DANISH OPERATORS Offshore Oil and Gas Operators in Denmark Use of Nitrogen Purge in Flare and Vent Systems 7 September 2009 Esplanaden 50 6 1263 Copenhagen K 6 Denmark Telephone: +45 3363 4097 6 E-mail: info@danishoperators.com 1. Title of Initiative Use of Nitrogen Purge in Flare and Vent Systems. 2. Description of Initiative The offshore installations flare and atmospheric vent headers are required to be purged in order to prevent oxygen ingress to the flare and atmospheric vent systems. This is required in order to avoid the formation of explosive mixtures in the headers, which could lead to explosions if ignited. Fuel gas or nitrogen can be used as purge gas. The purge gas is injected at different locations in the systems in order to maintain a positive pressure in the flare headers thus preventing air ingress. Cold vents (atmospheric vent headers) are used to vent hydrocarbon gas from low pressure sources where insufficient pressure is available to allow the gas to be flared. Under normal operating conditions the volume of gas vented via the cold vent is minimal. The use of fuel gas in flare and vent headers for purging purposes results in environmental emissions. These can be in the form of CO2 or NOx when the fuel gas used in the HP and LP flare headers is burnt or in the form of CH4 and other species present in the atmospheric vent header purge gas when this is cold vented. The green house effect associated with the CH4 is around 23 times worse than that for the CO2 emissions. The replacement of the use of fuel gas with nitrogen for purging the flare and atmospheric vent headers is one of the options currently being investigated in order to reduce environmental impact. The use of nitrogen will eliminate the environmental emissions described in the above paragraph. It should be noted that, when replacing purge fuel gas with nitrogen for Atmospheric Vent headers, the NOx emissions increase. This is due to the NOx emissions produced in the gas turbines when generating the necessary power for N2 generation. However, the environmental impact of cold venting in terms of CO2 emissions is seen as much higher than that of the increased NOx emissions for nitrogen generation. This initiative is applicable to the DUC Facilities only. Nitrogen is currently being used on the Dong Energy Siri facilities for purging the flare system. A flare recovery system is planned to be installed on Hess South Arne Facility which will eliminate the need to purge the flare headers with nitrogen. In the case that Flare Gas Recovery is installed on any of the DUC platforms, it will not be necessary to replace the use of fuel gas with nitrogen for purging purposes as the purge fuel gas would be recovered and sent back to the process. If the pay back time for changing from fuel gas to nitrogen purge is significantly less than an expected implementation time for a flare gas recovery system, nitrogen purge should be considered. Nitrogen will still be required in order to purge the flare stack, downstream of the Fast Opening Valves that are normally installed in the main headers as part of flare recovery projects. This is considered to be a project requirement and therefore considered to be outside the scope of this report. 1/7 3. Potential for Reduction of Environmental Emissions Table 1 below summarises the potential for environmental emissions reduction as well as an estimate of the total investment required to replace the use of fuel gas with nitrogen for the purpose of purging the DUC Facilities Flare Header. The total potential reduction in fuel gas usage is around 0,06MMSCFD. The figures below exclude the Gorm HP, LP and Vent headers given that the platform does not have sufficient nitrogen generation capacity to supply the required flow rate. It is not considered feasible at this stage to proceed with the installation of a new nitrogen generation unit for this purpose. Table 1 Net CO2 Emissions Reduction, tonnes/year (Notes 1, 2 and 3) 4000 NOx Emissions Estimated Total DKK/(ton/year of CO2 Reduction, kg/year Investment (Note 8) reduction) (Note 4) (Note 5) MM DKK 457 50 12500 Notes: 1. Figure takes into account CO2 emissions generated when combusting FG in the Gas Turbines for generating the power necessary to produce purge nitrogen. 