Air emissions

We acknowledge there is a growing consensus about the contribution of human activity towards global warming and that our activities produce emissions of methane and carbon dioxide – two gases recognised as GHGs. Energy is essential to social and economic progress but we recognise our responsibility to take a precautionary approach to climate. We therefore seek to minimise our own emissions of greenhouse gases.

Direct GHG Emissions

Our climate change strategy involves the measurement, verification and reporting of direct emissions from our production facilities and exploration activities such as seismic surveying and drilling which we have done since 2000. Many of these activities are carried out by specialist contractors on our behalf. Our direct GHG emissions include methane (CH₄) and carbon dioxide (CO₂) from burning gas, diesel and oil for power generation and flaring and venting during non-routine operations. Emissions of these gases are quantified in accordance with the Methods for estimating atmospheric emissions from E&P operations (OGP 1994).

We work to understand our future energy requirements and emissions as our operational activities evolve, and aspire to maintaining energy consumption and emissions relative to levels of hydrocarbon production, within the top quartile of the OGP members. In 2009, we achieved this target for our production facilities across India and Bangladesh with the greenhouse gas intensity in India and Bangladesh at 47.3 and 13.1 tonnes CO₂e per 1,000 tonnes of hydrocarbon production respectively compared to the OGP average in 2008, the last year for which data is available, of 162.0 tonnes CO₂e per 1,000 tonnes of hydrocarbon production.

For all activities, our emissions from Cairn India increased by 28% from 129,474 tonnes CO₂e in 2008 to 165,656 tonnes CO₂e in 2009. Total GHG emissions are expected to increase as production from Rajasthan increases. For Cairn, excluding Cairn India, we have seen GHG emissions reduce by some 15% from 29,399 tonnes CO₂e in 2008 to 24,891 tonnes CO₂e in 2009.

Outside Cairn India, the business is exploration-led and levels of total GHG emissions are directly related to activity levels. During 2009, the business outside Cairn India did not carry out any drilling activities but did carry out a number of seismic and other survey activities. Most significantly, GHG emissions at our Sangu plant were reduced due to the installation of third-stage gas compression.

Over a number of years, we have implemented several initiatives to reduce the emissions associated with our activities. These include:

• the installation of high-efficiency flares;
• third-stage compression facilities, which increase gas recovery from the oil/gas mixture for use as fuel gas and reduce losses to flaring; and
• improving plant operations to minimise gas emissions. This can include improving the way we operate to reduce plant upsets that usually require releases to flare.

We seek to improve our understanding of our carbon footprint and define programmes for energy efficiency and emissions reduction in line with developing best practices and legislation. However, as producing fields mature, GHG emissions increase relative to hydrocarbon production so maintaining energy and emissions efficiency will always be a challenge.

Indirect GHG Emissions

We also recognise that, in common with other commercial organisations, our activities contribute indirectly to the generation of GHG emissions. In 2008, we started to monitor indirect emissions associated with purchased electricity and air travel within our business activities.

Dust and Air Quality

We also monitor parameters important to air quality. These include nitrogen oxides (NOx) and sulphur dioxide (SO₂), which arise primarily from the generation of power from diesel for drilling and seismic activities, and land and sea transportation.

Our EIAs also recommend that adequate measures be taken to minimise the impact on local air quality, especially during the construction phases when dust is commonly generated during earthwork activities and vehicle movements. The Environment Management Plan arising from the EIA conducted at Mangala, for instance, noted that some of the roads have been 'topped' to provide a more robust road surface and reduce dust.

Emissions Data Quality

All air emissions, including GHG performance data, have been quantified since 2000 in accordance with the Methods for estimating atmospheric emissions from E&P operations (OGP, 1994). Although the data as presented within this Report provides a good indication of our performance, we recognise that using 1994 emission factors is not best practice. Going forward, we will adopt and report according to the more recent air emissions factors industry guidelines such as the Compendium of Greenhouse Gas Emissions Estimation Methodologies for the Oil and Gas Industry (API, 2009) for GHG data. This is expected to increase materially the reported emissions for greenhouse gases and the results utilising this updated methodology will be presented later in 2010. This comment with regards to our Greenhouse Gas Emissions data also applies to the other air emissions performance we are reporting on i.e. NOx, SOx, and VOCs.