6

Environmental Considerations, Advanced Technologies, and Solutions

The final panel of the workshop served as a complement to the previous panel on safety considerations by introducing the environmental components of offshore operations in four presentations. Lois Epstein, The Wilderness Society, provided a brief introduction to the session and then moderated a large group discussion after the panel presentations.

Epstein offered a brief overview of the situation in her home state of Alaska. She said that Alaska has only a small amount of offshore oil production, which is from a manmade gravel island, in Alaska state waters. Alaska has, however, a number of near-shore Outer Continental Shelf (OCS) projects in the planning stages. Cook Inlet, in particular, has had offshore platforms in state waters since the 1960s, and while that location is not producing as much as before, some hydraulic fracturing projects are in place. In addition to concerns about the use of fresh water in Alaska, Epstein also raised concerns about noise and drilling discharge impacts on marine mammals. When these mammals change their migration patterns as a result of such disturbances, people who rely on those mammals for subsistence are also affected. She mentioned that because the Arctic freezes in the winter, drilling schedules also have to be adjusted. Ultimately, there are many uncertainties in this area.

PANEL PRESENTATIONS

Offshore Oil and Gas Operations—Ecosystem Considerations: What Have We Learned Over the Past Four Decades?

James Ray, Oceanic Environmental Solutions, LLC

Ray explained that although industry, regulators, and scientists have decades of both laboratory and real-world environmental science data related to offshore oil and gas operations, they do not (and may never) know everything about the effects of oil and gas on offshore ecosystems. There are many contributors to this foundational knowledge base, including the federal govern-

ment,¹ industry, academia, the private sector, and the international community. Reports that have compiled this wealth of data over time have been used by companies and regulators alike for decision-making purposes.² The Bureau of Ocean Energy Management (BOEM) Environmental Studies Program website³ provides access to some of these texts as well as information about the funding and planning of current projects. The National Academies Press website⁴ also offers access to many other key sources of information.

Ray noted that current regulations require ongoing monitoring and reporting of discharge systems. Permits, in particular, often require additional studies and data collection. He encouraged participants to review two general permits from the Gulf of Mexico that regulate discharges, including the Western Gulf of Mexico General Permit GMG 290000⁵ and the Eastern Gulf of Mexico General Permit GEG460000.⁶ Ray explained that permits are updated every 5 years based on new details, standards, and analytical techniques, and a new permit for the Central and Western Gulf was released just prior to this workshop.

Much data have been collected on a range of environmental programs including fate and effects of water column and seafloor discharges using dispersion modeling and field verification, methods development for toxicity testing and analyte measurements, laboratory studies on toxicity and bioaccumulation, containment studies, baseline studies, and acoustic effects on the marine environment. He mentioned that the industry also studies and tests various species, including invertebrates (crustaceans are an especially valuable test species) and vertebrates, to better understand the environment. The geographical distribution of these studies varies widely, including numerous coastal areas in the United States—Alabama, Alaska, California, Florida, Louisiana, Mississippi, Oregon, Texas, Washington, East Coast states and abroad—Canada, Denmark, England, Germany, India, Indonesia, Norway, and the North Sea.

Ray remarked that completion, treatment, and workover fluids (including fracturing fluids) have for years been permitted to be routinely processed offshore in produced water treatment systems. If the combined produced water and treatment fluids meet the produced water discharge permit requirements, then they are considered to be produced water and will be discharged as part of the produced water stream. If the discharge permit standards are not met, the returns have to be segregated and shipped to shore for handling.

___________________

¹ According to Ray, the Bureau of Land Management, the Minerals Management Service, and the Bureau of Ocean Energy Management alone have invested $1.3 billion in environmental studies since 1973.

² A few of these influential texts include Response of Marine Animals to Petroleum and Specific Petroleum Hydrocarbons (Neff and Anderson, 1981), Drilling Discharges in the Marine Environment (NRC, 1983), Long-Term Environmental Effects of Offshore Oil and Gas Development (Boesch and Rabalais, 1987), Oil Dispersants: New Ecological Approaches (Flaherty, 1987), Produced Water (Ray and Engelhardt, 1992), Bioaccumulation in Marine Organisms: Effects of Contaminants from Oil Well Produced Water (Neff, 2002), and Oil in the Sea III: Inputs, Fates, and Effects (NRC, 2003).

³ Available at https://www.boem.gov/Studies (accessed November 17, 2017).

⁴ Available at https://www.nap.edu (accessed November 19, 2017).

⁵ Available at https://www3.epa.gov/region6/water/npdes/genpermit/gmg290000final/gmg290000finalpermit2012.pdf (accessed November 17, 2017).

