January 2013 - FracTracker Alliance

NM Shale Map Shows Contamination Events

January 30, 2013/by Matt Kelso, BA

Recently, the FracTracker Alliance has gotten several requests from residents of New Mexico for maps showing the large scale drilling operations in that state. As we began to look around for data sources, we encountered an interesting document from 2008:

This 2008 document from the New Mexico Oil Conservation Division shows instances of ground water contamination by oil and gas pits in the state.

There isn’t much description on the document or the New Mexcio Oil Conservation Division (NMOCD) page that links to it, however, the subject matter is straightforward enough. Altogether, there are 369 instances of ground water contamination documented by a New Mexico governmental agency from dozens of drilling operators throughout the Land of Enchantment.

Ground Water Contamination Controversy

Since the title of document indicates that the agents causing contamination are “pit substances”, this does not technically indicate that hydraulic fracturing is to blame. This is largely a matter of definition, but it is an important one to understand, because the word “fracking” means something different to industry insiders than it does to the general public, and the issue of ground water contamination is a point of considerable debate.

Technically speaking, hydraulic fracturing only refers to one stage of the well completion process, in which water, sand, and chemicals are injected into the oil or gas well, and pressurized to break up the carbon-rich rock formation to allow the desired product to flow better.Most people (and many media outlets) consider “fracking” to be the entire production process for wells that require such treatment, from the development of the several acre well pad, through the drilling, the completion, flaring, waste disposal, and integration of the product to pipelines. (It is due to these competing definitions that the FracTracker Alliance goes out of our way to avoid the term “fracking”.)

All of this has lead to some carefully worded statements that seem to exhonerate hydraulic fracturing, despite suspected contamination events reported in Pennsylvania, Wyoming, and elsewhere. Of course, from the perspective of residents relying on a contaminated aquifer, it hardly matters whether the water was contaminated by hydraulic fracturing, leeching from the associated pits, problems with well casing or cement, or re-pressurized abandoned wells. A fouled aquifer is a fouled aquifer.

This document does not specify what was contained in the pits, only that they are contamination events. Therefore, we do not know what stage of the process the contaminant came from, only that it was believed by the state of New Mexico to have originated from a pit, and not the well bore itself.

Notes About Location Information

It is important to note that the location information is not exact, but are generally within 0.72 miles of the specified location. The reason for this is that the location information was provided using the Public Land Survey System (PLSS). The brainchild of Thomas Jefferson, the PLSS was the method used to grid out the western frontier, and it is still used as a legal land description in many western states. Essentially, the land was divided into townships that were six miles by six miles, which was then broken into 36 sections, each of which is one square mile. FracTracker has calculated the centroid of each section, which could be up to 0.71 miles from the corner of the same section if the shape is perfectly square.

The PLSS system was used to grid out most of New Mexico, but some portions of the state had already been well defined by Spanish and Mexcian land grants. Aside from being a fascinating historical anecdote, it does have an effect on the mapping of these pits. In the image of the table above, note that the “Florance Z 40” well does not have any values in the location column. As a result, we were not able to map this pit. Altogether, 11 of the 369 pits identified as causing groundwater contamination could not be mapped.

New Mexico Shale Viewer. You can zoom and click on map icons in this window for more information. For full access to map controls, including layer descriptions, please click the expanding arrows icon in the top right portion of the map.

The Ohio Utica Shale Play Turns 500… Almost!

January 29, 2013/by Ted Auch, PhD

Drilling Trends

Ohio’s first Utica well was permitted by ODNR on behalf of Hess Ohio Resources on 9-28-10. As shown in Figure 1 (right), the major uptick in well permitting began in the summer of 2011 with 23 wells permitted during that period, ramping up to 24 wells in November 2011. There was a brief reduction in permitting during the winter of 2011-12, followed by the boom-boom summer and fall of 2012, with an average of 37 wells per month and a total of 261 wells permitted between June and December 2012.

