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United States
Environmental Protection
Agency
                                        Air and Radiation
                                        (6202J)
                                                                     EPA430-F-01-012
                                                                     February 2001
                                                                     www.epa.gov/gasstar
Unocal  Gulf  Region USA
Natural Gas STAR
Case Study  Series
       nocal Gulf Region
       USA's participation   |J *M Q fA I   76
       in EPA's Natural Gas

       STAR Program illustrates how well-planned methane

emission reduction pilot projects can lead to larger initiatives that

significantly benefit the company's bottom line and the environ-

ment. Since joining the program in 1998, Unocal Gulf Region

has successfully implemented and expanded several pilot projects

that have yielded methane emission reductions of 640 million

cubic feet (Mmcf), valued at nearly $1.9 million. Word of Unocal

Gulf Regions accomplishments as a Gas STAR partner has spread

quickly, and its parent company, Unocal Corporation, has now

made methane emission reductions a corporatewide priority.
mm
Unocal Corporation, an international
energy resource and project develop-
ment company, produced 175,000
barrels of petroleum liquid and more
than 1,800 Mmcf of natural gas per
day in 1999. Unocal Gulf Region
USA, formerly Spirit Energy, is one of
Unocal Corporation's exploration and
production units, focusing on oil and
gas resources in the Gulf of Mexico
and onshore in Texas, Alabama, and
                                                   Louisiana. Headquartered in Sugar
                                                   Land, Texas, Unocal Gulf Region
                                                   employs approximately 1,300 people
                                                   and operates more than 200 offshore
                                                   platforms and about 1,500 active
                                                   wells in numerous onshore and off-
                                                   shore fields. In 1999, Unocal Gulf
                                                   Region's net natural gas production
                                                   was 747 Mmcf per day, and net crude
                                                   oil production was 40,000 barrels per
                                                   day.

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                    r
     Unocal Gulf Region had already started a pilot
     project to reduce methane emissions from
     pneumatic devices when EPA approached the
     company about the Natural Gas STAR
Program. Unocal Gulf Region reviewed the pro-
gram's goals and determined that joining Gas
STAR was consistent with the goals of the pilot
project. In addition, the company felt that partici-
pation in Gas STAR would provide an opportunity
to be recognized for its methane emission reduc-
tion activities and would improve its bottom  line.
In 1998, Unocal Gulf Region joined the program
with full support  from its president and the
health, environmental, and safety (HES) manager.
The company immediately began promoting
existing pilot programs and its  new partnership
with Gas STAR to employees as a unified under-
taking. The new partnership helped Unocal  Gulf
Region focus its efforts on improving efficiency
and reducing methane emissions  across its pro-
duction operations.
 ^B nvironmental specialist, James Frederick, is
     the implementation manager for the Gas
,^L STAR Program at Unocal Gulf Region. Upon
 ^•joining the program, Frederick established
two goals for initiating a successful partnership
with EPA: 1) review and inventory past methane
emission reduction efforts and 2) continue pilot
projects as a way to demonstrate Unocal Gulf
Region's commitment to methane emission reduc-
tion programs.
Emission Reduction Inventory
Unocal Gulf Region began its participation by
examining past emission reduction efforts.
Frederick coordinated with nine HES coordina-
tors and nine field supervisors to inventory best
management practices and partner reported
opportunities that Unocal Gulf Region imple-
mented as early as 1990. The inventory highlight-
ed several  activities:
•  Installation of flash tank separators on glycol
   dehydrate rs
•  Replacement of high-bleed pneumatic devices
•  Use of compressed air, rather than natural gas,
   in instrument systems
•  Installation of vapor recovery units
•  Installation of flare systems
•  Consolidation of production tank batteries
•  Performance of fugitive emission tests
After verifying the inventory data, Frederick pro-
vided this  information to EPA in the company's
first annual Gas STAR report. The report docu-
mented that from 1991 to 1999 Unocal Gulf
Region achieved methane emission reductions of
640 Mmcf, worth $1.9 million. Frederick pub-
lished the results internally on the company's
intranet, spreading the word
about Unocal Gulf
Region's accomplish-
ments and encourag-
ing employees to
think about what
else the company
could do to get the
"biggest bang for
the buck." He also
continues to work
with HES  coordinators
and field supervisors to
find other  past emission reduc-
tions that were missed during the first review.
Unocal Gulf Region USA
            Natural Gas STAR Case Study Series

