AS many Guyanese have already heard, the Liza Destiny production vessel has conducted controlled flaring over the past few weeks due to a technical complication with its gas compressor. While Exxon has indicated that it is working to remedy the situation, and that the amount of gas being flared has already been reduced substantially, it is important to understand the safety role flaring plays during the startup of an oil and gas development.
Natural gas that is found at predominantly crude oil developments like Liza Phase One is called “associated” gas. When wells are drilled into an oil reservoir, that gas comes up to the surface under pressure along with the oil. Companies treat associated gas very carefully, otherwise it could lead to build up of pressure and potentially safety incidents.
Depending on the situation, oil companies have a few options to handle this associated gas: they re-inject it to boost oil recovery; process it as liquefied natural gas (LNG) and ship it via tanker; bring it ashore on a pipeline for use in power plants; or flare it. Flaring is the safest method of dealing with short term or unexpected gas coming out of a well, particularly at start up when other facilities are not yet built (like a pipeline to shore). Flaring involves igniting the gas as it emerges in a highly controlled continuous flame.
While the government and Exxon have discussed a possible pipeline to bring gas ashore for domestic electricity generation, at present Exxon has to dispose of the gas another way. The Liza Destiny is designed to avoid routine flaring once it reaches peak production, primarily by using a large compressor to re-inject the gas back into the ground to help oil production. Due to the compressor issue, however, the Liza Destiny was forced to continue flaring gas for a few weeks as a safety precaution before reducing oil production, and flaring, in early June.
It’s worth noting that it is standard procedure for government contracts to allow operators to flare during startup purposes and for safety reasons. Recent reports indicate that Exxon is working with the Environmental Protection Agency and Department of Energy to keep them updated as they work to fix the machinery.
The gas compressor system itself is an enormously complex and vital piece of machinery made by precision manufacturers under contract, not by Exxon itself. Exxon has indicated that a major complicating factor in resolving the malfunction has been difficulties in getting experts into the country in light of travel restrictions caused by the COVID-19 pandemic.
Experts from the compressor manufacturer are actively providing advice remotely and will be on site as soon as they complete the required two-week quarantine imposed on industry personnel entering the country. Though unfortunate, the operators will need to continue flaring gas as a precaution until the technical experts are able to leave quarantine and can fix the problem.
While much has been made of the amount of gas being flared, it’s useful to consider the global context. Guyana now has only one active production site and so temporary flaring on the Liza Destiny has a considerably smaller impact than that seen by many larger producers. Many other countries continuously and intentionally flare much larger quantities of gas. According to public data, even in the highly unlikely event Guyana’s present flaring rate continued for a full year, it would account for less than one fifth of one per cent of overall global flaring volumes.
While it is very important that we be vigilant about how Exxon is operating off our shores, the company says the current flaring is the result of an unplanned event during project startup and notes that it is capturing lessons learned to apply in its other projects here in Guyana. When completed and at full production, Liza is designed to be a world class operation including by having no routine flaring. Let’s hope this only is a temporary blip in the decades of life ahead for Liza.