Canada furthers plan to cut VOCs at oil and gas facilities

*The following regulatory news article is intended to be an overview of the report, legislation or proposal, and not a replacement for the actual guidance or information from the government. For the comprehensive data, please visit the linked source material within the article.

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bulk fuel facility
According to 2019 federal data, total VOC emissions from sites such as bulk fuel facilities were 53,790 tonnes, with approximately 63% originating from storage and loading of volatile petroleum liquids. Photo Credit: Media Whale Stock, stock.adobe.com

Equipment-based requirements to lower volatile organic compounds (VOCs) from a variety of oil and gas facilities are now in a 60-day consultation period from Environment and Climate Change Canada, and Health Canada. 

If implemented, the new draft regulations are estimated to impact a total of 250 facilities spread across every province in the country, including terminals, refineries, upgraders, petrochemical facilities, and bulk fuel facilities. These are Canada’s largest source of VOC emissions, the departments stated. 

According to 2019 federal data, total VOC emissions from these facilities were 53,790 tonnes, with approximately 63% originating from storage and loading of volatile petroleum liquids. 

VOCs are known pollutants that cause smog in communities across Canada, and increase the risks for a wide range of health problems. The departments noted that potential air quality improvements over the next two decades could  result in 150 fewer premature deaths associated with reduced exposure to PM2.5 and ground-level ozone.  

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The new draft regulations build on the Reduction in the Release of Volatile Organic Compounds Regulations (Petroleum Sector) that were finalized in 2020 and are in force. 

“Due to the gaps in coverage of current provincial and municipal instruments for reducing VOC emissions, there is no nationally consistent protection for Canadians from the health and environmental risks resulting from VOC emissions from the storage and loading of petroleum liquids,” the departments noted in a regulatory impact analysis statement. 

Due to facilities taking different approaches to mitigate VOC emissions, the draft regulations suggest that monitoring data continues to show high ambient levels of VOCs such as benzene, particularly near liquid petroleum storage and loading facilities, despite existing federal and provincial measures in place. 

A 2023 report by Health Canada concluded that Canadians living near gas stations may be exposed to elevated levels of VOCs, including benzene, which can be carcinogenic. The emissions come from underground gasoline storage tanks and other sources, and consultations on risk management options to address these issues are being launched in the winter of 2024. 

The primary element of the new VOC reduction draft regulations would require that petroleum liquid storage tanks and loading racks be equipped with emissions control (or vapour control) equipment. Facility operators would be required to install, inspect, maintain, and repair the equipment, including recordkeeping and reporting. 

Facilities that would be required to control emissions include those that store volatile petroleum liquids in tanks that meet or exceed 100 m³, or load and unload volatile petroleum liquids that exceed approximately 500,000 litres per day. 

If the regulations come into force, regulated facilities would be required to bring a certain percentage of existing storage tanks and loading racks into compliance each year 

The proposed regulations would also require the use of specific ASTM International or Canadian General Standards Board standard methods whenever sampling and testing liquids to determine VOC concentration, true vapour pressure, or benzene content. 

Improvements to air quality could also help to combat climate change, the departments said. Crude oil, for instance, contains methane that can evaporate during storage and loading operations. The draft regulations are estimated to reduce methane emissions by 195 kilotonnes of carbon dioxide equivalent emissions between 2024 and 2045, which would result in reduced climate change damages of about $24 million.  

Government analysis also estimates the proposed regulations would result in health benefits amounting to $1.05 billion and $14 million in environmental benefits. 

The production benefits from recovered crude oil and gasoline associated with the regulations are estimated at $343 million worth of recovered products, while the total costs of the regulations to industry are estimated at approximately $1 billion between 2024 and 2045.  

The draft regulations would therefore provide a net benefit to the Canadian economy of $337 million, according to the Government of Canada. 

Canada is inviting interested Canadians to submit their feedback on the draft VOC regulations during the 60-day consultation period, which will end on April 24, 2024. 

Related Professional Development Course

Attend “Air Quality, Climate Change, and Decarbonization” on April 24th at the CANECT 2024 Environmental Compliance and Due Diligence Training Event in Vaughan, Ontario. Attendees will learn about air quality regulation and reporting, including odour and greenhouse gas emissions, and more. Visit www.canect.net for more information.

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