Yes, it sounds great to say “love is in the air” but, unfortunately, methane is also out there. Methane, a fossil fuel composed by Carbon and Hydrogen atoms forming CH4, that in case of being almost all methane in the gas stream, is also known as Natural Gas. It is extracted from different sources and basins, either Conventional and Unconventional, Onshore or Offshore (both shallow waters and deep waters) and it is very relevant for the modern life. Methane it is not only a reasonable adopted fuel for heating and power generation, but also a raw material for fertilizers and a critical feed for the petrochemical industry. Yes, methane is important and, certainly, present in your life maybe more than you know.
Methane has also a critical role to play as a “greener” option to coal, fuel oil and diesel, this is the reason why it was adopted several decades ago as a “transition fuel” in line with a less contaminated world, and many countries turned into methane or natural gas as main fuel for heating purposes. But there is also a potential downside if we don’t manage it properly, therefore, we believe that it deserves our understanding. Methane is, from the gases that conform the group of Green House Gases (GHGs) one of the most dangerous in comparison with the well-known Carbon Dioxide (CO2).
The particularity of methane is that it has a value in the market which is much higher than the price of the CO2, this is because the diverse uses it can have. So, both environmentally and commercially speaking, it is good to keep it under control and avoid methane emissions to the atmosphere. This applies for the Upstream producers, for the Midstream gas transport companies and, also, for the Downstream industry that uses the gas as fuel or raw material. The big challenge with the methane is that those potential emissions are not visible to the human eye, and the infrastructure that handles it is widely distributed along many kilometers or miles, so the control of methane emissions becomes a real challenge.
In the Upstream for example, historically speaking, the solution was just flaring the methane that came as associated product of the crude oil wells. The crude oil, being a liquid, is much easier to produce, control, store and transport. While the gas, in the other hand, when present in small quantities becomes a potential problem for the producers if there is not available infrastructure to manage it and commercialize. So different approaches have been explored along the years. As mentioned before, the easier way to manage it is to flare it, which basically means to burn it in a controlled way using a flare device (imagine a big torch). This combustion process converts the methane into CO2 and other gases that have lower impact but are still emissions. If infrastructure is available, for example, a nearby gas pipeline, Upstream gas gathering systems, small scale LNG solutions, etc., the better option would be to inject the gas into the pipes and also get some profit from it. Finally, some companies are choosing to burn it in the Upstream to generate electric energy for different needs such as artificial lift pumps that require electric energy, the fracking activities, and many others. This last option of electric energy generation still generates emissions coming from burning the gas in gas turbines or gas engines, but is preferable than flaring because it generates low emissions electric energy that otherwise will come from other sources probably more contaminating (like diesel engines). If we can include a Carbon Capture and Storage as a post combustion solution to avoid the CO2 emitted into the atmosphere we could have a complete net-zero solution that is even better than all the previous options.
Coming back to the most challenging characteristic, even if we avoid methane emissions by different means, the methane sometimes just leaks from compressors joints, seals or labyrinths, valve packings, pipelines that have a failure or even from non-performing gaskets. The point is that all these leakages, defined as “fugitive emissions” because the owners don’t want them to escape to the atmosphere, are difficult to detect and track. Many technologies have been developed to tackle the issue, and others are under development. We have for example drones with special cameras that can fly over the pipelines, assets or plants and identify exactly those fugitive emissions with high accuracy. There are static stations with special detectors that work 24x7 in very critical tasks like LNG plants, that detect and sound an alarm for any scape event. Most recently, satellite images that can give us a warning call if a big emission is detected are under study and deployment. Here the tradeoff or balance of the accuracy versus the cost and operability of the solution, is common to other industries, for example in the agribusiness.
All the solutions discussed have pros and cons. The drones are flexible, cheap and easy to deploy, normally contracted as a service (Software as a Service or SaaS), but you depend on having the drone flying over the assets which is not feasible in all the cases for different reasons such as bad weather, availability, operational risk, etc. Also, the SaaS company must fulfill the drone flying regulations of each country; sometimes the drone pilots are required to hold specific licenses, procedure manuals, etc. which brings some operational implications. The static equipment in the other hand, could be the opposite case of a drone, as it can operate 24x7 and you don’t have to rely on weather and drone flights, but it is normally more expensive than drones because the equipment is dedicated and fixed and cannot be shared between different customers. Finally, the satellites look like a good mid-ground solution, because they are much cheaper than drones (the service, not the satellite itself) and are available almost all days (at least maybe one should pass above your asset per day) but the precision is still not that good versus drones or static equipment. Today satellites can detect, for example, a gas pipeline with a big leak, but not a small emission of methane from a valve inside a refinery.
In our opinion, as we already have seen with the agribusiness, an increasing number of solutions will come every year. The centralized high tech service providers will have more and more local partners to work with, the precision of the satellites will improve big time over the coming 10 years, and the size and cost of the static equipment will also decrease considerably. Our final comment about the topic is related to the needs of the industry. In some cases, like gas pipelines, maybe one technology (like satellites) could be better than others (like static detection equipment) while in other cases the static detection equipment works just fine (like in a LNG export facility) while drones can be the Swiss army that you deploy everywhere and for a wide range of applications and needs. It is also important to mention that we are having more and more companies putting targets of net-zero carbon emissions by 2030, 2035 or 2050, which makes the need of detecting and avoiding methane fugitive emissions a reality, and this opens a big window for new technologies, new services and new opportunities. At the end of the day, this is another example where collaboration between parties and the use of different technologies will make a difference.