Lessons Learned 

from Natural Gas STAR Partners 

Convert Gas Pneumatic Controls To 

Instrument Air 

Executive Summary 

Pneumatic instrument systems powered by high-pressure 

natural gas are often used across the natural gas and

petroleum industries for process control. Typical process 

control applications include pressure, temperature, liquid

level, and flow rate regulation. The constant bleed of 

natural gas from these controllers is collectively one of the

largest sources of methane emissions in the natural gas

industry, estimated at approximately 51 billion cubic feet

(Bcf) per year in the production sector, 14 Bcf per year in

the transmission sector, and <1 Bcf from processing. 

Companies can achieve significant cost savings and 

methane emission reductions by converting natural gaspowered pneumatic control systems to compressed

instrument air systems. Instrument air systems

substitute compressed air for the pressurized natural gas, 

eliminating methane emissions and providing additional

safety benefits. Cost effective applications, however, are 

limited to those field sites with available electrical power,

either from a utility or self-generated. 

Natural Gas STAR Partners have reported savings of up to 

70,000 thousand cubic feet (Mcf) per year per facility by 

replacing natural gas-powered pneumatic systems with 

instrument air systems, representing annual savings of up

to $490,000 per facility. Partners have found that most 

investments to convert pneumatic systems pay for 

themselves in just over one year. Individual savings will

vary depending on the design, condition and specific

operating conditions of the controllers. 

Technology Background 

The natural gas industry uses a variety of process control

devices to operate valves that regulate pressure, flow, 

temperature, and liquid levels. Most instrumentation and 

control equipment falls into one of three categories: (1) 

pneumatic; (2) electrical; or (3) mechanical. In the vast 

majority of applications, the natural gas industry uses

pneumatic devices, which make use of readily available

high-pressure natural gas to provide the required energy

and control signals. Pneumatic instrument systems

powered by high-pressure natural gas are used throughout 

the natural gas industry. In the production sector, an

estimated 400,000 pneumatic devices control and monitor

gas and liquid flows and levels in dehydrators and 

separators, temperature in dehydrator regenerators, and 

pressure in flash tanks. Most processing plants already 

use instrument air, but some use gas pneumatics, and

including the gathering/booster stations that feed these 

processing plants, there are about 13,000 gas pneumatic

devices in this sector. In the transmission sector, an 

estimated 85,000 pneumatic devices actuate isolation 

valves and regulate gas flow and pressure at compressor

stations, pipelines, and storage facilities. Non-bleed 

pneumatic devices are also found on meter runs at 

distribution company gate stations and distribution grids 

where they regulate flow and pressure. 

Exhibit 1 depicts a pneumatic control system powered by

natural gas. The pneumatic control system consists of the 

process control instruments and valves that are operated

by natural gas regulated at approximately 20-30 pounds 

Economic and Environmental Benefits 

Method for Reducing 

Natural Gas Losses 

Volume of 

Natural Gas 

Savings (Mcf/ 

year) 

Value of Natural Gas Savings ($/ 

year) Payback (Months) 

$3 per Mcf $5 per Mcf $7 per Mcf $3 per 

Mcf 

$5 per 

Mcf 

$7 per 

Mcf 

Replace Gas with Air in 

Pneumatic Systems 

(per facility) 

20,000 $60,000 $100,000 $140,000 $60,000 12 8 6 

General Assumptions: 

a Cost of installing compressor, dryer and other accessories, and annual electricity requirements. 

Implementation Cost ($)a 

1 
Convert Gas Pneumatic Controls To Instrument Air 

(Cont’d) 

Exhibit 1: Natural Gas Pneumatic 

Control System Exhibit 2: Signal and Actuation Schematics 

per square inch (psi), and a network of distribution tubing 

to supply all of the control instruments. Natural gas is

also used for a few “utility services,” such as small 

pneumatic pumps, compressor motor starters, and 

isolation shutoff valves. Exhibit 2 shows a simplified

diagram of a pneumatic control loop. A process condition, 

such as liquid level in a separator vessel, is monitored by a 

float that is mechanically linked to the liquid level 

controller outside the vessel. A rise or fall in liquid level 

moves the float upward or downward, which is translated

to small needle valves inside the controller. Pneumatic 

supply gas is either directed to the valve actuator by the 

needle valve pinching off an orifice, or gas pressure is bled

off the valve actuator. Increasing gas pressure on the

valve actuator pushes down a diaphragm connected by a 

rod to the valve plug, causing the plug to open and 

increasing the flow of liquid draining out of the separator

vessel. Gas pressure relieved from the valve actuator 

allows a spring to push the valve plug closed. 

