US gas producers say EPA rule on wellhead emissions not workable

04 October 2011 21:34  [Source: ICIS news]

PITTSBURGH (ICIS)--US environmental officials want shale gas producers to capture wellhead emissions, but the industry cannot figure out how to do that, a producer said on Tuesday at the Infocast Marcellus Infrastructure Finance and Development Summit.

“The rules are attempting to control all the loose gas escaping from anything that could potentially leak gas is what the EPA [Environmental Protection Agency] is after,” said Gary Slagel, director of environmental affairs for Consol Energy.

Industry trade representatives in Washington, DC, are asking themselves "what are we going to do and how are we going to do it", he said.

EPA has suggested that producers would profit from capturing stray gas emissions at the wellhead, but Slagel questioned whether that was possible. 

“I think if there was any profit in capturing escaping gas [producers] would have done it, and the profit really isn’t out there that the EPA says,” Slagel said.

At a Pittsburgh public hearing on 27 September, EPA proposed rules under the Clean Air Act (CAA) for reducing pollution from oil and natural gas production operations. The act requires the EPA to regularly review and update air quality regulations, with a goal of reducing volatile organic compounds (VOC) emissions by 25%.

The proposed rules would apply to about 25,000 gas wells that are hydraulically fractured in the US each year.

To comply with the proposed regulations, producers say that new technology would be needed to allow drillers to capture gases that escape during drilling activity.

The EPA has estimated that the cost of compliance with the regulations would be $750m (€570m), while the value of captured gas would be $780m, giving drillers a $30m profit.

Slagel argued that the new EPA proposal "is another way of involving the federal government in place of where the state government should be ruling”.

But on the state level, Slagel said there are questions on whether the Pennsylvania Environmental Council (PEC) has the capacity to help regulate air emissions.

($1 = €0.76)

By: Sheena Martin
+1 713 525 2653

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