Oilpatch accused of using ‘myth’ to delay Canada’s climate action.

There are two perspectives on whether Canada’s fossil fuelEnergy from fossil sources, such as natural gas and oil. This type of energy contributes to climate change and because of its finite nature it is not a permanent resource. industry can adapt to better limit methaneMethane is one of the six greenhouse gases to be mitigated under the Kyoto Protocol and is the major component of natural gas and associated with all hydrocarbon fuels, animal husbandry and agriculture. Coal-bed methane is the gas found in coal seams. (IPCC) gas, a harmful form of air pollution, without a costly and burdensome overhaul of its equipment.

Canada’s main oil industry lobby group says that new regulations to limit this heat-trapping pollution would be a “significant burden” with a potential impact on hundreds of thousands of operations nationwide.

That perspective has won the day with the federal Liberal government, at least for now. After the Canadian Association of Petroleum Producers (CAPP) lobbied to delay new regulations “past 2020,” the government did just that, pushing the start date from 2018 to 2020.

“There is a regulatory process. We need to listen to industry,” said Environment Minister Catherine McKenna, according to CBC News. “Our goal is to take serious action on climate changeClimate change is a lasting change in weather patterns over long periods of time. It can be a natural phenomena and and has occurred on Earth even before people inhabited it. Quite different is a current situation that is also referred to as climate change, anthropogenic climate change, or ... to reduce emissionsEmissions of greenhouse gases, greenhouse gas precursors, and aerosols associated with human activities, including the burning of fossil fuels, deforestation, land-use changes, livestock, fertilisation, etc. (IPCC). But we need to be doing it in a smart way where we make sure that we are understanding the perspective of industry and understanding the science.”

CAPP says it’s committed to the government’s objective of reducing methane emissions from its equipment 40-45 per cent by 2025, and just needed time to prepare. McKenna’s office appeared to agree when it justified the delay by saying it would give industry “more time to make changes to operations.”

The industry group also said implementation costsCost: The consumption of resources such as labour time, capital, materials, fuels, etc. as the consequence of an action. In economics, all resources are valued at their opportunity cost, which is the value of the most valuable alternative use of the resources. Costs are defi ned in a variety of ... will be in the “billions” of dollars, although the group told National Observer it can’t specify a dollar amount, or even a costCost: The consumption of resources such as labour time, capital, materials, fuels, etc. as the consequence of an action. In economics, all resources are valued at their opportunity cost, which is the value of the most valuable alternative use of the resources. Costs are defi ned in a variety of ... range, because costs would fluctuate highly from firm to firm. In any case, the government also appeared to agree costs are a factor, saying the delay would give industry time to “budget the capitalWealth in the form of money or other assets owned by a person or organization or available for a purpose such as starting a company or investing. needed.”

But one company at the heart of the industry is offering another perspective.

Audrey Mascarenhas, chief executive officer of Calgary-based Questor Technology Inc., said in an interview that her company has already deployed technology to eliminate methane gas at the source, by incinerating it in closed containers.

She said it’s a “myth” that converting oil and gas equipment to capture methane gas before it escapes into the atmosphere would cost the industry billions of dollars and will take it more time to prepare for. Questor is already deploying its commercial technology now, she said, partnering with many clients around the world, at a far lower cost.

“In some ways, industry does want the narrative to be, ‘there is no technology,’” said Mascarenhas.

Canada’s federal greenhouse gasGreenhouse gas emissions cause dangerous anthropogenic climate change. Emissions include CO2, fluoridated gases, methane which are emitted by human activity such as deforestation and burning fossil fuels, and water vapour. inventory report shows how methane emissions were the second-most common greenhouse gas in Canada from 1990 to 2015. National Inventory Report screenshot

Where methane gas comes from

Her comments come as Canada tries to get a handle on the growth of methane emissions from the oil and gas industry, which is responsible for 42 per cent of Canada’s methane emissions. Most of the rest comes from agricultureCultivation of the ground and harvesting of crops and handling of livestock, the primary function is the provision of food and feed. at 28 per cent and landfills at 22 per cent.