As part of normal operation, natural gas powered

pneumatic devices release or bleed gas to the atmosphere

and, consequently, are a major source of methane 

emissions from the natural gas industry. Pneumatic 

control systems emit methane from tube joints, controls,

and any number of points within the distribution tubing 

network. The actual bleed rate or emissions level largely 

depends on the design of the device. In general, controllers

of similar design have similar steady-state bleed rates

regardless of brand name. The methane emission rate will 

also vary with the pneumatic gas supply pressure, 

actuation frequency, and age or condition of the 

equipment. 

Many Partners have found that it is economic to substitute

compressed air for natural gas in pneumatic systems. The 

use of instrument air eliminates methane emissions and 

leads to increased gas sales. In addition, by eliminating

the use of a flammable substance, operational safety is

significantly increased. The primary costs associated with 

conversion to instrument air systems are initial capital 

expenditures for installing compressors and related 

equipment and operating costs for electrical energy to 

power the compressor motor. Existing pneumatic gas

supply piping, control instruments, and valve actuators of 

the gas pneumatic system can be reused in an instrument 

air system. 

A compressed instrument air system is shown in Exhibit 3. 

In these systems, atmospheric air is compressed, stored in

a volume tank, filtered and dried for instrument use. Air 

used for utility services (e.g. small pneumatic pumps, gas 

compressor motor starters, pneumatic tools, sand blasting) 

does not need to be dried. All other parts of a gas 

pneumatic system will work the same way with air as they 

do with gas. 

The major components of an instrument air conversion

project include the compressor, power source, dehydrator,

and volume tank. The following are descriptions of each of 

2 
 

 

Convert Gas Pneumatic Controls To Instrument Air 

(Cont’d) 

Exhibit 3: Compressed Instrument Air System 

these components along with important installation 

considerations. 

Compressor. Compressors used for instrument air 

delivery are available in various types and sizes, from 

rotary screw (centrifugal) compressors to positive 

displacement (reciprocating piston) types. The size of 

the compressor depends on the size of the facility, the 

number of control devices operated by the system,

and the typical bleed rates of these devices. The 

compressor is usually driven by an electric motor

that turns on and off, depending on the pressure in 

the volume tank. For reliability, a full spare 

compressor is normally installed. 

Power Source. A critical component of the 

instrument air control system is the power source 

required to operate the compressor. Because highpressure natural gas is abundant and readily 

available, gas pneumatic systems can run 

uninterrupted on a 24-hour, 7-day per week schedule.

The reliability of an instrument air system, however, 

depends on the reliability of the compressor and 

electric power supply. Most large natural gas plants 

have either an existing electric power supply or have

their own power generation system. For smaller 

facilities and remote locations, however, a reliable 

source of electric power can be difficult to assure. In 

some instances, solar-powered battery-operated air 

compressors can be cost effective for remote locations, 

which reduces both methane emissions and energy

consumption. Small natural gas powered fuel cells 

are also being developed. 

Dehydrators. Dehydrators, or air dryers, are an 

integral part of the instrument air compressor 

system. Water vapor present in atmospheric air 

condenses when the air is pressurized and cooled,

and can cause a number of problems to these 

systems, including corrosion of the instrument parts 

and blockage of instrument air piping and controller

orifices. For smaller systems, membrane dryers have 

become economic. These are molecular filters that 

allow oxygen and nitrogen molecules to pass through 

the membrane, and hold back water molecules. They

are very reliable, with no moving parts, and the filter

element can be easily replaced. For larger

applications, desiccant (alumina) dryers are more 

cost effective. 

Volume Tank. The volume tank holds enough air to 

allow the pneumatic control system to have an 

uninterrupted supply of high pressure air without

having to run the air compressor continuously. The 

volume tank allows a large withdrawal of compressed

air for a short time, such as for a motor starter, 

pneumatic pump, or pneumatic tools, without 

affecting the process control functions. 

Economic and Environmental Benefits 

Reducing methane emissions from pneumatic devices by

converting to instrument air control and instrumentation 

systems can yield significant economic and environmental

benefits for natural gas companies including: 

Financial Return From Reducing Gas Emission 

Losses. Assuming a natural gas price of $7.00 per 

Mcf, savings from reduced emissions can be 

estimated at $840 per year per device or $490,000 or 

more per year per facility. In many cases, the cost of 

converting to instrument air can be recovered in less 

than a year. 

Increased Life of Control Devices and 

Improved Operational Efficiency. Natural gas

used in pneumatic control devices and instruments 

often contains corrosive gases (such as carbon dioxide 

and hydrogen sulfide) that can reduce the effective 

operating life of these devices. In addition, natural 

3 
 

 

Convert Gas Pneumatic Controls To Instrument Air 

(Cont’d) 

gas often produces by-products of iron oxidation,

which can plug small orifices in the equipment 

resulting in operational inefficiencies or hazards. 

When instrument air is used, and properly filtered

and dried, system degradation is reduced and 

operating life is extended. 

Avoided Use Of Flammable Natural Gas. Using

compressed air as an alternative to natural gas 

eliminates the use of a flammable substance, 

significantly increasing the safety of natural gas

processing plants and transmission and distribution 

systems. This can be particularly important at 

offshore installations, where risks associated with 

hazardous and flammable materials are greater. 

