to deal with marine pollution in their ports and around their shores. These bodies work in cooperation with the petroleum companies in setting plans to coordinate oil spill response and establishing stockpiles of equipment and dispersants at strategic ports and harbours.

The international convention is to classify oil spill response into three tiers.

•Tier 1 is a small spill of up to 50 tonnes that can be handled locally by port authorities and/or the companies concerned.

•Tier 2 is a medium spill of up to 200 tonnes, or it might be remote from ports and harbours. This may require the assistance of industry and national government response agencies.

•Tier 3 is a major spill of up to 10,000 tonnes that will require the use of national agencies as well as teams from the international response centres.

Usually in a major incident the international response centre that is closest to the spill is called first. Depending on the severity, response centres from other parts of the world may be requested to help.

Oil spill combat equipment includes a wide variety of containment and oil retrieval devices, such as booms and skimmers, as well as a variety of spray mechanisms and dispersants to help break up the oil on the water surface. Often helicopters and fixed-wing aircraft are employed in this work. In addition there is increased use of computer modelling techniques to predict the direction and speed of marine oil slicks.

All the major response centres and national industry bodies conduct lectures and courses on oil spill response for government, petroleum and maritime personnel, at both operator and management levels.

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Climate change

The debate about climate change suggests that greenhouse gas emissions associated with human activity are contributing to global warming and that steps must be taken to mitigate this. The petroleum industry globally is both a user and producer of fossil fuel energy products that create greenhouse gas emissions. Fossil fuels are still an important source of world energy and are likely to remain so, at least for the next three or four decades. The use of these fuels underpins economic growth and development. Thus the petroleum industry sees its challenge as balancing the need to help meet the world’s energy needs while mitigating the potential impact of greenhouse gas emissions on world climates.

Many petroleum companies now set out to reduce greenhouse gas emissions in all their operations, setting themselves targets and publicising the results. Some put an absolute value on their reduction targets, others prefer to set intensity targets which are commitments to reduce emissions on a per-unit-of-output basis.

The companies require their individual sites to develop greenhouse management strategies and energy conservation plans. They ask management to price carbon in all investment decisions. They also fund research and development activities and collaborate with customers by assessing emissions over the life cycle of products, i.e. estimating the level of emissions emitted by customers using a company’s products. This latter initiative leads to an improvement in the overall energy efficiency in downstream consumption of energy products.

Some of the main initiatives to curb greenhouse emissions are:

Operational efficiency — this may be as simple as better design of buildings to take advantage of natural light or using less lighting at night or installing better insulation to cut down the energy needed to power heating or cooling appliances.

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Efficiencies are also aided by new technology such as improved flare stack efficiency and control. In addition, gas produced in association with oil is used as much as possible to run project facilities. There is also continued research into the conversion of excess gas into methanol for separate sale, even from remote locations.

Another push has been to phase out the use of lesser known greenhouse gases such as halons, which have been part of fire protection systems both offshore and in onshore production and treatment facilities. These are known to be ozone-depleting substances as well as contributing to the enhanced greenhouse effect.

Coal Seam Methane — methane, which would otherwise be vented to atmosphere, can be drained from coal mines ahead of mining. Methane has a global warming potential more than 20 times that of carbon dioxide, hence this can represent a significant reduction in greenhouse emissions. It also provides a safer mining environment and the drained methane can be used as a fuel in an associated power plant to generate electricity.

Carbon dioxide sequestration — there are two types of sequestration currently being researched, and in some cases, used around the world.

•Biological sequestration is the natural absorption of carbon dioxide into plants. For instance, trees absorb carbon dioxide from the air and release oxygen. Large tree plantations are being established in a number of countries such as the USA and Australia to offset carbon dioxide emissions from other activities, including land clearing and the consumption of fossil fuels.

•Geosequestration is a relatively new concept that injects carbon dioxide into deep, secure underground geological storage, including deep geological reservoir formations under the ocean. The concept is for carbon dioxide to be captured from industrial flue gas streams, such as power stations, refineries and petroleum production facilities and injected underground via specially drilled wells. The captured carbon dioxide is liquefied under high pressures and must be injected to depths of at least 800 metres below ground to be kept in the liquid state.

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One of the challenges is to separate carbon dioxide quickly and efficiently from other flue gases, such as nitrogen. Another is to determine which regions are geologically suitable for the injection process. A third is to reduce the costs of carbon dioxide capture and storage to commercial levels.

The technique has a precedent in Statoil’s Sleipner field in the Norwegian North Sea where carbon dioxide content is about 10 per cent. This has been extracted from the natural gas flow since 1996 at the rate of 1 million tonnes a year and re-injected into a non-petroleum reservoir at 1200 metres depth which overlies the field reservoir at 3000 metres depth subsea.

Norway and the European Commission are collaborating in Phase II of this project which will continue to monitor the field to track the carbon dioxide migration using seismic survey techniques. There will also be studies to obtain information about geochemistry and dissolution processes. Additional work will carry out feasibility studies on other suitable geologic settings in the region. The overall aim is to gather data to develop sound scientific-based methodologies for assessment, planning and long-term monitoring of underground carbon dioxide storage both on and offshore.