Production

As of the end of 2012, only 30.4% of the 487 permitted wells had been drilled or are currently being drilled. Forty-seven are currently producing gas, with the Ohio Department of Natural Resources (ODNR) reporting production data for only 9 of the 47 producing wells. All of these wells are owned by Chesapeake, 2/3 of which are in Carroll County. On average, these wells produced 61 barrels of oil, 1,875 million cubic feet of gas, and 8,905 gallons (i.e. 37 tons) of brine per day over an average production period of 88 days. Twenty of the permitted wells are classified as inactive (not drilled) or plugged, with the remaining permitted but yet to be drilled (Figure 2). The top five Utica counties based on number of well permits are Carroll, Harrison, Columbiana [1], Jefferson, and Guernsey [2]; while on the other end, Ashland, Geauga, Medina, and Wayne are each home to one Utica well at this point (Figure 3). According to Columbus, OH-based Huntington Bank’s first Midwest Economic Index, early returns in these parts are mixed in Ohio: “58 percent of respondents agreed that the industry would bring opportunity, with 15 percent of those saying it would be a significant opportunity, while 42 percent said they did not see it bringing economic opportunity to their communities.”

Bird’s Eye View

From an area perspective, Carroll County has 0.45 wells per square mile – 0.39 more wells per square mile than the next ten counties with the most wells (Figure 4) – while the bottom four counties currently contain 0.0023 wells per square mile. The relationship between population and wells is generally the opposite of the previous two relationships with the bottom four counties having an average of 108,345 citizens for every well drilled. Carroll County has 163 residents per well, while the remaining top ten counties have an average resident-to-well ratio of 7,057 (Figure 4, Inset). This means that any potential ad valorem-based tax structure would benefit – on a per capita basis – less populated counties rather than those with more wells such as Carroll.

Companies Involved

Chesapeake and its subsidiaries is the dominant player in the Ohio Utica play, with 320 of all wells permitted, followed by Gulfport Energy with 25, Enervest and HG Energy with 16, and Hess Ohio with 14 permitted wells. These five firms account for 80.3% of all permitted wells in Ohio, with an additional eighteen firms splitting the remaining 19.7% (Table 1, below). However, the firms that are publicly traded have been experiencing an average decline in share price of 3.41% since the time their first wells were permitted to the close of business on January 22^nd, 2013. The biggest financial losers have been some of the Ohio Utica play’s biggest participants – including Chesapeake (CHK, -27%), Consol Energy (CNX, -29%), and Devon (DVN, -17%) [3]. Meanwhile, Anadarko (APC, +14%), Gulfport (GPOR, +19%)), and the upstart PDC Energy (PDCE, +55%) are the biggest beneficiaries of wading into Ohio’s Utica Shale play. However, the industry is displaying quite a few characteristics of an unsustainable boom; Wall Street analysts have been skeptical of big Utica Shale energy operations from soup to nuts as reported by Reuters last fall. but Wall Street voted in favor of the removal – either voluntary or forced – of CHK’s founder Aubrey McLendon to the tune of a 10% share spike the day of the announcement. Even the aforementioned winners have been outperformed by the S&P 500 and Dow Jones Industrial by 12.6% since permitting began in September 2010.

Will the boom continue to boom? It may be too soon to tell, but one thing is for sure, shale gas extraction to-date has made an indelible mark on many communities in eastern Ohio.

Figure 1. Ohio Utica Well Development per Month & Cumulatively as of January 1, 2013. Click on the image to view full-screen.

Figure 2. Ohio Utica Well Status as of January 1, 2013. Click on the image to view full-screen.

Figure 3. Ohio Utica Wells by County as of January 1, 2013. Click on the image to view full-screen.

Figure 4. Ohio Utica Wells Per Square Mile by County and People Per Well by County as of January 1, 2013. Click on the image to view full-screen.

[1] Thanks to the surge in Columbiana County wells, the Texas-based Santrol will be opening a frac sand terminal with direct access to Ohio State Route 11 open 365 days a year and equipped to handle 500,000 tons annually.

[2] Guernsey and Noble are home to the Muskingum Watershed Conservancy District that is currently in negotiations with Antero to drill beneath Seneca Lake – even though there is a substantial and vocal opposition in the region in the form of the Southeast Ohio Alliance to Save Our Water.

