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La Plata Electric Association considers methane-capture project

Emissions from private company’s wells could generate power
A tentative methane-capture partnership project in Kline could generate power for La Plata Electric Association members and reduce a private natural gas drilling company’s methane emissions.

Amid a federal push to reduce greenhouse gas emissions, La Plata Electric Association is exploring a project with a private oil and gas production company that would put methane waste to use.

Methane emissions would be captured from about 40 wells in southwestern La Plata County, owned by Williford Resources. The project would help the Tulsa-based company follow a Colorado Oil and Gas Conservation Commission order to eliminate gas venting.

Williford has vented excesses from its Kline wells since March 2015, when the drilling contractor that transported Williford’s gas to the market, Red Mesa Holdings, went bankrupt and abandoned its midstream pipeline.

Williford’s wells would produce enough methane waste to generate 130 kilowatts of power, enough to serve about 100 homes.

While LPEA staff members agreed the project is worth pursuing, the terms of its structure is a trickier matter.

LPEA is bound by contract to purchase 95 percent of its power from wholesaler Tri-State Generation and Transmission, while the remaining 5 percent is available for investments in other energy providers.

The proposed methane-capture system could either be considered a “5 percent” project, or a qualifying facility, which is a renewable, often local power source as defined by the Public Utility Regulatory Policies Act. Qualifying facilities offer power at special rates, and they would not count toward the 5 percent limit.

Qualifying facilities and the terms by which member cooperatives may invest in them are currently matters of dispute between Tri-State and the Delta-Montrose Electric Association. While the Federal Electricity Regulatory Commission sorts it out, LPEA plans to tentatively pursue the project with Williford as a qualifying facility.

“We have to get a clear answer on some things, but we’ll try to follow the qualifying facility path as far as we can take it,” said Dan Harms, LPEA manager of rates, technology and energy policy.

The next step would be entering a purchased-power agreement with Williford for a negotiated amount. LPEA would offset the expense of the system by purchasing less electricity from Tri-State, and Williford would pay for potential line extensions and interconnection costs.

Because the cooperative is seeking fewer than 1,000 kwh of power, the project would be exempt from the $21,480 certification requirement for qualifying facilities.

The project’s cost is unclear.

“This seems like one of those projects where you say it’s a win-win,” said board member Britt Bassett. “We should go forward with it, and then deal with any problems that arise. This looks like a project that, because of the benefits, will allow you to push a gray area that other projects may not.”

Hearne Williford, manager and owner of Williford Resources, said the project was in its early phases and declined comment at this time.

jpace@durangoherald.com

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