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ICF: Methane emissions

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Hydrocarbon Engineering,

An independent analysis conducted by ICF International (ICF) has estimated that emissions of the potent greenhouse gas methane from the Canadian oil and gas sector can be reduced by 45% below projected 2020 levels, all while using existing technologies. The research was commissioned by Environmental Defense Fund (EDF). EDF partnered with the Pembina Institute, Canada's leading clean energy think tank, on the development of the project and dissemination of the ICF report.

Canada's oil and gas sector is the largest source of methane emissions. ICF reported a significant opportunity to reduce methane emitted from multiple sources in Canada's oil-and-gas rich provinces, spanning from drilling to delivery. Achieving this 45% reduction across Canada would allow for the recovery and potential sale of otherwise lost natural gas and would be the equivalent of eliminating 27 million metric t of carbon dioxide emissions. At a low cost of CAN$2.76 per metric t of CO2, this reduction would provide the same immediate climate benefit as taking every passenger car off the road in British Columbia and Alberta according to data from Statistics Canada and Canada's National Inventory Report.

Alberta and British Columbia are the country's main oil-and-gas producing regions, responsible for nearly 70% of Canada's total methane emissions. ICF analysed the reduction opportunity in each, concluding that upstream methane emissions in Alberta could be reduced by 45% for CAN$2.57 per metric t of CO2 and in British Columbia by 37% for CAN$1.69 per metric t of CO2. All told, the CAN$726 million initial investment to achieve Canada's 45% reduction from oil and gas represents about 1% of industry's annual capital expenditure, according to Oil and Gas Journal data, or costs less than 1% per million ft3 of gas produced.

"Curbing highly potent methane emissions offers a huge, untapped opportunity to better protect the climate now," said Drew Nelson, Senior Manager, EDF. "ICF's new report confirms that Canada can gain substantial greenhouse gas reductions using simple, cost-effective solutions to control methane emissions. Even during these challenging economic conditions, methane reductions are one of the lowest-cost, highest-value ways to tackle climate change in the energy business today."

"This analysis clearly demonstrates that controlling methane emissions is an important opportunity to cost-effectively contribute to meeting our climate change objectives," added Chris Severson-Baker, Alberta Director, Pembina Institute. "With both Alberta and BC in the process of updating their climate plans, now is the perfect time to implement rules that require methane emissions to be reduced significantly."

"When methane leaks from oil and gas facilities, operational efficiency can suffer," said Mike Shorts, President of the Fluid Sealing Association, a membership group of companies in the methane mitigation sector, and Vice President and General Manager of Triangle Fluid Controls, a sealing product manufacturer based in Belleville, Ontario. "This report outlines the clear opportunity Canadian oil and gas companies have to prevent product waste with simple and cost-effective fixes, while supporting good-paying jobs for Canadians who manufacture the technologies and deliver the services that curb emissions."

Achieving the 45% reduction in oil and gas methane relies on the sector implementing currently available technologies and processes for reducing and recovering emissions. Furthermore, the analysis shows that 90% of the emissions in the next five years will come from sources in operation today, and that the 45% reduction is in addition to reductions that are achievable by current regulatory and projected voluntary actions by 2020. Reducing methane also reduces conventional pollutants such as volatile organic compounds (VOCs) and hazardous air pollutants (HAPs) that are directly contributing to poor air quality conditions across Alberta at no additional cost (Government of Alberta, 9 September 2015).

The report, titled "Economic Analysis of Methane Emission Reduction Opportunities in the Canadian Oil and Natural Gas Industries," is based on data from numerous sources, including oil and gas producers, equipment vendors, governments and regulators, academics experts and trade associations, and has been peer reviewed by multiple experts in the Canadian oil and gas industry. The report uses Canadian-specific data supplemented by US data where Canadian data is unavailable. The US EPA Greenhouse Gas inventory and the Greenhouse Gas Reporting Rule are used in conjunction with Canadian reports to develop emission factors and equipment and facility information for Canadian segments.

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