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Bakken Shale Gas Flaring Highlights Global Problem

gas flaring problems

  • High rates of natural gas flaring in the Bakken shale formation are symptomatic of infrastructure limitations that prevent this gas from reaching a market.
  • Although various technical options could reduce flaring from high-output well sites, none matches the benefits of developing large-scale outlets for the gas.

The Wall St. Journal recently reported on the high rate at which excess natural gas from wells in North Dakota’s Bakken shale formation is burned off, or “flared.”  The Journal cited state data indicating 10.3 billion cubic feet (BCF) of gas were flared there during April 2014. That represented 30% of total gas production in the state for the month.

North Dakota’s governor attributed the high volume of gas flared in his state to the great speed at which the Bakken shale has been developed, outpacing gas recovery efforts. Oil output ramped up from 200,000 barrels per day five years ago to just over a million today, in a region lacking the dense oil and gas infrastructure of Texas and other states with a legacy of high production.

Nor is this situation unique to the Bakken. The World Bank has estimated that around 14 BCF of gas is flared every day, globally. Such flaring is a problem for more than governments and other mineral-rights owners that worry about missing potential royalties.  Aside from our natural aversion to waste, flaring natural gas has environmental consequences.

The tight oil produced from the Bakken shale is quite low in sulfur, and so is most of the associated gas, but some of it contains relatively high percentages of hydrogen sulfide (H2S). When that gas is flared, rather than processed, the resulting SOx emissions can affect local or even regional air quality.

Gas flaring also contributes to the greenhouse gas emissions implicated in global warming, although it must be noted that flaring is 28-84 times less climate-altering, pound for pound, than venting the same quantity of methane to the atmosphere.  When annualized, and assuming complete combustion of the gas, North Dakota’s recent level of flaring equates to around 6.7 million metric tons of CO2 emissions, or nearly a fifth of total estimated US CO2 emissions from natural gas systems in 2012. That means this one source accounts for around 0.1% of total US greenhouse gas emissions, or somewhat less than US ammonia production.

Why would anyone flare gas in the first place? As the Journal pointed out, the oil produced from Bakken wells is worth significantly more than the gas, although the energy-equivalent price ratio favors oil by more like 4:1 than the 20:1 cited in the article. Still, the economics of Bakken drilling are mainly driven by oil that can be sold at the lease and delivered by pipeline or rail, and not by the associated gas, particularly after tallying the cost of capturing and processing it, and then hoping capacity will be available to deliver it to a market that in the case of the Bakken might be hundreds or thousands of miles away. The characteristics of shale wells, with their steep decline curves, raise this hurdle even higher: Shale gas infrastructure at the well must pay for itself quickly, before output tails off.

There is no shortage of technical options for putting this gas to use, instead of flaring it. An industry conference in Bismarck, ND this spring featured an excellent presentation on this subject from the Energy & Environmental Research Center (EERC) of the University of North Dakota. Among the options listed by the presenter were onsite removal of gas liquids (NGLs), using gas to displace diesel fuel in drilling operations, and compressing it for use by local trucking or delivery to fleet fueling locations. However,  contrary to the intuition of the rancher interviewed by the Journal, none of these options would reduce high-volume flaring by more than a fraction, despite investment costs in the tens or hundreds of thousands of dollars per site.

Even in the case of the most technically interesting option, small-scale gas-to-liquids conversion to produce synthetic diesel or high-quality synthetic crude, EERC estimated this would divert only 8% of the output from a multi-well site flaring 300 million cubic feet per day, while requiring an investment of $250 million. And to make this option yet more challenging to implement, of the 200-plus such locations EERC identified in the state, fewer than two dozen flared consistently at that level over a six-month period. The problem moves around as older wells tail off and new ones are drilled.

Significantly reducing or eliminating natural gas flaring ultimately requires a large-scale market for the hydrocarbons being burned off. That’s as true in North Dakota as in Nigeria. While various technical options could incrementally reduce gas flaring from Bakken wells, the highest-impact solutions would be those that promote market creation. That would include fast-tracking long-distance gas pipeline projects or building gas-fired power plants nearby. Absent large new customers for Bakken gas, additional regulations on flaring will either be ineffective or impede the region’s strategically important oil output.

A different version of this posting was previously published on the website of Pacific Energy Development Corporation.

Photo Credit: Gas Flaring Problems/shutterstock

Geoffrey Styles's picture

Thank Geoffrey for the Post!

