N.M. Admin. Code § 19.15.27.8 - VENTING AND FLARING OF NATURAL GAS

A. Venting or flaring of natural gas during drilling, completion, or production operations that constitutes waste as defined in 19.15.2 NMAC is prohibited. The operator has a general duty to maximize the recovery of natural gas by minimizing the waste of natural gas through venting and flaring. During drilling, completion and production operations, the operator may vent or flare natural gas only as authorized in Subsections B, C and D of 19.15.27.8 NMAC. In all circumstances, the operator shall flare rather than vent natural gas except when flaring is technically infeasible or would pose a risk to safe operations or personnel safety, and venting is a safer alternative than flaring.

B. Venting and flaring during drilling operations.

(1) The operator shall capture or combust natural gas if technically feasible using best industry practices and control technologies.

(2) A properly-sizedflare stack shall be located at a minimum of 100 feet from the nearest surface hole location unless otherwise approved by the division.

(3) In an emergency or malfunction, the operator may vent natural gas to avoid a risk of an immediate and substantial adverse impact on safety, public health, or the environment. The operator shall report natural gas vented or flared during an emergency or malfunction to the division pursuant to Paragraph (1) of Subsection G of 19.15.27.8 NMAC.

C. Venting and flaring during completion or recompletion operations.

(1) During initial flowback, the operator shall route flowback fluids into a completion or storage tank and, if technically feasible under the applicable well conditions, flare rather than vent and commence operation of a separator as soon as it is technically feasible for a separator to function.

(2) During separation flowback, the operator shall capture and route natural gas from the separation equipment:

(a) to a gas flowline or collection system, reinject into the well, or use on-site as a fuel source or other purpose that a purchased fuel or raw material would serve; or

(b) to a flare if routing the natural gas to a gas flowline or collection system, reinjecting it into the well, or using it on-site as a fuel source or other purpose that a purchased fuel or raw material would serve would pose a risk to safe operation or personnel safety.

(3) If natural gas does not meet gathering pipeline quality specifications, the operator may flare the natural gas for 60 days or until the natural gas meets the pipeline quality specifications, whichever is sooner, provided that:

(a) a properly-sized flare stack is equipped with an automatic igniter or continuous pilot;

(b) the operator analyzes natural gas samples twice per week;

(c) the operator routes the natural gas into a gathering pipeline as soon as the pipeline specifications are met; and

(d) the operator provides the pipeline specifications and natural gas analyses to the division upon request.

D. Venting and flaring during production operations. The operator shall not vent or flare natural gas except:

(1) during an emergency or malfunction;

(2) to unload or clean-up liquid holdup in a well to atmospheric pressure, provided

(a) the operator does not vent after the well achieves a stabilized rate and pressure;

(b) for liquids unloading by manual purging, the operator remains present on-site until the end of unloading or posts at the well site the contact information of the personnel conducting the liquids unloading operation and ensures that personnel remains within 30 minutes' drive time of the well being unloaded until the end of unloading, takes all reasonable actions to achieve a stabilized rate and pressure at the earliest practical time and takes reasonable actions to minimize venting to the maximum extent practicable;

(c) for a well equipped with a plunger lift system or an automated control system, the operator optimizes the system to minimize the venting of natural gas; or

(d) during downhole well maintenance, only when the operator uses a workover rig, swabbing rig, coiled tubing unit or similar specialty equipment and minimizes the venting of natural gas to the extent that it does not pose a risk to safe operations and personnel safety and is consistent with best management practices;

(3) during the first 12 months of production from an exploratory well, or as extended by the division for good cause shown, provided:

(a) the operator proposes and the division approves the well as an exploratory well;

(b) the operator is in compliance with its statewide gas capture requirements; and

(c) within 15 days of determining an exploratory well is capable of producing in paying quantities, the operator submits an updated form C-129 to the division, including a natural gas management plan and timeline for connecting the well to a natural gas gathering system or as otherwise approved by the division; or

(4) during the following activities unless prohibited by applicable state or federal law, rule, or regulation for the emission of hydrocarbons and volatile organic compounds:

(a) gauging or sampling a storage tank or other low-pressure production vessel;

(b) loading out liquids from a storage tank or other low-pressure production vessel to a transport vehicle;

(c) repair and maintenance, including blowing down and depressurizing production equipment to perform repair and maintenance;

(d) normal operation of a gas-activated pneumatic controller or pump;

(e) normal operation of a storage tank or other low-pressure production vessel, but not including venting from a thief hatch that is not properly closed or maintained on an established schedule;

(f) normal operation of dehydration units and amine treatment units;

(g) normal operations of compressors, compressor engines, and turbines;

(h) normal operations of valves, flanges and connectors that is not the result of inadequate equipment design or maintenance;

(i) a bradenhead test;

(j) a packer leakage test;

(k) a production test lasting less than 24 hours unless the division requires or approves a longer test period;

(l) when natural gas does not meet the gathering pipeline specifications, provided the operator analyzes natural gas samples twice per week to determine whether the specifications have been achieved, routes the natural gas into a gathering pipeline as soon as the pipeline specifications are met and provides the pipeline specifications and natural gas analyses to the division upon request; or

(m) Commissioning of pipelines, equipment, or facilities only for as long as necessary to purge introduced impurities from the pipeline or equipment.