[3] Devon recently had to plug yet another disappointing well in Knox County along with two in Medina and Ashland Counties.

Table 1. Distribution of Ohio Utica Shale wells across companies (#, %), Date of First Permit (DFP), and the valuation of the publicly funded companies at their DFP at the close of business 1/22/2013.

				Company Valuation
Company	#	%	DFP^†	Share Price DFP	Share Price 1/22/2013	% Change
Anadarko	12	0.025	09/07/2011	69.88	79.49	1.138
Antero	11	0.023	03/23/2012
Atlas Noble	5	0.010	09/24/2012	31.14	30.315	0.974
Carrizo	2	0.004	07/26/2012	24.02	22.43	0.934
Chesapeake Energy	320	0.657	12/23/2010	25.61	18.73	0.731
Chevron Appalachia	2	0.004	07/31/2012	109.58	115.91	1.058
Consol Energy	19	0.039	06/17/2011	45.86	32.74	0.714
Devon Energy	13	0.027	11/02/2011	65.46	54.28	0.829
Eclipse Resources	1	0.002	12/21/2012	—	—	—
Enervest	16	0.033	06/30/2011	9.37	9.37	1.000
EQT	1	0.002	09/13/2012	57.76	60.43	1.046
Gulfport Energy	25	0.051	02/28/2012	35.49	42.3	1.192
Halcon	1	0.002	11/02/2012	5.003	5.815	1.162
Hall Drilling	1	0.002	09/17/2012
Hess Ohio	14	0.029	09/28/2010	53.63	58.87	1.098
HG Energy	16	0.033	09/14/2011	—	—	—
Hilcorp Energy	1	0.002	12/14/2012	—	—	—
Mountaineer Keystone	7	0.014	07/13/2012	—	—	—
PDC Energy	4	0.008	05/25/2012	25.67	39.8	1.550
R E Gas Development	8	0.016	03/19/2012	—	—	—
Sierra Resources	3	0.006	07/02/2012	—	—	—
SWEPI	1	0.002	06/20/2012	—	—	—
XTO Energy	4	0.008	04/09/2012	0.28	0.027	0.096
Sum	487				Average	0.966

^† DFP = Date of First Permit; “—“ not a publicly funded company.

A Rare Resource in WV Host Farms

January 25, 2013/by FracTracker Alliance

Fire on McDowell B well site near Wetzel County, WV. Burned for 9 days. (Sept. 2010) Wetzel County Action Group photo, copyright of Ed Wade, Jr.

By Samantha Malone, MPH, CPH – Manager of Science and Communications

While I am a full-time staff member of FracTracker Alliance, like many other people I wear several hats. One of these is as an academic researcher and doctorate student in environmental health at Pitt. My academic research focuses on unconventional natural gas extraction and its potential impacts on health. However, trying to conduct research in such a controversial arena can be frustrating – at best. Access to well pads, pipelines, or other industrial areas is limited for a variety of reasons in Pennsylvania. The opportunity to discuss concerns with workers and residents is stifled by fear, red tape, and/or the desire to protect precious assets. I don’t blame people for being cautious about with whom they speak, but I truly wish it were easier to get close to drilling activity in person, without putting anyone’s lives or jobs in danger. My lamenting on that very subject one day resulted in a colleague telling me about The West Virginia Host Farms Program, a grassroots project launched by volunteer home owners residing near drilling activity.

The purpose of the program is to provide environmental researchers and the media with the chance to conduct research or simply to photograph a well pad in person from the safety of an adjacent host farm. In short, the network of volunteers help to develop research partnerships to better understand the impacts of drilling. Diane Pitcock, the program’s administrator, recognized the need for this initiative a few years ago as a surface rights owner. In WV many people are in “split-estate” situations, meaning that most surface owners do not own the mineral rights beneath their land. This issue is compounded by the fact that most of the minerals in WV are owned by people that do not even live in state. As such, the people who own the surface rights feel that their homes and livelihoods in some cases are at risk – without the potential for financial reimbursement from the sale of the mineral rights below their land. The program aims to show people that unconventional drilling using hydraulic fracturing is not our grandfather’s gas extraction process, and it can’t be treated as such.