Lower Methane Emissions. Reductions in 

methane emissions have been reported as high as 

70,000 Mcf per facility annually, depending on the 

device(s) and the type of control application. 

Decision Process 

The conversion of natural gas pneumatics to instrument

air system is applicable to all natural gas facilities and

plants. To determine the most cost-effective applications,

however, requires a technical and economic feasibility 

study. The six steps outlined below, and the practical 

example with cost tables, equations, and factors, can help

companies to evaluate their opportunities. 

Step 1: Identify Possible Locations For Instrument Air 

System Installations. 

Most natural gas-operated pneumatic control systems can 

be replaced with instrument air. Instrument air systems

will require new investments for the compressor,

dehydrator, and other related equipment, as well as a 

supply of electricity. As a result, a first step in a 

successful instrument air conversion project is screening 

existing facilities to identify locations that are most 

suitable for cost effective projects. In general, three main 

factors should be considered during this process. 

Decision Process for Converting Gas Pneumatic Devices to 

Instrument Air: 

1. Identify possible locations for system installations. 

2. Determine optimal system capacity. 

3. Estimate the project costs. 

4. Estimate gas savings. 

5. Evaluate the economics. 

6. Develop an implementation plan. 

The average methane content of natural gas varies by natural gas 

industry sector. The Natural Gas STAR Program assumes the 

following methane content of natural gas when estimating 

methane savings for Partner Reported Opportunities. 

Production 79 % 

Processing 87 % 

Transmission and Distribution 94 % 

Methane Content of Natural Gas 

Facility Layout. The layout of a natural gas facility 

can significantly affect equipment and installation

costs for an instrument air system. For example, 

conversion to instrument air might not be cost 

effective at decentralized facilities where tank 

batteries are remote or widely scattered. Instrument 

air is most appropriate when used at offshore 

platforms and onshore facilities where pneumatics 

are consolidated within a relatively small area. 

Number Of Pneumatics. The more pneumatic 

controllers converted to instrument air, the greater

the potential for reduced emissions and increased 

company savings. Conversion to instrument air is 

most profitable when a company is planning a facility

-wide change. 

Available Power Supply. Since most instrument 

air systems rely on electric power for operating the 

compressor, a cost-effective, uninterrupted electrical 

energy source is essential. While major facilities

often have an existing power supply or their own 

power generation system, many smaller and remote 

facilities do not. For these facilities, the cost of power

generation generally makes the use of instrument air

unprofitable. In addition, facilities with dedicated 

generators need to assess whether the generators 

have enough available capacity to support an air 

compression system, as the cost of a generator 

upgrade can be prohibitive. Remote facilities should 

examine alternatives for power generation, which

range from microturbines to solar power. 

Step 2: Determine Optimal System Capacity. 

Once project sites have been identified, it is important to

determine the appropriate capacity of the new instrument

air system. The capacity needed is a direct function of the 

amount of compressed air needed to both operate the 

pneumatic instrumentation and meet any utility air 

requirements. 

4 
 

 

 

Convert Gas Pneumatic Controls To Instrument Air 

(Cont’d) 

Instrument Air 

Requirements. The 

compressed air needs for the 

pneumatic system are equivalent

to the volume of gas being used

to run the existing instrumentation—adjusted for air

losses during the drying process. The current volume 

of gas usage can be determined by a direct meter 

reading (if a meter has been installed). In 

nonmetered systems, a conservative rule-of-thumb 

for sizing air systems is one cubic foot per minute 

(cfm) of instrument air for each control loop

(consisting of a pneumatic controller and a control 

valve). 

Rule-of-Thumb 

1 cfm air/control loop 

The initial estimate of Rule-of-Thumb instrument air needs should 

17 percent of air input then be adjusted to account for is consumed by the air losses during the drying membrane dryer process. Typically, the 

membrane filters in the air dryer consume about 17 

percent of the air input. As a result, the estimated 

volume of instrument air usage is 83 percent of the 

total compressed air supply: i.e., divide estimated air 

usage by 83 percent. Desiccant dryers do not 

consume air and therefore require no adjustment. 

Utility Air Requirements. It Rule-of-Thumb is common to use compressed air 

Pneumatic air uses: 1/3 for utility purposes, such as for instrument air; 2/3 engine starters, pneumatic for utility air driven pumps, pneumatic tools

(e.g., impact wrenches), and sand blasting. Unlike 

instrument air, utility air does not have to be dried. 

The frequency and volumes of such utility air uses 

are additive. Companies will need to evaluate these 

other compressed air services on a site-specific basis, 

allowing for the possibility of expansion at the site. A 

general rule-of-thumb is to assume that the 

maximum rate of compressed air needed periodically

for utility purposes will be double the steady rate 

used for instrument air. 

