Northwest Gas Association Annual Meeting June 6, 2013 Jill E. - PowerPoint PPT Presentation

take a closer look Northwest Gas Association Annual Meeting June 6, 2013 Jill E. Cooper Group Lead Environment Encana Oil & Gas (USA) Inc.

Encana Oil & Gas (USA) Inc. 1

Societal Expectations Work with Communities and Local Officials  Develop Good Working Relationships with State Regulators  Be Transparent and Seek Opportunities to Address Concerns  2

Location 3

“For every site there is an ideal use. Surface Footprint: For every use there is an ideal site. Understand And in between is analysis, planning & mitigation.” Bryan Whiteley, Piceance Construction, Encana, October 2009 DRILLING ENVIRONMENTAL LAND DESIGN CONSTRUCTION PRODUCTION INPUTS GATHERING COMPLETIONS

Surface Footprint: Assessment Technology Affects of Surface Footprint Source: National Petroleum Council, Prudent Development: Realizing the Potential of North America’s Abundant Natural Gas and Oil Resources

Resource Play Hub Extended Reach S-shaped Wells N S 1500’ 950’ 6000’ from Surface to Williams Fork Producing Horizon 4800’ Pay zone = 3000’ thick 6

Resource Play Hub Best Management Practices North Parachute Ranch, Colorado  Multiple wells drilled from one pad – Reduces surface impact and rig moves – 52 wells on one 4.2 acre pad  Three-phase gathering via pipeline – No tanks on location = no VOC emissions  Centralized production facility – Captures VOC’s – Treat and recycle over 90% of produced water  Fracturing water distribution via pipeline – Reduces truck trips >150,000/year  Closed-loop drilling system (all of Colorado) – Eliminates waste pit for drill cuttings 7

Surface Footprint: Measure and Communicate

NEPA Process Source: Marine Corps Base Hawaii

Source: US Fish and Wildlife Service

Endangered Species Act: Greater Sage Grouse

Air Quality: Assessment 13

Air Quality: Measurement

Air Quality: Measurement UT Air Study A Unique Partnership Sponsors were an environmental group and nine natural gas  producers – Environmental Defense Fund (EDF), Anadarko Petroleum Corporation, BG Group plc, Chevron, Encana Oil & Gas (USA) Inc., Pioneer Natural Resources Company, SWEPI LP (Shell), Southwestern Energy, Talisman Energy USA, and XTO Energy, an ExxonMobil subsidiary  Study team – Led by University of Texas and including URS and Aerodyne Research Scientific Advisory Panel  – Six university faculty with expertise in air quality and natural gas production

Air Quality: Measurement UT Air Study Scope Environmental Defense Fund, with different groups of companies and study teams, are engaged in projects addressing the rest of the supply chain for natural gas

Air Quality: Communications Natural Gas = Fewer Emissions

Groundwater Monitoring Colorado industry partnered  with Colorado Oil and Gas Conservation Commission Developed voluntary  groundwater monitoring program Resulted in state regulatory  program Example of cooperative  state and industry effort

Drilling Operations • Drilling rig drills to various depths per state/federal requirements for surface casing • Surface casing set (metal pipe cemented in place to protect groundwater) • Rig resumes drilling until total depth reached • Casing run in remainder of well and cemented in place • Four layers of protection of groundwater now exist

Protecting Fresh Water Aquifers  Casing and cement creates barriers between ground water and production of hydrocarbons Surrounding shale is a  barrier to hydraulic fracturing above the target sand or shale interval Thousands of feet of sand,  shale, sometime limestone between hydraulically fractured rock and fresh water aquifers  Wellbores are properly cased and checked before hydraulic frac process starts Frac jobs are monitored and  sometimes seismically mapped Generally, fluids pumped  into the rocks breakdown Not to Scale and flow back to surface with gas production

Operations: Completions  Well is “completed” and brought into production with different rig  Complete in minimum days possible  Hydraulic fracturing is conducted  Water use – Recycled water if feasible – Water storage and management is critical – Almost exclusively non-tributary water – Dispose of water as per permits and regulations Well then converted into a production well  Interim reclamation is conducted 

Piceance Basin – Williams Fork Formation Dept Formation Name 0 GR 200 h (ft)  Geology 3,000 Wasatch – Overpressure Reservoir 4,000 – 3000’ Vertical Section – Shale, Sandstone, Coal Deposition 5,000 – Avg Porosity 6% 6,000 – Avg Permeability 7µD Williams Fork – Avg Water Saturation 65% 7,000 – Frac Gradient 0.5-0.75 psi/ft  Fracture Characteristics 8,000 Rollins – Naturally Fractured Cozzett 9,000 Corcora e – High-Perm Formation Created When Iles n Sego Hydraulically Fractured 10,000 Mancos

What is Hydraulic Fracturing?  Method to create fractures in rock formations from a borehole (called stimulation) – Pumping fluid (slickwater) containing proppant at a rate high enough to ‘crack’ the rock  Used primarily in “tight” reservoirs to aid in the release of hydrocarbons to the wellbore not otherwise capable of production  It is a well understood process that has been used for over 60 years around the world in the oil and gas industry

Why Fracture a Well?  Increases rate at which fluids are produced – By increasing the surface area of the formation or reservoir exposed to the wellbore  Reasons for different permeabilities – Low permeable reservoirs – The rocks require hydraulic fracturing to produce at economical rates – Medium permeability reservoirs – Fractures accelerate recovery from wells – High permeability reservoirs – To http://www.energyindepth.org/hydraulic-frac-graphic.jpg bypass near wellbore drilling damage

Water Management 25

Materials Management

Materials and Waste: Product Assessment  Canadian Association of Petroleum Producers product assessment program – Hazard based product assessment and management program – Inventory of hydraulic fracturing fluid systems and products assssed before put into FracFocus – Use a health and environmental screening tool at an ingredient level – Operational review and management of risks identified in assessment – Product usage and procurement optimization

Source: National Petroleum Council, Prudent Development: Realizing the Potential of North America’s Renwables Nonrenewables Communicate Materials and Waste: Understand and Geothermal Hydroelectric Biofuels Biomass Solar Wind Nuclear Natural Gas Oil Coal SOURCE                        Transportation Air Emissions Stormwater Run-off Produced Water/Dewatering Hydrualic Fracturing Produced Water Abundant Natural Gas and Oil Resources Discarded Equipment (vehicles, tires,        batteries) EXTRACTION Equipment Maintenance (lube oils, filters,         antifreeze etc.)        Mine Tailings/Spoils Acid Mine Drainage Overburden    Drilling Solids (Mud, Sand, Formation Rock) Naturally Occuring Radioactive Materials     WASTE STREAMS (NORM)                           Spent Chemcials           General Wastes (workshop, office) Production Air Emissions     Transportation Air Emissions Ash PROCESSING & CONVERSION          Stormwater Run-off Cooling Water    Processing Water Equipment Maintenance (lube oils, filters,           antifreeze etc.)    Unused Byproducts    High-level Radioactive Materials Low-level Radioactive Materials          Spent Chemcials   Heavy Metals       General Wastes (workshop, office)

Federal Regulatory Tracking  CAA: NSPS Subpart  Clean Water Act OOOO  Effluent Limit Guidelines  Ozone regulations  Safe Drinking Water Act  Greenhouse gases  Wetlands 404  Toxic Release Inventory  BLM Onshore Orders  Toxic Substance Control  BLM Oil & Gas Regulation Act  ASTM efforts  Resource Conservation  Groundwater monitoring Recovery Act  Endangered Species Act  Migratory Bird Treaty Act 29

Thank you 30