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Oilfield Gas Flaring

Convert Flaring Gas into a Long-Term Revenue Stream

OILFIELD GAS FLARING OVERVIEW

Today, natural gas is one of the most important sources of energy in the United States. The demand is on the rise and fossil resources are becoming increasingly valuable. Clean burning natural gas and the need for sustainable conservation of the environment necessitate maximum efficiency in the transformation of energy to power, heat and cold. XLS Energy’s highly efficient power production and co-generation proprietary technologies run on natural gas from flaring sites.

The United States is the number one producer of natural gas in the world and is currently producing the largest amount of natural gas in our history. This increased production has resulted in a significant overabundance of natural gas, and these amounts are expected to continue to increase as a result of “fracking” in the oil industry.

At the present time, a large percentage of the natural gas being produced in the U.S. is not being captured or commercialized. The primary reason for this is that many oil and gas production sites are too far from existing natural gas pipeline infrastructures. In many cases, even if the location of the production sites are in close proximity to an existing pipeline infrastructure, the costs associated with constructing a connecting pipeline, waiting periods to build, easements required, continued environmental permitting, and capital costs of the equipment to convert the waste gas into pipeline quality gas is not economically feasible. When this occurs, there are limited options available for producers. The most common solution is to flare the gas directly at the production site.

Flaring is the practice of burning gas that is deemed uneconomical to collect and sell. Flaring is also used to burn gases that would otherwise present a safety problem. It is common to flare natural gas that contains hydrogen sulfide (i.e., sour gas) in order to convert the highly toxic hydrogen sulfide gas into less toxic compounds.

In many states, gas producers are being fined excessively for the environmental impact the gas flaring is causing due to the substantial emissions. For example, on January 1, 2014, Colorado began enforcing up to a $15,000 per day fine for flaring sites. In certain cases, these fines have become so excessive that some producers are “shutting in” their wells and stopping production.