Policy and Targets
Background and the Role of Reductions in Meeting Environmental and Economic Objectives
Between 2012 and 2022, oil production in Saudi Arabia fluctuated around 10 million barrels a day. The volume of gas flared over the same period dropped by 4 percent while flaring intensity also decreased by 10 percent, most of it between 2021 and 2022 (Figure ). There were 148 individual flare sites in the most recent flare count, conducted in 2022.
Figure 1. Gas flaring volume and intensity in Saudi Arabia, 2012–22
Saudi Arabia submitted an updated Nationally Determined Contribution (NDC) in October 2021. The NDC states an aim to reduce, avoid, and remove 278 million tonnes of carbon dioxide equivalent annually by 2030, more than twice the 130 million tonne target of the Intended Nationally Determined Contribution. The NDC mentions zero routine flaring, and recovery and use of methane for electricity generation and petrochemicals manufacturing among the methane management measures. As a member of the Global Methane Pledge, the Kingdom will reduce methane emissions by 30 percent from 2020 levels by 2030. Saudi Arabia is also a member of the Global Methane Initiative.
Saudi Aramco, the world’s largest integrated oil and gas company and, until the sale of 1.5 percent of its shares in 2019, fully state owned, endorsed the World Bank’s Zero Routine Flaring by 2030 initiative in November 2019. The company, with the financial support of the government, implemented the Master Gas System (MGS) starting in the 1970s. The MGS is a large system that gathers associated gas and delivers it to various end-users, including petrochemical facilities and power plants, via a growing pipeline network. The development of the MGS allowed for flaring to be reduced from about 4,000 million cubic feet (mmcf) per day to less than 200 mmcf per day by the mid-1980s. Saudi Aramco continues to expand the MGS, which, as of early 2023, consisted of 50 gas-oil separation plants, 7 gas processing plants, 2 natural gas liquid plants, and a pipeline network of more than 4,000 kilometers.
Targets and Limits
There are no targets set for emissions reduction in laws or regulations. Saudi Aramco has a zero routine flaring program and aims for near zero methane emissions by 2030. Every Saudi Aramco facility must have a flare minimization plan and targets.
Legal, Regulatory Framework, and Contractual rights
Primary and Secondary Legislation and Regulation
There are no specific laws or regulations on gas flaring and venting in oil and gas operations. According to Article 32 of the Basic Law of Governance (Royal Decree No. A/90), 1992, the state “shall endeavor to conserve, protect, and improve the environment and prevent pollution.” All companies engaged in the resource sector have been subject to the General Environmental Regulations of 2001. Royal Decree No. M/165, July 2020, enacted in early 2021, issued the Environmental Law. The Executive Regulation for Air Quality governs emissions across the economy, including vents and flares at petrochemicals and refining facilities but not upstream and midstream operations of Saudi Aramco, which is self-regulated via company engineering procedures and standards, including the Guidelines for Facility Flaring Minimization Plan (SAEP-400), Guidelines for Real-Time Flare Monitoring System Development (SAEP-400A), and Ambient Air Quality and Source Emissions Standards (SAES-A-102).
According to Section 5.1.3 of SAES-A-102, best available control technology (BACT) and best available retrofit technology (BART) must be used to control air emissions for new and existing facilities, respectively. The guidelines reference the United States Environmental Protection Agency to identify appropriate BACT and BART.
Facilities in industrial cities of Jubail, Yanbu, Ras Al-Khair, and Jazan are subject to the Royal Commission Environmental Regulations (RCER). Saudi Aramco procedures and standards, national regulations and RCER are, as far as can be ascertained from available documents, consistent with respect to main requirements pertaining to flares, vents, and fugitive emissions.
Legislative Jurisdictions
Saudi Aramco manages flaring, venting, and fugitive emissions from its operations, especially in the upstream segment. The Royal Commission for Jubail and Yanbu (the Royal Commission hereafter) regulates the same for downstream facilities in four industrial cities under its jurisdiction (Jubail, Yanbu, Ras Al-Khair and Jazan). For the facilities not covered by Saudi Aramco and the Royal Commission, the National Center for Environmental Compliance (NCEC) regulates flaring, venting, and methane emissions across all geographies.
