On July 28, 2011, EPA proposed a set of standards to reduce emissions of volatile organic compounds (VOCs) and air toxics from the oil and natural gas industry. The rules also would significantly reduce methane, a greenhouse gas. The Proposed Rule, EPA's Fact Sheet for the Proposed Rule and Overview Presentation and a Regulatory Impact Analysis are on EPA's Oil and Natural Gas Air Pollution Standards webpage. The Proposed Rule has yet to be published in the Federal Register.
Background
In January 2009, WildEarth Guardians and the San Juan Citizens Alliance sued EPA, claiming that EPA had failed to review new source performance standards and air toxic standards for the oil and natural gas industry. In February 2010, the U.S. Court of Appeals for the D.C. Circuit entered a consent decree among the parties requiring EPA to sign its proposed rules related to the review of these standards by July 28, 2011 (thus EPA's notice of signature on EPA’s website on July 28) and to issue final standards by Feb. 28, 2012.
EPA’s proposal includes four air regulations for the oil and natural gas industry: a new source performance standard for VOCs; a new source performance standard for sulfur dioxide; an air toxics standard for oil and natural gas production; and an air toxics standard for natural gas transmission and storage.
In explaining the applicability of the Proposed Rule to hydraulic fracking operations, EPA stated:
The majority of new wells drilled today produce gas, and the majority of those new wells use a process known as hydraulic fracturing or "fracking." In this process, a mixture of water, chemicals and a proppant (usually sand) is pumped into a well at extremely high pressures to fracture rock and allow natural gas to escape. An estimated 11,400 new wells are fractured each year; another 14,000 are re-fractured to stimulate production or to produce natural gas from a different production zone. . . .Some of the largest air emissions in the oil and gas industry occur as natural gas wells that have been fractured are being prepared for production. During a stage of well completion known as "flowback," fracturing fluids, water, and reservoir gas come to the surface at a high velocity and volume. This mixture includes a high volume of VOCs and methane, along with air toxics such as benzene, ethylbenzene and n-hexane. The typical flowback process lasts from three to 10 days.
EPA Fact Sheet.
The proposed NSPS would limit VOC emissions from gas wells in the well completion process. It would apply to all hydraulically fractured wells - new wells as well as existing wells that are fracked or refracked in order to obtain more gas from a well. EPA claims that “these processes are the source of an estimated 500,000 tons of VOC emissions each year, and that about 9,700 completions of new wells annually are not controlled.” EPA also asserts that “12,000 re-completions annually would fit the criteria but are not controlled.” See EPA Overview Presentation.
According to EPA, the rule would require a combination of “green completion” and flaring for most fractured wells. It would also achieve 95% VOC reduction and 90% recovery of salable natural gas. The Proposed Rule would require flaring in those circumstances where criteria for reduced emissions are not met and where flaring is not a hazard.
Comments on the Rule will be due within 60 days of the date that EPA actually publishes the Proposed Rule in the Federal Register. If you would like to discuss the Proposed Rule or this blog post, please contact Robert Lawrence at 303-892-7409 or robert.lawrence@dgslaw.com.
