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Other topics Figure 2 SANGEA summary chart example, indirect emissions could include those from the production of purchased electricity, contract manufacturing, contracted drilling operations and product transport by third parties. The Guidelines provide a rationale for accounting and reporting indirect emissions from energy consumption. An example for the petroleum industry illustrated in the Guidelines is accounting for power plants located within a refinery that export electricity and/or steam to other companies. Another unique situation for the petroleum industry is contract operations where a petroleum company provides fuel to a contract operator. This occurs in drilling operations, as well as in transportation of crude oil or products. The Guidelines suggest that companies consider accounting for significant contract operations as sources of indirect emissions. Based on the accounting approach described in the Guidelines, provision of fuel to a contract operator should not influence whether the emissions are included as operated or equity share. Since the emissions come from a contracted operation, they are indirect emissions. Once the inventory accounting approach has been set, and decisions have been made as to what types of reports will be developed and what the data will be used for, the next step is to understand the specific sources included in each facility and what methodology is appropriate to estimate the emissions. The Guidelines provide an overview of the types of methodologies that are appropriate for exploration and production facilities and petroleum and petrochemical refining/manufacturing facilities. These approaches are described for the two types of facilities for various ranges of accuracy, using a tiered approach. Tier A represents the highest level of accuracy. Tier B includes somewhat less rigorous methods, and is therefore likely to be more straightforward and less costly to implement. However, the uncertainty associated with these methods is greater. Finally, for an assessment of emissions where uncertainties of 30- 60% are acceptable, Tier C methods may be employed. Each of the Tiers in the Guidelines is linked to appropriate calculational methodologies in the API Compendium. Specific information about the types of approaches available for estimating emissions is found in the Compendium. For a given facility, and a given range of uncertainty, the specific method used for each source will de pend on the information available about that source. For example, the Compendium recommends that the preferred method for estimating emissions from combustion sources is to determine the mass of carbon per mass of fuel and the mass of fuel used. However, the Guidelines and the Compendium recognize that this type of information is not available for all devices in all facilities. Where the preferred information is not available, the Compendium provides alternative methodologies that utilize existing information to develop a reasonable estimate of emissions. For example, in many cases a facility may measure the volume of fuel used and periodically analyze the specific gravity and/or heating value of the fuel. As an alternative to mass based estimates, this information can be used to estimate carbon dioxide emissions from fuel combustion. Developing an inventory: methodologies As described above, the Guidelines provide information on accounting for and reporting to corporate level of greenhouse gas emissions at the facility. A companion publication, the API Compendium of Greenhouse Gas Emissions Estimation Methodologies for the Oil and Gas Industry, documents a number of currently recognized calculation techniques and emission factors available for developing GHG emissions inventories for oil and gas industry operations. The Compendium was developed to Figure 3 SANGEA normalized emissions summary accomplish the following: 1. assemble an expanse of relevant emission factors for estimating GHG emissions from oil and gas industry activities, based on currently available public documents; 2. outline detailed procedures for conversions between different measurement unit systems, with particular emphasis on implementation of oil and gas industry standards; 3. provide descriptions of the multitude of oil and gas industry operations – from exploration and production through refining to the marketing of products, as well as the transportation of crude oil, natural gas and petroleum products – and the associated emissions sources that should be considered; 4. develop emission inventory examples – based on selected facilities from the various industry segments – to demonstrate the broad applicability of the methodologies. The Compendium is neither a standard nor a recommended practice for the development of GHG inventories. Rather, it represents a compilation of recognized methodologies for estimating GHG emissions specific to oil and gas industry operations. Source classification The Compendium groups oil and gas industry GHG emission sources into three categories: combustion devices, process emissions and fugitive emissions. 1. Combustion devices include both stationary sources, such as engines, burners, heaters and flares, and fleet-type transportation devices, such as trucks and ships, where these sources are essential to operations (i.e. transportation of material or personnel); 2. Point sources include vents from oil and gas industry units, such as hydrogen plants and glycol dehydrators, that emit CO 2 and/or CH 4 . They also include other stationary devices such as storage tanks, loading racks and similar equipment; 3. Non-point sources include fugitive emissions (equipment leaks), emissions from wastewater treatment facilities, and a variety of other emissions generated by waste handling; 4. Non-routine activities, associated with maintenance or emergency operations, also may generate GHG emissions; 5. Indirect emissions are defined as GHG emissions associated with oil and gas company operations, but physically occurring from sites or operations owned or operated by another organization. The Compendium includes calculation and estimating techniques for determining CO 2 , CH 4 and N 2 O emissions from all of these sources. 74 ◆ UNEP Industry and Environment April – September 2004