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                         "
Pilot Projects
Unocal Gulf Region has found that using pilot proj-
ects to test new methane emission reduction activities
is the best way to establish which practices will be
most cost-effective to implement on a larger scale.
Pilot projects help determine associated costs and
               savings, timeframes, staffing, and
                       operational requirements
                          before the company
                            invests in large-scale
                              improvements.
                               Just before joining
                               Gas STAR, the
                                company initiated
                                its first pilot proj-
                               ect with the instal-
                               lation of an instru-
                              ment air system at a
                            facility in  Louisiana.
                          After careful planning
                        and consideration, Unocal
                 Gulf Region installed the pilot
instrument air system, thereby achieving substantial
emission reductions and cost savings. See  page 4 for
more details on this particular pilot project.
After the success of the instrument air project,
Unocal Gulf Region began considering  new projects
to reduce gas losses from high-bleed pneumatic
valves in the company's Gulf of Mexico operations.
One of the options that the company evaluated was
     "Not only is Natural Gas STAR a
     good vehicle to promote our
     company, but it's a good way to
     do business. Our business is the
     bottom line, and through STAR,
     we can make money."
           —-James Frederick, Environmental
          Specialist, Unocal Gulf Region USA
retrofitting all high-bleed
instruments with
Mizer low-bleed
controllers. The
low-bleed valves
could reduce gas
losses by up to 90
percent per
device.
Initial testing was
performed on two
Mizer controllers to
ensure that implementa-
tion of the pilot project
would not create an additional maintenance burden
for operators. In addition, the company analyzed
operational and economic conditions at several of the
proposed project locations. Unocal Gulf Region con-
cluded that although the Mizer controllers were
promising, there was enough electrical generation
capacity at the evaluated sites to support the installa-
tion of an instrument air system. The instrument air
alternative would eliminate gas  losses and provide a
quicker financial  return.
Unocal Gulf Region is still considering the Mizer
controllers at other platforms where there is not
enough generation capacity for  the instrument air
system. The company hopes to  accomplish conver-
sions to either the instrument air system or Mizer
controllers at all major platform facilities within the
next two years.
                                                         lith Unocal Gulf Region's successful pilots
                                                         'showing strong emission reductions and cost
                                                         savings, Unocal Corporation decided to join
                                                         the program in October 2000. Although only
                                                   Unocal Corporation's domestic facilities will report
                                                   program activities to EPA, the corporation wants to
Unocal Gulf Region USA
                                                                 Natural Gas STAR Case Study Series

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   Before joining Gas STAR, Unocal Gulf Region started a pilot project in 1996 at its Fresh Water
   Bayou facility in Vermilion Parish, Louisiana. Unocal Gulf Region designed the pilot to test the
   conversion of its natural gas-powered pneumatic instrument system to a compressed air-
   powered system. Initially, Unocal Gulf Region intended this project to cut overall gas losses
   and ensure the facility was not a major source of volatile organic compound (VOC) emis-
      is. However, the pilot project had the additional benefit of greatly reducing methane
      ssions caused by the intermittent bleed of gas from pneumatic controllers—one of the
      istry's largest sources of methane emissions.
   To determine the cost-effectiveness of the  pilot project,  Unocal Gulf Region conducted a
   four-step analysis that involved the following:
   Step 1: Establishing the technical feasibility of an instrument air system. The facto.
   impacting technical feasibility included a facility layout conducive to equipment installatio
   ample power supply, and a large number of pneumatic controller conversions. Based on th»
   facility's consolidated layout, onsite generators, and plans to convert all pneumatics, the
   Fresh Water Bayou facility met the technical conditions needed to  maximize emission reduc-
   tions and cost savings.
   Step 2: Estimating capital costs. Unocal Gulf Region's primary costs were the purchase of
   two Quincy rotary screw-type air compressors, a dehydration system, piping, and installation
   labor, bringing the initial projected capital outlay to $60,000.
   Step 3: Estimating potential savings. Using a turbine meter at the system inlet to measure
   the volume of natural gas used daily to feed the pneumatic instruments (e.g., bleeding con-
   trollers, chemical pumps, generators, saltwater pump starter), Unocal Gulf Region estimated
   that the average gas lost was 190 Mcf per day. This loss was costing the company $570 per
   day,  based on a gas price of $3 per Mcf.
   Step 4: Evaluating the economics. After comparing the capital costs and potential savings,
   Unocal Gulf Region determined that it would realize a quick return on its investment. In
   addition, the extra revenue generated by the increased gas sales would more than cover the
   annual maintenance costs—averaging $4,000 for both compressors—and the instrument air
   system would also protect the pneumatics from corrosion.
   Unocal Gulf Region's conversion to an instrument air system at its  Fresh Water Bayou facility
   is paying off. The company is reducing natural gas emissions by 69.4 Mmcf per year, includ-
   ing 62.4 Mmcf of methane emissions and 1.5 Mmcf of VOC emissions, saving more than_
   $208,000 annually. This success has prompted the company to look for other opportunities
   to convert to instrument air systems. In addition, the positive results helped convince Unocal
   Gulf Region's senior management that participation in Gas STAR is good for the company.
Unocal Gulf Region USA
Natural Gas STAR Case Study Series

