Shale Gas Primer 2009

U.S.
Department of Energy Office of Fossil Energy

N a t i o n a l E n e r g y Te c h n o l o g y L a b o r a t o r y
April 2009

DISCLAIMER
ThisreportwaspreparedasanaccountofworksponsoredbyanagencyoftheUnitedStates
Government.NeithertheUnitedStatesGovernmentnoranyagencythereof,noranyoftheir
employees,makesanywarranty,expressedorimplied,orassumesanylegalliabilityor
responsibilityfortheaccuracy,completeness,orusefulnessofanyinformation,apparatus,product,
orprocessdisclosed,orrepresentsthatitsusewouldnotinfringeuponprivatelyownedrights.
Referencehereintoanyspecificcommercialproduct,process,orservicebytradename,trademark,
manufacturer,orotherwisedoesnotnecessarilyconstituteorimplyitsendorsement,
recommendation,orfavoringbytheUnitedStatesGovernmentoranyagencythereof.Theviews
andopinionsofauthorsexpressedhereindonotnecessarilystateorreflectthoseoftheUnited
StatesGovernmentoranyagencythereof.
Modern Shale Gas

Development in the United States:
A Primer
Work Performed Under DE-FG26-04NT15455
Prepared for
U.S. Department of Energy
Office of Fossil Energy
and
National Energy Technology Laboratory
Prepared by
Ground Water Protection Council
Oklahoma City, OK 73142
405-516-4972
www.gwpc.org
and
ALL Consulting
Tulsa, OK 74119
918-382-7581
www.all-llc.com
April 2009
MODERNSHALEGASDEVELOPMENTINTHEUNITEDSTATES:APRIMER
ACKNOWLEDGMENTS
ThismaterialisbaseduponworksupportedbytheU.S.DepartmentofEnergy,OfficeofFossil
Energy,NationalEnergyTechnologyLaboratory(NETL)underAwardNumberDEFG26
04NT15455.Mr.RobertVagnettiandMs.SandraMcSurdy,NETLProjectManagers,provided
oversightandtechnicalguidance.ThisstudywasdirectedbytheGroundWaterProtectionCouncil
(GWPC)withALLConsultingservingasleadresearcher.
GWPCandALLConsultingwishtoextendtheirappreciationtothefollowingfederal,state,industry,
andeducationalinstitutionswhichhelpedwithnumerousdatasources,datacollectionand
technologyreviewsthatwerecriticaltothesuccessofthisproject.Additionally,theextratimeand
energythatindividualsprovidedinreviewingandinbroadeningourunderstandingoftheissuesat
handisrespectfullyacknowledged.
Theauthorswishtospecificallyacknowledgethehelpandsupportofthefollowingentities:
ArkansasOilandGasCommission,LouisianaDepartmentofNaturalResources,Michigan
DepartmentofEnvironmentalQualityOfficeofGeologicalSurvey,MontanaBoardofOilandGas
Conservation,MontanaDepartmentofNaturalResources,NewYorkStateDepartmentof
EnvironmentalConservation,OhioDepartmentofNaturalResourcesDivisionofMineralResources
Management,OklahomaCorporationCommission,PennsylvaniaDepartmentofEnvironmental
Protection,RailroadCommissionofTexas,StateofTennessee,StateUniversityofNewYorkat
Fredonia,WestVirginiaDepartmentofEnvironmentalProtection,EnergyInformation
Administration,U.S.EnvironmentalProtectionAgency,StateReviewofOilandNaturalGas
EnvironmentalRegulation,Inc.(STRONGER),BPAmericaProductionCo.,ChesapeakeEnergyCorp.,
DevonEnergyCorp.,EastResources,Inc.,FortunaEnergyInc.,IndependentPetroleumAssociation
ofAmerica,SchlumbergerLtd.,UniversalWellServicesInc.,andWeatherfordInternationalLtd.,

