PTAC is seeking a proposal or proposals to provide a technology solution (or solutions) to minimize or eliminate methane slip from stationary reciprocating engines used in oil and gas production. The focus is on the elimination of methane slip, but this consideration can include the impact on NOx and CO2 emissions from these engines.
The Government of Canada has announced a target to achieve at least a 75% reduction in oil and gas methane by 2030 relative to 2012. In the fall 2022, Environment and Climate Change Canada published draft guidelines for the framework to achieve these emissions reductions. Methane slip from stationary engines is included in that framework.
PTAC convened an industry session to identify gaps for addressing methane slip from engines, noting there are few, if any, commercial options to reduce these emissions significantly. As such, oil and gas producers, through the industry fund AUPRF (Alberta Upstream Petroleum Research Fund), are seeking solutions to reduce or eliminate methane emissions from these engines.
The project is focused on the development and field testing of one, several or a family of technology options to reduce methane slip in stationary engines via pre-combustion or post-combustion routes. Technology solutions can be related to any aspect of the operating cycle, including but not limited to:
- Engine redesign.
- Fuel treatments.
- Fuel additives.
- Combustion enhancement.
- Treatment of exhaust gases.
Field trial information will be important to develop an understanding of performance characteristics for the control of CH4 engine emissions. Particular attention must be made to the optimization of reduction across several other emissions categories, including CO2, NOx, CO, and possibly VOCs. This optimization should be considered within the context of least cost and also largest emissions reductions overall. Least cost analysis must consider the impact of carbon credits. Ideally, this project should be completed within 24 months and result in a technology option ranking at least at a TRL 8.
Technology assessments should contain a comprehensive evaluation of the installed performance of these technologies on operating sites of average configuration applicable to the Alberta context. Focus areas could include:
- Identify specific ideas that would aid the sector in reducing methane slip regulatory requirements in the most cost-effective way possible.
- Development of “Implementation Guidance Documents” for reciprocating engines within the UOG sector, including the following content:
- The impact on engines vintages and technology solutions performance
- Lean burn versus rich burn engine performance
- Installation, operation, and maintenance practices for abatement technology on reciprocating engines
- Cost-effective regulatory compliance strategies
- Fuel efficiency impacts.
- Emissions/Operability/Maintenance benefits and trade-offs.
- Cost – procurement costs, installation, replacement, and maintenance considerations.
- Support – local or international distribution centers; procurement directly from the manufacturer or through local distributors; qualified technical and maintenance support locations.
The requested proposal or proposals should contain a very short description of the project and scope of work, a CV or statement of qualifications and short excerpts of reports written by the applicant. The proposal document should address the following elements and must be delivered electronically to PTAC by the deadline stated below:
- Scope of work
- Budget and execution schedules
- Personnel assigned to the project
- Disclosure of co-funding agreements or partnerships
- Requested payment schedule, if any.
It is anticipated that there will be ongoing communication with PTAC and the technical steering committee throughout the project. The proposal should include components for each stage with milestones, the project schedule, proposed costs, and relevant expertise of the applicant’s proposed team.
Answers to Submitted Questions – Dec 8, 2023
|1. Will PTAC entertain proposals from non-Canadian companies? The Project is based in Canada (Pilot demonstration), but the Project will be managed by a non-Canadian entity. Is this allowed?
|Yes. Any firm anywhere is eligible. The only jurisdictional condition is that the technology be applicable to operations in Alberta.
|2. What is the contribution of PTAC to project costs? Is it a capped contribution per project? Is it a fixed % of the project costs? For example, if a 24-month project costs are $3 million (including equipment and labor costs), will PTAC contribute 70% of the costs ($2.1 million) and the company contribute 30% ($0.9 million)? Or will PTAC contribute up to $1 million and the company is responsible for the rest of the costs?
|The financial terms of the proposals can be flexible. The objective of the project is to improve upon one or more technology solutions to reduce methane slip. Leveraged funding from other sources will be beneficial.
|3. Is there a cap on the project budget? For example, will PTAC consider projects with costs of $2 million? $20 million?
|The budget for this project is an initial $330,000 CDN. Additional phases can be proposed but future budget allocations can’t be confirmed.
|4. How detailed should the Project Budget be? Is it enough to show budget (CAPEX and OPEX and labor costs) per Work Package in the Project Schedule?
|The proposed budget should include total expenditures summarized between compensation costs and operating costs and shown by deliverable or project phase.
|5. Do you have a sample proposal or any additional guidance on how to structure our submission?
|Proposals can be of any structure so long as they address the key elements noted in the RFP document.
|6. Could you please provide a list of pre-conditions mentioned in “1. Failure to Enter into an Agreement” in the “Conditions of this Request and Process.
