Reducing methane emissions from Canada’s oil and gas sector

In preparation of the upcoming changes to the limits for Alberta Energy Regulator’s Directive 060 (effective January 1, 2023) and in response to the recent publication of Canada’s Methane Strategy document, we are sharing a snapshot of the updated limits, industry insights on ways to reduce methane emissions, and a summary of Canada’s approach to CH4 reduction.

Canada has committed to achieve net zero emissions by 2050 and to reduce total GHG emissions by 40% to 45% below 2005 levels by 2030. Methane makes up about 13% of Canada’s total GHG emissions, and approximately 21% of the oil and gas sector’s total GHG emissions in carbon-dioxide equivalent (CO2e), as reported in Canada’s 2021 National Inventory Report. In Alberta, the oil and gas industry is the largest source of methane emissions; in 2014, it accounted for approximately 70% of the province’s methane emissions. More broadly, the global energy sector is responsible for around 40% of total methane emissions attributable to human activity, second only to agriculture.  Despite these figures, the most cost-effective opportunities for methane abatement are in the energy sector, especially in oil and gas operations. A combination of policy, market-approaches, and new technologies are the path towards reducing our methane emissions globally and achieving our targets.

Summary of changes to Directive 060 limits

One policy targeting methane emissions is Alberta Energy Regulator’s (AER) Directive 060, which sets out requirements for flaring, incinerating, and venting in Alberta at all upstream petroleum industry wells and facilities. In 2018, the directive was revised with changes coming into effect beginning in 2023. The changes include:

Effective January 1, 2023, for level controllers that emit vent gas and are installed before January 1, 2022, the duty holder must

• Prevent or control vent gas, or
• Evaluate the actuation frequency during normal operating conditions and for level controllers that actuate between 0 and 15 minutes, use a relay that has been designed to reduce or minimize transient or dynamic venting or adjust the actuation frequency to ensure that the time between actuations is greater than 15 minutes.

Effective January 1, 2023, for pneumatic instruments other than level controllers that emit vent gas and are installed before January 1, 2022, the duty holder must

• Prevent or control vent gas, or
• Ensure that the instruments have a manufacturer-specified steady-state vent gas rate of less than 0.17m³/hr.

Overall Vent Gas Limit

Overall vent gas (OVG) is all routine and nonroutine vent gas.

• The duty holder must limit OVG at a site to less than 15.0 10³m³ of vent gas per month or 9.0 10³ kg of methane per month

In addition to complying with the OVG limit, the duty holder must comply with the vent gas limits in sections 8.4 to 8.9.

Exceptions

Vent gas from pneumatic devices, compressor seals, and glycol dehydrators are excluded from the OVG limit until January 1, 2023. Non-combustible gas, as described in section 8.9, is excluded from the OVG limit.

Why having the right data matters

Methane emissions from the energy sector are about 70% higher than reported in official data (3). One of the best ways to ensure we are effectively managing methane emissions is by ensuring we have accurate data available. While reductions policies are paramount, they are predicated on the accuracy and understanding of how much and where methane is emitted, in addition to being properly reported.

Research indicates that since the implementation of Directive 060, nation-wide methane emissions have gone up, however, this is attributable to the improved tracking of emissions. One of the many methods to improve the accuracy is to measure gas compositions as opposed to using defaults, which are typically conservative resulting in over-estimation. The importance of site-tested fugitives and like detection methods and monitoring are equally as important to achieving our methane reduction targets as the implementation of new technologies.

What gets measured gets improved.

How you can reduce your methane emissions

Technology

43% of total CH4 emissions in Canada are from fugitive sources in oil and natural gas systems, making fugitive reduction technology a key component of reducing methane emissions. Some examples of methane emissions reduction successes we’ve seen include tactics such as:

• Leak detection and repair campaigns, including LDAR and infrared
• Installing emissions control devices
• Replacing components and devices that emit methane in their normal operations
• Electrification of natural gas processing facilities
• Instrument air conversions, pneumatic conversions, waste heat recovery, and flare reduction initiatives
• Alternative fugitive emissions management program (Alt-FEMP) to deviate from the technologies and processes outlined in Directive 060 

Funding

While methane reduction technologies present the lowest cost opportunities to making progress towards climate goals, several funding initiatives exist to support methane reductions technologies:

• Methane Technology Implementation Program (MTIP): $25-million program to support installation of readily-available methane reduction technologies at conventional oil and gas facilities. More information is available on the Carbon Connect International website.
• Baseline and Reduction Opportunity (BRO) Assessment Program: $15-million program to support small and medium-sized oil and gas operators to conduct detailed assessments of methane reduction opportunities and fugitive emissions. More information is available on the Carbon Connect International website.
• Alberta Methane Emissions Program (AMEP): $17-million to support investigating and testing alternative approaches to detection and quantification of fugitive and vented emissions. More information on this provincewide program is available on the AMEP website.
• Emissions Reduction Alberta and Alberta Innovates continue to support various methane emission detection and reduction projects. Visit Emissions Reduction Alberta and Alberta Innovates Clean Resources for information about the initiatives supporting methane emissions detection and reduction research and technology development.

Canada’s current methane policies

In November 2021, Canada joined over 100 countries in supporting the Global Methane Pledge (GMP). This pledge commits members to a collective goal of reducing human-caused methane emissions by 30% below 2020 levels by 2030. More recently, Canada joined as an inaugural member supporting the GMP Energy Pathway. As part of Canada’s broader climate finance efforts, Canada has allocated $2 million over the next four years to support methane mitigation projects in developing countries. Canada was also the first country to commit to achieving at least a 75% reduction in methane emissions from its oil and gas sector from 2012 levels by 2030.

National

• Regulations Respecting Reduction in the Release of Methane and Certain Volatile Organic Compounds (Upstream Oil and Gas Sector)
• Emissions Reduction Fund
• Proposed Clean Fuel Regulations
• Clean Resource Innovation Network

Alberta

• Methane Emission Reduction Regulation, incorporating:
  • Directive 060: Upstream Petroleum Industry Flaring, Incinerating, and Venting Directive and
  • Directive 017: Measurement Requirements for Oil and Gas Operations
• Emissions Reduction Alberta
• Methane Emissions Program
• Baseline and Reduction Opportunity Assessment Program

British Columbia

• Drilling and Production Regulation
• Clean Infrastructure Royalty Credit Program and Clean Growth Infrastructure Royalty Program
• Oil and Gas Processing Facility Regulation
• Clean BC Industry Fund

Saskatchewan

• The Oil and Gas Emissions Management Regulations
• Directive PNG036: Venting and Flaring Requirements
• Directive PNG017: Measurement Requirements for Oil and Gas Operations
• Methane Action Plan

We invite you to dig deeper by reviewing our source material:

• Faster and Further: Canada's Methane Strategy - Publications.gc.ca
• Reducing methane emissions from Canada’s oil and gas sector: discussion paper - Canada.ca
• Methane reduction - AER.ca
• Global methane tracker - IEA.org
• Reducing methane emissions - Alberta.ca
• National Inventory Report 1990-2018: Greenhouse Gas Sources and Sinks in Canada - Publications.gc.ca