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Flaring levels hit “shale-era” low in Permian Basin

In all the ways COVID-19 has threatened the energy sector and, more specifically, oil production, it may have allowed companies time to reset and evaluate their infrastructure.
Published: Jan. 18, 2021 at 9:20 PM CST
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MIDLAND, Texas (KOSA) - The Permian’s flaring levels have hit an all-time low for what is considered the shale-era.

In all the ways COVID-19 has threatened the energy sector and, more specifically, oil production, it may have allowed companies time to reset and evaluate their infrastructure.

As activity returns to the Permian Basin, the oil and gas business is working to lower emissions and get the most value out of their product.

When the shale revolution began in 2011, oil and gas companies in the Permian Basin raced to produce as much crude oil as possible.

The Permian Basin currently makes up about 40 percent of the world’s oil production.

Natural gas is a byproduct of crude oil but hasn’t always been as valuable or easy to store - so flaring was the best way to get rid of it.

“Out here because crude oil is the focus, natural gas can be treated sometimes like a byproduct almost. But companies really don’t wanna do that. They see it as a valuable resource. They see as it something they want to capture. They want to be able to make a profit off that by getting it to market, so that’s what they wanna do. They want to continue to increase their efficiency so they are as efficient and effective as possible at capturing everything,” said executive vice president of the Permian Basin Petroleum Association, Stephen Robertson.

According to a new study by Rystad Energy, flaring levels here in the Permian reached the highest they’ve been in a decade in the summer of 2019, but now they are at the lowest - and staying that way.

In this case, lower levels of flaring do not mean less production, but companies are finding new ways to profit from the natural gas they usually burn.

“We’re back into this much more disciplined approach where you have to be really careful with what you’re doing with the waste, with the emissions. So right now we’re seeing production is still growing in the permian, flaring is coming down so this really means that the companies are addressing this issue and they are trying to do something to solve the problem of flaring,” said vice president of shale research for Rystad Energy, Alexandre Peon.

The pandemic caused the oil and gas sector to shut down production and subsequently lowered the flaring amount.

Robertson says he believes those levels will stay low as companies shift their focus to getting natural gas to market.

“Our companies and ourself as an association are part of several different groups that are working to make sure that those levels do remain low. You can never tell exactly what’s going to happen in the future because you don’t know what the future is gonna hold for you as far as hurdles or sideboards on anything that you’re trying to do. But companies are very focused on it and I think companies are going to remain focused on having a priority of low flaring and emission levels,” said Robertson.

Flaring levels will never reach zero because they provide a safety aspect when equipment and pipelines become overpressured.

But experts believe that levels will remain low as the infrastructure of oil wells evolve.

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