FOREWORD
ThisPrimeronModernShaleGasDevelopmentintheUnitedStateswascommissionedthroughtheGround
WaterProtectionCouncil(GWPC).Itisanefforttoprovidesoundtechnicalinformationonandadditional
insightintotherelationshipbetweentodaysfastestgrowing,andsometimescontroversial,naturalgas
resourcedevelopmentactivity,andenvironmentalprotection,especiallywaterresourcemanagement.The
GWPCisthenationalassociationofstategroundwaterandundergroundinjectionagencieswhosemissionis
topromotetheprotectionandconservationofgroundwaterresourcesforallbeneficialuses.Onegoalofthe
GWPCistoprovideaforumforstakeholdercommunicationonimportantcurrentissuestofoster
developmentofsoundpolicyandregulationthatisbasedonsoundscience.ThisPrimerispresentedinthe
spiritoffurtheringthatgoal.
Waterandenergyaretwoofthemostbasicneedsofsociety.Ouruseofeachvitalresourceisreliantonand
affectstheavailabilityoftheother.Waterisneededtoproduceenergyandenergyisnecessarytomake
wateravailableforuse.Asourpopulationgrows,thedemandsforbothresourceswillonlyincrease.Smart
developmentofenergyresourceswillidentify,consider,andminimizepotentialimpactstowaterresources.
Naturalgas,particularlyshalegas,isanabundantU.S.energyresourcethatwillbevitaltomeetingfuture
energydemandandtoenablingthenationtotransitiontogreaterrelianceonrenewableenergysources.
Shalegasdevelopmentbothrequiressignificantamountsofwaterandisconductedinproximitytovaluable
surfaceandgroundwater.Hence,itisimportanttoreconciletheconcurrentandrelateddemandsforlocal
andregionalwaterresources,whetherfordrinkingwater,wildlifehabitat,recreation,agriculture,industrial
orotheruses.
BecauseshalegasdevelopmentintheUnitedStatesisoccurringinareasthathavenotpreviously
experiencedoilandgasproduction,theGWPChasrecognizedaneedforcredible,factualinformationon
shalegasresources,technologiesfordevelopingtheseresources,theregulatoryframeworkunderwhich
developmenttakesplace,andthepracticesusedtomitigatepotentialimpactsontheenvironmentandnearby
communities.WhiletheGWPCsmissionprimarilyconcernswaterresources,thisPrimeralsoaddressesnon
waterissuesthatmaybeofinteresttocitizens,governmentofficials,watersupplyanduseprofessionals,and
otherinterestedparties.
Eachstatehaslawsandregulationstoensurethewiseuseofitsnaturalresourcesandtoprotectthe
environment.TheGWPChasconductedaseparatestudytosummarizestateoilandgasprogram
requirementsthataredesignedtoprotectwaterresources.Thesetwostudiescomplementoneotherand
togetherprovideabodyofinformationthatcanserveasabasisforfactbaseddialogueonhowshalegas
developmentcanproceedinanenvironmentallyresponsiblemannerundertheauspicesofstateregulatory
programs.
ThisShaleGasPrimerwasintendedtobeanaccuratedepictionofcurrentfactorsanddoesnotrepresentthe
viewofanyindividualstate.Knowledgeaboutshalegasdevelopmentwillcontinuetoevolve.TheGWPC
welcomesinsightsthatreadersmayhaveaboutthePrimerandtherelationshipofshalegasdevelopmentto
waterresources.

