The following projects have long-term environmental benefits, including energy and/or emissions reductions, and contribute to our emission reduction targets to 2025 and 2050. 302-4 305-5
In April 2014, we closed the purchase of Elkhorn, a small private company with light-oil assets in Southeast Saskatchewan. Following the purchase of these assets, Vermilion has made important improvements that reflect our focus on Safety, Integrated Sustainability, and Operational Excellence, based on our target to reduce flaring and venting emissions from this operation by 50% by 2020, compared to a baseline of 2014.
In these assets, beginning in 2015 and continuing through 2020, the construction of new infrastructure, operational changes and increased infrastructure runtimes have resulted in:
In May 2018, Vermilion completed the acquisition of Spartan Energy Corp., a publicly traded company headquartered in Calgary, Alberta. A major addition, the acquisition of Spartan resulted in an approximately 30% increase to our Canadian production relative to 2017 totals. Similar to the 2014 Elkhorn acquisition, a target was set in 2018 to reduce the flaring and venting emissions associated with the Spartan assets by 50% by 2024, compared to a baseline year of 2018. This is being accomplished through a variety of gas conservation and recovery initiatives.
In these assets, infrastructure changes and performance optimization activities undertaken from 2018 through 2020 have resulted in:
It is important to note that these assets would have been in production regardless of whether we were the operators. Our philosophy is that we don't shy away from bringing assets with higher emissions profiles into the company, because we seek to improve those profiles. As a result, once we take over assets that were previously in production with less efficient and less emissions-conscious companies, we substantially reduce emissions.
We have a non-operating financial interest in the Weyburn-Midale Carbon Capture and Storage facility in Saskatchewan, Canada. This is one of the largest carbon capture, utilization and storage projects in the world, bringing in CO2 from a utility in North Dakota to use in an enhanced oil recovery (EOR) method of production. The CO2 then remains permanently sequestered in the field.
It’s important to note that we do not claim the carbon sequestered as credits against our own carbon production, because the US utility – as the organization responsible for creating the carbon emissions – has already claimed the credits, in accordance with globally recognized carbon accounting methodologies. However, we are proud to play even a small role in this groundbreaking project. In 2020, our partnership accounted for 2,098 bbls/day, or approximately 4% of our total production on a financial control basis.
In 2020, our Canadian operations worked with our vendors to trial the replacement of diesel or propane with compressed natural gas (CNG) for boilers and water heating for the drilling program in Alberta. This provided cost savings while also reducing CO2 emissions by 27% for the program this year: 380 Tonnes, which is equivalent to taking 82 passenger vehicles off the road for a year.
Continuing a project initiated in 2019, we converted an additional 69 high-bleed pneumatic device to low-bleed units in 2020. Based on the equipment supplier's data, this is expected to reduce vented emissions by approximately 4,804 tCO2e/year.
Although modest in relation to some of the larger infrastructure initiatives, a project that we feel demonstrates the breadth of consideration that Vermilion applies to emission reduction opportunities involves the replacement of traditional thermoelectric (TEG) power generating devices at remote production sites to hybrid solar/methanol fuel cell units. Unlike TEG units which run (and therefore consume fuel) continuously, the hybrid units run on demand only. Based on manufacturer specifications, this reduction in operating time is expected to result in a greater than 99% emissions reduction in relation to the TEG units.
Conceptualized in 2017 with implementation ongoing, a total of 13 additional hybrid units were installed in 2020 at 12 locations in Alberta. Based on a specified emissions reduction of approximately 8.2 kg CO2e/KWh, the additional units installed in 2020 represent an annual CO2e savings of approximately 90 tonnes/year. In total, 35 hybrid units have been installed under the initiative to date, epresenting approximately 240 tonnes/year in reduced CO2e emissions.
In 2016, Vermilion began purchasing 100% green power from our largest power provider in our Netherlands Business Unit. This represents approximately 48,327 tCO2e avoided based on information from our suppliers. The Netherlands accounted for approximately 41% of Vermilion's gross Scope 2 emissions in 2015, and for 0% beginning in 2017. We have continued this program through 2021.
On three drilling operations completed between 2019 and 2021, we reduced NOx emission exposure associated with our Netherlands operation by 960 kg NOx, or 10% compared to the base case, by using NOx scrubbers on our drills. We anticipate using both NOx scrubbers and purchasing NOx certification via permanent withdrawal of agricultural NH3 emissions for upcoming drills in 2022.
Our German business unit is certified annually under ISO 50001 for Energy Management. This Standard provides a framework for developing, implementing and maintaining an energy management system that supports continual improvement in the efficient use of energy.
As part of Vermilion’s operational excellence, our processes are designed to optimize the conservation/capture of energy and its use. At our battery in Parentis where no regional gas gathering infrastructure exists to tie in our gas, Vermilion has installed high efficiency incinerator technology that has significantly reduced flaring, and helped us be a good neighbor to the community.
Given the proximity of the glass windows of the tomato greenhouse that is co-located with our battery, it was particularly important to find a solution that avoided strong vibrations. Our installation of the new incinerator, along with new piping, scrubber and safety fencing in the incinerator area has resulted in no noise, vibration or smoke. Because the incinerator runs at a much higher temperature (900°C instead of 400-500°C) and combusts the gas in a much taller, 9-metre stack, significantly more of the gases – such as methane, sulphur oxides and nitrogen oxides – are safely incinerated, minimizing the gas that has to be flared.