E. Performance standards

(1) The operator shall design completion and production separation equipment and storage tanks for maximum anticipated throughput and pressure to minimize waste.

(2) The operator of a permanent storage tank associated with production operations that is routed to a flare or control device installed after May 25, 2021, shall equip the storage tank with an automatic gauging system that reduces the venting of natural gas.

(3) The operator shall combust natural gas in a flare stack that is properly sized and designed to ensure proper combustion efficiency.

(a) A flare stack installed or replaced after May 25, 2021, shall be equipped with an automatic ignitor or continuous pilot.

(b) A flare stack installed before May 25, 2021, shall be retrofitted with an automatic ignitor, continuous pilot, or technology that alerts the operator that the flare may have malfunctioned no later than 18 months after May 25, 2021.

(c) A flare stack located at a well or facility, with an average daily production of equal to or less than 60,000 cubic feet of natural gas shall be equipped with an automatic ignitor or continuous pilot if the flare stack is replaced after May 25, 2021.

(4) A flare stack constructed after May 25, 2021, shall be securely anchored and located at least 100 feet from the well and storage tanks unless otherwise approved by the division.

(5) The operator shall conduct an AVO inspection on the frequency specified below to confirm that all production equipment is operating properly and there are no leaks or releases except as allowed in Subsection D of 19.15.27.8 NMAC.

(a) During an AVO inspection the operator shall inspect all components, including flare stacks, thief hatches, closed vent systems, pumps, compressors, pressure relief devices, valves, lines, flanges, connectors, and associated piping to identify defects, leaks, and releases by:

(i) a comprehensive external visual inspection;

(ii) listening for pressure and liquid leaks; and

(iii) smelling for unusual and strong odors.

(b) The operator shall conduct an AVO inspection weekly:

(i) during the first year of production; and

(ii) on a well or facility with an average daily production greater than 60,000 cubic feet of natural gas.

(c) The operator shall conduct an AVO inspection weekly if the operator is on site, and in no case less than once per calendar month with at least 20 calendar days between inspections:

(i) on a well or facility with an average daily production equal to or less than 60,000 cubic feet of natural gas; and

(ii) on shut-in, temporarily abandoned, or inactive wells.

(d) The operator shall make and keep a record of an AVO inspection for not less than five years and make such record available for inspection by the division upon request.

(6) Subject to the division's prior written approval, the operator may use a remote or automated monitoring technology to detect leaks and releases in lieu of an AVO inspection.

(7) for facilities constructed after May 25, 2021, facilities shall be designed to minimize waste;

(8) Operators have an obligation to minimize waste and shall resolve emergencies as quickly and safely as is feasible.

F. Measurement or estimation of vented and flared natural gas.

(1) The operator shall measure or estimate the volume of natural gas that it vents, flares, or beneficially uses during drilling, completion, and production operations regardless of the reason or authorization for such venting or flaring.

(2) The operator shall install equipment to measure the volume of natural gas flared from existing process piping or a flowline piped from equipment such as high pressure separators, heater treaters, or vapor recovery units associated with a well or facility associated with a well authorized by an APD issued after May 25, 2021, that has an average daily production greater than 60,000 cubic feet of natural gas.

(3) Measuring equipment shall conform to an industry standard such as American Petroleum Institute (API) Manual of Petroleum Measurement Standards (MPMS) Chapter 14.10 Measurement of Flow to Flares.

(4) Measuring equipment shall not be designed or equipped with a manifold that allows the diversion of natural gas around the metering element except for the sole purpose of inspecting and servicing the measurement equipment.

(5) If metering is not practicable due to circumstances such as low flow rate or low pressure venting and flaring, the operator may estimate the volume of vented or flared natural gas using a methodology that can be independently verified.

(6) For a well that does not require measuring equipment, the operator shall estimate the volume of vented and flared natural gas based on the result of an annual GOR test for that well reported on form C-116 to allow the division to independently verify the volume and rate of the flared natural gas.

(7) The operator shall install measuring equipment whenever the division determines that metering is practicable or the existing measuring equipment or GOR test is not sufficient to measure the volume of vented and flared natural gas.

G. Reporting of vented or flared natural gas.

(1) Venting or flaring caused by an emergency, a malfunction or of long duration.

(a) The operator shall notify the division of venting or flaring that exceeds 50 MCF in volume and either results from an emergency or malfunction, or lasts eight hours or more cumulatively within any 24-hour period from a single event by filing a form C-129 in lieu of a C-141, except as provided by Subparagraph (d) of Paragraph (1) of Subsection G of 19.15.27.8 NMAC, with the division as follows:

(i) for venting or flaring that equals or exceeds 50 MCF but less than 500 MCF from a single event, notify the division in writing by filing a form C-129 no later than 15 days following discovery or commencement of venting or flaring;

(ii) for venting or flaring that equals or exceeds 500 MCF or otherwise qualifies as a major release as defined in 19.15.29.7 NMAC from a single event, notify the division verbally or by e-mail as soon as possible and no later than 24 hours following discovery or commencement of venting or flaring and provide the information required in form C-129. No later than 15 days following the discovery or commencement of venting or flaring, the operator shall file a form C-129 that verifies, updates, or corrects the verbal or e-mail notification; and

(iii) no later than 15 days following the termination of venting or flaring, notify the division by filing a form C-129.