⁶ Available at https://www.federalregister.gov/documents/2016/08/18/2016-19099/notice-of-draft-national-pollutant-discharge-elimination-system-npdes-general-permit-for-the-eastern (accessed November 17, 2017).

Marine Ecology and Water Research, Gulf of Mexico

Paul Montagna, Texas A&M University–Corpus Christi

Whereas Ray focused on knowledge accumulated during the past 40 years, Montagna focused on more recent lessons learned in marine ecology and water research. He first suggested that workshop participants read the high-level summary of the Deepwater Horizon research initiatives published in 2016 in Oceanography Magazine.⁷ Since the Deepwater Horizon accident, there has been an influx of information emerging from studies on the ecology of the Gulf of Mexico—for example, the $800 million National Resource Damage Assessment program involved 400 researchers who collected 100,000 samples and generated 13 million data records,⁸ and the $500 million Gulf of Mexico Research Initiative involves 3,000 researchers from 278 institutions worldwide who have already published 800 peer-reviewed publications, with more than 2 years remaining in the 10-year program.⁹

Montagna believes that knowledge gains will continue under the 2012 RESTORE Act¹⁰ and the $20 billion settlement from the Deepwater Horizon accident that will be distributed among the states’ restoration programs. He noted that restoration lags only when monitoring, data, and follow-up measures are not in place. With the Act’s requirement for monitoring specific restoration projects, Montagna expects to see an improvement. The Act also includes monetary designations for the Centers of Excellence in each of the five Gulf states (more than $130 million), the National Oceanic and Atmospheric Administration’s (NOAA’s) Science Program (more than $130 million), and the Gulf Research Program at the National Academies ($500 million). These investments ensure that the flow of information will increase substantially during the next 10 to 15 years.

Montagna referred back to the existing ecological and environmental issues discussed by William Brown, BOEM, during the keynote session of the workshop and highlighted oil spills, bottom disturbance, noise, and lighting as the most pressing issues. He explained, however, that when offshore activities go according to plan, the effects are localized, and there are no long-term chronic effects. He explained that ecological zones depend on depth in the offshore. There are approximately 1,200 active platforms and 25,000 miles of active pipelines (and 18,000 miles of inactive pipelines) in the Gulf of Mexico (see Figure 6.1).

He noted that shelf and deep sea mud is unremarkable unless something is added to it, but because benthic elements are not charismatic, little attention is paid to the bottom of the ocean. However, according to Montagna, benthos have important roles (i.e., the Benthic Effect) in coastal and marine food webs. The benthos regulate or modify nearly all physical, chemical, and geological processes, and they continuously sample the ocean. This makes benthic organisms extremely good indicators of any changes in the environment. Benthos can be defined by size, distribution, taxonomy, or even by genetic bar codes. However, the genetic bar codes only indicate presence or absence, not diversity. According to Montagna, benthic diversity is the best indicator of ecosystem health, and because scientists currently know only approximately 25 percent of species, further exploratory research would be beneficial.

___________________

⁷ Available at http://tos.org/oceanography/issue/volume-29-issue-03 (accessed November 17, 2017).

⁸ Available at dwhdiver.orr.noaa.gov (accessed November 18, 2017).

⁹ Available at http://gulfresearchinitiative.org (accessed November 18, 2017).

¹⁰ Available at https://www.restorethegulf.gov/history/about-restore-act (accessed November 18, 2017).

Montagna described the Gulf of Mexico Offshore Operations Monitoring Experiment that considered whether offshore structures had chronic, sublethal effects in the mid-1990s. Studies revealed that nearly all effects were limited to within approximately 100 meters of a platform. Prompted by a question about contaminant effects versus ecological or reef effects, he conducted further experiments that revealed that the offshore platforms actually serve as artificial reefs. Montagna explained that while there is some contamination and some disturbance, he believes the positives of the reef effect outweigh the negatives, when offshore operations are normal.

A new human-dimension framework for studying the offshore that has emerged over the past 20 years is “ecosystem services.” He defined ecosystem services as the free benefits people obtain from the ecosystem. For example, the ocean provides 17 services to people, including nutrients, food, culture, biology, and gas (see Figure 6.2). Oceanic ecosystem services are also a substantial benefit to the offshore industry—for example, the Gulf of Mexico’s natural removal of spilled oil saved BP between $20 billion and $40 billion after the Deepwater Horizon incident. Montagna concluded by reiterating that the Gulf of Mexico is productive, diverse, and worth protecting.

