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SUBJECT: Impacts of NSPS Gas Capture Requirements for New Gas Well Completions

DATE: April 5, 2012

This document summarizes the approach for estimating the impacts of regulating volatile organic 

compound (VOC) emissions from new gas well completions following hydraulic fracturing where 

reduced emissions completions (REC) are required. A description of the data and how it was used is 

provided. This document is intended to serve as a companion to the docket memos and TSD, so this 

document provides a summary of the information and methodologies that are detailed separately in 

those files. A similar procedure as the one shown here was used to estimate the impacts from 

recompletions following hydraulic fracturing and for the portion of affected facilities where combustion 

is used for VOC control instead of the combination of combustion and gas capture.

General Methodology

Below is the list of steps taken to estimate each aspect of the impacts.

Estimate Emissions from Representative Individual Source

1. Develop a methane emission factor for hydraulically fractured well completions (see separate 

docket memo: Emission Factor for Hydraulically Fractured Gas Well Completions: Data 

Assessment and Calculation Methodology)

2. Develop a conversion of mass of methane to mass of VOC (see separate docket memo: 

Composition of Natural Gas for Use in the Oil and Natural Gas Sector Rulemaking)

Estimate Reductions from Representative Individual Source

1. Determine the control efficiency of implementing a REC (see separate docket memo: Percent of 

Emissions Recovered by Reduced Emission Completions, May 19, 2011)

2. Multiply the control efficiency by the VOC emissions from a representative source

Estimate the Cost of Compliance for Representative Individual Source

1. Determine average cost per day of a REC (see Section 4.4.2.3 of Proposal Technical Support 

Document)

2. Determine average duration of REC in days (see Section 4.4.2.3 of Proposal Technical Support 

Document)

Estimate the Cost-Effectiveness of VOC Control

1. Divide the reductions from a representative source by the cost for a representative source

Estimate Total Emissions from All Hydraulically Fractured Gas Well 

Completions

1. Estimate the number of gas well completions in a representative year

2. Multiply the number of gas well completions by the representative emissions from an individual 

source
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Estimate Total Reductions from All Hydraulically Fractured Gas Well 

Completions

1. Estimate the number of gas well completions in a representative year

2. Multiply the number of gas well completions by the representative emissions reductions from 

an individual source

Estimate Total Cost of Compliance for All Hydraulically Fractured Gas Well 

Completions

1. Estimate the number of gas well completions in a representative year

2. Multiply the number of gas well completions by the cost of compliance for a representative 

individual source

Figure 1, below, illustrates the general process by which each aspect of the impacts was determined.
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Figure 1: Flow Diagram of Impacts Estimations

Figure 1

Data Descriptions

This section describes the data used for the impacts calculations. The data is also discussed in related 

docket memos and in the TSD. The list of the data is:

 Methane emission factor for hydraulically fractured gas well completions

Methane Emission

Factor

Conversion of 

Methane to VOC

VOC Emissions per 

Gas Well Completion

REC Control 

Efficiency

VOC Reductions per 

Gas Well Completion

Average Cost of 

REC per Day

Average Duration 

of RECs

Cost of REC per 

Well Completion

Cost-Effectiveness of 

VOC Control

Total VOC 

Reductions

Total Cost of 

Compliance

Total VOC 

Emissions

Number of Hydraulically 

Fractured Gas Well 

Completions per year
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 Conversion of mass of methane to mass of VOC

 REC control efficiency

 Average cost of REC per day

 Revenues from natural gas product recovery

 Average duration of RECs

 Number of hydraulically fractured gas well completions per year

Methane Emission Factor

The methane emission factor was calculated based on 4 different data sets which contained over 1,000 

wells. The emission factor was a simple average of the average emissions per completion from each data 

set (i.e. a simple average of 4 emission factors). The data included tight gas formations, shale 

formations, and coal bed methane (CBM) formations.

From the comments submitted to the proposed NSPS, additional data was received that the EPA 

considered. By performing a series of calculations based on this new data, it was shown that the 

previously developed emission factor was representative of emissions from a typical hydraulically 

fractured gas well completion.

For more information on the development of the original emission factor and the evaluation of data 

submitted through NSPS comments, please see the docket memo titled “Emission Factor for 

Hydraulically Fractured Gas Well Completions: Data Assessment and Calculation Methodology”.

Conversion of Mass of Methane to Mass of VOC

A conversion of mass of methane to mass of VOC was determined using composition data from 9 

different references. Based on this data, it was possible to generate an average composition profile for 

produced gas, and subsequently, a ratio of mass of methane to mass of VOC.

For more information regarding the development of this ratio as well as the raw data on which it is 

based, please see the memo from EC/R to Bruce Moore titled “Composition of Natural Gas for use in the 

Oil and Natural Gas Sector Rulemaking”.

