Oil Production in Libya Using an ISO 14001 Environmental Management System
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Oil production in Libya using an ISO 14001 environmental management system To the Faculty of Geosciences, Geo-Engineering and Mining (3) Of the Technische Universität Bergakaemie Freiberg is submitted this THESIS To attain the academic degree of Doktor ingenieur (Dr.-ing.) submitted by BSc. petroleum engineer MSc. petroleum engineer Biltayib. M. Biltayib born on 17 February in 1974, Sirte, Libya Freiberg, 06. 01. 2006. Date of submission Dedication To my father and mother who supported me and lighted up my life since my birth to this date. To my brothers and sisters for their effort, moral support and endless encouragement. Biltayib. M. Biltayib 2 Acknowledgements First of all I wish to express my sincere thanks and gratitude to my supervisor Prof. Dr. Jan C. Bongaerts for their friendly assistance, guidance, discussion and criticism that made study interesting and successful. I am grateful to the staff of IMRE, TU Bergakademic Freiberg, Dipl.-Ing. Stefan Dirlich, Kristin Müller, who gave useful contributions at various times during the development of this thesis. I appreciate the support of the staff of AGOCO , Dipl.-Ing. Soliman Daihoum, Mr. Hassan Omar, Dipl.-Ing Ibrahim Masud during the data collection. Finally thanks to my special friends, Dr. Mohamed Abdel Elgalel, khalid kheiralla, Khaled raed, Dr. Aman Eiad , Dr. Saad Hamed, Mahmud Guader, Samuel Famiyeh, Abdallminam, Salem kadur, Abdalgader Kadau , Mohammed Mady, Abu yousf and his familly, Nizar and his son Rany, Mohammed Adous, Mohammed Almallah, Mustafah Wardah, Ali almagrabia, Samer, Ali almear, Ahamed Alkatieb, Mohammed Almasrea, salahedeen keshlaf , Radwan Ali Sead, Sadek Kamoka , Mohamed Arhuom, Dr. Abdalla Siddig, Mahmud Aref , Mohamed Nasim for their encouragement, advise and support during my stay in Germany. 3 Table of contents Abstract 11 Introduction 12 CHAPTER ONE 14 PETROLEUM FORMATION, HISTORY AND MARKET 14 1.1 Summary 17 CHAPTER TWO 18 WORLD OIL AND GAS PRODUCTION 18 2.1 World oil production 19 2.1.1 Peak oil production 19 2.2 World oil consumption 20 2.3 World oil reserves 21 2.4 Middle East oil production 23 2.4.1 History 23 2.4.2 Middle East oil production 24 2.5 Natural gas 27 2.5.1 Introduction 27 2.5.2 Natural gas production 28 2.5.3 Natural gas consumption 31 2.5.4 Natural gas reserves 31 2.6 World petroleum economics 33 2.6.1 The role of non-OPEC countries 33 2.6.2 The role of OPEC countries 35 2.6.3 Changing transportation technologies 37 2. 7 World trade in oil and gas 37 2.7.1 World oil and gas prices 40 2.7.1.1 Oil prices 40 2.7.1.2 Natural gas prices 41 2.8 Summary 43 CHAPTER THREE 44 OIL UPSTREAM OPERATIONS AND THEIR IMPACT ON THE ENVIRONMENT 44 3.1 Overview of the oil and gas exploration and production process 44 3.1.1 Exploration survey 45 3.1.2 Exploration drilling 46 3.1.2.1 Appraisal 48 3.1.3 Development and production 49 3.1.4 Decommissioning and rehabilitation 51 4 3.2 Classification of the exploration and production wastes 52 3.2.1 Produced water 53 3.2.2 Drilling waste 53 3.2.3 Associated wastes 54 3.2.4 Industrial wastes 54 3.3 The potential environmental impact 54 3.3.1 Aquatic impacts 56 3.3.2 Atmospheric impact 57 3.3.3 Impact of ecosystems 58 3.3.4 Oil impacts on terrestrial environment 59 3.4 Testing for toxicity 59 3.4.1 Toxicity for hydrocarbons 60 3.4.2 Drilling fluid toxicity 61 3.5 Summary 63 CHAPTER FOUR 64 ENVIRONMENTAL AGREEMENTS AND GUIDELINES TO CONTROL ENVIRONMENTAL IMPACT IN THE PETROLEUM INDUSTRY 64 4.1 Voluntary initiatives 64 4.2 Multilateral environmental agreements 66 4.3 Protocols 70 4.4 Regional agreements 72 4.5 Summary 74 CHAPTER FIVE 75 THE PETROLEUM INDUSTRY AND ENVIRONMENTAL LAWS IN LIBYA 75 5.1 General information 75 5.1.2 Overview in the Libyan oil industry: Libya's National Oil Corporation and Subsidiaries 75 5.1.3 Economic importance 76 5.1.4 Oil production 78 5.1.5 Gas production 79 5.1.6 Oil and gas reserves 79 5.2 Stresses on the environment 80 5.3 Environmental laws in the Libya oil industry 81 5.4 Summary 82 CHAPTER SIX 83 ARABIAN GULF OIL COMPANY 83 6.1 AGOCO operations and their potential environment impact 85 6.1.1 Operation 85 5 6.1.1.1 Exploration survey by AGOCO 85 6.1.1.2. Exploration drilling by AGOCO 85 6.1.1.3. Production and development by AGOCO 87 6.1.2 Potential environmental impact by AGOCO operations 88 6.1.2.1. Potential impact of exploration survey by AGOCO 88 6.1.2.2 Potential impact of exploration drilling by AGOCO 88 6.1.2.3 Potential impact of production and development by AGOCO 89 6.2 Summary 91 CHAPTER SEVEN 92 INTRODUCTION TO ENVIRONMENTAL MANAGEMENT SYSTEMS AND EVALUATION THE CURRENT LEVEL OF AGOCO’S ENVIRONMENTAL COMMITTMENT 92 7.1 Introduction 92 7.2 ISO 14001 Environmental Management