United States Environmental Protection Agency Air and Radiation 6202] EPA-430-N-01-001 Winter 2001 ATURAL GAS STAR Winter 2001 i i 1 1 Higher Gas Prices Mean Greater Cost Savings from Reducing Methane Emissions Natural gas has never been a more valuable commodity! With elevated gas prices and demand at an all-time high, some gas companies may see a welcome boost to profits. Today's high prices also mean that operators are likely to have additional cost- effective opportunities to reduce methane emissions and increase gas sales. With annual industry-wide emissions estimated at 312 Bcf and well-head prices averaging $4.00/Mcf and higher, approximately $1.2 billion of natural gas are lost to the atmosphere each year. Now is a good time to take a second look at gas leaks and losses that were not economic to address at lower prices, (continued on page 2) Potential Cost Savings at $4/Mcf and $6/Mcf Action Replace wet seals with dry seals in centrifugal compressors Annual Volume Value of Gas Value of Gas Implementation Payback of Gas Lost Saved at Saved at Cost in Months $4/Mcf $6/Mcf $4/Mcf $6/Mcf 45,120 Mcf $180,480 $270,720 $240,000 8.8 5.9 Directed inspection and maintenance at compressor stations 2,585 Mcf per $10,340 per $15,510 per $2,065 per N/A N/A station on station on station on station on average average average average Install static seal/maintain pressure in off-line compressors 5,600 Mcf $22,400 $33,600 $3,000 1.6 1.0 Directed inspection and 385 Mcf maintenance at gate stations and surface facilities Reduce TEG circulation 1 30 to 1 3,1 40 Mcf rates in dehydration units $1,540 $320 to $52,560 $2,310 $480 to $78,840 $295 per station Negligible N/A N/A Immediate Replace high-bleed pneumatic devices with low-bleed devices 50 to 200 Mcf $200 to $800 $300 to $1200 $150 to $250 2.3-1.5 1.5-10 Economic replacement of rings and rods in compressor rod packing systems 80 Mcf $320 $480 $100 3.7 2.5 Install flash tank separators (energy exchange pump, 300 gal/hr TEG circulation rate) 7,095 Mcf $31,080 $46,620 $7,160 2.8 1.9 ------- Higher Gas Prices Mean Greater Cost Savings continued from page 1 Historically, Natural Gas STAR has used $2.00/Mcf to calculate savings and evaluate economic opportunities from methane emission reduction technologies and practices. Given today's higher gas prices, potential savings are even more impressive, and payback periods are significantly shorter. The table on page 1 demonstrates possible savings and payback periods for selected STAR Best Management Practices and Partner Reported Opportunities, using gas prices of $4.00/Mcf and $6.00/Mcf. We hope this information will encourage you to consider which practices and technologies will boost your company's bottom line. To showcase the methane reduction efforts of Gas STAR Partners and promote the Natural Gas STAR Program, this public service announcement appeared pro bono in the December 1999 issue of Pipeline & Gas Industry and in the March 2000 issue of American Gas. When change is in the air...leaders emerge. IN THIS I SSU E Higher Gas Prices Mean 1 Greater Cost Savings Natural Gas STAR in 4 the News Program Update 5 Program Tools 6 Mitigating Greenhouse 7 Gases: New Jersey's Plan Service Representatives 8 Document Request Form 10 ANR Pipeline Atlanta Gas Light Baltimore Gas & Electric Bay State Gas Brooklyn Union/Keyspan Energy Central Hudson Gas & Electric Citizens Gas & Coke Utility Colorado Interstate Gos Columbia Gas of KY,MD,OH,PA,VA Columbia Gas Transmission Columbia Gulf Transmission Conectiv Power Delivery Consolidated Edison Consumers Energy El Paso Natural Gas Enron Gos Pipeline Group Equitable Resources Granite State Gas Transmission Great Lakes Gas Transmission Iroquois Gas Transmission Kansas Operating Pipeline Koch Gateway Pipeline LG&E Gas Division Michigan Consolidated Gas MidCon Texas Pipeline Natural Gas Pipeline Company of America New York State Electric & Gas