Other topics Technical considerations The Compendium provides emission factors from many different references, with many different approaches to defining emissions from the same sources. Careful review of these documents was required to understand the underlying assumptions used in developing the emission factors, and to combine data from multiple references using the reporting conventions selected for the Compendium. Some of the key technical considerations are: 1. standard gas conditions: standard conditions used in the Compendium are 14.7 psia and 60°F (1 atm and 15.6°C); 2. heating value specifications: both higher heating value (HHV) and lower heating value (LHV) are provided to report fuel data in terms of energy and to convert between fuel volume and energy; 3. units: GHG emissions are typically reported in metric tonnes (1 metric tonne = 1000 kg = 2205 lbs.) and emission factors are provided in both English and System International (SI) units of measure. Other aspects of the Compendium that enhance usability include: 1. tables of fuel properties common to the oil and gas industry; 2. example calculations for each emission estimation method; 3. case studies to illustrate the use of the Compendium and to demonstrate the computational approaches; 4. detailed references to sources of emissions data. Developing an inventory: the SANGEA inventory tool An electronic data management tool is highly valuable to effectively manage greenhouse gas emissions data following the accounting and reporting approaches contained in the Guidelines, and consistently applying the methodologies from the Compendium. The SANGEA system is a comprehensive energy and emissions management system that can be used to: 1. account for emissions on both an operated and equity share basis; 2. account for and report direct and indirect emissions separately; 3. assess energy utilization and greenhouse gas emissions to determine the major sources; Figure 4 SANGEA summary sheet 4. guide energy and greenhouse gas emissions management activities by enabling comparisons of emissions per barrel for similar activities or similar fields; 5. establish the initial baseline for energy utilization and emissions; 6. forecast emissions, both for business as usual and for new energy efficiency projects; 7. set goals for improving energy efficiency and decreasing greenhouse gas emissions; 8. track progress towards interim and final goals; 9. provide an indication of the need to take early action or re-evaluate systems if progress is inadequate; 10. document progress against baseline for potential future crediting; 11. provide a basis for discussions with regulators and other stakeholders about the various parameters that affect energy utilization and greenhouse gas emissions from a mature oilfield. Chevron Texaco directed a team of consultants that developed the SANGEA software. It is Excel based, with a Visual Basic add-in containing the calculations, emission factors and macros to help users set up their files. To make sure the SANGEA system yields auditable data, PricewaterhouseCoopers recommended a range of controls that were built into the SANGEA software. The SANGEA system is comprehensive and modular, so that it can be used to estimate energy utilization and greenhouse gas emissions from all types of petroleum industry sources. Users configure the system for their site, select the applicable modules, and then specify the sources within each module (e.g. turbines, engines and boilers). Once the SANGEA spreadsheet has been configured, data entry is straightforward, using standard tables for monthly data entry for each source. The input tables can be linked to other data management or accounting systems, such as Excel, J.D. Edwards or SAP. Users can generate quarterly reports. The system also generates standard charts to show emissions over time, by intensity and as a forecast. As shown in Figures 2-4, the summary tables and charts generated by the SANGEA software allow the user to analyze the data in many different ways – by location, module or species. Because the SANGEA system uses Microsoft Excel as a basis, the tables can be copied and pasted to other Excel spreadsheets for further manipulation of the data. Conclusion A credible, systematic approach to GHG emissions, as embodied in the Petroleum Industry Guidelines and the API Compendium, provides strategic value to the petroleum industry as we address the climate change issue. By furthering the goal of consistent guidance on greenhouse gas emissions accounting, estimating and reporting, our industry improves its credibility and provides a foundation for future cooperative efforts among petroleum industry companies, regulators and other industries to address this important issue. References American Petroleum Institute (API) (2001) Compendium of Greenhouse Gas Emissions Estimation Methodologies for the Oil and Gas Industry. American Petroleum Institute, Washington, DC (http://ghg.api.org). International Petroleum Industry Environmental Conservation Association (IPIECA) (2003) Petroleum Industry Guidelines for Reporting Greenhouse Gas Emissions. IPIECA, London (www.ipieca. org). World Resources Institute (WRI)/World Business Council for Sustainable Development (WBCSD) (2004) The Greenhouse Gas Protocol: A corporate accounting and reporting standard, Revised Edition. WRI/WBCSD, Geneva and Washington, DC (www.wri.org; www.wbcsd.ch). ◆ UNEP Industry and Environment April – September 2004 ◆ 75
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