The project operates out of 14 West Virginia counties where drilling is most active. The network of volunteers has aided in academic research based out of several universities including Yale and Duke. The project has also hosted out of state reporters and even international photojournalists, people who possess platforms to advance the outreach and public education effort surrounding unconventional drilling. For example, Jolynn Minaar, who produced the documentary, Un*earthed, visited from South Africa in 2012 as part of her field work. Journalists from alternet.org and polidoc.com have been among the area’s many inquirers, as well. Even if you don’t plan on taking a tour of WV drilling sites, you can still benefit from the project’s extensive, online photo gallery (see image above).

Despite the controversial nature of shale gas drilling, the growing utilization of the program is surely a success story. Based on the WV Host Farms model, additional host farm networks are being coordinated in PA and OH as we speak. Engaging people who can volunteer 30-40 hours per week is no easy task, however. As more federal research like the US EPA’s hydraulic fracturing study begins to get off of the ground and into the well, perhaps even more people will support and recognize the value of such an integral, on-the-ground resource in the WV Host Farms Program. I know this researcher does!

For more information:

Diane L. Pitcock, Program Administrator
The WV Host Farms Program
P.O. Box 214, West Union, WV, 26456
304-873-3764
(e) wvhostfarms@yahoo.com
(w) www.wvhostfarms.org

Ohio’s Waste Not, Want Not!

January 23, 2013/by Ted Auch, PhD

By Ted Auch, PhD – Ohio Program Coordinator, FracTracker Alliance

The Akron Beacon Journal’s Bob Downing has just published an investigative report looking at the recent advisory put forth by the Ohio Environmental Protection Agency’s (OEPA) Division of Materials and Waste Management – along with the Ohio Department of Natural Resources (ODNR) Division of Oil and Gas Resources Management and the Ohio Department of Health (OHD) [1] Bureau of Radiation Protection – to all of Ohio’s municipal solid waste landfills. The advisory suggests that the landfills statewide – including 17 industrial residual waste, 40 municipal solid waste, 36 orphaned landfill facilities along with 64 transfer stations – should prepare to start receiving solid Utica and Marcellus shale drilling waste, “including drill cuttings, drilling muds, and frac sands,” (especially since Pennsylvania seems to be cracking down on some of its traditional drilling waste disposal practices). This new waste stream is in addition to the millions of barrels of potentially radioactive liquid waste already being trucked in from PA and WV [2] for deep well injection – and potentially shipped into Washington County, OH along the Ohio River [3]. This advisory is concerning because the same regulatory bodies have been conveying to other media outlets (e.g. The Columbus Dispatch) that such activities are strictly prohibited and that injection of Technologically Enhanced Naturally Occurring Radioactive Materials (TENORM) is “almost the perfect solution” compared to to landfill disposal.

If the advisory is correct, however, there are complications associated with using this disposal method relative to the waste’s viscosity, elevated levels of Total Dissolved Solids (TDSs), and/or concentrations of TENORM. Materials deemed suitable for municipal landfills must not exceed five picocuries per gram radium above background levels; however, early returns speak to the potential for shale wastewater to be:

… 3,609 times more radioactive than a federal safety limit for drinking water…[or] 300 times higher than a Nuclear Regulatory commission limit for industrial discharges to water. Learn more

Additionally, Marcellus brine may have salinity and radium levels three times that of traditional sandstone/limestone oil and gas wells of the Cambrian-Mississippian age. To put this Marcellus data in perspective, the range was 0-18 picocuries per gram with a median value of 2.46 picocuries per gram. Issues associated with brine disposal, however, are not new here in Ohio where researchers like The Ohio State University’s Wayne Pettyjohn reported excessive levels of freshwater chloride (35-320,000 mg/l) pollution in Morrow, Delaware, and Medina counties. These results prompted Pettyjohn to write “ground-water resources may be seriously and perhaps irreparably contaminated long before landowners are even aware that a problem exists” (Pettyjohn, 1971).