Exhibit 4 illustrates how the instrument air compressor

size can be estimated. Using the rule-of-thumb of 1 cfm/

control loop, the current gas usage would translate to

approximately 35 cfm of dry instrument air. Adjusting for 

the dryer's air consumption (17 percent of air input), the 

total instrument air supply requirement will be 42 cfm.

Factoring in utility air needs of about 70 cfm, the project

would require a total of 112 cfm of compressed air. 

Exhibit 4: Calculate Compressor Size for 

Converting Gas Pneumatics to Instrument Air 

Given: For an average size production site with pneumatics, glycol 

dehydration, compression, 35 control loops, and an average of 

10 cfm utility gas usage for pneumatic pumps and compressor 

engine starting. 

A = Total Compressed Air 

IAu = Instrument air use 

IAs = Instrument air supply 

UAs = Utility air supply 

L = Control loops 

Rule-of-thumb: 1 cfm per control loop for estimating 

instrument air systems. 

Rule-of-thumb: 17% of air is bypassed in membrane dryers. 

Rule-of-thumb: 1/3 of total air used for instruments, 2/3 of 

total air used for utility services. 

Calculate: A = Air compressor capacity required. 

A = IAs + UAs 

IAu = L * (1 cfm/loop) 

IAs = IAu/(100% - % air bypassed in dryer) 

UAs = IAu * (fraction of utility air use) / (fraction of instrument air 

use) 

A = (35*1) / (100% - 17%) + (35*1) * (2/3) / (1/3) = 112 cfm 

Step 3: Estimate the Project Costs. 

The major costs associated with installing and operating 

an instrument air system are the installation costs for 

compressors, dryers, and volume tanks, and energy costs.

The actual installation costs will be a function of the size, 

location, and other location specific factors. A typical 

conversion of a natural gas pneumatic control system to 

compressed instrument air costs approximately $45,000 to 

$75,000. 

To estimate the cost for a given project, all expenses 

associated with the compressor, dryer, volume tank, and 

power supply must be calculated. Most vendors are willing 

to provide estimates of the equipment costs and 

installation requirements (including compressor size, 

motor horsepower, electrical power requirements, and 

storage capacity). Alternatively, operators can use the

following information on the major system components to

estimate the total installed cost of the instrument air 

system. 

Compressor Costs. It is common to install two 

compressors at a facility (one operating and one 

stand-by spare) to ensure reliability and allow for 

maintenance and overhauls without service 

interruptions. The capacity for each of the 

compressors must be sufficient to handle the total 

expected compressed air volume for the project (i.e.,

both instrument and utility air). Exhibit 5 presents 

5 
 

 

 

 

Convert Gas Pneumatic Controls To Instrument Air 

(Cont’d) 

cost estimates for purchasing and servicing small,

medium, and large compressors. For screw-type

compressors, operators should expect to overhaul the

unit every 5 to 6 years. This normally involves

exchanging the compressor core for a rebuilt 

compressor at a cost of approximately $3,929, with an 

additional $720 in labor expense and a $650 core 

exchange credit. 

Exhibit 5: Air Compressor Costs 

Service 

Size 

Air 

Volume 

(cfm) 

Compressor 

Type 

Horsepower 

Equipment 

Costs 

($) 

Annual 

Service 

($/yr) 

Service 

Life 

(yrs) 

Small 

Medium 

Large 

30 

125 

350 

Recipro 

-cating 

Screw 

Screw 

10 

30 

75 

3,275a 

16,371 

28,812 

434 

868 

868 

1 

5-6b 

5-6b 

a Cost included package compressor with a volume tank. 

b Rebuilt compressor costs $3,929 plus $500 labor minus $500 core exchange credit. 

Volume Tank. Compressed air supply systems

include a volume tank, which maintains a steady 

pressure with the on-off operation of the air 

compressor. The rule-of-thumb in determining the 

size of the volume tank is 1-gallon capacity for each 

cfm of compressed air. Exhibit 

6 presents equipment costs for

small, medium, and large

volume tanks. Volume tanks 

have essentially no operating

and maintenance costs. 

Rule-of-Thumb 

1 gallon tank capacity/1 

cfm air 

Air Dryer Costs. Because instrument air must be 

very dry to avoid plugging and corrosion, the 

compressed air is commonly put through a dryer. 

The most common dryer used in small to medium 

Exhibit 6: Volume Tank Costs 

Service Size Air Volume (gallons) Equipment Cost 

($) 

Smalla 

Medium

Large 

80 

400 

1,000 

655 

1,964 

3,929 

a Small reciprocating air compressors, 10 horsepower and less, are commonly supplied with a surge tank. 

applications is a permeable membrane dryer. Larger

air systems can use multiple membrane dryers, or, 

more cost effectively, alumina bed desiccant dryers. 