Associated Gas Ownership
According to Article 14 of the Basic Law , all resources belong to the state.
Regulatory Governance and Organization
Regulatory Authority
The NCEC, as a branch of the Ministry of Environment, Water and Agriculture, is the environmental regulator. The NCEC regulates flare systems in many industries, including petrochemicals and refining—except for operations under the supervision of Saudi Aramco or the Royal Commission. The NCEC is one of the successors to the previous environmental regulator, the General Authority of Meteorology and Environment Protection, pursuant to the changes implemented by Royal Decree No. M/165 . The Royal Commission was established in 1975 to develop industrial cities at Jubail and Yanbu to create demand for natural gas to be captured and delivered via the MGS. Later, the industrial cities of Ras Al-Khair and Jazan were placed under the Royal Commission’s jurisdiction. Environmental approvals for Saudi Aramco projects, which cover almost all upstream and midstream activities in the country, are provided by the Ministry of Energy (formerly part of the Ministry of Energy, Industry and Mineral Resources). The Royal Commission is the environmental regulator for industrial and energy operations in four industrial cities under its jurisdiction.
Regulatory Mandates and Responsibilities
Flaring, venting, and methane emissions are regulated by three entities across different jurisdictions and/or segments of the oil and gas industry. In addition, the Supreme Council for Petroleum and Minerals is responsible for oil and gas policy and Saudi Aramco’s strategic plan. The Ministry of Energy oversees commercial activities in the oil and gas industry, including Saudi Aramco (see section 6 of this case study).
Monitoring and Enforcement
Saudi Aramco identifies priorities across company operations and requires every facility to develop and implement a flare minimization plan (FMP) as outlined in SAEP-400 . Site specific FMPs are developed based on the real-time flare monitoring system (FMS) developed by Saudi Aramco. Data are aggregated at the corporate level.
According to RCER-2015 , Volume I, Section 1.1.17, “the Royal Commission has the right to enter and access to the facility, upon reasonable prior notice of at least 24 hours, for the purpose of regular surveillance, monitoring, sampling, and inspection to verify compliance with these Regulations.”
The NCEC provides licenses to facilities subject to its regulation. The Executive Regulation for Environmental Inspections and Audits gives the NCEC authority to monitor and enforce compliance.
Licensing/Process Approval
Flaring or Venting without Prior Approval
No explicit regulations on flaring or venting without prior approval were found. According to SAEP-400 , routine, nonroutine, and emergency flaring and how they will be managed and reported must be explained in each facility’s FMP. Section 8.4.1 of SAEP-400 provides the following examples of allowable reasons for routine flaring: safety (minimum purge gas to keep air out of the flare headers), leakage (control and safety valves), and normal operation control valve discharge. Section 8.4.2 provides an extensive list of nonroutine flaring examples.
SAES-A-102 , Section 5.7, prohibits horizontal flares; refers to SAES-F-007 for flare height (air dispersion modeling is required but must be at least 30 feet) and other design requirements; requires FMP and FMS at all facilities; and mandates flow meters for each flare and reporting actual flaring data through the corporate FMS. Section 5.15 mandates leak detection and repair for fugitive emissions.
Authorized Flaring or Venting
SAEP-400 details routine, nonroutine, and emergency flaring operations that are implicitly authorized. Saudi Aramco’s FMP and FMS practice suggests that routine flaring is marginal. Saudi Aramco has maintained a flare volume of less than 1 percent of total raw gas production since 2012 according to the company’s 2021 sustainability report.
Development Plans
Saudi Aramco’s stated aim is to eliminate routine flaring in its upstream operations by ensuring that oil wells do not go online until gas takeaway infrastructure is in place, and by deploying appropriate technologies across company assets as identified in the FMPs of each facility . According to SAEP-400, FMPs, updated annually or when there is a significant modification, must describe measures taken in the past five years that led to the reduction or elimination of flaring, as well as short- and long-term plans to reduce flared volumes further in the future.
