In the wake of Deepwater Horizon and growing public concern over the environmental performance of big business generally, oil companies are taking their approach to the issue more seriously than ever. Mark Brierley talks to Saudi Aramco about leading the charge to green its business, a process that began almost 50 years ago.
Back in 1963, the world was a very different place. The assassination of JFK made headlines around the world, the Beatles released their debut album and Malaysia became a country following the merger of Malaya, Sabah, Sarawak and Singapore. In the oil industry, reserves were still flowing freely and knowledge of the environmental impact of hydrocarbon extraction and use was only beginning to be understood.
Meanwhile, in Saudi Arabia, King Saud’s intense rivalry with his half-brother Prince Faisal was coming to a head and would soon lead to his deposal. Aramco was also beginning to seriously consider the environmental impact of its activities, devising its first policy explicitly focused on environmental protection.
Fast forward half a century and a lot has changed, both in the oil industry and the wider world. Reserves are no longer as plentiful as they once were and lessons have been learned the hard way about the impact E&P can have on the natural environment. But this adversity has driven the industry to make great strides in improving the efficiency of the E&P process while at the same time minimising its impact on the environment.
For its part, Saudi Aramco’s Environmental Protection Department (EPD) has spearheaded the organisation’s efforts in this respect. Working at more than 40 different locations, the EPD monitors the environmental performance of Saudi Aramco’s upstream, midstream and downstream facilities. It also raises awareness and provides training to staff, measuring each facility’s performance against 21 environmental indicators.
Beyond this, the organisation also launched its Environment Master Plan (EMP) in 2001, which funds capital projects aimed at improving environmental performance, whether that be through improving energy efficiency, reducing emissions or developing cleaner energy technologies through its research and development centre. In its first decade, the Master Plan provided funding for more than 100 projects, which together with other work being undertaken by the EPD, were responsible for a multi-billion dollar commitment to environmental protection. Oil & Gas Agenda talks to Saudi Aramco about where the money is being spent.
Oil & Gas Agenda: How does the EPD to monitor the performance of Saudi Aramco’s many diverse facilities and act accordingly?
Saudi Aramco: The EPD works with each company facility to achieve a shared win-win goal of enhancing operations, while reducing our environmental footprint. This is accomplished by annual goal-setting and having an environmental coordinator in each facility. EPD has established several programmes to monitor the environmental compliance and performance of Saudi Aramco facilities with corporate environmental indicators:
Environmental performance assessment (EPA): the EPA programme is an environmental auditing function whose objective is conducting periodic environmental surveys of facilities. These surveys determine compliance with company and government environmental requirements. Major findings are tracked until satisfactorily resolved.
Air quality monitoring and meteorology network (AMMNET): selected air pollutants are routinely monitored as mandated by government regulations.
Waste management: promotes waste management best practices including waste minimisation and reuse, and environmentally acceptable and cost-effective initiatives.
Wastewater management: the programme monitors the compliance status of the company’s industrial and sanitary wastewater treatment facilities and wastewater discharges.
Marine protection: through the programme, the status of the company footprint on the marine environment is evaluated.
Hazardous materials communication (HAZCOM): the objective of the HAZCOM programme is to minimise occupational health risks associated with use, handling and storage of chemicals in the workplace.
Occupational health hazard assessment (OHHA): the programme aims to identify and evaluate potential hazards associated with employees’ work environment and work practices.
Comprehensive environmental health assessment (CEHA): the CEHA programme aims to identify and evaluate environmental health risks associated with the working and residential environment. Major findings identified are tracked until satisfactorily resolved.
Radiation protection assessments: these assessments are carried out to verify compliance with ionising radiation protection requirements.
NORM management: company-wide assessments are undertaken and recommendations are made regarding workers’ protection and contamination control measures required when working with NORM waste or NORM-contaminated equipment.
Saudi Aramco also has programmes to assess and enhance company facilities’ performance. These include water conservation and the Facility Environmental Management System.
EPD has also developed a corporate water conservation strategy. The strategy focuses on optimising water consumption, minimising water loss, and maximising wastewater reuse through water-use monitoring and leveraging relevant advanced technologies.
In addition, EPD developed the Facility Environmental Management System (EMS) corporate framework, which provides a proactive, systematic approach for facilities to achieve continual environmental performance.
How does the EMP cover this diversity effectively?
The purpose of the EMP is accelerating the implementation of environmentally related projects without having to wait for the normal project upgrade cycles. The EMP was originally developed in 2001. EPD identified all instances where Saudi Aramco facilities required capital projects to upgrade their environmental control systems, and developed a list of projects that were needed to enhance the environmental performance of these facilities. Today, the EMP continues to identify projects that are required for environmental reasons and approves them, based on the environmental need specific to the facility.
Many other environmental needs valued at less than $4m are handled as expense items, paid by the individual facilities and therefore not part of the EMP.
What elements of the EMP refer directly to upstream activities?
The allocation of funds in the EMP is based on environmental risk assessment and not a percentage allocation between upstream and downstream operations. This approach is a more efficient way of reducing our environmental footprint.
Can you outline the main aims of the FMP programme?
The FMP was deployed to company facilities as part of the Corporate Flaring Minimisation Roadmap, which calls for guidelines to minimise daily flaring, installation of flare gas recovery (FGR) systems for facilities with routine flaring rates in excess of 1MMSCFD (million standard cubic feet per day), and the installation of HP Air Assist smokeless technology for facilities with routine flaring rates less than 1MMSCFD.
The main goal of FMP is to reduce flaring from company operations as much as possible. This goal can be achieved by implementing an effective flare monitoring system, better planning, best practices and new technologies, undertaking regular preventive maintenance and installing flare gas recovery systems. A comprehensive facility-specific FMP is the key to the overall flaring reduction plan.
How do you measure the success of the FMP and environmental performance as a whole?
The establishment of Saudi Aramco’s FMP created significant momentum, which was essential for implementing flare-reduction measures in a very large company such as ours. In addition, the development and implementation of the programme significantly improved the effectiveness and reliability of monitoring and reporting facilities’ flaring losses. This programme can identify the short and long-term mitigation measures to reduce facility flaring, and hence reduce air pollutants such as SO2 and NOx.
Saudi Aramco recently received the ‘Award for Excellence in Gas Flare Reduction’ from the World Bank.
How successful has the EMP been and what challenges remain?
The majority of environmental protection projects are included in the normal capital programme for new and major upgrades of existing facilities. Expenditure through the EMP is additional, and does not reflect the actual company investment in environmental protection. Since its inception in 2001, the EMP has funded over $3.3bn of capital. This is an evergreen commitment and the funding required continues to rise every year.