Membrane dryers filter out oil mist and particulate 

solids and have no moving parts. As a result, annual 

operating costs are kept low. Exhibit 7 presents 

equipment and service cost data for different size

dryers. The appropriate sized dryer would need to

accommodate the expected volume of gas needed for

the instrument air system. 

Exhibit 7: Air Dryer Costs 

Service 

Size 

Air 

Volume 

(cfm) 

Dryer 

Type 

Equipment 

Cost ($) 

Annual 

Service 

($/yr) 

Small 

Medium 

Large 

30 

60a 

350 

membrane 

membrane 

alumina 

1,964 

5,893 

13,096 

724 

2,894 

4,341 

a Largest membrane size; use multiple units, larger volumes. 

Using the equipment information described above, the 

total installed cost for a project can be calculated. Exhibit 

8 illustrates this using the earlier example of a mediumsized production facility with an instrument air 

requirement of 42 cfm and a maximum utility air 

requirement of 70 cfm (for a total of 112 cfm of compressed

air). To estimate the installed cost of equipment, it is a

common practice in industry to assume that installation 

labor is equivalent to equipment purchase cost (i.e. double 

equipment purchase cost to estimate the installed cost).

This would be suitable for large, desiccant dried 

instrument air systems, but for small, skid-mounted 

instrument air systems a factor of 1.5 is used to estimate

the total installed cost (installation labor is half the cost of

equipment). 

In addition to the facility costs, it is also necessary to

estimate the energy costs associated with operating the 

system. The most significant operating cost of an air 

compressor is electricity, unless the site has excess selfgeneration capacity. To continue the example from above,

assuming that electricity is purchased at 7.5 cents per

kilowatt-hour (kWh) and that one compressor is in standby 

while the other compressor runs at full capacity half the 

time (a 50 percent operating factor), the electrical power 

6 
 

Convert Gas Pneumatic Controls To Instrument Air 

(Cont’d) 

Exhibit 8: Calculate Total Installation Costs 

Given: 

Compressors (2) 

Volume Tanks (2-

small) 

Membrane Dryer 

Installed Cost Factor 

= $32,742 (Exhibit 5) 

= $1,310 (Exhibit 6) 

= $5,893 (Exhibit 7) 

= 1.5 

Calculate Total Installed Cost: 

Equipment Cost = Compressor Cost + Tank Cost + Dryer 

Cost 

= $32,742 + $1,310 + $5,893 

= $39,945 

Total Cost = Equipment Cost * Installation Cost 

Factor 

= $39,945 * 1.5 

= $59,917 

cost amounts to $13,140 per year. This calculation is 

shown in Exhibit 9. 

Step 4: Estimate Gas Savings. 

To estimate the gas savings that result from the 

installation of an instrument air system, it is important to

determine the normal bleed rates (continuous leak from

piping networks, control devices, etc.), as well as the peak 

bleed rates (associated with movements in the control 

devices). One approach is to list all the control devices, 

Exhibit 9: Calculate Electricity Cost 

Given: 

Engine Power 

Operating Factor (OF) 

Electricity Cost 

= 30 HP 

= 50 percent 

= $0.075/kwh 

Calculate Required Power: 

Electrical Power = Engine Power * OF * Electricity Cost 

= [30 HP * 8,760 hrs/yr * 0.5 * $0.075/ 

kwh] / 0.75 HP/kw 

= $13,140/yr 

assess their normal and peak bleed rates, frequency of 

actuation, and estimates of leakage from the piping 

networks. Manufacturers of the control devices usually 

publish the emission rates for each type of device, and for

each type of operation. Rates should be increased by 25 

percent for devices that have been in service without 

overhaul for five to 10 years, and by about 50 percent for 

devices that have not been overhauled for more than 10 

years to account for increased leakage associated with

wear and tear. Alternatively, installing a meter can be

more accurate, provided monitoring occurs over a long

enough period of time to take account of all the utility uses 

of gas (i.e., pumps, motor starters, activation of isolation 

valves). 

EPA’s Lessons Learned: Options for Reducing Methane 

Emissions from Pneumatic Devices in the Natural Gas 

Industry, provides brand name, model, and gas

consumption information for a wide variety of currently 

used pneumatic devices. Manufacturer information and 

actual field measurement data, wherever available, are 

provided as well (see Appendix of that report). To simplify

the calculation of gas savings for the purpose of this lesson

learned analysis, we can use the earlier rules-of-thumb to

estimate the gas savings. The gas savings for the mediumsized production facility example in Exhibit 4 include the

conservatively estimated 35 cfm used in the 35 gas

pneumatic controllers plus the gas used occasionally for 

compressor motor starters and small pneumatic chemical 

and transfer pumps. (Note that replacing these gas usages

will result in direct savings of gas emissions.) Natural gas

is not used for pneumatic tools or sand blasting, so 

additional compressed air provided for these services does

not reduce methane emissions. Assuming an annual 

average of 10 cfm gas use for natural gas powered noninstrument services, the gas savings would be 45 cfm. As 

shown in Exhibit 10, this is equivalent to 23,652 Mcf per 

year and annual savings of $165,600. 