2. Figure represents approx 0,2% of the total DUC CO2 emissions for 2008. 3. Value includes both the burnt and unburnt fractions of fuel gas used for purging the HP/LP flare and atmospheric vent headers. 4. When replacing purge fuel gas with nitrogen for Atmospheric Vent headers, the NOx emissions increase. This is due to the NOx emissions produced in the gas turbines when generating the necessary power for N2 generation. However, these will be small as compared to those generated in the flare tips when burning the purge FG and as a result a net reduction is achieved for all the categories. 5. Required investment to reduce CO2 emission by 1 tonne per year. Figure represents the average for all DUC Facilities. The individual values for each particular flare/vent header ranges from 243 DKK for the Dan FG vent header (most attractive option) to 122541 DKK for the Tyra East LP flare header (less attractive option). The values for all headers are shown in Table 2 below and are to be used when prioritising any future works. 6. Given that the nitrogen purity currently generated offshore is not completely pure (purity> 93%) some oxygen will be introduced into the flare headers. However, the Upper Flammability Limit (UFL) of natural gas in oxygen is around 61% in volume (assuming pure methane). The volume fraction of gas during normal operation in all flare headers will be above 99.9%, which is well above the UFL. The normal flaring rates will have to be reduced to 0,0009 MMSCFD or lower in order to create flammable mixture. Rates as low as those are never experienced during operation. Therefore a flammable mixture is not predicted under any circumstance. 2/7 7. The flammability of all mixtures expected in the flare tips, resulting from the replacement of fuel gas with nitrogen have been checked and found not to be a problem. This is due to the high hydrocarbon/nitrogen ratio seen in the flare headers. 8. Includes engineering, equipment and installation costs. Table 2 below shows the above values and other relevant information for each individual header. 3/7 Table 2 Current Flare/Vent Stack Total FG Estimated ID required Equivalent Net CO2 Opex Increase Net Cost Emissions (cost of N2 economic Estimate for Cost/(tonnes/year of Required Header Comments CO2 reduction) N2 reduction Generation) benefit modifications CO2 emissions inch Nm3/h kg/h Nm3/h tonnes/year DKK/year DKK/year DKK DKK/(tonne/year) DAN FG-Vent 12,39/6,36 1,3185 68,5 1,1367 597,1 1892 63715 150000 251 N2 generation is sufficient to meet requirements. N2 purging facilities exist. N2 flowmeter to be installed. TYW-A Vent 13,62 1,6614 86,4 1,4323 752,3 2383 80282 1000000 1329 N2 generation is sufficient to meet requirements. New N2 purging facilities are required (pipework + flow meter) TYE Vent 13,62 1,6614 86,4 1,4323 752,3 2383 80282 1875000 2492 N2 generation is sufficient to meet requirements. New N2 purging facilities are required (pipework + flow meter) DAN FG- HP 23,50 12,4584 28,2 10,4009 216,8 17308 141885 600000 2768 N2 purge facilities are installed. N2 generation system capacity is 150N/m3. Normal consumption is 0 according to Design Manual. Halfdan Vent 6,36 0,1190 6,2 0,1026 53,9 171 5749 150000 2784 N2 generation is sufficient to meet requirements. New N2 purging facilities are required (pipework + flow meter) HWA Vent 10,42 0,6577 34,2 0,5670 297,8 944 31782 1000000 3358 N2 generation is sufficient to meet requirements. New N2 purging facilities are required (pipework + flow meter) HALFDAN HP 23,50 11,3464 25,6 9,4553 197,1 15735 129220 750000 3806 N2 purge facilities are installed. N2 is supplied by N2 Generation package HDAC-A-0801 with a design capacity of 320 Nm3/h. Consumption is 100Nm3/h giving a spare capacity of 220 Nm3/h. PCV designed for 44 Nm3/h. Flow to glycol regen package discontinuous. Nitrogen line to HDC has been disconnected. PCV OK for required purge flow. HALFDAN LP 13,62 1,6614 3,8 1,4323 28,7 2383 18829 150000 5224 As per Halfdan HP header above. Dan F Vent 10,42 0,6577 34,2 0,5670 297,8 944 31782 2000000 6715 N2 generation is sufficient to meet requirements. N2 purging facilities exist. N2 flowmeter to be installed. DAN FG LP 12,39 1,2330 2,8 1,0323 21,4 1718 14033 300000 14019 As per Dan FG HP header above. 