(b) The operator shall provide and certify the accuracy of the following information in the form C-129:

(i) operator's name;

(ii) name and type of facility;

(iii) equipment involved;

(iv) compositional analysis of vented or flared natural gas that is representative of the well or facility;

(v) date(s) and time(s) that venting or flaring was discovered or commenced and terminated;

(vi) measured or estimated volume of vented or flared natural gas;

(vii) cause and nature of venting or flaring;

(viii) steps taken to limit the duration and magnitude of venting or flaring; and

(ix) corrective actions taken to eliminate the cause and recurrence of venting or flaring.

(c) At the division's request, the operator shall provide and certify additional information by the specified date.

(d) The operator shall file a form C-141 instead of a form C-129 for a release that includes liquid during venting or flaring that is or may be a major or minor release under 19.15.29.7 NMAC.

(2) Monthly reporting of vented and flared natural gas. For each well or facility at which venting or flaring occurred, the operator shall separately report the volume of vented natural gas and volume of flared natural gas for each month in each category listed below. Beginning October 1, 2021, the operator shall gather data for quarterly reports in a format specified by the division and submit by February 15, 2022 for the fourth quarter and May 15, 2022 for the first quarter. Beginning April 2022, the operator shall submit a form C-115B monthly on or before the 15th day of the second month following the month in which it vented or flared natural gas. The operator shall specify whether it estimated or measured each reported volume. In filing the initial report, the operator shall provide the methodology (measured or estimated using calculations and industry standard factors) used to report the volumes and shall report changes in the methodology on future forms. The operator shall make and keep records of the measurements and estimates, including records showing how it calculated the estimates, for no less than five years and make such records available for inspection by the division upon request. The categories are:

(a) emergency;

(b) non-scheduled maintenance or malfunction, including the abnormal operation of equipment;

(c) routine repair and maintenance, including blowdown and depressurization;

(d) routine downhole maintenance, including operation of workover rigs, swabbing rigs, coiled tubing units and similar specialty equipment;

(e) manual liquid unloading;

(f) storage tanks;

(g) insufficient availability or capacity in a natural gas gathering system during the separation phase of completion operations or production operations;

(h) natural gas that is not suitable for transportation or processing because:

(i) N₂, H₂S, or CO₂ concentrations do not meet gathering pipeline quality specifications; or

(ii) O₂ concentrations do not meet gathering pipeline quality specifications except during commissioning of pipelines, equipment, or facilities pursuant to Subparagraph (l) of Paragraph (4) of Subsection D of 19.15.27.8 NMAC, except as otherwise approved by the division;

(i) venting as a result of normal operation of pneumatic controllers and pumps, unless the operator vents or flares less than 500,000 cubic feet per year of natural gas;

(j) improperly closed or maintained thief hatches;

(k) venting or flaring in excess of eight hours that is caused by an emergency, unscheduled maintenance or malfunction of a natural gas gathering system as defined in 19.15.28 NMAC;

(l) venting and flaring from an exploratory well; and

(m) other surface waste as defined in Subparagraph (b) of Paragraph (1) of Subsection W of 19.15.2.7 NMAC that is not described above.

(3) Upon submittal of the C-115B report, the division will compile and publish on the division's website an operator's vented and flared natural gas information for each month on a volumetric and gas capture percentage basis.

(a) To calculate the lost natural gas on a volumetric basis, the operator shall deduct the volume of natural gas sold, used for beneficial use, vented or flared during an emergency,and vented or flared because it was not suitable for transportation or processing due to N₂, H₂S, or CO₂ concentrations, vented as a result of normal operation of pneumatic controllers and pumps if reported pursuant to Subparagraph (i) of Paragraph (2) of Subsection G of 19.15.27.8 NMAC, or vented or flared from an exploratory well with division approval from the natural gas produced.

(b) To calculate the natural gas captured on a percentage basis, the operator shall deduct the volume of lost gas calculated in Subparagraph (a) of Paragraph (3) of Subsection G of 19.15.27.8 NMAC from the total volume of natural gas produced and divide by the total volume of natural gas produced.

(4) Beginning June 2022, the operator shall provide a copy of the C-115B to the New Mexico State Land Office for a well or facility in which the state owns a royalty interest, and the operator shall notify all royalty interest owners of their ability to obtain the information from the division's website at the time the initial C-115B is filed.

(5) Upon the New Mexico environment department's request, the operator shall promptly provide a copy of any form filed pursuant to 19.15.27 NMAC.

Notes

N.M. Admin. Code § 19.15.27.8

Adopted by New Mexico Register, Volume XXXII, Issue 10, May 25, 2021, eff. 5/25/2021