Operators across the oil and gas supply chain are continuously looking for ways to improve operational efficiencies, highlight emissions reductions, and differentiate themselves in front of investors and gas buyers. Project Canary’s environmental risk assessments (TrustWell) provide a holistic view of environmental performance by analyzing more than 600 data points across operational categories including air, water, land and community. But let’s dive a little deeper into the air component. Our Low Methane Rating (LMR) puts the spotlight squarely on emissions, and we’re excited to share how we’re bringing new levels of granular data and transparency to the marketplace.
As the Differentiated Gas market has grown, existing protocols and frameworks have become antiquated and dependent on the speed of regulation. At the same time, markets are demanding more and more granular data as more transactions move onto registries such as EarnDLT. Project Canary’s Low Methane Rating provides more clarity and detail than current regulatory emissions reporting and voluntary protocols. Components of the program include:
- Pad-specific methane intensity values in addition to basin-level methane intensity
- Stringent monitoring technology requirements coupled with engineering best practices
- Disclosure of carbon intensity
- Disclosure of public emissions targets and goals
Pad-specific methane intensity in addition to basin level:
The LMR provides a granular look at pad-level emissions performance while also requiring operators to maintain a low methane intensity at the basin level. This degree of transparency confirms emission reductions at scale, providing buyers confidence that sites that have achieved the LMR have lower emissions at a specific location and across an entire asset. A TrustWell score, combined with emissions quantification and the Low Methane Rating, can be leveraged for Differentiated Gas trading on digital registries.
Stringent monitoring technologies coupled with best practices:
Emissions monitoring is a critical component in any measurement and reconciliation program. The LMR does not mandate the use of any particular technology. However, monitoring technology and the operator’s fugitive monitoring plan addressing such technologies must meet specific performance criteria. Additional points and recognition are awarded for increased frequency and higher precision.
Project Canary will evaluate an operator’s methane monitoring technologies and their monitoring plan, allowing optionality and flexibility to mix and match technologies as part of our digital canopy approach. To verify compliance with the monitoring technology and deployment requirements of the LMR, the following will be reviewed:
- Fugitive Emissions Monitoring Plan (as required by NSPS or equivalent)
- Technology specifications and applicable test results
- Operator’s responses to emissions detections and associated inspection results
- Alarm criteria, as applicable
Supplementary to the monitoring requirements, the LMR implements a series of best practices developed by industry professionals with operational knowledge and expertise in emissions reduction programs.
Disclosure of Carbon Intensity (CI):
The critical next step in GHG emissions reduction is focusing on an overall carbon impact. While methane intensity is a valuable metric, it doesn’t give a holistic view of a company’s emissions performance, particularly as mandatory flaring reductions become commonplace. An operator must account for all greenhouse gases emitted to implement a truly effective carbon management strategy.
Disclosing carbon intensity creates further differentiation between operators and rewards those working to limit their emissions profile for all greenhouse gases rather than methane alone. Carbon Intensity also provides operators and buyers with an effective metric for any carbon offset programs or carbon tax considerations.
Disclosure of public emissions targets and goals:
Publicly disclosed targets and objectives confirm an operator’s emphasis on meaningful reductions. The LMR will review publicly stated goals or targets, operators’ plans to achieve these goals, and annual emissions tracking against said goals to allow for additional accountability.
LMR scoring allows you to meet discrete methane intensity thresholds and implement supplementary best practices. A set of minimum requirements must be met for LMR qualification. Additional scoring is given to operators that meet methane intensity thresholds and demonstrate further differentiating practices. The table below outlines the scoring levels:
|Rating||Methane Intensity (%)||Company Practices||Scoring Requirements|
|LMR Minimum Qualification||≤ 0.20||Minimum Requirements||≥ 0|
|LMR A||≤ 0.20||Minimum Requirements + Further Differentiated Practices||≥ 5|
|LMR AA||≤ 0.10||Minimum Requirements + Further Differentiated Practices||≥ 10|
|LMR AAA||≤ 0.05||Minimum Requirements + Further Differentiated Practices||≥ 15|
Project Canary’s environmental risk assessments remain committed to all aspects of environmental stewardship across air, water, land, and community, but we also recognize the importance of drawing out critical categories within the program, particularly relating to GHG emissions. With this objective in mind, the LMR has been designed to put a spotlight on reducing all types of emissions using measurement technologies that meet your needs. The combination of our environmental risk assessment, Low Methane Rating, emissions quantification, and Project Canary’s freshwater attribute allows you to spotlight your comprehensive emissions management programs and truly differentiate your assets.