Niagara Mohawk Power Northern Indiana Public Service Northern Utilities Northwest Natural Gas Orange & Rockland Utilities Pacific Gas & Electric PECO Energy Public Service Company of North Carolina Public Service Electric & Gas Reliant Energy Minnegasco Rochester Gas & Electric South Carolina Electric & Gas Southern California Gas Southern Natural Gas Southwest Gas Superior Water, Light & Power Tennessee Gas Pipeline UGI Utilities UtiliCorp United Washington Gas Williams Gas Pipeline-Central Williams-Texas Gas Transmission Williams-Transco Wisconsin Public Service These transmission and distribution companies are leaders in the natural gas industry. Why? Because they are implementing voluntary, cost-effective measures to reduce emissions of methane, a greenhouse gas. They're maximizing profits by reducing gas losses, and they're demonstrating that environmental performance and business innovation go hand in hand. To learn how your company can master this winning combination, call EPA's Natural Gas STAR Proaram at 2 EPA Natural Gas STAR Program — www.epa.gov/gasstar Natural Gas STAR Partner Update • Winter 2001 ------- Profitability & environment; performanc As thes winpanit Production Partners Amerado Hess, U.S. Exploration and Production ATOFINA Petrochemicals Belco Energy BP Burlington Resources Chevron, U.S.A. Production Devon Energy ExxonMobil Production Kerr-McGee Marathon Oil Mitchell Energy and Development Ocean Energy Phillips Petroleum, Americas Division Pioneer Natural Resources USA Shell Exploration and Production Spirit Energy 76, i- A Business Unit gsf of Unocal Texaco Exploration and Production 1 The Stranded Gas Association Union Pacific Resources Group Transmission and Distribution Partners ANR Pipeline Atlanta Gas Light Atmos Energy Baltimore Gas and Electric Boy State Gas Central Hudson Gas & Electric Citizens Gas & Coke Utility Colorado Interstate Gas Columbia Energy Group Distribution (Columbia Gas of KY, MO, OH, PA, VA) Columbia Gas Transmission Transmission Conectiv Power Delivery Consolidated Edison of New York Consumers Energy El Paso Natural Gas Enron Gas Pipeline Group Equitable Resources Granite Slate Gas Transmission Great Lakes Gas Transmission Iroquois Gas Transmission Kansas Pipeline Operating Company KeySpan Energy Delivery KN Interstate Pipeline (Midcon) Koch Gateway Pipeline Louisville Gas & Electric Michigan Consolidated Gos New York Slate Electric & Gas Niagara Mohawk Power Northern Indiana Public Service Northern Natural Gos Northern Utilities NW Natural Orange and Rockland Utilities Pacific Gas and Electric PECO Energy PSNC Energy Public Service Electric end Gos Questar Pipeline Reliant Energy Minnegasco Rochester Gos & Electric South Carolina Electric & Gas Southern California Gas Southern Natural Gas Southwest Gas Superior Water, Light and Power Tennessee Gos Pipeline Transwestern Pipeline UGI Utilities UtiliCorp United Washington Gas Williams Gos Pipeline - South Central Williams Gas Pipeline - Transco Williston Bosin Interstate Pipeline Wisconsin Public Service This public service announcement and editorial promoting Gas STAR was printed pro bono on the cover wrap of the November/ December 2000 edition of the Harvard Business Review. These natural gas companies are focused on being smart, efficient, and innovative, which are qualities that define business leadership. Each has found that implementing marke consistent with objectives for continued ased solutions to environmental challenges is 1 by volunta" rtant greer component of natural reducing emissions gas. As partners witn implementing cost-effective technologies and practices that reduce methane emissions, while improving the bottom line. In teaming with EPA, these companies are establishing a reputation for reducing natural gas losses at a time when the demand for clean-burning natural gas is expected to rise significantly over the next 20 years. And EPA considers