The U.S. Environmental Protection Agency (EPA) has proposed a suite of regulatory requirements designed to reduce air emissions from the oil and natural gas industry. EPA has proposed new standards for several processes associated with oil and gas production that have not previously been subject to federal regulation.
Among these processes are well completions at new hydraulically fractured gas wells and at existing gas wells that are “re-fractured.” For these wells, EPA proposes that emissions of volatile organic compounds (VOCs) would be minimized through the use of “reduced emissions completions” or RECs, which simultaneously reduce both VOC and methane emissions. When gas cannot be collected during well completion operations, emissions would be reduced through pit flaring, unless it is a safety hazard.
EPA’s proposed rule imposes REC requirements on most unconventional gas wells, but requests comment on concerns that limited availability of REC equipment could adversely impact drilling and U.S. natural gas supplies necessitating a phase-in period to avoid disruptions. EPA estimates that only 3,000 to 4,000 of the 25,000 new and modified fractured gas wells completed each year currently employ RECs.
Advanced Resources International’s (ARI) assessment of the potential impact of just the requirements for the use of RECs on hydraulically fractured wells included consideration of potential additional revenue from recovered methane and possible condensates, increased costs associated with implementing RECs on hydraulically fractured wells, and the impact of delays in unconventional resource development associated with the demand for REC equipment exceeding the supply.
See complete final report below: