# Presentation: 631195

## Sustainability and offshore oil and gas exploration and production

**Christian Holmes **
**Executive Director**
**Shell Center for Sustainability**
**Rice University**

## Key topics

- Importance of sustainability to the oil and gas industry
- Importance of sustainability to environmental regulators
- Sustainability challenges facing the exploration and production industry
- Key responses to these challenges
- Future exploration and production sustainability challenges – methane hydrates

## Sustainability

- How to produce energy so as to sustain *over many generations* our society, environment and the economy.
- Sustain: “to keep going”
- Oxford English Dictionary

## Sustainability Drivers

- Increased population
- Increased competition
- Civil strife
- Global climate change
- Stakeholder and shareholder expectations

## Population Projections

## Importance of sustainability to the oil and gas E& P industry

- A way to live one’s values
- An approach to maximize environmental social and financial performance
- An approach to have multi-generational impact
- An approach to secure the “license to operate”

## The importance of sustainability to environmental regulators

- Environmental performance has improved because responsibility and accountability is dispersed throughout the company
- The CEO, CFO, senior VP for corporate affairs, senior VP for environment health safety and sustainability all have a stake sustainability
- Everyone in a corporation has a stake in sustainability
- Sustainability is the link between environmental and social impact: environmental justice

## Challenges: exploration and production

- Historic and present challenges:
- Flaring and venting
- Decommissioning of oil and gas installations
- Brent spar oil storage tank disposal
- Management of drill cuttings
- Produced waters
- Drilling muds and fluids
- System for estimating and validating greenhouse gas emissions
- subsidence
- Spills
- Safety
- enhanced profitability

## Sustainability E&P responses

- Venting and flaring: piping of gas to coastal facilities; use of gas as as an on platform source of energy
- Use of solar and wind power generation on offshore production facilities
- Spill prevention
- Less harmful drilling muds and fluids
- Safety improvements
- New techniques to estimate and manage GHG emissions

## Responses: the role of technology

- Identify and development discovered reserves less intrusively
- Faster elimination of non-prospective areas do more efficient basin modeling
- Better subsurface imaging and interpretation using gravity and 4-D seismic data thereby decreasing the number unsuccessful wells
- More efficient off take from smarter wells, requiring fewer wells per unit of production
- Less environmentally intrusive handling of drill cuttings
- Decreased venting and flaring
- --Dr. John H. Barwis, Shell UK exploration and production

## Sustainability reporting

- Global reporting initiative
- United Nations environment programs oil sector report
- International Petroleum Industry Environmental Conservation Association and American Petroleum Institute joint corporate reporting project

## performance measures

- Present Measures
- Emissions to air
- Discharged water
- Waste
- Health and safety
- Social
- Resource management
- Economic
- regulatory sanctions
- Contractor performance
- Management systems – ISO 14001

## performance measures 

- Future measures
- Environmental impact of products
- Health impact of processes in products
- Access to sensitive areas
- Land-use and habitat restoration
- Climate change – GHG. trading
- Stakeholder consultation
- Strategic EHS risk management

## Impact

- Marine Mammals
- Human Health Impact
- Climate Change

## Future challenges-- methane gas hydrates

## What are Gas Hydrates?

- The heat from the flame melts the hydrate thus releasing more methane to fuel the flame.
- Notice the water dripping from the person’s hands.

- www.gashydate.de/images/hand.jpg

## Slide 17

## Pipeline Plugging

- preventing Gas Hydrate formation accounts for
- 10-15% of the production costs
- $1 Million per day for Methanol alone

- www.spe.org/cda/images/ hydrate.jpg

## Slide 19

## Where Do Hydrates Form?

- In sediments below the ocean floor

- http://marine.usgs.gov/fact-sheets/gas-hydrates/title.html

## Geologic Settings 

- Images: *Trehu et al., 2002*

- BSR

- Seafloor

## Data from USGS

## CO2 Displaces Methane

*CO2 Displaces Methane*

- Sketch of a Proposed Method to Sequester CO2 while Producing Methane and Possibly Electricity.

## Backup Slides

## An integrated approach

- Offshore oil and gas exploration production is part of an overall system:
- E& P
- Transportation
- Storage
- Refining

## Challenges and responses: transportation, storage and refining

**Transportation**
- Double hulled tankers
- Movement to zinc based paints
**Storage**
- Segregation of water and ballasts of
- No discharge of ballast waters
- Minimize use of water tank cleaning
**Refining**
- Reduction of sulfur content in oil
- Use of heat exchangers to preheat feedstock in reformulation process
- floating roof tanks to control benzene