the voluntary actions of these companies an important part of the nation's response to concerns about global climate change. To learn more about how these companies have become industry leaders while emphasizing environmental performance, call the program manager at 202-564-2318 or visit the program Web site at www.epa.gov/gasstar. PA Natural Gas STAR Program — www.epa.gov/gasstar Endorsers of the Natural Gos STAR Program include: American Gas Association 4> American Petroleum Institute Interstate Natural Gas Association of America NOS& Natural Gas Supply Association Natural Gas STAR Partner Update • Winter 2001 ------- AR l\l EVX/S Industry journals are increasingly interested in the achievements of Natural Gas STAR and its partners. These three excerpted articles highlight Gas STAR'S recent accomplishments. Methane Cuts Save STAR Partners $54 Million Washington, Dec. 22, 2000 - EPA's Natural Gas STAR program industrial partners reduced methane emissions from unit operations and equipment leaks by 27 billion cubic feet in 1999, according to an Agency report just released. At a gas value of $2 per thousand cubic feet, these gas savings are worth approximately $54 million. The STAR program, a voluntary partnership between EPA and the natural gas industry, focused on identifying and implementing cost-effective technologies and —GreenBiz.com, week of December 22, 2000 From OGJ Newsletter EPA is expanding its STAR program to promote cost-effective management practices that could save up to 2.5 bcf, or more than 70% of the natural gas lost annually by the gathering and processing segment of the industry. The new program proposes to reduce gas losses through market-based activities that are profitable for industry partners and beneficial to the environment. Industry partners would choose among a number of best management practices recommended by EPA to minimize equipment leaks, reduce gas releases from unit —Oil and Gas Journal, December 11, 2000 STAR Honors Companies For Reducing Emissions Washington - The U.S. Environmental Protection Agency announces that the industry partners in its Natural Gas STAR program reduced methane emissions from unit operations and equipment leaks by 27 billion cubic feet in 1999. At a gas value of $2 an Mcf, these reductions equate to $54 million, EPA notes. EPA reports that it has awarded Kerr-McGee Oil and Gas Corp., Columbia Transmission, and Bay State Gas Co. with STAR Partner of the Year awards for outstanding performance in identifying and implementing innovative emission-reducing practices, achieving significant reductions, and supporting —The American Oil & Gas Reporter, December 2000 Natural Gas STAR Partner Update • Winter 2001 ------- PROGRAM LJRDA Natural Gas STAR Welcomes Five New Partners! EXPLORATION ft PRODUCTION COMPANY MURPHY Murphy Exploration and Production Company, a business unit of Murphy Oil Corporation, is an independent oil and gas company based in New Orleans, Louisiana. Murphy's U.S. exploration and production operations are concentrated in the Gulf of Mexico Region and onshore South Louisiana. Average daily production from these areas in 2000 was approximately 150 million cubic feet of natural gas and 6,800 barrels of crude oil and natural gas liquids. This is roughly one-third of Murphy's total production. Visit Murphy's Web site at www.murphyoilcorp.com. BARRETT Barrett Resources Corporation, based in Denver, Colorado, is an independent natural gas and oil RESOURCES exploration and production company with major emphasis in the Rocky Mountain Region. The CORPORATION company also has producing properties in the Mid-Continent Region and exploration activities in Peru. Barrett Resources operates a gas marketing and trading group, allowing the company to market its own gas and buy and resell other companies' natural gas at a profit. Visit Barrett's Web site at www.brr.com. f Reliant >\\ Energy., Arkla ' Reliant >\\ Energy, Entex Reliant Energy Arkla, based in Little Rock, Arkansas, and Reliant Energy Entex, based in Houston, Texas, are subsidiaries of Houston-based Reliant Energy. Together, they serve over 2.1 million natural gas customers in Louisiana and Texas. Reliant Energy is an international energy services and energy delivery company with approximately $29 billion in annual revenue and assets totaling more than $32 billion. The company has nearly 24,000 megawatts of power generation in operation in the United States and nearly 4 million American customers. Visit Reliant's Web site at www.reliantenergy.com. & \ LOUIS DreyfilS Natural Gas Louis Dreyfus Natural Gas Corporation is an independent oil and gas producer based in Oklahoma City, Oklahoma. Louis Dreyfus is one of the largest natural gas companies in the United States, with reserves of 1.464 Tcfe and average daily production of 345 Mmcfe. Natural gas represents 88 percent of proven reserves. The company's major operating regions are the Mid-Continent, Permian Basin, and Gulf Coast/Offshore. Visit Louis Dreyfus's Web site at www.ldng.com. -, How do you like receiving the Partner Update via e-mail? Natural Gas STAR would like your opinion. E-mail your response to Carolyn Henderson at henderson.carolyn@epa.gov If you prefer to receive a paper copy, please let us know. We are pleased to welcome Kathleen Meier as the newest Natural Gas STAR team member. Kathleen recently worked in the EPA Office of Pesticide Programs and will now work with Paul Gunning and Carrie Henderson to manage Natural Gas STAR. Jon Passe has moved on to another position within EPA's Climate Protection Partnerships Division. Natural Gas STAR Partner Update • Winter 2001 ------- PROGRAM We hope that you have received your copy of the Natural Gas STAR Communications Toolkit User's Guide, designed to help partners communicate about their participation in the program. The kit contains (1) templates for press releases, newsletters and web sites; (2) sample communication pieces developed and used by STAR partners; (3) presentations, videos, and articles about the STAR Program; and (4) technical and programmatic information. You can request a User's Guide from Kathleen Meier at (202) 564-9748 or go to the Toolkit on the Internet at www.epa.gov/gasstar/toolkit. Natural Gas STAR Partner Update • Winter 2001 ------- EOH l\l IOAL IMEVX/S Mitigating Greenhouse Gases: State of New Jersey First To Implement Action Plan With the unveiling of its Sustainable State Project on April 17, 2000, New Jersey became the first state to establish a goal for greenhouse gas (GHG) reductions with specific milestones. Last year, the New Jersey Department of Environmental Protection (NJDEP) committed to cutting state GHG emissions by 3.5 percent below 1990 levels by 2005. The plan calls for reducing emissions by about 20 million tons through five initiatives: energy conservation, pollution prevention, innovative technologies, recycling and solid waste management, and natural resource protection. New Jersey produces about 2 percent of the nation's greenhouse gases (about 130 million tons a year). If no action is taken, emissions are projected to rise 6 percent annually. On February 12, all 56 New Jersey colleges and universities agreed to implement programs to help reach the state's 3.5-percent GHG reduction target. State Environmental Protection Commissioner Bob Shinn is now working to develop environmental partnership agreements with cities and counties that contain a similar commitment to GHG reductions. The City of Bayonne and Hudson County have already signed on; three more agreements are in draft stages. Joe Genovay, Office of the Commissioner, notes that Shinn plans to create a statewide program through these agreements. Strategies to address greenhouse gases include the following: • Establishing incentives that encourage voluntary reductions, such as a