13,62 / 17,62 10,9217 24,7 4,9234 201,9 8193 132370 5000000 24768 N2 Generation System produces 30Nm3/h. LP/IP Comp consumption is 20Nm3/h. There is sufficient spare capacity to meet the requirements. Piping mods required. 23,50 10,9675 24,8 9,4553 189,6 15735 124302 5700000 30069 HWA HP 2 headers Platform A: N2 Generation package supplies 60Nm3/h. LP comp consumes 2,4 Nm3/h. Capacity available will be sufficient to meet requirements. Platform E: N2 is supplied by N2 Gen Unit WEATYW HP A-8501. Generation capacity is 80Nm3/h and consumption 44 Nm3/h. Spare capacity of 36Nm3/h will be sufficient. Only piping mods are required. N2 generation system capacity is 40N/m3, consumption is 11Nm3/h, therefore there is sufficient capacity to meet the requirements. Two of the purging points are located on Platforms E and F. TYE HP 23,50 12,0853 27,3 9,7738 210,8 16265 138203 11250000 53377 Nitrogen for these platforms is supplied by nitrogen bottles. It is not recommended to run nitrogen pipes across the bridges in order to replace FG purge with N2. Replacement is only to be applied to Platform A. N2 is available. Two N2 generation packages are available on Dan FC platform (A-0802 and A-0807) with a total combined capacity of 105Nm3/h. N2 from Dan FF is also available (A-0801) with DAN FD - HP 17,62 8,0380 18,2 6,3475 140,6 10563 92213 13300000 94576 a capacity of 138Nm3/h. Consumption is not known but given the small flow rate required and the high generation capacity as compared with other platforms it will be assumed that there is sufficient capacity available to meet the requirements. TYE LP 13,62 1,6614 3,8 1,4323 28,7 2383 18829 3750000 130592 Capacity available will be sufficient to meet requirements. See TW HP Flare above . Only piping mods are required. HWA LP 8,33 0,3847 0,9 0,3168 6,7 527 4389 1000000 149417 As per Harald HP header above. TYW LP 10,42 0,7682 1,7 0,6005 13,5 999 8825 2300000 170899 Capacity available will be sufficient to meet requirements. See TW HP Flare above . Only piping mods are required. GORM LP 10,42 1,4897 3,4 1,1440 26,2 1904 17152 - - Gorm F: N2 Generation System produces 10Nm3/h and supplies LP Compressor C-4201. LP comp consumption is 7 Nm3/h. , which makes the N2 Generator insufficient to supply the required N2 purge flow rates. Given the small gain to be obtained, is not considered feasible to install extra N2 generation capacity. Gorm F: N2 Generation System produces 10Nm3/h and supplies LP Compressor C-4201. LP comp consumption is 7 Nm3/h. , which makes the N2 Generator insufficient to supply the required N2 GORM HP 23,50 15,9784 36,1 13,1277 278,1 21846 182331 - purge flow rates. Given the small gain to be obtained, is not considered feasible to install extra N2 generation capacity. Gorm F: N2 Generation System produces 10Nm3/h and supplies LP Compressor C-4201. LP comp consumption is 7 Nm3/h. , which makes the N2 Generator insufficient to supply the required N2 GORM Vent 10,42 0,6577 34,2 0,5670 297,8 944 31782 - purge flow rates. Given the small gain to be obtained, is not considered feasible to install extra N2 generation capacity. See next page for calculation methodology. 4/7 Calculation Methodology Purge gas rates calculation (applicable to both fuel gas and nitrogen): Calculated based on API 521 (5th Edition, 2007) equation. Q = 0,0035283* D^3,46 * K Where, Q is the purge gas rate, expressed in normal cubic metres per hour (standard cubic feet per hour); D is the flare stack diameter, expressed in metres (inches); K is a constant which depends on the purge gas composition. Different values are used for fuel gas and nitrogen. Equivalent CO2 emissions Equivalent CO2 emissions are calculated as follows: For burnt Fuel Gas CO2 emissions (kg/h) = Fuel Gas normal volume flow rate (Nm3/h) x 2.26 kg CO2 / Nm3* *Figure based on an Emission Factor of 57 kgCO2/GJ and a Heating Value of 39,6GJ/1000Nm3. For cold vented Fuel Gas Equivalent CO2 emissions (kg/h) = Normal volume flow rate (Nm3/h) x 2,26 kg CO2 / Nm3 x 23** **Figure takes into account more harmful environmental effect of unburnt CH4 (advised by Production