ND industry, state officials address flaring concerns

By Patrick C. Miller | February 20, 2018

Gas flaring is once again on the minds of North Dakota regulators and Bakken operators, causing the North Dakota Petroleum Council (NDPC) to reconvene its Natural Gas Capture and Infrastructure Development Task Force.

The group met last week to establish goals and will begin collecting and analyzing data to find common challenges that can be addressed through industry-wide coordinated efforts. North Dakota producers are currently required to capture 87 percent of produced gas. In November this year, the requirement will increase to 88 percent.

“Our task force model has been successful in the past and helped industry continually meet or exceed its gas capture goals,” said Ron Ness, NDPC president. “The multi-year industry downturn and changes over the past two years, however, have created new challenges that need to be addressed.”

Lynn Helms, director of North Dakota’s Department of Mineral Resources, said the situation has changed since 2016 and 2017 when there was little profit in capturing and processing natural gas, which meant there was no spare capacity for growth.

“It’s great news that natural gas and NGLs are profitable now,” he said. “They are generating money, and that money is going to be reinvested into bigger pipes, compressors and gas plants.”

According to Helms, the areas of greatest concern are on tribal land in northern Dunn County and eastern McKenzie County where obtaining pipeline right of ways is often a long and difficult process. In recent discussion with the Three Affiliated Tribes, he said it was determined that the slowdowns were caused by Bureau of Indian Affairs (BIA) regulations, not the tribal government.

“There are conversations going on about how we can take some of the hurdles out of the right-of-way process,” Helms noted. “There are numerous approvals required. It seems like pipeline by pipeline, they’re still doing environmental assessments.”

Helms noted that a primary goal this spring is to hold a meeting between U.S. Secretary of the Interior Ryan Zinke, state officials, the BIA and tribal officials to work on solutions. ”That’s probably the No. 1 thing,” Helms said.

The NDPC task force has established six subcommittees that will closely examine key challenges, including additional infrastructure buildout, right-of-way and tribal regulatory challenges, H2S contamination, remote capture technologies, new operator engagement, and reworking of the gas capture plan requirements to better meet the needs of a changing and technologically advancing oilfield.

The group consists of more than 60 people representing all of North Dakota’s major producers and midstream companies. It will meet monthly and plans to report back to the North Dakota Industrial Commission regularly. By mid-May, the task force expects to have recommendations developed on how to increase gas capture.

“In just four years since this task force was first formed and came out with its initial findings and recommendations, so much has changed,” said Ness. “It became clear we needed to revisit this issue in a rapidly changing environment and pursue new innovations and new ideas to ensure we’re continuing to meet our goals and capture more natural gas for the benefit of mineral owners, value-added markets and the state as a whole.”

During his monthly report on oil and gas activity in North Dakota, Helms stressed his primary message to the state’s oil and gas producers.

“The biggest thing industry could do is that when somebody brings you an infrastructure project, commit,” he said. “The only way that gathering and processing and export capacity is going to get built is if operators will commit their oil and gas to those projects so they can get funded and permitted and built.”