The solution proposed by the authors of this advisory is to use the US EPA’s “paint-filter test” bringing materials into compliance with Code of Federal Regulation (CFR) 264.313 and 265.313, which basically ended the practice of disposing of “liquid waste or waste containing free liquids” in 1985. The EPA’s Paint Filter Liquids Test (Method 9095B) is summarized as follows:

Material is placed in a paint filter [Mesh number 60 +/- 5% (fine meshed size)] [4]. If any portion of the material passes through and drops from the filter … the material is deemed to contain free liquids.

Figure 1. Ohio’s Registered Non-Hazardous & Hazardous Waste Landfills

This advisory is likely due to the backlash associated with injection well incidents, including the Youngstown earthquakes attributed by some scientists to the lubrication effect that injected materials have on geologic faults. Additionally, rural communities – and researchers – in Ohio’s Utica Shale basin are beginning to raise questions around the practice of spreading shale gas brine on roads as a substitute for salt in the winter and approved disposal method during the summer. Concerns revolve around elevated levels of chlorides in excess of 2-5 times EPA public drinking-water standards (Bair and Digel, 1990). Unfortunately, the OEPA advisory is ambiguous about post-disposal monitoring, suggesting only that:

… the landfill may need to perform monitoring of landfill systems, such as those related to leachate collection, to determine potential impacts to human health or the environment associated with these [TENORM] waste streams.

This inclusion of the word may rather than must further alienates communities already skeptical about the ability or will of ODNR – and now OEPA and ODH – to regulate and/or ensure adequate monitoring of unconventional natural gas drilling activities. If this advisory is any indication related activities will be spreading beyond the Utica Basin to the state’s 21 hazardous and 121 non-hazardous waste facilities (Figure 1), with specific focus on the 57 industrial residual and municipal solid waste facilities throughout the state (Figure 2 below). Such a regulatory development has serious ramifications for PA’s 40+ municipal waste landfills, 5 construction/demolition waste landfills, 3 residual waste landfills, and 6 resource recover/waste to energy facilities (see full PA stats) and the nation’s 1,908 Municipal Solid Waste (MSW) landfills as reported in BioCycle (2010).

As drilling intensifies in the Utica Shale, nearby states may be further burdened by the mounting waste stream. Communities once thought to be disconnected from hydraulic fracturing will be forced to debate the merits of allowing such waste in their communities, similar to the situation facing non-Utica Shale cities in Ohio. Such a discussion will be unavoidable given that 84% of the state’s waste treatment facilities are located outside what could liberally be referred to as the Ohio Shale play (Figure 2 Inset).

Figure 2. Ohio’s Registered Non-Hazardous Waste Facilities by Type (% of the state’s 121 facilities)

[1] The ODH co-signed the OEPA advisory even though its own radiation-protection chief Michael Snee told The Columbus Dispatch that “wastes trucked to landfills pose a bigger threat to groundwater” relative to injection wells only days prior to the OEPA advisories release last September.

[2] 53% of the 12.2 million barrels of brine injected into Ohio’s 160 injection wells came from these neighboring states (PA and WV).

[3] The company proposing the Washington County landfill in New Matamoras is confident that the shipping of shale gas drilling waste is safe because “barges ship hydrochloric acid,” as their VP of Appalachian business development told The Columbus Dispatch.

[4] Mesh number 60 is in the lower third of the US Sieve size distribution with an opening of 0.250 mm or 0.0098 in, with the smallest sieve size being No. 400 at 0.037 mm. or 0.0015 in. Learn more>

Lakes in Appalachian Ohio’s Utica Play: A Snapshot

January 16, 2013/by Ted Auch, PhD

By Ted Auch, PhD – Ohio Program Coordinator, FracTracker Alliance

Ohio’s southwest Appalachian counties – namely Carroll, Harrison, Guernsey, and Noble Counties – are home to two significant resources:

the state’s Utica Shale Triple Play – defined as the extraction of “natural gas and natural gas liquids…from the Marcellus Shale…Upper Devonian Shale…and the Utica Shale about 1,000 to 2,000 feet below the Marcellus” (Range Resources CEO, John Pinkerton); and
many of the state’s premier lakes, including Atwood in Carroll and Tuscarawas and Senacaville in Noble and Guernsey counties (Figure 1).

