Frack Check WV » best practices

“Best Fracking Practices” Demanded by Investors Controlling $1 Trillion Shares

Duane Nichols — Sat, 19 May 2012 15:33:00 +0000

: Interfaith Center on Corporate Responsibility

The Environment News Service has distributed the following story, which is excerpted below:

Institutional investors in the United States, Europe and Australia with nearly $1 trillion in assets under management have united to support a set of best practices for the hydraulic fracturing of shale rock to harvest natural gas.

Boston Common Asset Management, the Investor Environmental Health Network and the Interfaith Center on Corporate Responsibility announced Wednesday that 55 major investors are part of their growing coalition seeking industry action to reduce and disclose all chemicals used in fracking, among other practices.

Steven Heim, managing director and director of Boston Common’s environmental, social and governance research and shareholder engagement division, said, “Assuming that hydraulic fracturing is going to continue to be used in some form, investors need to have greater certainty in the marketplace as to industry practices and government regulation. Currently there is no such certainty and that is really why investors are speaking up.” In December 2011, two of the coalition organizations published “Extracting the Facts: An Investor Guide to Disclosing Risks from Hydraulic Fracturing Operations.”

The guide is organized around 12 core goals and supporting practices and indicators:

Manage risks transparently and at board level
Reduce surface footprint
Assure well integrity
Reduce and disclose all toxic chemicals
Protect water quality by rigorous monitoring
Minimize fresh water use
Prevent contamination from waste water
Minimize and disclose air emissions
Prevent contamination from solid waste and sludge residuals
Assure best in class contractor performance
Secure community consent
Disclose fines, penalties and litigation

Investors are seeking action from the industry due to the increasing level of uncertainty about the impacts of fracking on human health and the environment.

The Delaware River Basin Commission has a moratorium in place and has proposed regulations to protect water resources during the development and operation of natural gas projects. The Marcellus Shale formation underlies about 36 percent of the Delaware River Basin, which includes portions of New York, New Jersey, Pennsylvania and Delaware.

The province of Quebec, Canada has imposed a fracking moratorium. Outright bans in France and Bulgaria. Chevron’s exploration license in Bulgaria has been cancelled.

Investor concern is evident in the high levels of shareholder votes supporting requests for more fracking disclosure. In the 2010 and 2011 proxy seasons, 21 shareholder resolutions at 16 companies received strong support, averaging 30 percent votes on six resolutions going to votes in 2010, and an average 40 percent votes on five resolutions voted on in 2011.

Sister Nora Nash is director of corporate social responsibility with Sisters of St. Francis of Philadelphia, a member of the Interfaith Center on Corporate Responsibility, the other organization behind the guide. “Local communities have been seriously impacted by lifecycle of shale gas fracturing,” she told reporters. “What is not known is whether impacts are being adequately addressed by gas companies.” “We’ve heard all sorts of horror stories, but we’re still woefully under educated about this process. When adequate protections are not in place, communities on the front lines clearly suffer.”

See also the report in Scientific American entitled “The Future of Energy.”

Shale Drilling Operations Standards Developed by Industry Group

Duane Nichols — Mon, 14 May 2012 22:12:04 +0000

The Appalachian Shale Recommended Practices Group (ASRPG), a consortium of 11 of the Appalachian basin’s largest natural gas and oil producers, has prepared recommended standards and practices for exploration and production of natural gas and oil from Appalachian shales. ASRPG said its standards were consistent with the key recommendations of the US Secretary of Energy Advisory Board’s final report and the National Petroleum Council’s Prudent Development Report (OGJ Online, Sept. 16, 2011).

The standards could affect Ordovician, Silurian, and Devonian formations and potentially other formations. The Marcellus shale is a sedimentary rock formation deposited over 350 million years ago. It is a Middle Devonian formation consisting of black, low density, carbonaceous (organic rich) shale. The organic-rich Utica shale is of the Middle Ordovician formation being older, deeper, thicker and more extensive than the Marcellus shale.

The ASRPG plans to submit its recommended standards and practices document to state regulators and legislators in the Appalachian basin, the Interstate Oil & Gas Compact Commission, the State Review of Oil & Natural Gas Environmental Regulations, and various producer organizations.

Companies belonging to ASRPG are Anadarko Petroleum Corp., Cabot Oil & Gas Corp., Chesapeake Energy Corp., Chevron Corp., EQT Corp., Seneca Resources Corp., Shell Oil Co., Southwestern Energy Co., Talisman Energy Inc., WPX Energy Inc., and XTO Energy Inc.

The standards call for preoperational planning to provide communities with information and call upon operators to seek good landowner relations. Operators should evaluate potential water management options before the start of drilling. In addition, operators should consider use of alternative water sources and work with local water boards and other regulatory agencies to identify suitable water sources.

After potential wellpad sites are identified, operators should implement measures designed to reduce the operational footprint. Operators should prepare a regional spill and emergency response plan. Operators also should identify the existence of coal mines or coal seams, depths of useable groundwater, and shallow oil and gas wells within 1,000 ft of the surface location before drilling.

In selecting additives in hydraulic fracturing fluids, operators should strive to minimize the volume and concentration of additives listed on the Material Safety Data Sheet. Operators should design water transfer systems and implement measures to test the integrity of all high-pressure surface equipment.

The process of initiating production should be designed to minimize releases of produced gases and contain produced liquids. Thus, operators should prepare a management plan addressing handling and managing of liquid hydrocarbons when operating in crude, condensate, or wet-gas areas. Also, operators should use a corporate reporting standard, such as the International Petroleum Environmental Conservation Association, for reporting environmental performance metrics.