ScottKell,President,
GroundWaterProtectionCouncil

THISPAGEINTENTIONALLYLEFTBLANK
EXECUTIVESUMMARY
Naturalgasproductionfromhydrocarbonrichshaleformations,knownasshalegas,isoneofthe
mostrapidlyexpandingtrendsinonshoredomesticoilandgasexplorationandproductiontoday.
Insomeareas,thishasincludedbringingdrillingandproductiontoregionsofthecountrythathave
seenlittleornoactivityinthepast.Newoilandgasdevelopmentsbringchangetothe
environmentalandsocioeconomiclandscape,particularlyinthoseareaswheregasdevelopmentis
anewactivity.Withthesechangeshavecomequestionsaboutthenatureofshalegasdevelopment,
thepotentialenvironmentalimpacts,andtheabilityofthecurrentregulatorystructuretodealwith
thisdevelopment.Regulators,policymakers,andthepublicneedanobjectivesourceof
informationonwhichtobaseanswerstothesequestionsanddecisionsabouthowtomanagethe
challengesthatmayaccompanyshalegasdevelopment.
NaturalgasplaysakeyroleinmeetingU.S.energydemands.Naturalgas,coalandoilsupplyabout
85%ofthenationsenergy,withnaturalgassupplyingabout22%ofthetotal.Thepercent
contributionofnaturalgastotheU.S.energysupplyisexpectedtoremainfairlyconstantforthe
next20years.
TheUnitedStateshasabundantnaturalgasresources.TheEnergyInformationAdministration
estimatesthattheU.S.hasmorethan1,744trillioncubicfeet(tcf)oftechnicallyrecoverablenatural
gas,including211tcfofprovedreserves(thediscovered,economicallyrecoverablefractionofthe
originalgasinplace).Technicallyrecoverableunconventionalgas(shalegas,tightsands,and
coalbedmethane)accountsfor60%oftheonshorerecoverableresource.AttheU.S.production
ratesfor2007,about19.3tcf,thecurrentrecoverableresourceestimateprovidesenoughnatural
gastosupplytheU.S.forthenext90years.Separateestimatesoftheshalegasresourceextendthis
supplyto116years.
Naturalgasuseisdistributedacrossseveralsectorsoftheeconomy.Itisanimportantenergy
sourcefortheindustrial,commercialandelectricalgenerationsectors,andalsoservesavitalrole
inresidentialheating.Althoughforecastsvaryintheiroutlookforfuturedemandfornaturalgas,
theyallhaveonethingincommon:naturalgaswillcontinuetoplayasignificantroleintheU.S.
energypictureforsometimetocome.
Thelower48stateshaveawidedistributionofhighlyorganicshalescontainingvastresourcesof
naturalgas.Already,thefledglingBarnettShaleplayinTexasproduces6%ofallnaturalgas
producedinthelower48States.Threefactorshavecometogetherinrecentyearstomakeshale
gasproductioneconomicallyviable:1)advancesinhorizontaldrilling,2)advancesinhydraulic
fracturing,and,perhapsmostimportantly,3)rapidincreasesinnaturalgaspricesinthelast
severalyearsasaresultofsignificantsupplyanddemandpressures.Analystshaveestimatedthat
by2011mostnewreservesgrowth(50%to60%,orapproximately3bcf/day)willcomefrom
unconventionalshalegasreservoirs.Thetotalrecoverablegasresourcesinfournewshalegas
plays(theHaynesville,Fayetteville,Marcellus,andWoodford)maybeover550tcf.Totalannual
productionvolumesof3to4tcfmaybesustainablefordecades.Thispotentialforproductionin
theknownonshoreshalebasins,coupledwithotherunconventionalgasplays,ispredictedto
contributesignificantlytotheU.S.sdomesticenergyoutlook.
ES-1
Shalegasispresentacrossmuchofthelower48States.ExhibitES1showstheapproximate
locationsofcurrentproducinggasshalesandprospectiveshales.Themostactiveshalestodateare
theBarnettShale,theHaynesville/BossierShale,theAntrimShale,theFayettevilleShale,the
MarcellusShale,andtheNewAlbanyShale.Eachofthesegasshalebasinsisdifferentandeachhas
auniquesetofexplorationcriteriaandoperationalchallenges.Becauseofthesedifferences,the
developmentofshalegasresourcesineachoftheseareasfacespotentiallyuniqueopportunities
andchallenges.
EXHIBITES1:UNITEDSTATESSHALEBASINS
ThedevelopmentandproductionofoilandgasintheU.S.,includingshalegas,areregulatedunder
acomplexsetoffederal,state,andlocallawsthataddresseveryaspectofexplorationand
operation.Allofthelaws,regulations,andpermitsthatapplytoconventionaloilandgas
explorationandproductionactivitiesalsoapplytoshalegasdevelopment.TheU.S.Environmental
ProtectionAgencyadministersmostofthefederallaws,althoughdevelopmentonfederallyowned
landismanagedprimarilybytheBureauofLandManagement(partoftheDepartmentofthe
Interior)andtheU.S.ForestService(partoftheDepartmentofAgriculture).Inaddition,eachstate
inwhichoilandgasisproducedhasoneormoreregulatoryagenciesthatpermitwells,including
theirdesign,location,spacing,operation,andabandonment,aswellasenvironmentalactivitiesand
ES-2
discharges,includingwatermanagementanddisposal,wastemanagementanddisposal,air
emissions,undergroundinjection,wildlifeimpacts,surfacedisturbance,andworkerhealthand
safety.Manyofthefederallawsareimplementedbythestatesunderagreementsandplans
approvedbytheappropriatefederalagencies.
Aseriesoffederallawsgovernsmostenvironmentalaspectsofshalegasdevelopment.For
example,theCleanWaterActregulatessurfacedischargesofwaterassociatedwithshalegas
drillingandproduction,aswellasstormwaterrunofffromproductionsites.TheSafeDrinking