Senacaville and Atwood Lakes provide countless ecological and economic benefits (a.k.a., Ecosystem Services) at a regional, state, and local level contributing substantially to the state’s $3.6 billion wildlife tourism economy – a number that is increasing by 2% per year according to the US Fish & Wildlife Service’s Wildlife & Sport Fish Restoration Program (WSFR). Needless to say, the unconventional natural gas industry, which uses approximately 5 million gallons of fresh water per drilled well, relies heavily on Ohio’s lakes, wetlands, and to a lesser degree vernal pools – all of which are concentrated in the Utica Shale sweet spot counties on the Pennsylvania and West Virginia borders. These same counties are home to nearly all the state’s 440+ Utica Wells and more than half its 160+ injection wells (used for waste fluid disposal) (Figure 2).

Recently – for these and other environmental reasons – many in the area have grown concerned that Appalachian Ohio’s entire lake network is at risk due to current and proposed hydraulic fracturing and injection wells. In an attempt to assess these risks, we analyzed the proximity of current Utica drilled wells and Class II/III [1] wells to these two lakes specifically and to the state’s inland perennial water bodies. Atwood Lake is the lake with the most wells – either injection or fracturing – within a five-mile radius with 19 total (Figures 3 and 4). Meanwhile, M.J. Kirwan Reservoir, Guilford, and Senacaville Lakes each have 12 wells within a five-mile radius. The Cuyahoga River, Lake Mohawk, Tappan Lake, and Berlin Lake are the remaining water bodies currently within five miles of 10 or more wells. Four of these 19 wells are within two miles of Atwood and Guilford Lake’s shores. In the case of Tappan and Berlin Lakes, 3 wells sit within two miles (Figure 4). Interestingly Tappan Lake’s integrity from a water quality perspective has come under pressure thanks to the Chesapeake Energy Dodson well according to Charles Fisher, administrator of the Harrison County Health Department and organic farmer John M. Luber as “a stream…that empties into Tappan Lake becomes discolored during periods of rainfall or melting snow…the pollution did not happen until drilling operations began.”

In researching previous natural resource activities in the Utica Shale Basin, we found that in addition to the many shale and injection wells in the vicinity of these lakes, most are surrounded or sit atop abandoned, underground coal mines (AUCM). One example is Senacaville Lake, where Seneca Coal’s Klondyke, Rigby, and Walholding AUCMs are within feet of the lake’s western shore. In addition, Akron Coal, James W. Ellsworth, and Cambridge Collieries’ AUCMs just to the west of Senecaville Lake lie directly beneath two Utica and two Class III wells, bringing into question the reported discrete nature of these types of extraction procedures with respect to their proximity to primary freshwater sources. The same is true for Atwood Lake, with six AUCMs less than a mile of its eastern extent – previously owned by the Ohio Central Mining Co., Burns Coal Co., White Barr Coal Co., Marshall Harvey, etc. (Figure 5).

The possibility for the disruption of regular inputs/outputs of these lakes’ hydrological cycles – specifically from a water quality or quantity perspective – is growing. This is the case because the interconnectivity (Setbacks Press Release V 3) between Utica and injection wells is increasing and due to the fact that many AUCM exist in the very areas where hydraulic fracturing is currently being conducted or has been proposed. As a result, many community organizations and non-profit environmental groups are looking to construct and implement a comprehensive water monitoring protocol in Ohio’s Utica Basin. However, given funding limitations and the lack of data being made available from Ohio’s Department of Natural Resource (ODNR) and Ohio Environmental Protection Agency (OEPA), these groups are being forced to prioritize water bodies of concern. Our research suggests that some of the state’s largest and most economically beneficial lakes – namely Senacaville, Atwood, Guilford, Tappan, and Berlin – are at the top of the list of stressed and/or potentially susceptible inland waters.