|No additional pre-conditions have been determined at this time, from those noted in the RFP document. Any additional conditions would be developed and discussed with the winning bidder during contract negotiations.
|7. What is the anticipated project start date?
|April 1, 2023.
|8. What is the approximate, anticipated number of awards and average value of each award? This is important to us so we can bound the project scope.
|One or two awards may be provided.
|9. Are there any special requirements for cost share? For example, we have contract for 2024 with an industrial sponsor that will be funding laboratory development of a methane reducing technology. Could the funding from the industrial sponsor be considered cost share if the PTAC funds would be used to demonstrate the technology in the field?
|There are no pre-conditions for cost sharing and PTAC welcomes partnering organizations to collaborate with this project.
|10. Would it be a 50/50 contribution, or a loan option?
|The project funding is non-dilutive funding to the development of the technology. The one stipulation is that AUPRF funders have the right to a free licence to use the technology solution in their own operations.
|11. If it is the 50 / 50 contribution, what is the maximum funding that could be received?
|The budget for this RFP is $330,000 CDN. The amount of leveraged funding is flexible. Higher levels of leveraged funding would be beneficial.
|12. Can one project encompass multiple engines / surface locations, or would an RFP be required for each proposed engine?
|Yes, multiple engines / surface locations can be considered.
|13. Would the scope of this project require pre / post testing to prove emission mitigation?
|Verification of the performance of the technology solution should be included in submitted proposals.
|14. Is the emission mitigation more focused on NOx, or CO2 emissions, or just a general emission reduction?
|The project is solely focused on the reduction in methane emissions from stationary engines.
A technical committee, composed of oil and gas producer companies, and government and regulatory representatives will determine the winning proposal. All submitted proposals will be provided to the Committee for review. The Committee will determine if proposals meet the requirements herein and provide an overall ranking based on Contractor qualifications and on proposal quality.
Once a selection of the best proposal according to the Committee has been made, all submission contacts will be notified by email of the outcome of their individual proposal. The project’s final report will be shared on the PTAC website upon its completion.
- 40% – Scope and quality of the proposal in meeting the needs of a mitigation solution for methane slip
- Technical expertise
- Practicality of the implementation of the technical solution, including the potential timeline for commercialization
- Compatibility with existing or proposed provincial or federal regulations
- Need for additional support from PTAC or funders
- 20 % – timeline for full commercialization of the technology solution – nearer-term solutions will be ranked higher
- 15% – projected cost-effectiveness of the solution at initial commercialization and five years after commercialization ($/tonne CO2e
- 20% – project management
- Management of deliverables
- Communications protocols
- Leveraged support
- Industry in-kind support
- Funding from other sources
- 5% – Conditions under which intellectual property (IP) developed under this RFP will be accessible to AUPRF funders. This could range from the IP ownership being held by funders, to a free unfettered licence, to a licence with conditions, to preferred commercial arrangements, to the proponent having full and complete ownership and control. Please note that the greater the degree of access and use by AUPRF funders, the higher the ranking of this criterion.
Conditions of this Request and Process
- Failure to Enter into an Agreement: If a selected proponent fails to execute the Agreement or satisfy any pre-conditions of award within fifteen (15) days of notice of selection, PTAC may, without incurring any liability, proceed with the selection of another proponent and pursue all other remedies available to the organization.
- RFP Incorporated into Proposal: All of the provisions of this RFP are deemed to be accepted by each proponent and incorporated into each proponent’s proposal. A proponent who submits conditions, options, variations, or contingent statements inconsistent with the terms set out in this RFP, either as part of its proposal or after receiving notice of selection, may be disqualified. If a proponent is not disqualified despite such changes or qualifications, the provisions of this RFP will prevail over any such changes or qualifications in the proposal.
- Proponents to Follow Instructions: Proponents should structure their proposals in accordance with the instructions in this RFP. Where information is requested in this RFP, any response made in a proposal should reference the applicable section of this RFP. Failure to follow these instructions may result in the proposal being disqualified.
- Past Performance In the evaluation process: PTAC and the committee may consider the proponent’s past performance or conduct on previous contracts with the organization or other institutions.
- Proponents to Bear Their Own Costs: The proponent will bear all costs associated with or incurred in the preparation and presentation of its proposal, including, if applicable, costs incurred for interviews or demonstrations.
- No Guarantee of Volume of Work or Exclusivity of Contract: Unless otherwise expressly stated in the RFP, PTAC makes no guarantee of the value or volume of work to be assigned to the successful proponent. The Agreement may not be an exclusive contract for the provision of the described Deliverables. PTAC may contract with others for goods and services the same as or similar to the Deliverables or may obtain such goods and services by other means.
- All proposals to become the confidential property of PTAC: Proponents agree that any and all documents or other communications with respect to this RFP become the confidential property of PTAC.