A Letter to Otsego 2000 Challenging James Northrup's Comments

This letter was sent to Otsego 2000 in response to some comments that James Northrup made.

August 24, 2010

Otsego 2000

101 Main Street

PO Box 1130

Cooperstown, NY

13326

Dear Otsego 2000:

In response to Mr. James Northrup’s comments in the July 25^th essay “The Challenges of Horizontal Hydraulic Fracturing in New York State,” (and apparently also printed in Cooperstown Chamber of Commerce News) and also his essays posted on Otsego2000 website, I must disagree with many of his claims that, as a practicing scientist and engineer, I find to be either patently false, misleading or at the very least errors of omission. 

First, New York has regulated all oil and gas activities under Article 23 of the Environmental Conservation Law since 1963 – not just activities for “stripper wells” as Mr. Northrup suggests.

In 1992, the New York State Department of Environmental Conservation (DEC) issued its final Generic Environmental Impact Statement (GEIS), including gas drilling and development, solution salt mining, underground natural gas storage, geothermal development, stratigraphic wells, and brine disposal well rules and regulations.  The GEIS is still in force and addresses all known risks and impacts relating to oil and gas production, including hydraulic fracturing. And DEC is still continuing its additional two year long unprecedented comprehensive study of regulations for high volume hydraulic fracturing.

High volume hydraulic fracturing in horizontal wells employs essentially the same equipment, pressures and techniques as for vertical wells.  Because horizontal wells are much longer than vertical wells, more fluid is necessary.  However, the amount of water used during hydraulic fracturing is small compared to the amount of water available each year in the Northeast U.S. The amount of water used in natural gas extraction generally represents a small percentage of the total water-resource use in each shale gas area – typically between 0.1 and 0.8 percent of total water use by basin. Also the Susquehanna and Delaware River Commissions regulate water withdrawals in their watershed areas which cover most of the prospective territory.

Produced water that flows back to the surface is collected and either recycled or reused for use in subsequent future fracture jobs or disposed of according to stringent regulations.  NY will more than likely also require closed loop systems and the most active operators have already they said they will do so regardless.

As far as Mr. Northrup’s regrettable comparisons to a bomb, hydraulic fracturing merely exerts pressure on the column of water inside the well until the pressure exceeds the strength of the shale bedrock, causing a network of tiny fractures to form in the rock adjacent to the well.  These fractures are typically  a mm or so thick, just big enough to be propped open by the grains of fine sand, which are the primary ingredient—besides water—in the fracturing fluid. And fracture height is only a few hundred feet in vertical height at best! There is nothing felt or heard at the surface, and there certainly is nothing even close to an underground explosion.  Characterizations such as blasting fractures to the surface are ridiculous especially from someone with apparent prior experience in the drilling business.
 
Because hydraulic fracturing occurs thousands of feet below shallow freshwater aquifers, fractures are confined to the Marcellus Shale and neither shallow aquifers nor surface water are at risk of contamination as a result of hydraulic fracturing. Petroleum geologists universally agree that even pre-existing deep seated faults that Mr. Northrup speaks of as conduits offer no realistic pathway to the surface because of the overburden pressures that seal the faults at depth, overlying ductile NY salt layers that have sealing properties and mineralization along fault planes add to the sealing effect. If this were not true we would have not have been able to trap the methane in the first place! Because the stress fields in PA and NY do not permit vertical fracture generation above approximately 3000 feet (propagated horizontally at that point), drilling will be confined to deeper buried shales thus presenting no danger.  Biil Kappel of USGS in Ithaca and other NY university professors have already spoken authoritatively on this subject at a number of NY venues.

Mr. Northrup is also mistaken in saying that the shales are “harder” than the overlying and underlying formations thus concluding that fracture stimulation cannot be contained. Mr. Northrup not only used the improper term “hardness” but has the facts completely wrong. The pertinent terms when referring to fracture ease are elastic modulus and yield strength. Marcellus is confined above and below by limestones of greater elastic modulus than the shale and thus serve to contain fracture growth. Strata with high elastic modulus and yield strength serve as potential “fracture barriers” because they exhibit less tendency to deform and rupture with applied stress. “Hardness” is not even an appropriate term unless one narrows the term down to scratch, indentation or rebound harness.

Organic-rich deposits of the Appalachian Basin such as the Marcellus are defined by relatively large sonic travel times and low densities indicative of relatively low elastic stiffness (Plumb et al., 1991) and generally have significantly smaller elastic constants than either sandstone or limestone thus making shales far easier to deform and fracture. The Marcellus is therefore an especially good fracture stimulation candidate because it is easily fractured compared to the underlying confining Onondaga limestone and overlying other limestone formations with elastic moduli greater than the Marcellus shale. So in this respect Mr. Northrup has the facts completely backward. In fact the overlying Tully limestone is a well know cap rock for much of NY and PA gas storage facilities.

In any event fractures resulting from hydraulic fracturing are considered successful if they can even extend a few hundred feet vertically and not all of that can even be fully propped. The fracture height, lateral extents and complexity are easily mapped and well understood through real time wellbore micro-seismic monitoring during stimulation which may be a technology Mr. Northrup is not familiar with. There is no mystery to the fracture orientation and extent. Additionally, fracture stimulation pressures last only a few hours after which the wellbore becomes a pressure sink with all flow directed toward the wellbore and absolutely no path to the surface through the overlying strata.  Over the past 60 years, more than one million U.S. wells have been safely produced in the U.S. using this process.  