Figure 1. Eastern Ohio Utica Shale Basin	Figure 2. Ohio lakes, wetlands, & vernal pools relative to Utica Shale & Class II/III injection wells	Figure 3. The distribution of Ohio’s Utica Shale and Class II/III Injection wells with respect the region’s primary perennial water bodies at 1, 3, and 5 mile intervals
Figure 4. Senecaville & Atwood Lake Region of Ohio’s shale geology, state parks, Utica Shale & Class II/III wells	Figure 5. Senecaville & Atwood Lake Region of Ohio’s shale geology, state parks, Utica Shale & Class II/III wells, plus Abandoned Underground Coal Mines	Note: Pink & Green Circles in Figures 4 and 5 represent a 1 mile radius around Utica Shale & Class III Wells.

1. From the ODNR: “Class II disposal wells include conventional brine injection wells, annular disposal wells, and enhanced oil recovery injection wells. Enhanced recovery injection wells are used to increase production of hydrocarbons from nearby producing wells… Additionally, DMRM also regulates Class III salt-solution mining wells, which are used to produce saturated brine from the salt deposits that occur from 2000 to 3500 feet below Ohio’s ground surface. The saturated brine is then used to make table salt, water softener salt, and salt blocks. All types of injection wells are designed to ensure safe injection into permitted formations.”

Inergy Seeks Approval for Gas Storage in Once Deemed Unusable Salt Caverns

January 15, 2013/by Guest Author

By Peter Mantius, Staff Writer, DCbureau.org

Key brine wells of interest at Salt Point on Seneca Lake (click to enlarge)

Key brine wells of interest, Salt Point on Seneca Lake

WATKINS GLEN, N.Y. — A Kansas City energy company is urging New York and federal regulators to disregard explicit warnings about the structural integrity of two salt caverns that it plans to use to store millions of barrels of highly-pressurized liquid propane and butane.

One cavern was plugged and abandoned 10 years ago after a consulting engineer from Louisiana concluded that its roof had collapsed in a minor earthquake. He deemed the rubble-filled cavity “unusable” for storage. It is now scheduled to hold 600,000 barrels of liquid butane.

The other cavern sits directly below a rock formation weakened by faults and characterized by “rock movement” and “intermittent collapse,” according to a 40-year-old academic study that cautioned that the cavern might be plagued by “difficulties in production arising from the geological environment.” That cavern is scheduled to hold 1.5 million barrels of liquid propane.

Both warnings were overstated, according to Inergy LP, which begins the fourth year of its bid to obtain an underground storage permit from the state Department of Environmental Conservation. “There is no reason to believe now that a roof cavern collapse did in fact occur,” Inergy wrote in a confidential 2010 report to the DEC.

The company claims its own tests show the caverns to be structurally sound and suitable for storing the liquefied petroleum gases, or LPG, under pressure of 1,000 pounds per square inch.

Public details of contrary opinions are scarce because Inergy, which bought the caverns from US Salt in 2008, has insisted that their history is a confidential “trade secret.”

Both the DEC and U.S. Environmental Protection Agency have generally accepted that argument and withheld or redacted many historical documents requested under state and federal Freedom of Information laws. However, the EPA did provide one document to DCBureau that disclosed the name of the Louisiana consulting engineer—Larry Sevenker. The DEC later released documents that summarized Sevenker’s 2001 analysis of “Well 58,” the entry point for the cavern now set to hold liquid butane.

Those records and recent interviews with Sevenker reveal the DEC’s concerns about Well 58 and other Seneca Lake salt caverns in early 2001 following a series of catastrophic gas explosions in Hutchinson, Kansas.Sevenker had made many trips to the Watkins Glen brine field to study wells and caverns for US Salt and predecessor companies before US Salt hired him to report on Well 58. Dug in 1992, the well was originally used to mine salt by extracting brine, but US Salt had plans to eventually use the cavern to store compressed natural gas.

However, Sevenker’s findings convinced US Salt’s local manager, Alan Parry, to plug and abandon the cavern surrounding the well, according to a once-confidential letter.

“Our intentions for this well are to plug and abandon on the advice of our consultant, Mr. Sevenker,” Parry wrote the DEC on May 24, 2001. “He clearly states in his report that the roof movement is unusual and renders the cavity unusable for continued development or storage.”