Step 5: Evaluate the Economics. 

The cost effectiveness of replacing the natural gas 

pneumatic control systems with instrument air systems 

Exhibit 10: Calculate Gas Savings 

Given: 

Pneumatic instrument gas 

usage 

Other non-instrument gas 

usage 

= 35 cfm 

= 10 cfm 

Calculate Value of Gas Saved: 

Volume of Natural Gas Saved = Instrument Usage + Other Usage 

= 35 cfm + 10 cfm 

= 45 cfm 

Annual Volume of Gas Saved = 45 cfm * 525,600 min/yr / 1000 

= 23,652 Mcf/yr 

Annual Value of Gas Saved = volume * $7.00/Mcf 

= 23,652 Mcf/yr * $7.00/Mcf 

= $165,600/year 

7 
 

 

 

Convert Gas Pneumatic Controls To Instrument Air 

(Cont’d) 

can be evaluated using straightforward cost-benefit 

economic analyses. 

Exhibit 11 illustrates a cost-benefit analysis for the 

medium-sized production facility example. The cash flow 

over a five-year period is analyzed by showing the 

magnitude and timing of costs from Exhibits 8 and 9 

(shown in parentheses) and benefits from Exhibit 10. The 

annual maintenance costs associated with the compressors

and air dryer, from Exhibits 5 and 7, are accounted for, as 

well as a five-year major overhaul of a compressor per

Exhibit 5. The net present value (NPV) is equal to the 

benefits minus the costs accrued over five years and 

discounted by 10 percent each year. The Internal Rate of 

Return (IRR) reflects the discount rate at which the NPV 

generated by the investment equals zero. 

Step 6: Develop an Implementation Plan. 

After determining the feasibility and economics of 

converting to an instrument air system, develop a 

systematic plan for implementing the required changes.

This can include installing a gas measuring meter in the 

gas supply line, making an estimate of the number of 

control loops, ensuring an uninterrupted supply of electric

energy for operating the compressors, and replacing old,

obsolete and high-bleed controllers. It is recommended 

that all necessary changes be made at one time to 

Nelson Price Indexes 

In order to account for inflation in equipment and 

operating & maintenance costs, Nelson-Farrar 

Quarterly Cost Indexes (available in the first issue of 

each quarter in the Oil and Gas Journal) are used to 

update costs in the Lessons Learned documents. 

The “Refinery Operation Index” is used to revise

operating costs while the “Machinery: Oilfield Itemized 

Refining Cost Index” is used to update equipment 

costs. 

To use these indexes in the future, simply look up the 

most current Nelson-Farrar index number, divide by 

the February 2006 Nelson-Farrar index number, and, 

finally multiply by the appropriate costs in the Lessons 

Learned. 

minimize labor costs and disruption of operations. This 

might include a parallel strategy to install low-bleed 

devices in conjunction with the switch to instrument air 

systems. There are similar economic savings for 

conserving instrument air use as for conserving methane 

emissions with low bleed pneumatic devices. Whenever 

specific pneumatic devices are being replaced, such as in 

the case of alternative mechanical and/or electronic 

Exhibit 11: Economic Analysis of Instrument Air System Conversion 

Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 

Implementation Cost ($) (59,917) 

O&M Cost ($) (13,140)a 

(4,630)b 

(13,140) 

(4,630) 

(13,140) 

(4,630) 

(13,140) 

(4,630) 

(13,140) 

(4,630) 

Overhaul Cost ($) 0 0 0 0 0 (6,286)c 

Total Cost ($) (59,917) (17,770) (17,770) (17,770) (17,770) (24,057) 

Gas Savings ($) 0 165,600d 165,600 165,600 165,600 165,600 

Annual Cash Flow ($) (59,917) 147,830 147,830 147,830 147,830 141,543 

Cumulative Cash Flow ($) (59,917) 87,912 235,742 383,571 531,401 672,944 

Payback Period (months) 

IRR 

NPVe 

5 

246% 

$496,570 

a Electrical power at 7.5 cents per kilowatt-hour. 

b Maintenance costs include $1,736 compressor service and $2,894 air dryer membrane replacement. 

c Compressor overhaul cost of $3,929, inflated at 10% per year. 

d Value of gas = $7.00/Mcf. 

e Net Present Value (NPV) based on 10% discount rate for 5 years. 

8 
Convert Gas Pneumatic Controls To Instrument Air 

(Cont’d) 

systems, the existing pneumatic devices should be replaced

on a similar economic basis as discussed in the companion

document Lessons Learned: Options for Reducing Methane 

Emissions from Pneumatic Devices in the Natural Gas 

Industry. 

