Air quality remains a hot topic in the energy sector.
Ozone is the issue in urban areas. This year is critical for Tulsa and Oklahoma City, since U.S. Environmental Protection Agency will be designating ozone non-attainment areas in 2010.
The director of a local environmental engineering company has already seen what happens with a city or region falls into non-attainment.
Mary Wofford, senior project manager at Flatrock Engineering and Environmental, 7633 E. 63rd Place, Suite 300, said energy companies operating in the Dallas/Fort Worth and Houston/Galveston areas are hit with whole new layers of rules and regulations.
“That makes it more expensive to operate and harder to comply with environmental standards,” said Wofford, who has a bachelor’s degree in Environmental Science and is a registered Environmental Manager with more than 10 years experience in environmental compliance. She most recently was employed at one of the largest natural gas providers in the U.S.
Flatrock is a San Antonio-based engineering and environmental consulting firm that recently opened a Tulsa office.
The EPA has estimated it will cost polluting industries between $7.6 billion to $8.8 billion a year to meet the current 75 parts per billion standard. The rule, however, will yield $2 billion to $19 billion in health benefits, according to the EPA Web site. In 2001, the Supreme Court ruled the government had to base the ozone standard strictly on protecting public health, with no regard to cost.
Tulsa has long been a major hub of the energy industry and many of Flatrock’s clients either headquarter or have operations in or near the city, said Wade Ingle, a Flatrock managing partner in San Antonio.
“We need to be accessible to our Oklahoma, Texas, Kansas and Arkansas clients, and we felt that Tulsa provided us with the best location to base the business,” Ingle said.
On the Horizon
Comprehensive environmental management systems are becoming more and more common. They help companies identify all applicable requirements (air, water, waste, even safety and health) and establish a consistent, cost-efficient process to comply with them.
“It’s easy to overwhelm and inundate clients with what could potentially apply to their business; it’s a lot more satisfying to help them weed through the regulatory compliance jungle and come out with an effective environmental, health and safety compliance program,” Wofford said. “We do a lot of on-site training for operations personnel. Many companies can’t afford a full-time environmental manager, so we help them develop programs that virtually any employee can coordinate.”
Two regulatory issues the oil and natural gas industries are facing that will have a huge impact on their operations in the near future deal with air pollution and engines.
The proposed rules expand the reach of the EPA, bringing every class and size of engine under regulation, even though the majority of the sources are in rural areas, said a Flatrock engineer.
The industry is just now coming to grips with the what is commonly called the “Consolidated Engine Rule,” which was finalized in 2008 and established new standards for natural gas-fired internal combustion engines and expanded existing standards for hazardous air pollutants from reciprocating internal combustion engines. They are the National Emission Standards for Hazardous Air Pollutants for Reciprocating Internal Combustion Engines and the proposed rule for mandatory reporting of greenhouse gases.
“Virtually no one disagrees with the need to regulate industry to help ensure environmental protection,” said Wofford. “However, much can be accomplished through work practices such as improving engine maintenance plans, rather than the crippling economic costs of installing control equipment to meet standards that may not even be achievable with the current control technology.”
Mandatory reporting of greenhouse gases will change the landscape of environmental compliance for nearly every industry, Wofford said. The gases include carbon dioxide, methane (CH4), nitrous oxide (N2O), hydrofluorocarbons, perfluorocarbons, sulfur hexafluoride and other fluorinated gases including nitrogen trifluoride and hydrofluorinated ethers.
The rule, proposed in April, requires facilities of certain sizes to begin reporting emissions in 2011. It is expected that the next step in climate change policy will be establishing a cap-and-trade system to reduce greenhouse gas emissions, what some consider to be a free market solution to an environmental problem.
“To others, it’s essentially a carbon tax. Either way, it’s another complex environmental issue that companies will have to face very soon,” Wofford said.
Flatrock’s large staff includes experienced engineering and environmental professionals in industry, regulatory and technical fields. These professionals provide varied expertise in gas pipeline engineering, air quality, water and waste management, DOT compliance and full service safety services.
Finding Energy Sources
Tulsa and the state are home to several major players in the oil and natural gas industry whose operations are heavily impacted by environmental regulations in many different states in the Mid-Continent and Rocky Mountain region.
But now, with formations like the Marcellus Shale, drilling companies operating in Pennsylvania, New York, Virginia and West Virginia and facing stiffer rules.
“Every state has its own regulatory agencies and ways of doing things so it can be difficult for companies to keep up with so many different state rules, not to mention federal regulations,” Wofford said.
Even relatively small sources of air pollution have to obtain some sort of authorization to operate, usually a permit issued by the state in which they operate.
“They may have monitoring or reporting requirements that go along with the permit,” Wofford said. “We help them obtain the permits and develop systems to comply with the permit requirements, so regardless of how strict the standards are, the business of preparing permit applications is always there.”
When standards are passed to bring in sources or pollutants that weren’t previously regulated, Flatrock sees an increase in demand to obtain or modify permits, Wofford said. “We try to keep our clients ahead of the curve so they are prepared when new standards are finalized. We are also actively involved in commenting on proposed rules so that we are able to serve as advocates for clients who may not want to be seen by regulatory agencies as argumentative if they object to certain requirements in the proposal.”
Tulsa offers easy access to the Oklahoma City market via the turnpike and allows Flatrock to support clients to the south, Ingle said.
“Probably the most important advantage is the ability to meet face-to-face to discuss projects; many of our clients are based either in Tulsa or Oklahoma City, so access to the client is very convenient,” Ingle said. “There are several industry related groups in Oklahoma, such as the Gas Processors Association and the Oklahoma Independent Petroleum Association. Also, compared to other commercial real estate markets, Tulsa offers very competitively priced office lease options and allows us to keep our costs to our customers as low as possible.”
Flatrock’s offers expertise in gas pipeline engineering, air quality, water and waste management and Department of Transportation compliance.
“Most of the professionals at Flatrock have worked in industry so we focus on implementing practical environmental management systems,” Wofford said.
Flatrock focuses on environmental and safety compliance for the oil and natural gas industry. The engineering company also provides air quality permitting, environmental site assessments, greenhouse gas emissions strategies and personnel training.
The vast majority of companies want to comply with the law and go about operating their business, she said.
“A lot of big companies spend tremendous amounts of money on public relations campaigns to show what they’re doing for the environment but so many more companies are struggling to keep up with regulations that are complex and confusing to anyone, let alone an employee who has to wear multiple hats in the company — environmental, safety, human resources, etc.,” she said. “They want to do the right thing but don’t have the internal expertise to figure out the most efficient way to do it.”
Air quality remains a hot topic in the energy sector.