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Can Oil Companies Accurately Measure Greenhouse Gas Emissions?

Petroleum producers argue that March 2011 is too soon to report emissions from production wells, for example



FLICKR/ROGER MELB

Major oil companies are urging the White House to ensure that U.S. EPA's upcoming greenhouse gas reporting rules do not include what the industry considers burdensome requirements or force disclosure of proprietary information.

Representatives of the American Petroleum Institute and several large companies -- BP America, Exxon Mobil Corp., Shell Oil Co. and Chevron Corp. -- met with Office of Management and Budget and EPA officials last Tuesday.

At issue are draft rules that require annual greenhouse gas reporting from an estimated 13,000 sites, including refineries, other oil and gas sites, power plants, and many other types of industrial operations, such as cement and metals production. Industry data collection under the rule, which was proposed formally in April, would begin in January 2010, with the first reports due to EPA in March 2011.

But according to a list of concerns that API provided to the White House, the compliance date is not feasible, and hence the "best available data" should be allowed for the first year and subsequent years when facilities are unable to install the required monitoring.

"We feel that to make this successful, there needs to be some acceptable lead time for facilities, and that should include allowing for best available data ... until normal scheduled and planned shutdowns or services at our facilities to install the new monitoring devices," said API's Khary Cauthen, who attended the meeting.

Cauthen also noted that defining and gathering data on the upstream -- or exploration and production -- side of the industry is much newer for the industry. "There is not that standard methodology yet," he said.

When it issued the draft rule, EPA had sought comment on allowing use of "best available" data for the initial reporting or delaying the implementation by a year.

The industry also has other concerns with the agency proposal. Among them: API does not want the rule to require data from specific units at a site -- such as a specific catalytic cracker at a refinery -- that could compromise proprietary business information, Cauthen said. These emissions will be counted, regardless, as part of the facility-level reporting, he said.

The group also argues that the draft rule imposes requirements for reporting on petroleum-products supplies that will result in "significant overstatement" of emissions for some facilities, according to comments that API sent in June to EPA.

This is because some products, such as asphalt and lubricants, are not ultimately burned the group wrote. Also, some products, such as naphtha, require further processing or blending.

"The refinery that processes the feedstock and produces the extra volume of product should be the one that reports," API wrote. "If a facility has the ability to determine that the stream will not be combusted they should be able to exclude it from their GHG emissions calculations."

The rules do not require emissions reductions, although EPA said the proposed measure would help with future climate policies. Congress required the rule in an omnibus fiscal 2008 spending bill.

Cauthen said the industry is not against the rule but rather wanted to share with White House officials "the importance of getting this reporting rule right."


Reprinted from Greenwire with permission from Environment & Energy Publishing, LLC. www.eenews.net, 202-628-6500

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