Economic Evaluation
At the macroeconomic level, the MGS, implemented by Saudi Aramco and supported by the government via large upfront capital investments in the 1970s, resulted directly from the desire to meet the country’s growing energy demand with gas-fired electricity generation and to increase value-added production of petrochemicals, while freeing oil, previously combusted for electricity generation and industrial uses, for exports. Such economic assessment continues to drive investments to capture associated gas that could be otherwise flared and deliver it to industrial and electricity generation facilities across the country.
At the facility and corporate level, monthly reports from the FMS help operators estimate the financial impacts of flaring, and its reduction (see section 13 of this case study).
Measurement and Reporting
Measurement and Reporting Requirements
SAES-A-102 mandates all Saudi Aramco facilities with flares to have an FMP, which must be updated annually and must cover:
- policies and procedures to minimize flaring,
- measuring, monitoring, and recording of flared gases to be reported monthly (daily volumes of vent, pilot, and purge gases),
- causes of flaring (safety, leaks, upset, mechanical failure, startup/shutdown, and process/fuel imbalance), and
- preventive measures implemented and to be implemented per FMP.
SAEP-400 provides the guidelines for facility FMPs, which are to be developed based on the FMS, developed by Saudi Aramco’s Process & Control Systems Department. This standardized tool must be implemented at all flare systems across Saudi Aramco facilities.
According to SAEP-400, all facilities must provide daily, monthly, and annual reports, with the goal of mitigating flare volumes by area and plant. These reports are to outline the sources and reasons for flaring as described in Section 8.4 of the guidelines.
The FMS was granted a US patent and is described in Appendix 8, SAEP-400A . The guidelines call for identifying and monitoring all equipment that may cause flares to malfunction; offer detailed system design recommendations and engineering equations; and set key performance indicators. The FMS software allows for the collection of real-time data from all equipment. Monthly reports from the FMS help operators distinguish between routine and nonroutine flaring, identify volumes released from each piece of equipment, and estimate financial impacts, all of which inform each facility’s FMP and allow analysts to benchmark recent flaring data against each facility’s best historical performance.
Stations in the Air Quality and Meteorology Monitoring Network (AMMNET) track ambient air quality. Saudi Aramco’s Emissions Monitoring Solution tracks greenhouse gas emissions across company operations. The company plans to include air emissions in this system according to Saudi Aramco’s 2021 sustainability report . SAES-A-100, Section 5.16, requires major new facilities to install at least one new AMMNET station, the location of which has to be approved by the Environmental Engineering Division.
The Executive Regulation for Air Quality includes technical requirements for flare systems burning volatile organic compounds (VOCs) (Article 5, Section 7). These regulations apply to petroleum refineries and petrochemicals facilities not operated by Saudi Aramco as well as other industries. Reporting requirements are not included in the Executive Regulation for Air Quality but NCEC may develop such requirements in the future.
According to RCER-2015 , Volume I (Regulations and Standards), Section 8, operators are to report the quantity and estimated composition of gases flared monthly, fugitive emissions annually, point source emission data annually, and an air emissions inventory for renewal of their environmental permit. Table 2D of RCER-2015 Volume I (Regulations and Standards) lists air emission sources subject to continuous monitoring, which include refineries. The monitoring focuses on opacity, carbon monoxide, and sulfur dioxide, and not explicitly on flaring, venting, or methane emissions.
Measurement Frequency and Methods
According to SAEP-400 , all Saudi Aramco facilities must be required to monitor gases directed to flares using flow meters approved by the Process & Control Systems Department. Meters should be maintained and calibrated to ensure accuracy over time. Compliance with flare minimization plans is monitored by the relevant Saudi Aramco department. Monitoring of real-time operations is centralized at Saudi Aramco’s 4th Industrial Revolution Center in Dhahran per Saudi Aramco’s 2021 sustainability report.
Outside Saudi Aramco, operators of industrial facilities must install digital recording devices to detect the presence of a flame at each flare and devices to measure the total volume of VOCs entering the flare under Article 5, Section 7, of the Executive Regulation for Air Quality .