System (EMS) 93 7.3 Initial environmental review 94 7.3.1. Policy 95 7.3.2 Planning 96 7.3.3 Implementation and operation 98 7.3.4 Checking and corrective action 105 7.3.5 Management review 107 CHAPTER EIGHT 109 GUIDING AGOCO FOR THE IMPLEMENTATION OF EMS ACCORDING TO ISO 14001 110 8.1 Environmental policy 109 8.2 Planning 110 8.3 Implementation and operation 124 8.4 Checking and corrective action 148 8.5 Management review 160 CHAPTER NINE 162 CONCLUSION 162 Glossary 165 References 168 APPENDIX 182 6 List of Abbreviations (ACGIH): American Conference of Governmental Industrial Hygienists (AEO): Assumption Energy Outlook ( AFEAS): Alternative Fluorocarbons Environmental Acceptability Study (AGOCO): Arabian Gulf Oil Company (APPEA): Australian Petroleum Production and Exploration Association (API): American Petroleum Institute (BP): British Petroleum Company (CFT): A Cross Functional Team (CFC): Chlorofluorocarbons (CIS): Commonwealth of Independent States (DWD): Deep Well Disposal (EMS): Environment Management System (EIA): The Energy Information Administration (ECT): The Energy Charter Treaty (EMR): Environmental Management Representative (EMT): Environmental Management Team (EPA): Environmental Protection Agency (E&P Forum): An association of about 50 oil companies and petroleum industry organisations. (ESP): Electrical Submersible Pumps (FSU): Former Soviet Union, (GDP): Gross Domestic Product (IEA): The International Energy Agency (IFP) : Institut français du pétrole (IGO): Intergovernmental Organizations (ISO): The International Organization for Standardization (IUCN): The World Conservation Union (LNG): Liquefied Natural Gas (LOS): The Law of the Sea (LPG): Liquefied Petroleum Gas (LDC): London Dumping Convention (MEA): Multilateral Environmental Agreements (MARPOL): The International Convention for the Prevention of Pollution from Ships 7 (Non-OPEC ): Countries are not members of the (OPEC) (NGO): Non-Governmental Organizations (NORM): Naturally Occurring Radioactive Materials (NOC): National Oil Corporation (OPEC): Organisation of Petroleum Exporting Countries (ODS): Ozone Depleting Substances (OSPAR): The Oslo and Paris Commissions (PDCA) : Cycle for “Plan, Do, Check, Act” (SOC): Srite Oil Company (SMEC): Senior Management Environmental Committee (TLV): Threshold Limit Values (UAE): United Arab Emirate (UNEP): United Nations Environment Programme (UKOOA): The United Kingdom Offshore Operators’ Association’s (UNCLOS): The United Nations Convention on Law of the Sea (UNFCCC): The United Nations Framework Convention on Climate Change (VOC): Volatile Organic Compounds (WOC): Waha Oil Company (WTO): World Trade Organization (WLGP): The Western Libyan Gas Project (ZOC): Zueitina Oil Company 8 List of figures Figure (1) World demand for primary energy 13 Figure (2) Percentage of the world’s crude oil production in major areas in 2003 17 Figure (3) Years remaining for selected countries’ peak oil production in 1999 18 Figure (4) Share of global reserves by 2003 20 Figure (5) Middle East: oil production forecast from 1930-2050 24 Figure (6) Middle Eastern oil production and consumption in 2004 24 Figure (7) Estimated global natural gas future recovery in 2002 29 Figure (8) Distribution of global natural gas production by region in 2002 29 Figure (9) World natural gas consumption 30 Figure (10) Percentages of world natural gas reserves by region in January 2005 31 Figure (11) Non -OPEC oil production from 1970 to 2020 33 Figure (12) OPEC oil production from 1970 to 2020 35 Figure (13) Production and consumption of oil and gas by region (2003) 37 Figure (14) Costs of oil and gas transportation 38 Figure (15) Historical oil prices from 1970 to 2004 41 Figure (16) Natural gas futures prices 42 Figure (17) Seismic survey (fieldwork) 46 Figure (18) Rotary drilling rig with its important components 48 Figure (19) Typical crude oil processes 51 Figure (20) The decommissioning process 52 Figure (21) Classes and homologous series of hydrocarbons 61 Figure (22) Libyan map 74 Figure (23) Libya’s oil production from 1970 to 2010 77 Figure (24) The life cycle of the oil industry 80 Figure (25) Sedimentary basin in Libya and AGOCO fields location 82 Figure (26) AGOCO oil production in 2004 83 Figure (27) Horizontal well 85 Figure (28) Disposal of produced waters to the desert in the AGOCO Sarir field 89 Figure (29) Leakage accident by AGOCO for 2000-2002 90 Figure (30) Environmental management system model for ISO 14001 93 Figure (31) AGOCO management structure 101 Figure (32) Suggestion for a new structure for AGOCO 125 9 List of tables Table (1) World crude oil reserves 20 Table (2) Middle East countries, reserves, and percent of world reserves, 2004 - production rate 22 Table (3) World gas production by region 27 Table (4) Natural gas reserves by region 31 Table (5) Summary of the exploration