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implement similar methane emission reduction activ-
ities at all of its international facilities.
The expansion of the Gas STAR Program has had
strong support from Unocal Corporation's CEO and
corporate Global Climate Change (GCC) Team,
which is responsible for reducing the corporation's
greenhouse gas emissions. The team promotes
Unocal Corporation's global climate efforts internally
through a Web site and conducts regular meetings to
review corporate procedures, policies, and programs
that impact global climate.
Frederick will be working closely with the GCC
Team and will oversee Unocal Corporation's partici-
pation in Gas STAR. He believes that with the
involvement of the corporate GCC Team, program
expansion will be easy. The GCC Team has closely
followed Unocal Gulf Region's participation in Gas
STAR and will provide insight to help guide the
expansion process. The Gulf Region has already
assigned five gas measurement technicians to the cor-
poration's Gas STAR Program  and is designing an
incentive program to encourage field employees to
propose ways to control both methane and carbon
dioxide emissions. The planned incentive program
expects to reward employees with a gift certificate
when their suggestions for operational improvements
are successfully implemented.
In addition  to the incentive program, several other
efforts are planned to ensure the success of Unocal
Corporation's Gas STAR Program. In the near
future, the corporation intends to develop a database
to make tracking emission reductions and cost sav-
    Being a Gas STAR partner can benefit a
    company in more ways than one.
    Unocal Gulf Region has found that work-
    ing with Louisiana's Department of
    Environmental Quality (DEQ) is becom-
    ing easier now that the company is a
    Gas STAR Partner. Because DEQ is aware
    of Gas STAR and the positive efforts and
    environmental benefits associated with
    the program,  DEQ can expedite the
    permitting pro*            cal Gulf
    Region's methane reduction activities.
ings easier. It also is spreading the word about Gas
STAR both internally to employees and externally to
other members of the idustry. A presentation on the
Gas STAR Program is scheduled for the corporation's
upcoming environmental conference. Furthermore,
Frederick is planning to work with the Gulf Coast
Environmental Affairs Group to encourage other
companies to join Gas STAR by demonstrating that
reducing methane emissions is cost-effective.
     "As a Natural Gas STAR partner, we are recognized as an environmentally
     friendly company. Even regulators are aware of this partnership, which is just
     as valuable as the cost savings achieved by reducing methane emissions."
                            —James Frederick, Environmental Specialist, Unocal Gulf Region USA
Unocal Gulf Region USA
             Natural Gas STAR Case Study Series

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                                   tions(Mcf)
  600,000
        1991  1992  1993  1994  1995  1996  1997  1998  1999

 1 Annual    6,205  6,205  87,735 411,697 419,887 540,720 614,050 624,635  627,894
 Cumulative 6,205  12,410
                       42 931,729 l,472,449e,086,499B,711,1343,13!  1
     Unocal Gulf Region reports average
     methane emission reductions of more
     than 371,000 Mcf each year.
             Legion's Emission Reduction Savings
$12,000,000-
$10,000,000 -R
 $4,000,000-
 $2,000,00
         1991  1992  1993  1994 1995 1996  1997  1998  1999


     Unocal Gulf Region reports an average of
     more than $1.1 million in emission
     reduction savings annually.
Unocal Gulf Region has the following
recommendations for companies look-
ing to develop and implement a suc-
cessful program:
•  Stress revenue gains. Many com-
   panies do not realize that reducing
   methane emissions saves money,
   which means a quick payoff for
   implementing reduction activities.
•  Gain management support. This is
   especially important for implement-
   ing a voluntary program because it
   adds significance to program activi-
   ties and ensures employee cooper-
   ation.
     "Support from our presi-
     dent and CEO has been
     key to making our partic-
     ipation in Natural Gas
     STAR a success."
                 —James Frederick,
          Environmental Specialist,
           Unocal Gulf Region USA
   Share results. Sharing success sto-
   ries internally, especially when
   numerous facilities are involved,
   encourages teamwork and enthusi-
   asm companywide, guaranteeing
   program support.
   Form a team. When employees
   work together on targeted issues,
   the desired results are often easier
   to achieve.

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