Disclaimer 

This publication was prepared for the Canadian Association of Petroleum Producers, the Gas 

Processing Association Canada, the Alberta Department of Energy, the Alberta Energy 

Resources and Conservation Board, Small Explorers and Producers Association of Canada and 

Natural Resources Canada. by CETAC-West. While it is believed that the information contained 

herein is reliable under the conditions and subject to the limitations set out, CETAC-West and the 

funding organizations do not guarantee its accuracy. The use of this report or any information 

contained will be at the user’s sole risk, regardless of any fault or negligence of CETAC-West or 

the sponsors.

Acknowledgements 

This Fuel Gas Efficiency Best Management Practice Series was developed by CETAC WEST 

with contributions from: 

• Accurata Inc. 

• Clearstone Engineering Ltd. 

• RCL Environmental 

• REM Technology Inc. 

• Sensor Environmental Services Ltd. 

• Sirius Products Inc. 

• Sulphur Experts Inc. 

• Amine Experts Inc. 

• Tartan Engineering 

CETAC-WEST is a private sector, not-for-profit corporation with a mandate to encourage 

advancements in environmental and economic performance in Western Canada. The corporation 

has formed linkages between technology producers, industry experts, and industry associates to 

facilitate this process. Since 2000, CETAC-WEST has sponsored a highly successful ecoefficiency program aimed at reducing energy consumption in the Upstream Oil and Gas Industry.

Head Office

# 420, 715 - 5th Ave SW 

Calgary, Alberta 

Canada T2P2X6 

Tel: (403) 777-9595 

Fax: (403) 777-9599 

cetac@cetacwest.com
Table of Contents 

1. Background 1 

2. Who Developed the BMPs? 1 

3. Why Were the BMPs Created? 2 

4. How to Use the BMPs 4 

5. Available Training and Resources 5 

6. How to Measure Success 5 

7. Appendix A 7 

Efficiency Committee Membership
 - 1 -

1. Best Management Practices (BMP) Background 

Does your company know the dollar value of how much fuel gas it uses in 

upstream processing? This question will become increasingly critical as the 

costs relating to the production of natural gas will continue to increase and 

greater focus is placed on industry to employ environmentally sound practices in 

all aspects of its operations. 

Total fuel gas consumption, which may be defined as the part of the produced 

natural gas consumed by operations in the production, transportation and 

processing of natural gas from the wellhead to the sales line, is increasing. Even 

a moderate reduction in fuel gas consumption could translate in savings of 

millions of dollars. The amount of total fuel gas consumption in 2006 from the 

Upstream Oil and Gas Industry (oil and gas batteries, gas gathering systems and 

gas processing plants – excluding bitumen batteries and straddle plants) was 

more than 10.5 billion cubic metres. A ten percent reduction in fuel gas 

consumption could result in an estimated savings of more than $300 million per 

year at $7.5/GJ (or enough to heat more than 300,000 homes) and a reduction 

in greenhouse gas emissions of over 2.1 million tonnes of CO2 equivalent per 

year. 

Reducing fuel consumption at a facility reduces operating costs, air emissions 

and makes a facility more competitive so it can operate for a longer period of 

time. More efficient use of energy resources will extend both the life of the 

facilities and the oil and gas industry in Alberta. 

Currently, fuel gas optimization by industry is not a regulatory or legislative 

requirement. While there is a strong interest by regulators in Alberta in improving 

efficiencies, doing so without additional regulation is the preferred approach, 

provided it is successful. These BMPs are a first step to assist industry in 

identifying and implementing opportunities for greater fuel gas efficiencies. The 

success of this initiative will determine whether industry can proactively use 

these BMPs to improve efficiencies or whether regulatory initiatives are 

necessary. 

2. Who Developed the BMPs? 

In order to further examine this issue and explore ways, other than by regulation, 

to encourage industry to become more efficient in fuel gas usage, a 

government/industry working committee was established in April 2006. The 

committee included industry representatives from the Canadian Association of 

Petroleum Producers (CAPP), the Small Explorers and Producers Association of 

Canada, the Gas Producing Association Canada, several other large industry 

players and government representatives from the Department of Energy (DoE), 

the Energy Resources Conservation Board and Natural Resources Canada. 
 - 2 -

3. Why were the BMPs Created? 

The Terms of Reference mission statement is “to set direction and provide 

leadership to improve the upstream industry’s petroleum energy efficiency per 

unit of production and reduction of fuel gas use in oil and gas production, pipeline 

and gas processing facilities regulated by the EUB. (now the ERCB)” 

Generally, there has been an increase in the amount of fuel gas use in the 

upstream sector. The following chart shows total fuel use in the upstream sector: 

 

Source: ERCB 

Of this fuel gas approximately 43 percent of the fuel gas consumption can be 

attributed to gas processing plants, 35 percent to gas gathering systems and 22 

percent to gas and oil batteries. 

 

Source: ERCB 
 - 3 -

While information is available on how to efficiently run and maintain equipment in 

upstream gas processing, this information is not always available from a single 

source. Making such information more accessible would facilitate industry’s 

efforts to maximize the effectiveness of their operations. 

To this end, the committee’s first action was to support the development of a 

BMP which identifies fuel gas efficiency opportunities. The BMP will assist 

industry in identifying opportunities to reduce fuel gas usage in upstream gas 

processing, often with minimal or no capital investment; providing information to 

industry on how equipment should be operated for maximum efficiency; and 

reducing fugitive emissions, thereby contributing to the reduction of greenhouse 

gases. 