Regulatory Approaches and Considerations for Environmental Risk Offshore California

Robert S. Habel, California Department of Conservation

Habel provided an overview of the California Department of Conservation Division of Oil, Gas, and Geothermal Resources, which was created in 1915 to protect hydrocarbon zones from being watered out by poorly constructed neighboring wells. The Division’s work eventually shifted to focus primarily on the protection of freshwater and groundwater sources. The Division mandates include supervising drilling, operation, and maintenance of wells to prevent damage to life, health, property, and natural resources; supervising and permitting the

owners/operators to utilize all methods and practices known to industry for the purpose of increasing well production; and supervising the wise development of oil and gas resources. He noted that prior to 2013, the Division had not been permitting hydraulic fracturing.

Because the legislature was concerned about problems arising in California from hydraulic fracturing, Senate Bill 4 was developed by the State Senate, Habel explained. The Bill determined the level of monitoring required before, during, and after development, both onshore and offshore. With the passage of this Bill, California had new laws for well stimulation activities (i.e., hydraulic fracturing and other treatments that increase the flow of hydrocarbons to wells and then to the surface for recovery) performed by oil and gas operators. Senate Bill 4 includes stringent regulations, according to Habel. It requires a study of well stimulation, a statewide environmental impact report, and the development of well stimulation regulations for the onshore and the offshore. Senate Bill 4 also requires groundwater monitoring plans, permits for well stimulation, and increased transparency through public disclosure and notification to adjacent landowners. The bill also establishes procedures for protecting trade secrets and amendments to the oil and gas fee structure. These regulations aim to protect drinking water, the environment, and public health and safety.

Habel noted that the first step in regulating well stimulation treatment is to evaluate nearby wells (to ensure there were no old, poorly constructed wells that would provide a conduit outside of the intended zone) and geology (to ensure there was no natural conduit that could become problematic). Then pre-fracture well testing is conducted, allowing for water well testing in the case of concerns about contaminants, and notifications are provided to both the Division and the public. Monitoring is also required during and after the fracturing operations, Habel continued, and information about the materials used in the fracturing fluid are disclosed to the public. The regulations also cover methods for storage of these fluids.

The Division protects fresh waters in the hydrocarbon zone by ensuring that the wells have mechanical integrity (i.e., strong well casing and tubing) and by evaluating the cementing requirements to ensure that all zones that could be in contact are isolated so as to avoid cross-flow. Habel emphasized that while such practices were always occurring, they are now officially regulated. The Division’s sister agency, the California State Water Resources Control Board, oversees groundwater monitoring plans (including sampling and neighbor notification) for any

area in which hydraulic fracturing occurs where there are underground sources of drinking water. While in offshore operations there are not many “neighbors” to notify, in the onshore a third party sends notifications to people within 1,500 feet of a well head and within 500 feet of the projection of the wellbore at least 30 days in advance of when hydraulic fracturing will occur. The tenant has the right to request sampling of the well or of the surface water, and expenses for such testing will be paid by the operator and conducted by a certified laboratory. All groundwater data are posted to the State’s website.¹¹ During the well stimulation, surface injection pressure, slurry rate, proppant concentration, fluid rate, and annuli pressures are monitored and put into public record, according to Habel.

When the Division was first developing the regulations, he remarked, there was much concern about seismicity associated with hydraulic fracturing. If there were to be seismic activity during fracturing, the operations would stop and investigations would begin (although this is unlikely, given that most of their fracturing occurs in shallow waters). Because water is so important in drought-ridden California, operators handle fluids associated with well stimulation carefully. All of the fracturing fluid recovered from a fractured well has to be reinjected, which causes some challenges for California because some fields produce oil with fresh water and some of that water is then used to water non-food crops. Monitoring is also conducted on production pressures post-stimulation, in which samples are collected both immediately after the well stimulation and 30 days later to ensure that there are no anomalies associated with hydraulic fracturing. Habel reiterated that all reports (pre-, syn-, and post-stimulation) are posted on the Division’s website for public viewing. Because people are concerned about acid being put in wells located near fresh water, all uses of acid are recoded in these reports to distinguish between regular well maintenance and an acid job. Habel emphasized that the Division has paid special attention to keeping everything in the zone of intent—even if acid goes into the hydrocarbon zone, it is unlikely to cause any problems to fresh water. These regulations would apply in offshore and state waters as well.

During the 2016 reporting period, there were 579 well stimulation treatments performed in the onshore environment. According to Habel, there were no well failures associated with hydraulic fracturing and no emergency responses to spills or releases in 2016.