[Some of us believe that operating standards and best practices should be encoded as required regulations. In this way, the general public can have some confidence that the standards and practices are being followed. Also, in this way there is a so-called “level playing field” to prevent some operating companies from skirting around the standards to gain an unfair advantage over the other companies and over the land owners and the local community. Duane Nichols, www.frackcheckwv.net.]

The Natural Resources Defense Council (NRDC) has recently issued a new report evaluating the wastewater problem in the Marcellus Shale region. This paper analyzes the problem of wastewater generated from the fracking process of producing natural gas, particularly with regard to production in the Marcellus Shale. It shows that hydraulic fracking generates massive amounts of polluted wastewater that threaten the health of our drinking water supplies, rivers, streams, and groundwater; and, that federal and state regulations have not kept up with the dramatic growth in the practice and must be significantly strengthened to reduce the risks of fracking throughout the Marcellus region and elsewhere.

Chair of DOE Shale Gas Panel Presents Summary of Recommendations

Duane Nichols — Fri, 19 Aug 2011 14:56:38 +0000

: Fracking Protest Rally

In January, Energy Secretary Steven Chu formed a subcommittee of his advisory board on natural gas. The subcommittee, which John Deutch chaired, presented recommendations this week intended to give the public, regulators and industry a measurable way to monitor progress in reducing current and potential environmental impacts of shale-gas production, not just from fracking.

In an opinion column in the Washington Post, Deutch says that the proposed approach relies on increased measurement, public disclosure, and a commitment to continuous improvement in the development and environmental management of shale gas. Validated data on such indicators as the composition of produced water, background water quality, methane leakage to the atmosphere and well completion will meet key needs: helping regulators set and enforce limits, leading industry to more efficient operations, and providing the public with information on systematic trends to compare with individual reports of environmental damage.

The work of the Panel with state and federal regulators, industry representatives and the public convinces Deutch that two approaches will not work. The first is the view that existing and planned regulation adequately protects the public interest, and that the adverse environmental impacts are minor and compare favorably to energy sources such as coal. The second view is that prescriptive regulation is the only way to protect the public interest from a company’s profit and cost-cutting motives that can result in environmental damage.

There must be a shift to a data-driven process. says Deutch, that relies to a greater extent on performance-based standards, where a company certifies compliance and is assessed fines for violations at levels that vary with frequency and severity. For example, shale-gas well-cementing and completion regulations should not specify how a well should be completed but, rather, how a completed well should perform under specified tests. The subcommittee recommends that industry establish a national technical organization to encourage the development and diffusion of best practices — recognized improvements to techniques and methods based on measurement and field experience.

John Deutch, an institute professor at the Massachusetts Institute of Technology, chaired the energy secretary’s advisory board subcommittee on shale-gas production. He served as director of energy research and undersecretary of energy in the Carter administration.

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Clearly, a national technical organization formed by the gas industry to develop and promote “best practices” would be a positive step. However, calling on the industry to do its own regulation has not worked in the past; and, given the magnitude of the current problems and issues, will not work in the future. Strong regulations at the national and state levels are already very much overdue. Duane Nichols, August 19, 2011.

Unconventional Natural Gas: Horizontal Drilling & Hydrofracking, Here to Stay

Duane Nichols — Sun, 03 Apr 2011 19:51:44 +0000

Daniel Yergin, Chairman, Cambridge Energy Research Associates

A recent article in the Wall Street Journal by Daniel Yergin provides an historical and comprehensive view into fracking, horizontal drilling and so-called unconventional gas from diverse shale formations. What has become known as the “unconventional-natural-gas revolution” has turned a shortage into a large surplus. This revolution has arrived, moreover, at a moment when rising oil prices, sparked by turmoil in the Middle East, and the nuclear crisis in Japan have raised anxieties about energy security.

As late as 2000, shale gas was just 1% of American natural-gas supplies. Today, it is about 25% and could rise to 50% within two decades. Estimates of the entire natural-gas resource base, taking shale gas into account, are now as high as 2,500 trillion cubic feet, with a further 500 trillion cubic feet in Canada. That amounts to a more than 100-year supply of natural gas, which is used for everything from home heating and cooking to electric generation, industrial processes and petrochemical feedstocks.

Mitchell Energy’s light sand fracking, which breaks up hard shale rock, was combined with the horizontal drilling techniques of Devon Energy, starting in 2002. “At that time,” said Larry Nichols, the chairman of Devon, “absolutely no one believed that shale drilling worked, other than George Mitchell and us.”

In 2003, Devon Energy drilled 55 wells in the Barnett Shale of Texas, optimizing the combination of fracking and horizontal drilling. The know-how was applied across North America, in such shale formations as Haynesville, mostly in Louisiana; Eagle Ford in South Texas; Woodford in Oklahoma; Horn River and Montney in British Columbia; Duvernay in Alberta; and the “mighty Marcellus,” the huge formation that spreads from Pennsylvania and New York down into West Virginia.

In his energy speech this past week, President Barack Obama said, “Recent innovations have given us the opportunity to tap large reserves—perhaps a century’s worth—in the shale under our feet. The potential here is enormous.” And, in an era of heightened environmental awareness, any incident, even involving a single water well, can become a national event. As a recent analysis from the MIT Energy Initiative put it, “With over 20,000 shale wells drilled in the last 10 years, the environmental record of shale-gas development is for the most part a good one. Nevertheless, one must recognize…the damage that can be caused by just one poor operation.”

What many analysts expect to see is the emergence of a set of “best practices,” endorsed by both regulators and industry and tailored to the specific characteristics of the diverse basins across the country. For shale gas production to succeed on a massive scale, public confidence will be essential.

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—Mr. Daniel Yergin is chairman of IHS Cambridge Energy Research Associates, an energy research and consulting firm. His new book “The Quest” will be published in September. He received the Pulitzer Prize for his book “The Prize: The Epic Quest for Oil, Money and Power.”