Transcript Slide 1

Scoping Meeting
GHG Accounting Issues
Oil & Gas Exploration & Production
Natural Gas Gathering & Processing
October 25, 2007
Santa Fe, New Mexico
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Agenda
Introductions
Background on GHG Protocols
Overview of Existing Protocols
Discussion: Cross-cutting issues
Break-out discussions:
– Exploration & Production
– Gathering & Processing
• Wrap Up – report of break-out groups
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Purpose of Today’s Meeting
• Identify GHG accounting issues for annual entity
inventory of emissions from upstream O&G activities
– Not likely resolve accounting issues today
• Goals:
– ID issues that are relevant & answered elsewhere
– ID issues not answered elsewhere
– Create a parking lot of issues beyond the scope of today’s
discussion
• Assess -- is a protocol needed for these activities?
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Protocol Elements
• Framework document that informs
consistent, comparable, transparent,
accurate GHG inventory
– Definitions
– Scope & boundary requirements
– Calculations (emission factors,
methodologies)
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Protocol Development Process
1. Conduct literature review
2. White paper
3. Multi-stakeholder workgroup develops
draft protocol
4. Expert review
5. Public comment
6. Adoption/implementation
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Voluntary vs. Mandatory
Reporting?
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Can allow for flexibility
Understand footprint
Often used for corporate disclosures
3rd-party verification required?
• Mandatory
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Typically facility- or unit-based
Consistent approach across all sources
May support regulatory goals
Agency oversight?
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Ongoing GHG Protocol Efforts for
O&G Sector
• WRI/CA Registry protocol for NG T&D
• CARB mandatory reporting from
petroleum refineries (draft regulation)
• NMED mandatory reporting from
petroleum refineries (draft regulation)
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In Development: Natural Gas T&D
• Scope:
– Combustion, process vents, non-routine activities,
LAUG, equipment leaks, indirect emissions
• Discussion Paper
– www.climateregistry.org
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Workgroup formed by CA Registry/WRI
Expert review period
Public Comment period
Expected adoption (early 2008)
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In Development: Oil Refineries
• Literature review:
– API Compendium
– IPIECA Guidelines
• State of CA technical review of API Compendium
• White paper draft commissioned from CA Registry for
use by ARB
– www.climateregistry.org
• Public workshops & public comment
• Draft regulations for mandatory reporting
• Regulations adopted by CARB (expected December
2007)
• Protocol developed by CA Registry
– Workgroup to meet December-January
– Public comment February 2008
• Protocol adopted by The Climate Registry?
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Remaining Activities
Source: American Petroleum Institute: Toward a Consistent Methodology for Estimating Greenhouse Gas Emissions from Oil and
Natural Gas Industry Operations. Page 4.
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Guidance from Current Resources (1)
• GHG Protocol
– Framework:
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Direct emissions (Scope 1)
Indirect emissions (Scope 2,3)
Organizational boundaries
Operational boundaries
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Guidance from Current Resources (2)
• CA Registry GRP
• TCR GRP
– Geographic boundaries
– Materiality threshold
– Calculations/emission
factors:
• Stationary combustion
• Mobile combustion
• Indirect emissions
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Guidance from Current Resources (3)
• API Compendium
– Identify sources
– Identify emission factors
– Sample calculation
methodologies
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Guidance from Current Resources (4)
• IPIECA Guidelines
– Builds on GHG Protocol
• guidance specific to petroleum industry
– Inform boundaries
• Examples of equity share/operational control
– Identify & classify sources
• Table 6.1 – Upstream Petroleum Operations
– Emissions Calcs
• Outlines tiered approach
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Guidance from Current Resources
(5)
• CEC Evaluation
– Gap analysis of API
Compendium & IPIECA
• Compares w/CCAR GRP
– IDs potential users
– Some outdated emission
factors
– IPIECA provides framework,
but not program-specific
applicability
– Conclusion: most work
needed for CH4 emissions
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Break
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Cross-Cutting Issues
• What are sources?
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Indirects
Mobile
Stationary
Process
Fugitive
• What terms should be
defined?
• Geographic
boundaries?
• Organizational
boundaries?
• Operational
boundaries?
What guidance is currently available?
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Organizational Boundaries
Options:
Strengths
Weaknesses
Operational control
•Demonstrates regulatory risk
•Indication of operational
performance
•Operator is likely to implement
changes  reductions
•Operator has access to
emissions information
•Preferred by most companies
•Excludes emissions for
companies with interest but no
operation
Financial control
•Discloses financial risk
•Assigns emissions to party that
receives the majority of benefit
•Provides most complete basis for
assessing risks/opportunities
•Limited use?
Equity Share
•Reflects economic interest
•Demonstrates financial risk
•Represents multiple owners
accurately
•Consistent with financial
accounting
•Generally used in power sector
•Not indicator of control/ability to
affect emissions
•May have limited access to data
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Operational Boundaries
• What sources are required/optional?
• What is a facility?
– Geographic?
– Defined by reporter?
– Defined by state?
• What degree of aggregation is required?
– Entity?
– Facility?
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Break-out Groups
1. Exploration & Production
2. NG Gathering & Processing
Discussions will continue
in the Roundhouse after lunch.
Please meet back here at 2:45.
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Next Steps
• Is a protocol warranted?
– If so, goal: Present for adoption/incorporation
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NM mandatory reporting
CA Registry protocol
CARB mandatory reporting
TCR protocol
• Please convey interest to Tom Moore
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