Methane, a colourless, odourless, flammable gas, is one of the world’s major greenhouse gasesGreenhouse gas emissions cause dangerous anthropogenic climate change. Emissions include CO2, fluoridated gases, methane which are emitted by human activity such as deforestation and burning fossil fuels, and water vapour., meaning it traps heat in the atmosphere, contributing to dangerous climate change. Scientists say reducing methane gas emissions is one of the most effective ways of lowering Canada’s climate pollution, as it warms the planet over 80 times more than carbon dioxideCarbon dioxide (CO2) is emitted in several ways. Naturally through the carbon cycle and through human activities like the burning of fossil fuels. These human activities have increased CO2 concentrations in the atmosphere since the beginning of the industrial revolution and these high ... in the first few decades after it’s put into the air.

The industry is largely responsible for the nine-per-cent growth of Canada’s methane gas emissions since 1990. While emissions are up from all sources, a federal inventory report said the 8.9-megatonne jump is “largely due to the development of petroleum resources.” Gas that escapes from the fossil fuel industry rose 21.2 per cent between 1990 and 2015, the inventory report said.

Methane represented one seventh of all greenhouse gases created by Canada in 2015. The reason so much is from oil and gas, is because it’s produced by many small pieces of equipment scattered all over Canada’s landscape, said David Layzell, director of the Canadian energy systems analysis research initiative at the University of Calgary.

Some oil or gas wells naturally leak methane as they’re being exploited, while others are pieces of equipment used to contain or transport fossil fuelsEnergy from fossil sources, such as natural gas and oil. This type of energy contributes to climate change and because of its finite nature it is not a permanent resource.. Pumps on gas pipelines also release a bit of methane, he said.

Some pressurized equipment is specifically designed to release methane into the atmosphere in order to properly function, said Dale Marshall, national program manager at Environmental Defence. “They are designed to, what they call, ‘bleed’ methane; they keep the conditions of the system at a steady state by venting,” he said.

Methane is also released by accident when oil and gas equipment leaks—through an improperly-attached seal, for example—or malfunctions, like a ventAn opening permitting the escape of fumes, a liquid, a gas, or steam. that’s supposed to close but stays stuck open. These kinds of accidents are relatively frequent, according to Marshall. Environmental Defence released a report April 26 that said methane emissions at oil and gas facilities in Alberta were “60 per cent higher than estimates used to compile Canada’s greenhouse gas inventory.”

“On average, there is almost one piece of equipment leaking or venting methane at each well, [but] industry is not currently required to look for methane leaks to see if they have a problem,” the report said.

Canada’s inventory report shows greenhouse gas emissionsGreenhouse gas emissions cause dangerous anthropogenic climate change. Emissions include CO2, fluoridated gases, methane which are emitted by human activity such as deforestation and burning fossil fuels, and water vapour. from flaringA gas flare, alternatively known as a flare stack, is a gas combustion device used in industrial plants such as petroleum refineries, chemical plants, natural gas processing plants as well as at oil or gas production sites having oil wells, gas wells, offshore oil and gas rigs and landfills. ... and venting oil and natural gas grew 10 per cent and 33 per cent respectively from 1990 to 2015. National Inventory Report screenshot

Flaring, venting…or gas incineration?

Companies can capture the gas from each of these sources, process it and put it into a pipeline, said Layzell. But because gas is cheap, it’s often not worth the money for companies to set up infrastructure to do this, he said.

Instead, companies simply burn it off, a process called flaring, or release it into the air, known as venting, as a cheap and simple way of getting rid of it. This process is so common that flaring rose 10 per cent from 1990 to 2015, the inventory report said, while venting rose 33 per cent.

But this puts increasingly large amounts of methane into the atmosphere, threatening the climate. So if companies aren’t going to spend the money capturing the gas themselves, Mascarenhas believes she has another solution.

