June 7, 2004

Alberta petroleum industry achieves new record reductions in gas flaring, venting

Solution gas flaring in Alberta has been reduced by 70% since 1996, and solution gas venting has been reduced by 38% since 2000, the Alberta Energy and Utilities Board (EUB) reported recently in its latest Upstream Petroleum Industry Flaring and Venting Report (Statistical Series (ST) 2004-60B). The reduction in venting has surpassed target levels and represents a further reduction of 8% over 2002.

The 2003 statistics represent a further reduction from 2002, when flaring was down 62% from the 1996 baseline, and venting was down 29% from the 2000 baseline. Solution gas conservation in 2003 reached a new record high of 95.4%, up from the previous record level of 94.7% in 2002. Since 1996, solution gas flaring has been reduced by 70 per cent in Alberta.

The EUB attributes the reductions in solution gas flaring and venting achieved in 2003 to the co-operative efforts of the Clean Air Strategic Alliance (CASA) flaring/venting project team and the petroleum industry, as well as the Board. Nevertheless, even with the success experienced in Alberta through regulatory enhancements, industry compliance and co-operation, and the collaborative nature of CASA, further reductions continue to be aggressively pursued.

Solution gas is natural gas that is separated from oil or bitumen production. Flaring and venting of solution gas are a necessary part of some petroleum operations. In emergency situations, flaring provides a safe way to stabilize equipment. Flaring and venting may also be necessary for oil wells that produce small volumes of solution gas and are located far from pipelines and facilities necessary to deliver the gas to market.

The EUB recognizes, however, that solution gas flaring and venting at petroleum industry facilities are of concern to Albertans. Accordingly, it works to have industry continue to reduce the volume flared and vented and increase the volume of solution gas conserved. In 1996 the Board, together with the Clean Air Strategic Alliance (CASA), established flaring baselines; these were followed in 2000 by venting baselines.

EUB aids global reduction effort

Alberta's success in flaring and venting reduction has been acknowledged internationally. In 2002, the World Bank, impressed by Alberta's reduction efforts and the consensus-based CASA approach, invited the EUB to participate in a Global Gas Flaring Reduction Initiative. EUB experts worked closely with the GGFR to assist in the development of the Global Flaring and Venting Voluntary Standard which was released by the Global Gas Flaring Reduction Public-Private Partnership (GGFR) in Algiers, Algeria last month.

Global venting and flaring levels are estimated at more than 100 billion cubic metres per year, which is comparable to the annual gas consumption of Germany and France combined. This figure has stayed constant over the past 20 years. More than 80% of global venting and flaring occurs in fewer than 15 countries, often from oil and associated gas production in remote areas where there is a lack of access either to nearby gas markets, or infrastructure to transport and distribute the gas to other markets.

Implementation of the Standard aims to cut venting and flaring significantly within five to ten years in the GGFR partnership, whose members are responsible for some 40% of global flaring. Further reductions may be achieved if additional countries, companies, and institutions endorse and implement the standard.

As in Alberta, the Standard requires that gas be conserved unless it is deemed to be unrealistic and unreasonable and this determination must be revisited regularly. Similarly, any flaring or venting that cannot be eliminated will be reduced (as in the EUB's Guide 60: Upstream Petroleum Industry Flaring Guide). Technical requirements are also similar to the EUB's Guide 60.

Among the aims of the Standard are the conservation of natural gas and reduction of greenhouse gas emissions from venting and flaring. It also seeks to stimulate the growth of domestic gas markets in less developed countries and lessen barriers to gas market access elsewhere. In achieving these objectives, the Standard will contribute to fostering sustainable development practices in the hydrocarbons sector.

The GGFR's members include the World Bank Group; governments and/or national oil companies of oil-producing countries; international oil companies such as BP, Royal Dutch shell, ExxonMobil and NorskHydro; and donor countries Canada (through CIDA, the Canadian International Development Agency), the U.S. and Norway.

The EUB Flaring and Venting Report may be viewed on the EUB Web site, www.eub.gov.ab.ca. More information is also available from Darin Barter at the EUB, 403/297-4116, E-mail darin.barter@gov.ab.ca.

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