When assessing options for converting gas pneumatic

controls to instrument air, natural gas price may influence

the decision making process. Exhibit 12 shows an 

economic analysis installing two 30 hp compressors, two 

medium sized volume tanks, and a medium sized 

membrane dryer at different natural gas prices. 

Partner Experiences 

Several EPA Natural Gas Star Partners have reported the 

conversion of natural gas pneumatic control systems to 

compressed instrument air systems as the single most 

significant source of methane emission reduction and a 

source of substantial cost savings. Exhibit 13 below 

highlights the accomplishments that several Natural Gas 

STAR Partners have reported. 

Exhibit 12: Gas Price Impact 

on Economic Analysis 

$3/Mcf $5/Mcf $7/Mcf $8/Mcf $10/Mcf 

Value of 

Gas Saved $70,971 $118,286 $165,600 $189,257 $236,571 

Payback 

Period 

(months) 

14 8 5 5 4 

Internal 

Rate of 

Return 

(IRR) 

84% 166% 246% 286% 365% 

Net 

Present 

Value 

(i=10%) 

$137,853 $317,211 $496,570 $586,249 $765,607 

Other Technologies 

The majority of Partners' experiences in substituting

natural gas-powered pneumatic devices and control 

instrumentation with alternative controllers have involved 

Exhibit 13: Partner Reported Experience 

Gas STAR 

Partner Description of Project Project Cost 

($) 

Annual Emissions 

Reductions (Mcf/yr) Annual Savings ($/yr)a Payback (months)b 

Unocalc (now 

Chevron) 

Installed an air compression 

system in its Fresh Water 

Bayou facility in southern 

Vermillion Parish, Louisiana 

$79,000 69,350 $485,450 2 

Texacoc

 (now 

Chevron) 

Installed compressed air 

system to drive pneumatic 

devices in 10 South Louisiana 

facilities 

$52,000 23,000 $161,000 4 

Chevronc 

Converted pneumatic 

controllers to compressed air, 

including new installations 

$227,000 over 2 

years 31,700 $221,900 7 

ExxonMobild 

Installed instrument air 

systems at 3 production 

satellites and 1 central tank 

battery at Postle CO2 unit 

$72,000 19,163 $134,141 7 

Shell 

Used instrument air operated 

devices on over 4,300 valves 

at off-shore platforms 

Not available 532,800 $3,729,600 Not available 

Marathon 

Installed 15 instrument air 

systems in New Mexico 

facilities 

Not available 120 - 38,000 per facility $840 - 226,000 Not available 

a Value of gas = $7.00/Mcf. 

b Calculated based on Partner-reported costs and gas savings updated to 2006 costs. 

c Data for this report were collected prior to the Chevron-Texaco and Chevron-Unocal mergers. d Data for this report were collected prior to the Exxon/Mobil merger in 1999. 

9 
 

 

Convert Gas Pneumatic Controls To Instrument Air 

(Cont’d) 

the installation of compressed instrument air systems. 

Some additional alternatives to gas pneumatics 

implemented by Partners are described below: 

Liquid Nitrogen. In a system using liquid nitrogen, 

the volume tank, air compressor, and dryer are 

replaced with a cylinder containing cryogenic liquid 

nitrogen. A pressure regulator allows expansion of 

the nitrogen gas into the instrument and controlpiping network at the desired pressure. Liquid 

nitrogen bottles are replaced periodically. Liquid 

nitrogen-operated devices require handling of 

cryogenic liquids, which can be expensive as well as a 

potential safety hazard. Large volume demands on a 

liquid nitrogen system require a vaporizer. 

Mechanical Controls and Instrumentation 

System. Mechanical instrument and control devices 

have a long history of use in the natural gas and

petroleum industry. They are usually distinguished

by the absence of pneumatic and electric components, 

are simple in design, and require no power source. 

Such equipment operates using springs, levers, 

baffles, flow channels, and hand wheels. They have 

several disadvantages, such as limited application, 

the need for continuous calibration, lack of 

sensitivity, inability to handle large variations, and 

potential for sticking parts. 

Electric and Electro-Pneumatic Devices. As a 

result of advanced technology and increasing

sophistication, the use of electronic instrument and 

control devices is increasing. The advantage of these 

devices is that they require no compression devices to

supply energy to operate the equipment; a simple 120

-volt electric supply is used for power. Another 

advantage is that the use of electronic instrument

and control devices is far less dangerous than using

combustible natural gas or cryogenic liquid nitrogen 

cylinders. The disadvantage of these devices is their 

reliance on an uninterrupted source of electric 

supply, and significantly higher costs. 