According to RCER-2015 , Volume I (Regulations and Standards), Section 2.4.4, “Flares shall be operated with a flame present at all times which is to be monitored by a thermocouple or an equivalent device to detect the presence of a flame. In addition, the continuous imaging (digital recording) of all new flares (the existing flares, if possible) with date and time shall be maintained. All facilities, having flares, shall install flare flow monitoring device (like Ultrasonic Flow Meter) on the vapor line after liquid knock-out drum.”
Engineering Estimates
RCER-2015 Volume I, Section 2.11, allows for air emissions, including fugitive emissions, to be based on the United States Environmental Protection Agency (US EPA) AP-42: Protocol for Equipment Leak Estimates.
Record Keeping
Saudi Aramco’s FMS aggregates facility-level flaring-related data at the corporate level. Specific requirements on how long the data are kept, either at facilities or at the corporate level, were not identified for this case study.
According to RCER-2015 , Volume I (Regulations and Standards), Section 8.3, operators must maintain records “on site in an organized and legible fashion.” Records are required for all activities subject to the regulations, including flares. Records must be kept for at least three years and be made available for inspection.
According to Article 6, Section 1, of the Executive Regulation on Air Quality , “All persons must keep data, records, and annual reports on the progress made and the status of fugitive emissions management for a period of no less than five (5) years, and must submit them to the center upon request, and the center may increase the period for some activities for another five (5) years.”
According to Article 6, Section 2, of the Executive Regulation on Air Quality, operators are required to monitor all units and network components where the concentration of VOCs or methane exceeds 10 percent. Leaks of VOCs and methane can be determined using US EPA Method 21.
Data Compilation and Publishing
Historical data on Saudi Aramco facilities, in aggregate, can be found in various publications of the company, but no facility-level information on flaring, venting, or emissions is made publicly available on a regular basis.
Fines, Penalties, and Sanctions
Monetary Penalties
Under Article 8 of the Executive Regulation for Air Quality , “failure to comply with the requirements of the design, installation and operation of flare systems” is subject to penalties from SRI 50,000 to SRI 500,000 based on the amount and duration of emissions.
Under RCER-2015 Volume III (Penalty System), operators can be fined if, upon inspection by the Royal Commission, they are found to violate venting, flaring, and emissions regulations outlined in Volume I. Section C3 provides the formula used in calculating the penalty. The minimum fine is SRI 5,000.
Nonmonetary Penalties
No evidence of nonmonetary penalties was found.
Enabling Framework
Performance Requirements
Saudi Aramco engineering procedures and guidelines call for the deployment of flare systems that ensure the efficiency of hydrocarbon destruction and avoidance of nonroutine flaring during interrupted operations, under high gas line pressure, or for safety reasons.
Article 5, Section 7, of the Executive Regulation for Air Quality , provides technical specifications of when the flaring of VOCs is allowed, as well as performance requirements for flare systems, such as expulsion velocity under various conditions.
Fiscal and Emission Reduction Incentives
No evidence of fiscal incentives to reduce emissions was found.
Use of Market-Based Principles
No evidence of market-based incentives was found. However, since the 1970s, the development of the MGS and its ongoing expansion is driven by the economic value of captured associated gas.
Negotiated Agreements between the Public and the Private Sector
Almost all flaring and venting and emissions from the oil and gas industry are from Saudi Aramco, the Saudi Arabia Basic Industries Corporation (SABIC), and other public companies.
Interplay with Midstream and Downstream Regulatory Framework
As noted earlier in the case study, the MGS is a large system that gathers associated gas and delivers it to various end-users via a pipeline network of more than 4,000 km. As of early 2023, 7 gas processing plants, 2 natural gas liquid units, and 50 gas-oil separation plants complemented the network. The MGS midstream infrastructure, developed primarily by Saudi Aramco since the 1970s, ensures the utilization of associated gas for power generation, industrial activities, and other end uses. The Royal Commission oversees the downstream operations hosted by industrial cities; regulations, standards, and investments are coordinated across upstream, midstream, and downstream as well as across Aramco, Royal Commission, and other government entities.