Days later, Kathleen Sanford, a DEC permit administrator, wrote to New York State Electric and Gas to request a report on the integrity of nearby salt caverns NYSEG was using to store compressed natural gas. In particular, she wanted to know if its storage caverns had been affected by the Well 58 roof collapse “that occurred sometime prior to Feb. 12, 2001.” She said her questions “are in response to the Hutchinson, Kansas, incident.” … Read more

2012 Violations per Well in Pennsylvania

January 9, 2013/by Matt Kelso, BA

Ever since the Pennsylvania Department of Environmental Protection (PADEP) first released violation data to FracTracker in October 2010, our viewers have wanted to know if there were any discernible patterns in the data. Since that time, the format of the data has changed, the data categories have changed, and the analyses at FracTracker have continued to evolve. The gold standard has always been some variation on the number of violations per well (VpW), which takes into account the reality that some operators have many more wells than others, so ranking by the total number of violations would show the largest operators in the worst light.

Even so, there are many ways to calculate the data. The first effort was violations per offending well, which more than anything measures how badly things go when they do go wrong. The difference between that and violations per drilled well is more than trivial semantics, because it’s designed to show how often things go wrong per attempt. This same analysis also includes violations per amount of gas produced, which is more of a cost/benefit analysis, which allows for the possibility that some violations may be “worth it” more so than others, if the well is an especially large producer.

But even violations per drilled well is less straght-forward than one might think. You could look at a given time frame, or the entire period of available data–either way you do it there will be some skew, whether because some activity is excluded, or because the data for drilled wells goes back three years further than violations data.

There is also the fact that some violation ID numbers appear more than one time on the compliance report, a fact that makes, “What is a violation?” something of an existential question. Summaries by PADEP show that the agency counts violations by the number of violation IDs that have been issued, although a close look at the data really does make it seem like related issues are sometimes lumped together into a single violation ID, although usually not.

And finally, there is the whole issue of whether we should even bother to count administrative violations, or if we should limit it to the environmental, health, and safety (EH&S) category. In February 2012, FracTracker argued to include administrative violations, as a closer look at those violations showed that it included real-world impacts, and not just a failure to dot i’s and cross t’s. A few months later, the University of Buffalo’s Shale Resources and Society Institute (SRSI) argued, among other things, to exclude them. FracTracker then created a Classify the Violation Quiz, which asks users to guess whether a given violation was classified as administrative or EH&S. This anonymous quiz was set up so that participants who got half of the questions correct would pass, but despite the fact that each question only has two possible answers, a large majority of respondents have failed. A few months later, the prime advocate for excluding administrative violations–the SRSI–was closed by the University of Buffalo amid a cloud of ethics concerns.

It is a shame that a simple metric like violations per well should require such a preamble, but at FracTracker, we strive to be completely open with what we have done with the data. In this case, I have looked at both the number of violation IDs issued as well as the raw number of appearances on the report. Administrative violations are rightfully included. Wells are included if their spud date was in 2012, and violations are included if their violation issue date was in 2012. This data has been summarized by drilling operator and by county. So let’s get to it:

Violations issued per well drilled for unconventional oil and gas operators in Pennsylvania in 2012.

The following line chart shows the violations per well as tabulated by unique violation ID numbers issued:

Violations per well by operator for unconventional wells in Pennsylvania in 2012. Violations tallied by unique violation ID numbers issued.

In the chart above, Penn Virginia and Enerplus seem to be particularly egregious in terms of violations per the number of wells drilled, but it should be pointed out that both operators had only one well drilled in 2012, reminding us of the importance of sample size. Here then is the same data, including only operators that drilled 10 or more wells in 2012:

Violations per well by operators with 10 or more unconventional wells drilled in Pennsylvania.

The state-wide average in this category is 0.50 violations per well drilled.

Let’s take a look at the data in terms of geography:

Violations per well by county for unconventional wells in Pennsylvania

As with operators, there is considerable variation in terms of violations per well between the various counties:

Violations per well by county for unconventional wells in Pennsylvania