Added gas processing capacity bringing the state's total to 1 Bcf/d is expected to cut volumes being flared significantly. Currently 34% of North Dakota's average daily gas production is being flared, but that is slated to change a lot over the course of 2012, according to Industrial Commission spokesperson Alison Ritter.
This Friday the first of three major gas processing plants with a 100 MMcf/d capacity will come online at ONEOK Partners LP's Garden Creek plant near Watford City, ND, Ritter said (see Shale Daily, Jan. 13). There will be three processing plants by ONEOK Partners' Bear Paw Energy LLC unit built this year. In addition, Hess Corp. has told the state it plans to expand its 120 MMcf/d plant to 250 MMcf/d before the end of this year.
"We expect the flaring numbers to decrease exponentially," said Ritter, noting that gas industry operators have committed to spend an additional $3 billion on new infrastructure in the next two or three years in North Dakota.
The Garden Creek facility will cut the state flaring by about 10%, she said. By the end of 2012 the state expects flaring to amount to be less than 10% of all gas produced in the state.
"Obviously, the natural gas industry was a couple of years behind the oil industry [in the Bakken ], but now [it is] catching up," she said.
In the meantime, the state Oil and Gas Division's industrial commission has increasingly been making it more difficult for producers to continue flaring gas. After a year, producers are required to come before the state commission, made up of the governor, attorney general and agriculture director, to obtain an exemption to flare gas beyond that time.
"They may have taxes placed on their well, and instead of granting exemptions to continue flaring, we may require them to seek alternatives to flaring through the research council that can provide temporary and some permanent solutions for the gas," said Ritter, noting that third-party consulting companies collect the gas and get it trucked to various end-users. "We ask the producers why they can't use the flared gas this way.
"The amounts being flared really haven't gone up drastically. We have hung around the low 30% level for sometime now."