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Engineer- Poet's picture
Engineer- Poet on August 4, 2014

Announcements of skid-mounted LNG plants would appear to be aimed at the Bakken.  An investment would not be tied to a well site, but could move with the activity.  Product could be shipped out by truck, eliminating the need for long-term investments such as pipelines.

However, given the enduring glut on the gas markets, it appears likely that the players in the business have looked at the economics and dropped the proposals in the wastebasket.

There are markets which could absorb the current NG surplus without apparent difficulty.  Heavy trucking is one of them.  Sadly, efforts to produce natural gas OTR trucks and LNG filling infrastructure to support them has lagged behind the need.  By the time they arrive in force, we may be back to a scarcity situation.

Roger Arnold's picture
Roger Arnold on August 5, 2014

Thanks for the excellent and informative article, Geoffrey. I hadn’t really considered how much of a problem the rapid depletion of fracked wells in shale formation created, in terms of the need to be constantly reconfiguring the collection pipeline network.

The industry had better get its act together pretty quickly with something like mobil GTL plants that can eliminate the need for any flaring.  With that much gas being flared relative to what’s produced, its PR halo as a relatively “green” alternative to coal could become very tarnished.

 

Bob Meinetz's picture
Bob Meinetz on August 5, 2014

Geoffrey, it seems the only reason we pay attention to Bakken flaring is the spectacular visual effect it creates. Meanwhile, as you correctly point out, the U.S. is generating one thousand times the corresponding emissions from driving cars and burning coal.

I suppose any attempt to regulate flaring will result in surreptitious dumping of CH4 to worse effect, as the fossil fuel industry’s M.O. has historically been to dump whatever it can get away with. So we should welcome flaring as the lesser of two evils, and continue working toward the goal of plugging as many of those holes as we possibly can.

Geoffrey Styles's picture
Geoffrey Styles on August 5, 2014

Bob, It’s always interesting how differently people can see the same thing. I look at ND flaring and see $$s and the equivalent of 2,000 MW going up in flames; you see a reminder of the price we pay for our high-energy economy. If it makes you feel better, technology is making it harder to leak CH4 without being noticed: http://blogs.nature.com/news/2014/07/google-maps-methane-leaks.html 

Bob Meinetz's picture
Bob Meinetz on August 5, 2014

Geoffrey, I admit after seeing photos of ND flaring from space I had the same thoughts about wasted energy. But in climate terms it’s almost exactly the same as the yearly increase in CO2 emissions due to the 2012 closure of San Onofre Nuclear Generating Station, 80 miles down the road. It’s very difficult to see San Onofre from space – an innocuous mile of beachfront – but maybe if we lit its concrete domes on fire we could draw attention to how screwed up our climate priorities are.

More accurately, I see a reminder of the price we pay for our high fossil energy economy. Though conflating fossil fuels with energy is a popular and deliberate tactic of industry PR these days, I’m not willing to concede that fossil fuel-derived carbon is a price we need to pay – or if it is, that the price isn’t much higher than it needs to be.

All the methane leak technology is wonderful, it’s very hard to quantify, and in the wilds of North Dakota virtually unenforceable. Which is why I’m also cynical about CCS and the multitude of other “we’ll deal with emissions later” non-solutions.

Instead of bumming myself out even more, I’m going to read the wonderful email I just received from a pro-active group called Nuclear Matters, which is taking nuclear to the people – forty years late – but cause for optimism.

Lewis Perelman's picture
Lewis Perelman on August 7, 2014

Interesting article and good comments. The conclusion of the article sounds right: It would be nice to find economical ways to use a resource that currently is just being thrown away.

Styles suggests two possibilities: Bring pipelines to where the gas is being producded; or use it to generate power there.

Extending pipelines to shale gas fields is, so far as I know, a work in progress. As it seems for most infrastructure needs in the US, the pace of progress is slow. I don’t know, but I imagine that adding more destinations for pipeline extension may further burden a limited capacity for growth.

Using the gas to generate power in place raises the question of where the electricity is going to go. Some may be usable in the oil field locations themselves. Again, I don’t really know enough about this but I sense from what the article says about limit local markets for the gas itself probably would apply to electric power too.

But extending the electric grid to these locations would seem to run into the same limitations that apply to pipeline extension.

I was prompted to wonder — again on a topic I admit to knowing too little about — whether there may be value-added products for which the now-wasted gas could be used. That is, products that might be produced nearby that, being more valuable, might be more economical to ship elsewhere by truck or rail.

A bit of Web searching led me to this article on “Value Added Opportunities from Natural Gas”: http://j.mp/1sBLImW.

I’m not sure how pertinent that is to the problem discussed here, but maybe it suggests another type of solution.

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