Air Emissions from Offshore Platforms

Desikan Sundararajan, Statoil

Sundararajan suggested that emissions management in the onshore is more pressing than that in the offshore—offshore operations are already heavily regulated and thus have better emissions control than onshore operations. He explained that a good air emissions program would be comprised of science, technology, operator protocols, and policy (STOP). He believes that all four have to come together; otherwise, the industry will never be in control of acceptable emissions or have strong climate policies for oil and gas operations. Sundararajan added that while emissions-related technology has evolved, outdated emissions factors are still used for emissions reporting both onshore and offshore.

Sundararajan explained that although the U.S. Environmental Protection Agency’s (EPA’s) emissions inventories are revised every other year, there is inconsistency in how emissions fac-

___________________

¹¹ Available at http://www.water.ca.gov/groundwater/gwinfo (accessed November 22, 2017).

tors are used and how operators extrapolate their emissions data. He commented on the importance of having a robust methodology for emissions estimation and noted that bottom-up approaches to emissions inventories have been supported in the past by industry and by regulators. Bottom-up approaches involve conducting measurements at the component level where the emissions occur, developing a mathematical model, and extrapolating emissions.

In the past 10 to 20 years, NOAA has been working to better understand the emissions footprint from the oil and gas industry from a top-down fashion. NOAA has combined effective measurement technologies and techniques with strong algorithms to create box models and allocate emissions. In addition, NOAA has installed analytical instrumentation on airplanes, because measurements observed 20,000 feet into the atmosphere likely indicate an issue emerging from the operations on the ground. However, as a result of NOAA’s work, there is now a substantial gap between its papers and the EPA’s inventories, causing confusion and concern for the industry, according to Sundararajan.

While Sundararajan asserted that the bottom-up approach may not capture all of an operation’s emissions, top-down approaches can overestimate or over-allocate emissions, resulting in a debate about the true emissions numbers. He explained that if the right methodology for emissions estimation is developed, policy makers can more appropriately regulate the oil and gas industry.

The Norwegian Environment Agency has worked with Sundararajan’s company Statoil and other companies during the past 5 years to refine its methodology for emissions estimation in Norwegian operations. The new methodology includes a focus on measuring performance, recognizing what operators and instruments look like, and understanding the types of maintenance protocols that are implemented, all of which play a role in reducing emissions. The Norwegian Environment Agency continues to refine its methodology, given that more emissions are being reported from the offshore platforms than are actually being emitted. Sundararajan suggested that the Gulf of Mexico could benefit from similar acceleration in methodological development.

According to Sundararajan, regulators have historically steered clear of requiring continuous emissions monitoring on offshore installations, owing to the high costs and inadequate technology that exist. He encouraged further dialogue between industry and regulators (especially given that technology has advanced, costs have decreased, and accuracy has increased) to revisit this issue and motivate better pollutant-monitoring practices.

Sundararajan commented that continuous monitoring of methane, in particular, is emerging—the Environmental Defense Fund has a detector challenge,¹² and the Advanced Research Projects Agency–Energy (2016), has a program to develop methane sensors. Where sensors are already installed, data are being collected and analytics and digitization are being applied to identify where equipment maintenance could correct a problem. This concern about methane has prompted both regulations onshore and discussions about regulations offshore. Sundararajan explained that there is a dramatic difference in methane emissions between the offshore and onshore worlds. In terms of safety and process instrumentation, the onshore world is not as heavily regulated as the offshore world, which is why it is so important to invest more money and research in understanding the true footprint of methane emissions in the onshore arena.

___________________

¹² Available at https://www.edf.org/energy/natural-gas-policy/methane-detectors-challenge (accessed November 20, 2017).

MODERATED DISCUSSION

Responding to Ray’s presentation, a participant asked how all of this knowledge that exists about the oil and gas industry gets translated to an operator or a regulator. The participant also asked if an example exists internationally where this knowledge and experience come together cohesively. Ray noted that the publication of all of these reports was driven by the desire for regulatory agencies to have information to properly manage resources and the environment. Oil and gas development spans a wide range of areas and costs, so justifications for investments have to be carefully presented. Ray continued that there is much cross-communication among governments and agencies, the concerned public, and the nongovernmental organizations internationally. Such synthesis activities are especially valuable for scientists because many academic disciplines do not engage with one another or participate in information sharing. He suggested that moving forward industry focus on what it does not know, what its concerns are, where the data are weak, and what needs to be verified. This approach of building on previous knowledge is more effective and less costly than “reinventing the wheel,” according to Ray. Montagna reiterated that synthesis is critical—for example, the Gulf of Mexico Research Initiative has dedicated $50 million in research grants toward synthesis activities in support of the offshore industry. He emphasized that humans are embedded in the environment, and so it is important to model the fact that people are connected to each other and the environment in the framework and context of ecosystem services.