Department) Net CO2 Emissions reduction Net CO2 Emissions reduction = Equivalent CO2 emissions - CO2 Emissions resulting from N2 generation Net economic benefit Net economic benefit =Additional Revenue (sales gas) + CO2 emissions reduction- Cost of fuel gas for N2 Generation CO2 emissions reduction: according to Forudsætninger for samfundsøkonomiske analyser på energiområdet, May 2009, the CO2 saving should be included in the economic assessment. A rate of 84,925 DKK/tonne is used for the calculations. NOx Emissions reduction / increase For fuel gas burnt if flare tips: NOx emissions (mass units) = 0,0015 * flare gas mass flow rate For fuel gas burnt in gas turbines = Fuel Gas normal volume flow rate (Nm3/h) x 0,0049 kg NOx / Nm3*** ***Figure based on an Emission Factor of 124g NOX /GJ and a Heating Value of 39,6GJ/1000Nm3. CAPEX: Includes engineering, equipment and installations costs. 5/7 4. Investments by Major Components and Years As stated in Table 1 above the total required investment is DKK 50.3MM. The cost estimates for the modifications required for each individual header are presented in Table 2 above. The implementation of the modifications is to be prioritised according to the cost / (ton/year of CO2 reduction). Some of the modifications for a particular platform (e.g HP/LP/Vent headers) could be combined in a single CFI package if it is decided to proceed with them. The timeline for implementation is subject to the decision to proceed with the project. 5. Operating Costs and Revenues 5.1 Total Net Economic Benefit The total net economic benefit that would be obtained if all the proposed projects were implemented is given in Table 3 below. Table 3: Additional Revenue from increased gas sales (purge FG sold). Additional Revenue from CO2 emissions reduction (CO2 quotas sold) Cost of FG for N2 Generation Net Economic Benefit 0.88 MMDKK/year 0.34 MMDKK/year -0.10 MMDKK/year 1.12 MMDKK/year *Gas price 32.6 DKK/GJ, Heating Value = 39.6 GJ/1000Nm3. See Section 6 below for payback period calculation. 6. Operating Economic Assessment A brief economic assessment based on payback period is present below for both the most attractive option and for the implementation of all the options. Included in the assessment is the value of CO2 emission reduction. According to Forudsætninger for samfundsøkonomiske analyser på energiområdet, Februry 2009, the CO2 saving should be included in the economic assessment. A rate of 84,925 DKK/tonne of CO2 is used for the assessment assessment. Most attractive option: The most attractive option in terms of Cost/(tonnes/year of CO2 reduction), is the installation of a nitrogen flow meter on the existing nitrogen line to the Dan FG atmospheric vent header. The following economic assessment is made for this option: Required investment = DKK 150000 (includes cost of flowmeter, engineering and installation) 6/7 Additional Revenue (FG Export) = 14890 DKK /year CO2 Emission Reduction = 50706 DKK /year Cost of FG for N2 Generation = - 1892 DKK /year Net Economic Benefit = 63704 DKK /year Payback period = 150000 / 63704 = 2,4 years Assuming that all the proposed projects are implemented: Required investment = MMDKK 50.3 Net Economic Benefit (Table 3) = 1.12 MMDKK /year Payback period = 50.3 / 1.12 = 45 years For the most attractive option the payback period of 2,4 years makes this worth pursuing and as such should be progressed to better define the costs. For all other individual options, and the implementation of all the options combined, the payback period exceeds 4 years such that the main drive for this initiative is seen as not an economic one. 7. Possible Socio-Economic Calculation Refer to Section 3 above. 8. Possible Socio-Economic Assessment Refer to Section 3 above. 9. Recommendations 1. Decision to proceed with this initiative and scope of implementation to be confirmed. 2. The installation of flare gas recovery systems on the DUC platforms is currently being studied. It is recommended to wait for the results of such studies before taking the decision to proceed with the implementation of this initiative. 3. To check the fuel gas flow rates currently being used offshore in order to ensure that the correct flows are in place. 7/7