Although these options have advantages, systems using air 

instead of natural gas are the most widely employed

alternative in replacing natural gas-operated pneumatic 

control devices. It is important to note that maintaining a

constant, reliable supply of dry, compressed air in a plant 

environment is a significant cost, albeit more economic 

than natural gas. Therefore, a parallel strategy to install 

low-bleed devices in conjunction with the switch to 

instrument air systems (refer to Lessons Learned: Options 

for Reducing Methane Emissions from Pneumatic Devices 

in the Natural Gas Industry), and to design a maintenance 

schedule to keep the instruments and control devices in 

tune, is often economic. Such actions can significantly

reduce the consumption of instrument air in the overall

system and, therefore, minimize both the size of the 

compression system and the electricity consumption over

the life of the plant. 

Lessons Learned 

The lessons learned from Natural Gas STAR Partners are: 

Installing instrument air systems has the potential to 

increase revenues and substantially reduce methane 

emissions. 

Instrument air systems can extend the life cycle of 

system equipment, which can accumulate trace 

amounts of sulfur and various acid gases when 

controlled by natural gas, thus adding to the 

potential savings and increasing operational 

efficiencies. 

Remote locations and facilities without a reliable 

source of electric supply often need to evaluate 

alternate power generation sources. When feasible, 

solar-powered air compressors provide an economical

and ecologically beneficial alternative to expensive 

electricity in remote production areas. On site 

generation using microturbines running on natural 

gas is another alternative. 

A parallel strategy of installing low-bleed devices in 

conjunction with the switch to instrument air 

systems is often economic. 

Existing infrastructure can be used; therefore, no 

pipe replacement is needed. However, existing 

piping and tubing should be flushed clear of 

accumulated debris. 

Rotary air compressors are normally lubricated with

oil, which must be filtered to maintain the life and 

proper performance of membrane dryers. 

Use of instrument air will eliminate safety hazards 

associated with flammable natural gas usage in

pneumatic devices. 

Nitrogen-drive systems may be an alternative to 

instrument air in special cases, but tends to be 

10 
Convert Gas Pneumatic Controls To Instrument Air 

(Cont’d) 

expensive and handling of cryogenic gas is a safety 

concern. 

Report reductions in methane emissions from 

converting gas pneumatic controls to instrument air 

in your Natural Gas STAR Annual Report. 

References 

Adams, Mark. Pneumatic Instrument Bleed Reduction Strategy and 

Practical Application, Fisher Controls International, Inc.1995. 

Beitler, C.M., Reif, D.L., Reuter, C.O. and James M. Evans. Control 

Devices Monitoring for Glycol Dehydrator Condensers: Testing and 

Modeling Approaches, Radian International LLC, Gas Research 

Institute, SPE 37879, 1997. 

Cober, Bill. C&B Sales and Services, Inc. Personal contact. 

Fisher, Kevin S., Reuter, Curtis, Lyon, Mel and Jorge Gamez. Glycol 

Dehydrator Emission Control Improved, Radian Corp., Public Service 

Co. of Colorado Denver, Gas Research Institute. 

Frederick, James. Spirit Energy 76. Personal contact. 

Games, J.P., Reuter, C.O. and C.M. Beitler, Field Testing Results for the R 

-BTEX Process for Controlling Glycol Dehydrator Emissions, Gas 

Research Institute, Radian Corporation, SPE 29742, 1995. 

Gunning, Paul M. U.S. EPA Natural Gas STAR Program. Personal contact. 

Gupta, Arun, Ansari, R. Rai and A.K. Sah. Reduction of Glycol Loss From 

Gas Dehydration Unit At Offshore Platform in Bombay Offshore—A 

Case Study, N.A.K.R. IOGPT, ONGC, India, SPPE 36225, 1996. 

Reid, Laurance, S. Predicting the Capabilities of Glycol Dehydrators, SPEAIME, Laurance Reid Associates. 

Scalfana, David B., Case History Reducing Methane Emissions From High 

Bleed Pneumatic Controllers Offshore, Chevron U.S.A. Production Co. 

SPE 37927, 1997. 

Schievelbein, V.H., Hydrocarbon Recovery from Glycol Reboiler Vapor 

With Glycol-Cooled Condenser, Texaco, Inc. SPE 25949. 1993. 

Schievelbein, Vernon H. Reducing Methane Emissions from Glycol 

Dehydrators, Texaco EPTD, SPE 37929, 1997. 

Soules, J.R. and P.V. Tran. Solar-Powered Air Compressor: An 

Economical and Ecological Power Source for Remote Locations, Otis 

Engineering Corp. SPE 25550, 1993. 

11 
Convert Gas Pneumatic Controls To Instrument Air 

(Cont’d) 

United States 

Environmental Protection Agency 

Air and Radiation (6202J) 

1200 Pennsylvania Ave., NW 

Washington, DC 20460 

October 2006 

EPA provides the suggested methane emissions estimating methods contained in this document as a tool to develop basic methane emissions estimates only. As 

regulatory reporting demands a higher-level of accuracy, the methane emission estimating methods and terminology contained in this document may not conform to 

the Greenhouse Gas Reporting Rule, 40 CFR Part 98, Subpart W methods or those in other EPA regulations. 

12