banking and trading system for carbon dioxide emissions • Promoting energy efficiency through the Open Market Emission Trading Program and requiring power suppliers in the forthcoming deregulated electricity market to disclose energy efficiency information • Addressing mobile sources of carbon dioxide emissions • Reducing landfill methane emissions • Promoting and establishing incentives for the use of renewable energy technologies, including geothermal, fuel cells, wave, solar, methane from landfills, biofuels and biomass used in the transportation, heating/cooling and energy production sectors The state's action plan follows on the heels of an incentive program for permit applicants established by NJDEP. The program seeks to reduce GHG emissions and achieve higher levels of pollution prevention. The Silver and Gold Track Programs for Environmental Excellence offer regulatory flexibility to companies with superior track records in exchange for a covenant committing to specified environmental gains. Five applicants have signed up for these programs since they were announced in late 1999. Natural Gas STAR strives to keep Partners informed about greenhouse gas and climate change-related developments at the state and federal levels. For more information on New Jersey's greenhouse gas action plan, contact Mike Winka, NJDEP, at (609) 292-9962. For more information on the partnership agreements, contact Joe Genovay, Office of the Commissioner, at (609) 633-1238. Natural Gas STAR Partner Update • Winter 2001 ------- SERX/ICE IM IX/ES Looking for assistance using the new Gas STAR Communications Toolkit or help in preparing your annual report? If so, your STAR Service Representative is waiting to hear from you. These representatives can help complete program forms, facilitate information exchange among partners, and provide up-to-date information on program developments. David Frank 703/841-0588 or dfrank@erg.com Rebecca Ferro 703/841-1705 or rferro@erg.com Thomas Graham 703/841-4378 or tgraham@erg.com Trevor Quinn 703/841-4816 or tquinn@erg.com Jocelyn Spielman 703/841-0557 or jspielma@erg.com Heather Wright 703/841-0547 or hwright@erg.com Company Name STAR Service Representative Amerada Hess Corporation, U.S. Exploration & Production ANR Pipeline Company Atlanta Gas Light Company Atmos Energy Corporation Baltimore Gas and Electric Co. Barrett Resources Corp. Bay State Gas Company Belco Energy Corp. BP Amoco Corp. Burlington Resources, Inc. Central Hudson Gas & Electric Corporation Chevron U.S.A. Production Company Citizens Gas and Coke Utility Colorado Interstate Gas Company Columbia Energy Group Distribution Companies Columbia Transmission Segment Conectiv Power Delivery Conoco, Inc. Consolidated Edison Company of New York, Inc. TREVOR QUINN TREVOR QUINN DAVID FRANK THOMAS GRAHAM THOMAS GRAHAM THOMAS GRAHAM THOMAS GRAHAM JOCELYN SPIELMAN HEATHER WRIGHT THOMAS GRAHAM TREVOR QUINN HEATHER WRIGHT HEATHER WRIGHT JOCELYN SPIELMAN DAVID FRANK DAVID FRANK JOCELYN SPIELMAN THOMAS GRAHAM HEATHER WRIGHT Consumers Energy Devon Energy Corporation Duke Energy Gas Transmission Dynegy Midstream Services, L.P. El Paso Field Services El Paso Natural Gas Company Enron Gas Pipeline Group Equitable Resources, Inc. ExxonMobil Corporation FINA Oil and Chemical Company Great Lakes Gas Transmission Company Iroquois Gas Transmission System Kansas Pipeline Company Kerr-McGee Oil and Gas Corporation Keyspan Energy Delivery Koch Gateway Pipeline Company Louis Dreyfus Natural Gas Louisville Gas & Electric Company Marathon Oil Company Michigan Consolidated Gas Company Mitchell Energy and Development Corporation HEATHER WRIGHT JOCELYN SPIELMAN REBECCA FERRO REBECCA FERRO TREVOR QUINN TREVOR QUINN DAVID FRANK HEATHER WRIGHT JOCELYN SPIELMAN DAVID FRANK TREVOR QUINN DAVID FRANK HEATHER WRIGHT JOCELYN SPIELMAN JOCELYN SPIELMAN HEATHER WRIGHT JOCELYN SPIELMAN TREVOR QUINN THOMAS GRAHAM DAVID FRANK