There are some who argue that in the world of economics the world is flat. The wired world has made claims our collective consciousness is becoming flat. There was even a time when some have argued the actual physical world was flat. Today, this writer is suggesting the easiest way to understand crude oil is to know flat Coke.
Pop culture metaphors aside, times and technologies change, ideas evolve and perceptions personify. When given the assignment of understanding vapor recovery systems, quickly I longed to be spoken to like an 8-year-old. This is a very complex industry filled with passion, money, science and oversight.
When trying to explain how vapor recovery is relevant in oil and gas, I found it is best to grab an ice cold Coca Cola. Or whatever carbonated beverage suits your palate. Next, think about the gas can sitting in the garage or shed. The one you use to fill up the lawnmower. That consumer-refined gasoline has been extracted out of the ground, de-vaporized, transported, refined numerous times, yet, still has the potential to combust if exposed to flame. Now that isn’t the liquid starting on fire, it is the vapor coming off the liquid inside the lawnmower’s gas can.
Jim Semerad, manager permitting and compliance at North Dakota Department of Health, believes understanding there is still some vapors being released from a garage gas can is a good basic illustration of vapor release. He pointed out the fact that even after multiple refining processes, there is still some vapor to be aware of.
“Essentially you have vapor recovery at every stage after it is out of the ground,” Semerad said. “You have it at the oil well where the majority of the gas and oil is separated. The oil, the liquid part, will be transferred to a crude oil storage tank.”
Semerad said the air pollution process doesn’t stop there. The oversight continues with trucks, railcars, loading facilities and any other processing that occurs. He added oil has slightly different rules and regulations.
“On the other side is the gas, again, it gets separated at the oil well, and then it goes to compressor stations and pipeline which ultimately pushes it to a gas plant,” Semerad said. “At the gas plant, it is purified or processed into natural gas that can be burned in our homes, our natural gas furnace and water heaters.”
Circling back to the lawnmower gas in the garage, Semerad compared how that form of vapor recovery energy can be environmental.
“We of course benefit from those vapors in a sense that if you capture those vapors and process those vapors you have methane of natural gas. Which is a valuable fuel and on our air pollution perspective, it is a relatively clean fuel compared to some of the dirtier fuels like the solid fuels,” Semerad said. “The solid fuels tend to be dirtier than natural gas. Those vapors, when captured and processed are very good.”
Now, crack open that can of Coca Cola. That can of Coke is now filled with bubbles and hydrocarbons escaping the once pressurized containment. Same concept is true with oil and gas. Once depressurized out of the earth, you have live oil that needs to be transported to the free market. In order to transport the live oil, gas and vapors need to be removed. Essentially turning the live oil into flat Coke.
“The flat Coke comparison is a very good analogy,” Semerad said. “In fact, even that flat Coke would still have small amounts of carbonation in it.”
So therein lies the challenge for oil and gas and the supporting industries. The level of technology has reached a point where vapor recovery advancements are proving economical, environmental and safe, however, property owners, public perception and a myriad of individualized situations add to the infrastructure and recovery delays. Unfortunately, these delays directly result in additional flaring and waste of a resource.
Time and regulations seem to be the main obstacles with vapor recovery systems. Technologies are advancing so rapidly that it appears to impact certain areas of oversight and regulation. When regulation occurs, investments hesitate and future planning becomes quickly diverted, restructured and redirected.
The technology of vapor recovery units (VRUs), which capture vapors and convert gases, is proving to add additional income streams to producers. According to Jeff Voorhis, corporate engineer, HyBon Engineers, new revenues are being generated while minimizing regulatory and liability exposure.
“We’ve been in business for over 65 years and were the first company to coin the term vapor recovery,” Voorhis said. “It’s now time to get your house in order and capture every BTU you can and put it into the pipeline. Because every BTU put into the atmosphere is waste. It is non product output.”
According to Voorhis, many producers are making money off vapor recovery because at the end of the day gas is gas.
“It’s gas, it’s hydrocarbons, so there’s a market,” Voorhis said. “If you are generating more than 15-20 mcf and you have a gas line close to put the gas into, it’s profitable to put a VRU on. You are wasting money if you are not doing that.”
The vapor recovery unit example Voorhis presented at the 2015 Williston Basin Petroleum Conference used an algebraic formula involving a $100,000 unit, VOC emissions and BTUs to demonstrate a nine month return on the $100K investment. However, Voorhis said he has seen some cases where the cost of the vapor recovery unit has been returned in two months.
“We are talking about tens of thousands and millions of dollars of paybacks that is being totally lost,” Voorhis said. “This is totally not an environmental decision it’s an economic decision.”
Like Semerad, Voorhis pointed out the environmental advantages of not venting gases into the atmosphere, but reiterated the economic perspective and benefits.
When asked about the flat Coke comparison, Voorhis said flat Coke is a good analogy to understand how oil and gas works. Especially when extracting it out of the ground.
“You are essentially popping open a can and going from 50 PSI to atmospheric pressure. You are popping that can and allowing it to bubble in that storage tank,” Voorhis said. “If you dump that Coke on the ground, it fizzes and goes away. That’s what is happening in oil and gas, it is fizzing in those storage tanks.”
Voorhis added many times you are going from high pressure to low pressure for flash to occur, often 400 to atmosphere. Within the oil and gas industry, the term for the action of gas leaving the solution is called flashing. A shook up can of Coke can create quite a flash.
“Imagine opening a 400 PSI Coke,” Voorhis said. “A lot of gas would come out of the solution. Basically you shake up a can of Coke and that’s the flash coming off it.”
Large industrial tanks acting like cans of Coke, storing the live solution and collecting the vapors. Once the vapors are collected and transported, the crude is ready for its own distribution, oversight and regulation.
“Oil burns because it is producing so much gas. It is live oil and what we want is flat oil, like flat Coke,” Voorhis said. “Oil that is basically ready to go to the oil refinery that isn’t full of live gas. So we pull as much of that gas off before it gets loaded for distribution.”
In the meantime, while progress and differences are ironed out, flaring is the preferred method.
“The last thing you want is to see is these things venting, so for gases that cannot be recovered, flaring or burning those vapors as a form of pollution control is a good thing,” Semerad said. “The efficiency of combustors is very very high in the 98-plus range. And that’s a good thing.”
Semerad believes the public thinks of the word flaring as only a negative.
“It’s a complicated issue on how to someway somehow collect that gas, those vapors, and get them to our water heaters and furnaces,” Semerad said. “You need pipelines and landowners to allow the pipelines to cross their property. Then the pipeline company needs to be a good steward, needs to work with the landowner. It’s a very complex process and any kind of weak link in that chain can present a problem and makes the solution very difficult at times.”
Semerad continued explaining and contextualizing the idea and reality of flaring and capturing natural gas.
“From a conservation standpoint, the most preferable would be to collect those vapors or gases and process them. Then burn them in our water heaters and furnaces,” Semerad said. “On the other hand, when those vapors can not be used, what our (ND Health) office does is ensure they are combusted via a flare or combustor. So that type of flaring is preferred to venting, which is the last thing we want to see with those vapors.”
In an economic flat world filled with flat-lining revenues, the concept of profiting on flat Coke appears more and more viable everyday. Then again, with all the opportunity in vapor recovery in today’s shale plays perhaps we should be popping open the champagne as our carbonated comparison.
Leave a Reply