REC Control Efficiency

Based on the results reported by 4 different Natural Gas STAR Partners who performed RECs, it was 

possible to estimate a representative control efficiency of using RECs. The companies provided both 

recovered and total produced gas, allowing for the calculation of the percentage of the total gas which 

was recovered. This estimate was based on data for more than 12,000 well completions.

Average Cost and Duration of RECs

The average cost and duration of RECs was obtained from data also shown in the Natural Gas STAR 

Lessons Learned document titled “Reduced Emissions Completions for Hydraulically Fractured Natural 

Gas Wells” and is available at: http://epa.gov/gasstar/documents/reduced_emissions_completions.pdf. 

The impacts calculations use the cost per day for gas capture and the duration of gas capture along with 

a setup/takedown/transport cost and a flare cost to represent the total cost. The cost is then annualized 
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across the time horizon under study. The average cost and duration information is also covered in the 

TSD.

Revenue from Recovered Products

The costs were depicted in two different ways: without accounting for the value of the product 

recovered as a result of controlling VOC, and with the revenue from recovered products. To estimate 

the revenue from recovered products, the estimated value of the recovered gas was added to the 

estimated value of the recovered condensate. 90% of the gas emitted (ie 90% of the emission factor per 

completion event) was depicted as being captured and sold (see separate docket memo: Percent of 

Emissions Recovered by Reduced Emission Completions, May 19, 2011). This saved gas was multiplied 

by a characteristic gas price of $4 per Mcf gas. A characteristic amount of gas condensate was 

determined to be 34 barrels per completion, and this number of barrels was multiplied by its 

characteristic market value of $70 per barrel.

Number of Hydraulically Fractured Gas Well Completions per Year

The number of hydraulically fractured gas well completions was estimated using the National Energy 

Modeling System analysis consistent with the Annual Energy Outlook 2011 Reference Case. It is 

estimated that there would be 11,403 gas well completions in tight, shale, and CBM formations. From 

this total, three deductions were made:

1. The first deduction was for wildcat and delineation wells

a. 446 well completions

b. According to Annual Energy Outlook 2011 Reference Case

2. The second deduction was for RECs already required by state regulations

a. 1,644 well completions

b. 15 percent of gas well completions (after subtracting wildcat and delineation wells)

c. Explained in Section 4.3.3 of Proposal Technical Support Document

3. The third deduction was for low pressure wells

a. 931 well completions

b. 10 percent of gas well completions (after subtracting wildcat and delineation gas wells 

and the gas well completions already controlled by state regulations)

c. Based on the memo titled “Determination of Minimum Flowback Pressure, Docket EPAHQ-OAR-2010-0505, Oil and Natural Gas Sector: New Source Performance Standards 40 

CFR Parts 60” from ICF International to Bruce Moore on March 26, 2012.
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The table below summarizes the breakdown of the estimated number of gas well completions.

Table 1: Number of Hydraulically Fractured Gas Well Completions

Source Required to 

perform RECs

Required to Combust 

Completion 

Emissions*

Completions 

Already Regulated 

by States

Total Hydraulically 

Fractured Gas Well 

Completions

Hydraulically 

Fractured Gas 

Well Completion

8,382 1,377 1,644 11,403

* Note that the gas well completions required to combust the completion emissions are not prohibited from performing RECs. 

However, for the impacts assessment, these well completions are assumed to control emissions through a combustion device 

only.

Final Impacts

The tables below provide the final rule impacts for well completions when REC are performed estimated

using the methodologies, data, and parameters described in this memo, in the docket memos, and in 

the TSD.

Table 2: Estimated Impacts per Individual Hydraulically Fractured Gas Well Completion When REC is 

Performed

Source

Uncontrolled 

VOC Emissions

(tons)

VOC Emissions 

Reductions

(tons)

Cost of Compliance 

(without savings)

Cost of 

Compliance 

(with savings)

Individual 

Hydraulically 

Fractured Gas Well 

Completion

22.691 21.500 $33,237 -$1,543

Table 3: Estimated Impacts for All Hydraulically Fractured Gas Well Completion When REC is Required 

Source

Uncontrolled

VOC Emissions

(tons)

VOC Emissions 

Reductions

(tons)

Cost of Compliance 

(without savings)

Cost of 

Compliance 

(with savings)

All Hydraulically 

Fractured Gas Well 

Completion

190,200 180,214 $278,594,675 -$12,931,285

Note: An additional 55,535 tons of 58,612 tons of VOC emissions are estimated to be reduced via 

completion combustion for hydraulically fractured gas well completions that are not required to 

implement a REC but are required to combust emissions.
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Table 4: VOC Control Cost Effectiveness when a REC is Performed

Source

VOC Control Cost 

Effectiveness 

($/ton)—without 

savings

VOC Control Cost 

Effectiveness 

($/ton)—with 

savings

All Hydraulically 

Fractured Gas Well 

Completion

$1,546 per ton 

VOC -$72 per ton VOC