REBECCA FERRO Natural Gas STAR Partner Update • Winter 2001 ------- SERX/ICE REPRESEIMTATIX/ES continued from page 8 Murphy Exploration and Production Company Natural Gas Pipeline Company of America/KN Energy New York State Electric & Gas Corporation Niagara Mohawk Northern Indiana Public Service Company Northwest Natural Gas Company Ocean Energy, Inc. ONEOK Field Services Orange and Rockland Utilities, Inc. Pacific Gas and Electric Company PECO Energy Company PG&E Natural Energy Group Phillips Petroleum Company's America Division Pioneer Natural Resources USA, Inc. (Domestic Operations) Pioneer Natural Resources USA, Inc. (Gas Processing) PSNC Energy Public Service Electric and Gas Company Questar Pipeline Company THOMAS GRAHAM THOMAS GRAHAM DAVID FRANK HEATHER WRIGHT JOCELYN SPIELMAN DAVID FRANK REBECCA FERRO REBECCA FERRO HEATHER WRIGHT JOCELYN SPIELMAN REBECCA FERRO JOCELYN SPIELMAN REBECCA FERRO THOMAS GRAHAM THOMAS GRAHAM DAVID FRANK HEATHER WRIGHT JOCELYN SPIELMAN Reliant Energy - Arkla Reliant Energy - Entex Reliant Energy - Minnegasco Rochester Gas & Electric Corporation Shell Exploration and Production Company South Carolina Electric & Gas Southern California Gas Company Southern Natural Gas Southwest Gas Corporation Superior Water, Light and Power Company Tennessee Gas Pipeline Texaco Exploration and Production TXU Electric and Gas TXU Lone Star Pipeline UGI Utilities, Inc. Union Pacific Resources Group, Inc. Unocal Corp. UtiliCorp United, Inc. Washington Gas WBI Holdings, Inc. Williams Gas Pipeline - Texas Gas Williams Gas Pipeline Central Williams-Transco JOCELYN SPIELMAN JOCELYN SPIELMAN JOCELYN SPIELMAN THOMAS GRAHAM JOCELYN SPIELMAN TREVOR QUINN DAVID FRANK HEATHER WRIGHT HEATHER WRIGHT HEATHER WRIGHT TREVOR QUINN THOMAS GRAHAM DAVID FRANK DAVID FRANK DAVID FRANK HEATHER WRIGHT TREVOR QUINN REBECCA FERRO JOCELYN SPIELMAN REBECCA FERRO REBECCA FERRO REBECCA FERRO REBECCA FERRO The Natural Gas STAR Service Representatives are employees of Eastern Research Group, a consulting firm providing support to EPA's Natural Gas STAR Program. Natural Gas STAR Partner Update • Winter 2001 ------- D O C U IVI E IM T REQUEST FORIVI Name & Title: Organization: Street Address: _ City, State, Zip: _ E-Mail Address: _ Telephone #: Date Requested: FAX#: Date Info Needed: FedEx/UPS # (if info needed asap): EPA POLLUTION PREVENTER Please fax to your STAR Service Representative at 703-841-1440 or directly to the Natural Gas STAR Program at 202-565-6674. PLEASE INDICATE WHICH IX/IATERIALS YOU WOULD LIKE TO RECEIVE: LESSONS LEARNED 1. Directed Inspection and Maintenance at Compressor Stations 2. Directed Inspection and Maintenance at Gate Stations and Surface Facilities 3. Options for Reducing Methane Emissions from Pneumatic Devices in the Natural Gas Industry 4. Installation of Flash Tank Separators 5. Reducing Methane Emissions from Compressor Rod Packing Systems 6. Reducing Emissions When Taking Compressors Off-line 7. Installing Vapor Recovery Units on Crude Oil Storage Tanks 8. Replacing Wet Seals with Dry Seals in Centrifugal Compressors 9. Reducing the Glycol Circulation Rates in Dehydrators 10. Replacing Gas-Assisted Glycol Pumps with Electric Pumps 11. Installing Plunger Lift Systems in Gas Wells 12. Using Pipeline Pump-Down Techniques To Lower Pipeline Pressure Before Maintenance STAR IMPLEMENTATION TOOLS Video-Production Video-Transmission/Distribution Case Study-El Paso Natural Gas Case Study-Brooklyn Union/Keyspan Energy Case Study-Texaco Exploration and Production, Inc. OUTREACH MATERIALS Natural Gas STAR Program Brochure Natural Gas STAR Marketing Package Natural Gas STAR Communications Toolkit STAR Partner Update, Summer 1998 STAR Partner Update, Spring 1999 STAR Partner Update, Winter 1999 STAR Partner Update, Fall 2000 Most of these materials are available on the Internet at www.epa.gov/gasstar Natural Gas STAR Partner Update • Winter 2001 ------- |