She said her company attaches its equipment to oil and gas devices, captures the methane emissions, then burns the gas at what she says is 99.99 per cent efficiencyUsing less energy/electricity to perform the same function. Programs designed to use electricity more efficiently - doing the same with less., producing carbon dioxide and waterClimate change is expected to exacerbate current stresses on water resources from population growth and economic and land-use change, including urbanisation. On a regional scale, mountain snow pack, glaciers and small ice caps play a crucial role in freshwater availability. Widespread mass ... as byproducts.

Carbon dioxide is also a greenhouse gas, but because methane is so concentrated, she says that converting it to carbon dioxide downgrades its polluting potency. She said incinerating a tonne of methane this way reduces emissions nine fold, and that she can reduce greenhouse gas emissions this way by 60 megatonnes “at a cost of less than $1.70 a tonne.”

The industry group, CAPP, isn’t yet convinced. It says it needs to look at the technology more before coming to a conclusion.

“Analysis is required on deployment of commercially-available technology and whether it is more cost-efficient for a new build than it is for the retrofit of existing facilities,” wrote CAPP spokeswoman Chelsie Klassen, in an emailed response to questions.

Oil and gas companies need to collect more data about the types of devices they’re using before figuring out if retrofits make sense, she said. “Industry has a significant inventory of facilities and over 200,000 operations across the country could potentially be impacted,” she wrote.

Klassen stressed that costs would include not just capital investments of new equipment or retrofitting purchases and installations, but also ongoing operating costs related to leak detection and repair. “The costs fluctuate based on staffing, frequency to check sites and repair surveys,” she added.

The implication: This could take a while, and it won’t be cheap.

Audrey Mascarenhas, chief executive officer of Questor Technology, says her company is “best practices” for some large firms. Handout photo

‘Missing one of the easiest ways to have an impact’

Mascarenhas isn’t buying it.

“Take a look at my client list,” said Mascarenhas. “Part of my revenue does come from Canada…we’ve been around for a long time. We build great equipment, we know it works well. We’re best practices for some big companies.”

Questor boasts clients that include some of the biggest names in the industry: Shell, ExxonMobil, ConocoPhillips, Suncor, TransCanada, EnCana, Canadian Natural, Enbridge, Kinder Morgan. Many of its clients are, in fact, members of CAPP.

The publicly-traded firm, which says it has clients in Canada, “the U.S., the Caribbean, Western Europe, Russia, Thailand, Indonesia and China” reported in its 2017 first-quarter results that it had boosted revenue 36 per cent from the same period in 2016.

It attributed the success to the introduction of rental units associated with its gas incineration technology, allowing companies to buy a certain amount of capacity and then rent more depending on need. It expects to grow its rental fleet 36 per cent over the year.

Mascarenhas also points to the company’s efforts in Colorado, the state that became the first U.S. jurisdictionThe geographic territory over which a government’s political authority is exercised. (WRI, 2014)The geographic territory over which a government?s political authority is exercised. (WRI, 2014) to directly control methane in 2014. She said she’s working with the state’s third-largest driller there now.

The state, which faced serious smog problems and a fracking boom, passed stringent rules on eliminating methane gas in 2014. After new rules went into place, gas production actually went up, while drillers were only down 0.4 per cent of revenues, according to Bloomberg News.

“In Colorado, what they showed was, by forcing people to be innovative and think out of the box, they actually created a better solution,” said Mascarenhas.

In the company’s year-end results, the firm said it’s looking to “expand its presence in Colorado” and is also looking at Texas, which it estimates will have “as much as ten times the activity in Colorado.”

For Mascarenhas, it’s all evidence that Canadians “haven’t created an environment in Canada for technology companies to thrive and grow,” because methane regulations forcing change aren’t in place.

Companies like hers are “all growing outside of our own backyard,” she said. “We’re missing one of the easiest ways to have an impact on emissions, that makes business sense, that would move the ball forward and get us a fair ways to our target.”

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