A participant expressed concern about the industry’s prioritization of onshore emissions to the degree that it would not do independent top-down studies of offshore emissions. Sundararajan concurred with the value of conducting top-down studies offshore, and he reiterated that onshore operations would benefit from stronger emissions regulations. Another participant noted that data on methane emissions for completion exist, but questioned whether the data are being transmitted up through organizations appropriately. Sundararajan acknowledged that industry has not always utilized data as wisely as it could and added that moving forward he expects to see data handled better and communication processes strengthened.

The industry’s reliance on data was discussed further after a participant observed that while it is easier to study phenomena after negative effects are already present, it is vital to collect baseline data before effects occur so as to be able to make effective comparisons. The participant wondered how resources could be allocated to support this step in the process. Ray agreed that it is much more difficult to secure funding for proactive research than for investigating a problem that already exists. He suggested focusing on priority setting and emphasized the value of being able to articulate a need. He added that joint industry projects, where partners can share cost, may be an effective strategy to collect data and anticipate potential problems. Montagna agreed that this is a challenge that has existed for decades: it is impossible to have baseline data without monitoring, but people are usually reluctant to invest in monitoring systems. He reiterated Ray’s point that it is difficult to convince people to “study” things they might need in the future. He highlighted the Gulf of Mexico Coastal Ocean Observing System, part of the international Integrated Ocean Observing System, as a successful program that collects routine measurements. He mentioned that the industry would benefit from better, larger-scale monitoring in conjunction with better synthesis of information—for example,

this is the only way to determine whether restoration dollars have been effective and to better understand the structure and function of the Gulf of Mexico.

Thinking about the function of the Gulf of Mexico more specifically, Epstein wondered about the process used to identify areas that are unique in relation to biodiversity. Montagna said the Gulf has many diverse habitats and protected areas would be beneficial to have because of the valuable ecosystem services the Gulf provides. He also clarified that “management” does not prevent actions; it simply means that something can be protected by better decision making. He added that if humans take care of the Gulf of Mexico, it will take care of humans.

Another participant asked if different ecosystem effects develop when platforms reach end of life and are left in place or cut far below the surface. Montagna said that this is another instance in which it is crucial to integrate natural science, social science, and engineering research to generate solutions, especially because this issue affects people. For example, he noted that while some fishermen love to fish on artificial reefs and offshore platforms, others believe fish in those locations will be contaminated and prefer to see them removed. He added that cutting platforms in half and toppling them over seems to be the most efficient approach, although this can create navigation issues for the U.S. Coast Guard. He emphasized that it is imperative to ensure that no contaminants are added during decommissioning. Personally, Montagna favors the Rigs to Reefs program.

A participant asked how the utilization of subsea dispersants has affected the overall recovery of a system. Montagna noted that this topic is still under discussion: Dispersants can put more oil on the sea floor, causing longer-term, more widespread impacts and mobilizing toxins in the food chain, but they can also enable work in the area because there are no fumes for the public to inhale. Ray responded that dispersants have been controversial for a long time and noted the importance of understanding the overall environment where the work occurs (i.e., where dispersed oil will go and what it might impact). The potential impacts on beaches, mammals, and wetlands if the oil is not dispersed are also important to understand. Resource managers and the environmental community have to weigh the environmental trade-offs with the knowledge base before making decisions about dispersants. Epstein said that the fact that no incentives are currently in place to push for oil recovery and to better manage major spills in the marine ecosystems indicates a failure on the parts of industry, the engineering community, and the regulatory bodies.

Referring back to the discussion of Senate Bill 4, a participant noted that its level of monitoring required onshore and offshore is a significant development for the United States. He asked what kinds of hydraulic fracturing data will be fully available to the public and to researchers. Habel said that the Groundwater Protection Council created a national database for operators to voluntarily load data about hydraulic fracturing, and the state of California created an additional space which contains extensive data on specific amounts and types of chemicals used in hydraulic fracturing. Habel added that even though all operator reports are also available to the public (which would include information on groundwater monitoring, downhole pressures, and post-fracturing monitoring, for example), he cautioned that fracturing in California is different from that in other sections of the United States, so the data may not be as useful for people working in other locales or for people engaged in other offshore operations.

A participant added that the Groundwater Protection Council is in the process of implementing a new risk-based data management system, WellSTAR (Well Statewide Tracking and Reporting System), that will contain an extensive data collection. The data will be both downloadable and manipulatable. He added that because hydraulic fracturing in California takes place at relatively shallow levels in the subsurface, one will not see many trade secret claims in California. He also emphasized that data generated from environmental studies allow operators to continue working in the offshore environment by balancing operational and environmental concerns.