Tougher Venting and Flaring Regulations in TX and NM Will Challenge Operator Reporting, but P2 is Ready to Help

02/22/2021
Tougher Venting and Flaring Regulations in TX and NM Will Challenge Operator Reporting, but P2 is Ready to Help

A wave of new, more stringent regulations for the venting and flaring of gas will soon be in force in Texas and New Mexico as the two states follow others like Alaska, Colorado, and Wyoming in toughening their regulatory oversight and reporting requirements for these types of events. In Texas, traditional reporting regarding flaring and venting required noting that an event occurred, and it was captured under a single flare-vent code. Not anymore.

Once the new regulations are finalized and go into effect later this year, Texas will likely require splitting these two types of events into separate categories – with four additional regulatory codes for each – followed by measuring and reporting in greater detail than in the past. As for flaring, depending on the age of the well, operators may already have meters in place for monitoring and measuring this type of release, but the level of required reporting will intensify significantly. Venting, however, is another story as it is much harder to quantify. Regardless, with each flare and vent volumes reported, regulators are requiring more insight into whether the emissions were permitted or the reason.

New Mexico Regulations Getting Hotter than a Hatch Chile

New Mexico regulations are taking the reporting process even further, creating a complex, multi-faceted challenge for operators. In a nutshell, New Mexico regulations will also likely require separate reporting of every single vent or flare event, as well as where it happened, but also 14 potential reason codes why that event occurred. And if more than one reason code is recorded within a day, the proportionate share of the volume will need to be calculated.

Additionally, New Mexico regulators are going to require reporting regarding the types of equipment in place where those events occurred, and whether that equipment was standard or not. Further, New Mexico regulators will instruct operators on what type of equipment to install based on the type of well in place to reduce venting and flaring. The state also has signaled it may require a new method for calculating flaring events.

The increasing complexity of these regulations promises additional layers of data gathering, allocation, measurement, and reporting across an entire organization – from the field to the health and safety personnel, then on to those in the back office. Ultimately, these reports will feed up to the C-suite, leading many operators to wonder how the software systems they have in place will handle allocating and reporting these individual events down to the well level to meet new requirements. These new data capture and reporting requirements will need even more collaboration between the field and back office so that the field can continue to focus on safe operations and production, while the back office manages data accumulation, calculations, and reporting.

The regulatory changes that are sweeping the sector, regardless of state, are not half-steps from the existing legislation that can easily be bolted on, if you will, to existing reporting processes. In the case of New Mexico, the regulatory changes are so significant and comprehensive in scope, they foretell a reporting nightmare that many of you say your organizations may not yet be prepared to address. Some of you already have cross-functional teams working on how you will address these new reporting challenges, and you have told us, these are interdependent, highly complex requirements that simply cannot be managed by a spreadsheet or through existing processes. We hear you, and we’re ready to support you.

P2 Merrick is Actively Documenting Requirements to Feed Development of Solution to Simplify Reporting of New Regulations

Anticipating many of these coming regulatory challenges, and in step with the needs and concerns expressed by you, our customers, P2 Merrick has built upon our existing end-to-end solution to help address these requirements. In doing so, we have challenged our teams to look at this development with fresh eyes and to rethink the entire reporting process from the field to the back office and back again.

We are committed to further simplifying your reporting processes because we see this as a critical step for your field, safety, and back-office personnel who will not only have to report more and different types of data, but will have to do so much more frequently.  

In an era where operators face increasingly tight capital budgets and at the same time an increasing level of scrutiny relative to methane emissions, few teams can expect to add more personnel to help address these added reporting requirements. We know you are being asked to do more with less.

This is not new to oil and gas, a sector known for innovation and solving complex problems, and it is not new for P2 Merrick. We have been the proven, go-to solution for production operations for nearly 30 years.

As the sector awaits finalization of these new regulations and a time frame for implementation, we will be ready with our complete, configurable, end-to-end solution to assist you in meeting your reporting requirements – no matter how complex.

To learn more about how P2 Merrick can help you and your teams navigate these new regulatory challenges and other production scenarios, please visit our website, or click the banner below.

 

Authored by:

Clara Fuge 

Clara Fuge, VP, Product Management

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