There is also no evidence of fractures connecting the target shale gas formations with the near surface strata. Regrettable methane incidents are simply a result of either drilling through near surface shales containing small amounts of methane or occasional poor surface casing cement jobs where methane from shallow gas zones behind poorly cemented surface casing causes short term problems until re-cemented. They are not a result of fracture connection between the deep shale formation and the surface strata through fractures. NY will also be addressing these cementing shortfalls by requiring fully cemented surface casing as well as either intermediate casing or production casing (or both) cemented to the surface as well as prohibiting any annular pressure build-up.  Radial cement bond logs that identify casing cement leaks will also be required in NY. As I hope you know, state regulators from 18 states have already testified that they have no evidence of hydrofracing causing any groundwater contamination anywhere at any time in their respective states. And the fact that shallow coal bed methane fracture stimulation, as studied by EPA in 2004, has not caused groundwater contamination should further ease your concerns about fracture stimulation a mile or more below the surface.

 Chemical additives comprise 0.5 percent of hydraulic fracturing fluids.  The other 99.5 percent is made up of water and sand.  The number of chemicals used is also far less than in the massive sand and gelled water fracture stimulations used in vertical wells.  The assertion that these additives and “oil” are found in water wells as a result of shale gas hydrofracking is a fabrication.  Yes, continually striving for the most inert ingredients is a worthwhile endeavor but for a variety of hydro-geological reasons explained in Chapter 5 of the SGEIS and quantified in Appendix 11, there is no realistic chance that these fluids could migrate upward through more than a mile of bedrock and contaminate shallow freshwater aquifers.

The claim that the proposed DEC regulations offer no protection for other bodies of the water in the Southern Tier also is inaccurate.  The NY DEC has broad authority to prohibit releases of regulated substances and wastes that could pollute surface water.  There are no environmental regulatory gaps in New York when it comes to hydraulic fracturing or protection of human health or the environment. Concern about possible sediment runoff from drilling pad and road construction was the reason for moratorium in the NYC drinking watershed because they do not currently filter water: it was not because of hydrofracturing. But with horizontal laterals now reaching well over a mile in length, surface pad spacing in approaching two miles apart on 1280 acre spacing which significantly reducing any surface impact. Even then storm water runoff due to surface disturbances is highly regulated in NY with a SPEDES permit required for surface disturbances over one acre.   

New York's environmental laws, regulations, guidance and policies are among the most stringent in the U.S and will be unparalleled once SGEIS is complete.  New York suspended Marcellus drilling for two years while DEC undertook the most comprehensive review of hydraulic fracturing ever conducted in its SGEIS process.  In the process, New York has developed a better understanding of shale gas extraction technology than any other state, is addressing all regulatory lapses in similar geologic environments and yet others continue to call for a moratorium until the EPA finishes its current study, which covers the same issues that New York State has already studied and reviewed so thoroughly.

Further, DEC’s permitting process for natural gas production is a regulatory function.  Most states entrust permitting to the agency with the most technical expertise to oversee and regulate the activity.  In NY, drilling permits are reviewed and enforced by engineers and geologists in the DEC's Department of Mineral Resources.  No other state agency has the technical capability to take over this function.  Not even the federal EPA has the specialized expertise or personnel to do this work on the ground in New York. And contrary to Mr. Northrup’s assertions, it is common practice for state regulatory agencies to also issue the permits as they are the state agencies with expertise: Pennsylvania’s DEP, Ohio’s DNR – Division of Mineral Resources, TX Railroad Commission- oil and gas division, and Oklahoma’s Corporation Commission to name just a few.

While people can have a differences of opinion about the fairness or desirability of compulsory integration, it is not unique to NY, it provides and orderly development process, offers a chance for all mineral owners to participate in a unitized well and does not require use of the mineral owners surface rights if he does not lease. In fact in NY, unitization still requires the permission of a majority of the landowners in the unit whereas in other states where integration/pooling exist, a majority is not a requirement.

Mr. Northrup also complains that NY does not have a severance tax on oil and gas, yet he does not mention the fact that there is an ad-valorem tax on oil and gas wells in NY which provides substantial revenue to our towns and schools. Such a tax is rare in other states. Nevertheless it is likely that NY will impose a severance tax at some point and increase permit fees substantially to help fund the necessary DEC personnel for proper oversight. There is little doubt that DEC will be funded directly from the oil and gas resources in some fashion.

While there are areas that could potentially use further study, drilling and production issues are best left to state agencies that already work tirelessly to protect our environment and specialize in these issues.

In conclusion, some of Mr. Northrup’s essays and videos may mislead your organization’s members with either inaccurate or missing information and also potentially damage your organization’s credibility. Perhaps you might consider posting opposing viewpoints from the many available petroleum engineering experts in the natural gas field? I will be glad to forward Mr. Northrup’s essays to several for their comments and input. In the meantime I appreciate the opportunity to help promote a broader public understanding of both the process of hydraulic fracturing and the many state and industry safeguards in place to ensure New York natural gas is developed in a safe and responsible way.

Sincerely,

Dr. Scott B. Cline

Scott Cline has spent more than 25 years working as geologist, geophysicist and petroleum engineer in exploration and production around the world, and currently resides in the Finger Lakes region of upstate NY. He has a BS in Geology from Penn State and an MS and PhD in petroleum engineering from the University of Oklahoma with an emphasis on reservoir engineering aspects of horizontal drilling in naturally fractured reservoirs.

Cc: Cooperstown Chamber of Commerce

31 Chestnut Street, Cooperstown, NY 13326