The proposed development of Statoil’s new Snohvit gas field in the Norwegian sector of the Barents Sea includes piping the field gas flow to an onshore facility. Carbon dioxide will be extracted from the gas stream and piped back offshore for injection into a sand aquifer underneath the gas field (differing from Sleipner where the carbon dioxide storage lies above the gas reservoir). Snohvit is expected on stream in 2006.

Statoil is also involved in a field development onshore Algeria at the Inshalla field operated by BP. The re-injection of carbon dioxide will have the double bonus of sequestering carbon dioxide and providing pressure maintenance.

Another project proposal is the Gorgon gas field offshore Western Australia operated by Chevron. With carbon dioxide content in the fields of this project above 12 per cent, the plan is to pipe gas to LNG production facilities on Barrow Island and re-inject the carbon dioxide into a deep aquifer underneath the island.

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There are a number of other collaborative carbon capture and storage projects around the world, four of which directly involve oil and gas or coal seam methane fields and reservoirs. These pilot projects are designed to increase knowledge in aspects of geosequestration, including technology, economics, health, safety, and environment issues.

One of the most advanced is the Weyburn enhanced oil recovery (EOR) project in Saskatchewan, Canada where the USA, Canada and Japan are working together. Phase 1 (between 2000 and June 2004) conducted trials of carbon dioxide injection into the oil reservoir. Phase II will magnify the scale with the transport of 95 million cubic feet per day of 95 per cent pure carbon dioxide to the field via a 320 kilometre pipeline from North Dakota in the USA. The carbon dioxide will be injected into the field for enhanced oil recovery purposes. This new phase will closely monitor the carbon dioxide migration within the reservoir to determine its performance as an enhanced oil recovery tool and to assess any risks involved in its longterm use and intake into the reservoir formations. The project will run for about four years.

Other pilot projects include work by the European Commission and Germany, and a government-backed project in Australia involving industry and research institutions. The EU study will evaluate carbon and geosequestration in an existing natural gas storage facility near Berlin in a deeper land-based underground saline aquifer nearby. The Australian study will involve production of carbon dioxide from a field in the onshore Otway Basin of western Victoria and re-injecting it into a depleted natural gas reservoir nearby. The movement of carbon dioxide in the underground reservoir will be monitored over a period of four or five years.

Emissions trading — this is emerging as a key instrument in the drive to reduce greenhouse gas emissions. The rationale is to ensure that the emission reductions take place where the cost of the reduction is lowest, thus lowering the overall costs of combating climate change.

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Such schemes allow governments to regulate the amount of emissions produced in aggregate by setting the overall cap for the scheme, at the same time giving companies the flexibility of determining how and where the emissions reductions will be achieved. This flexibility to trade allowances achieves the overall emissions reductions in the most cost-effective way possible.

Participating companies are allocated allowances, each allowance representing a tonne of the relevant emission, in this case carbon dioxide equivalent. Emissions trading allows companies to emit in excess of their allocation of allowances by purchasing allowances from the market. Similarly, a company that emits less than its allocation of allowances can sell its surplus allowances.

Although some companies have long-established internal trading schemes, the UK began the world’s first economy-wide greenhouse gas emissions trading scheme in March 2002, when 31 organisations voluntarily took on emissions reduction targets. They agreed to reduce their emissions against 1998-2000 levels, delivering 11.88 millions tonnes of additional carbon dioxide equivalent emissions reductions over the life of the scheme (2002-2006).

The scheme is also open to the 6000 companies with Climate Change Agreements. These negotiated agreements between business and government set energy-related targets. Companies meeting their targets will receive an 80 per cent discount from the UK Climate Change Levy, a tax on the business use of energy. These companies can use the scheme either to buy allowances to meet their targets, or sell any over-achievement of these targets.

The European Union began an emissions trading scheme in January 2005 which is the largest multi-national greenhouse gas trading scheme in the world, with all 25 member states of the EU participating. Phase 1 will run until December 2007. Phase 2 will run from 2008 until 2012 to coincide with the first Kyoto Protocol commitment period.

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The scheme works on a ‘cap and trade’ basis where member state governments are required to set an emission cap for all installations covered by the scheme. Each installation is then allocated allowances for the particular commitment period. The installation is required to have its annual emissions verified. Allowances equal to these verified emissions will then be retired.

In the USA the concept of dealing with unwanted emissions has its roots in a bid to curb acid rain in the 1990s. Although a separate issue to greenhouse emissions, a cap was put on how much sulphur dioxide a fossil-fuelled plant could emit. Then, extending this idea into the greenhouse arena, New York State obtained a commitment from nine northeast states in 2003 to cap and trade carbon dioxide emissions. There is also an informal trading scheme in California and some southeastern states. However, as yet there is no USA-wide scheme in place for carbon trading.

Cleaner fuels

Since lead was removed from petrol beginning in the early 1970s, the refining industry has made a number of additional improvements to petrol and diesel fuel. Vehicles running on these new fuels run more cleanly and efficiently and hence reduce pollution.

In the USA the most important improvement has been the development of reformulated gasoline (petrol), particularly for use in smog-affected cities. This is a refined and blended product aimed at reducing smog-forming and toxic pollutants in the fuel. Individual refiners are allowed to use their own formulae provided they meet the government standard.

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