4. How to Use the BMPs 

To effectively use these BMPs a company needs the support of senior 

executives who can track and reward the business units for improving 

efficiencies and reducing costs. This is critical to ensure improvements in 

efficiencies become a lasting success for the companies. These improvements 

need to become part of the company’s operating policy; this will be facilitated if 

there are individuals who are truly committed to improving efficiencies and 

successes are advertised, shared and promoted across the company. 

The type of equipment being operated by the company and how much fuel being 

consumed are two factors which will help determine how the BMPs will be used. 

Before implementing changes, a company should examine which modules will be 

applicable to their facilities. In Alberta, fuel gas measurement is required when 

site fuel gas use becomes significant (greater than 500 m3

/d). For the purpose of 

the BMPs, it is recommended that, as a minimum, companies should carefully 

examine opportunities for improvement in fuel gas efficiencies when site use 

exceeds this number. Furthermore, companies should be aware of which 

equipment accounts for larger fuel use and the reasons behind why energy 

consumption on a site is increasing or decreasing. 
 - 4 -

At the front of each BMP module is a flow chart which identifies three potential 

locations for the processing equipment: in the field; at a sweet gas plant or; at a 

sour gas plant. The following example is from Module 6 – Fired Heaters 

FIELD

5. Chemical Injection Pumps

1. Gathering Systems6. Fired Heaters4. Flaring

3. Pneumatic Instruments

2. Pumpjacks

7. Engines

10. Desiccant Dehydrators

8. Compression

9. Glycol Dehydrators

11. Fuel Gas Measurement

SOUR GAS PLANTS

17. Acid Gas Injection

15. Sulphur Recovery

14. Amine

13. Refrigeration12. Fractionation

5. Chemical Injection Pumps

6. Fired Heaters4. Flaring

3. Pneumatic Instruments

7. Engines

10. Desiccant Dehydrators

8. Compression

9. Glycol Dehydrators

11. Fuel Gas Measurement

16. Tail Gas Incineration

SWEET GAS PLANTS

13. Refrigeration12. Fractionation

5. Chemical Injection Pumps

6. Fired Heaters4. Flaring

3. Pneumatic Instruments

7. Engines

10. Desiccant Dehydrators

8. Compression

9. Glycol Dehydrators

11. Fuel Gas Measurement

16. Tail Gas Incineration

Different modules will provide the most appropriate information depending on the 

location of the equipment. For each module the flow chart highlights where it 

best fits amongst the three locations. 

Each BMP module: 

• identifies the typical impediments to achieving high levels of operating 

efficiency with respect to fuel gas consumption; 

• presents strategies for achieving cost effective improvements through 

inspection, maintenance, operating practices and the replacement of 

underperforming components; and 

• identifies technical considerations and limitations. 
 - 5 -

5. Available Training and Resources 

Many industries have started to change how they operate their business to 

include more efficient and environmentally friendly practices. This reflects 

increasing demands from the public who are becoming more educated and 

aware of the potential impact of fossil fuel development on the land, air, water 

and other resources. There is also increased pressure for industry to reduce the 

levels of greenhouse gases (GHG) emitted during processing, with financial 

incentives for reductions in GHG emissions and increasing penalties for those 

who fail to comply. 

To respond to this increased need for information, some companies, especially 

the larger ones, have in-house resources available to assist with staff training 

and to identify opportunities for greater efficiencies. In addition, there are a 

number of external resources available for training to help staff develop and 

incorporate efficient practices into their business practices. There are also 

companies who can provide a range of services including undertaking on-site 

energy efficiency audits, establishing benchmarking of equipment as well as 

providing more energy efficient equipment. 

6. How to Measure Success 

“What you do not measure, you cannot control.” 

- Tom Peters 

A first step is to determine the amount of fuel gas being used by your company in 

upstream processing. Some companies already track this information but it isn’t 

always at a sufficiently detailed level. More importantly, attaching a dollar value 

to the fuel gas used provides tangible support as to the ‘size of the prize.’ Having 

such information will also assist in determining where the process would most 

greatly benefit from application of the BMPs. Benchmarking can be completed 

internally; there are also resources available externally who can undertake an 

efficiency audit of the process. 

Once benchmarks have been established, data needs to be collected on an 

ongoing basis to determine the effectiveness of the BMP and areas where 

application was effective as well as areas for enhancement or improvement. A 

number of steps can be taken to improve efficiency with minimal associated cost 

or time. A decrease in overall fuel gas usage or a better ratio between amount of 

fuel gas used and amount of gas processed will be a sign of success. 

Industry is starting to voluntarily identify opportunities to operate in a more 

efficient, environmentally responsible manner. This makes economic sense but 

can also contribute to a more positive image of industry by landowners and other 

stakeholders. If industry can demonstrate that it can successfully manage or 

reduced fuel gas use by undertaking voluntary measures, there will be less 
 - 6 -

incentive for government to mandate such reductions through regulations or 

legislation which can be more costly and time consuming for industry. 

The Fuel Gas Committee is continuing its work on how to facilitate identifying 

appropriate benchmarks and tracking changes in fuel gas use. Additional 

information will be added to this module as it becomes available. 
 - 7 -

Appendix A 

Fuel Gas Efficiency Committee Membership 

2007/08 

The attached list identifies committee members who contributed towards the 

development of the Fuel Gas Efficiencies Best Management Practices manual. 

Members no longer participating on the committee by March 31, 2008 have been 

identified in italics. 

Alberta Department of Energy 

Alberta Energy Resources Conservation Board 

AltaGas Ltd. 

BP Canada 

Canadian Association of Petroleum Producers 

ConocoPhillips 

Dillon Consulting 

Gas Processing Association Canada 

Husky Oil Operations Ltd. 

Natural Resources Canada 

Small Explorers and Producers Association of Canada 

Suncor Energy 

Vantage Engineering Inc. 

Gas Processing Association of Canada