WaterActregulatestheundergroundinjectionoffluidsfromshalegasactivities.TheCleanAirAct
limitsairemissionsfromengines,gasprocessingequipment,andothersourcesassociatedwith
drillingandproduction.TheNationalEnvironmentalPolicyAct(NEPA)requiresthatexploration
andproductiononfederallandsbethoroughlyanalyzedforenvironmentalimpacts.Mostofthese
federallawshaveprovisionsforgrantingprimacytothestates(i.e.,stateagenciesimplementthe
programswithfederaloversight).
Stateagenciesnotonlyimplementandenforcefederallaws;theyalsohavetheirownsetsofstate
lawstoadminister.Thestateshavebroadpowerstoregulate,permit,andenforceallshalegas
developmentactivitiesthedrillingandfractureofthewell,productionoperations,management
anddisposalofwastes,andabandonmentandpluggingofthewell.Stateregulationofthe
environmentalpracticesrelatedtoshalegasdevelopment,usuallywithfederaloversight,canmore
effectivelyaddresstheregionalandstatespecificcharacteroftheactivities,comparedtoonesize
fitsallregulationatthefederallevel.Someofthesespecificfactorsinclude:geology,hydrology,
climate,topography,industrycharacteristics,developmenthistory,statelegalstructures,
populationdensity,andlocaleconomics.Statelawsoftenaddadditionallevelsofenvironmental
protectionandrequirements.Also,severalstateshavetheirownversionsofthefederalNEPAlaw,
requiringenvironmentalassessmentsandreviewsatthestatelevelandextendingthosereviews
beyondfederallandstostateandprivatelands.
Akeyelementintheemergenceofshalegasproductionhasbeentherefinementofcosteffective
horizontaldrillingandhydraulicfracturingtechnologies.Thesetwoprocesses,alongwiththe
implementationofprotectiveenvironmentalmanagementpractices,haveallowedshalegas
developmenttomoveintoareasthatpreviouslywouldhavebeeninaccessible.Accordingly,itis
importanttounderstandthetechnologiesandpracticesemployedbytheindustryandtheirability
topreventorminimizethepotentialeffectsofshalegasdevelopmentonhumanhealthandthe
environmentandonthequalityoflifeinthecommunitiesinwhichshalegasproductionislocated.
Modernshalegasdevelopmentisatechnologicallydrivenprocessfortheproductionofnaturalgas
resources.Currently,thedrillingandcompletionofshalegaswellsincludesbothverticaland
horizontalwells.Inbothkindsofwells,casingandcementareinstalledtoprotectfreshand
treatablewateraquifers.Theemergingshalegasbasinsareexpectedtofollowatrendsimilarto
theBarnettShaleplaywithincreasingnumbersofhorizontalwellsastheplaysmature.Shalegas
operatorsareincreasinglyrelyingonhorizontalwellcompletionstooptimizerecoveryandwell
economics.Horizontaldrillingprovidesmoreexposuretoaformationthandoesaverticalwell.
Thisincreaseinreservoirexposurecreatesanumberofadvantagesoververticalwellsdrilling.Six
toeighthorizontalwellsdrilledfromonlyonewellpadcanaccessthesamereservoirvolumeas
sixteenverticalwells.Usingmultiwellpadscanalsosignificantlyreducetheoverallnumberof
ES-3
wellpads,accessroads,pipelineroutes,andproductionfacilitiesrequired,thusminimizinghabitat
disturbance,impactstothepublic,andtheoverallenvironmentalfootprint.
Theothertechnologicalkeytotheeconomicrecoveryofshalegasishydraulicfracturing,which
involvesthepumpingofafracturingfluidunderhighpressureintoashaleformationtogenerate
fracturesorcracksinthetargetrockformation.Thisallowsthenaturalgastoflowoutoftheshale
tothewellineconomicquantities.Groundwaterisprotectedduringtheshalegasfracturing
processbyacombinationofthecasingandcementthatisinstalledwhenthewellisdrilledandthe
thousandsoffeetofrockbetweenthefracturezoneandanyfreshortreatableaquifers.Forshale
gasdevelopment,fracturefluidsareprimarilywaterbasedfluidsmixedwithadditivesthathelpthe
watertocarrysandproppantintothefractures.Waterandsandmakeupover98%ofthefracture
fluid,withtherestconsistingofvariouschemicaladditivesthatimprovetheeffectivenessofthe
fracturejob.Eachhydraulicfracturetreatmentisahighlycontrolledprocessdesignedtothe
specificconditionsofthetargetformation.
Theamountofwaterneededtodrillandfractureahorizontalshalegaswellgenerallyrangesfrom
about2millionto4milliongallons,dependingonthebasinandformationcharacteristics.While
thesevolumesmayseemverylarge,theyaresmallbycomparisontosomeotherusesofwater,such
asagriculture,electricpowergeneration,andmunicipalities,andgenerallyrepresentasmall
percentageofthetotalwaterresourceuseineachshalegasarea.Calculationsindicatethatwater
useforshalegasdevelopmentwillrangefromlessthan0.1%to0.8%oftotalwaterusebybasin.
Becausethedevelopmentofshalegasisnewinsomeareas,thesewaterneedsmaystillchallenge
suppliesandinfrastructure.Asoperatorslooktodevelopnewshalegasplays,communicationwith
localwaterplanningagencies,stateagencies,andregionalwaterbasincommissionscanhelp
operatorsandcommunitiestocoexistandeffectivelymanagelocalwaterresources.Onekeytothe
successfuldevelopmentofshalegasistheidentificationofwatersuppliescapableofmeetingthe
needsofadevelopmentcompanyfordrillingandfracturingwaterwithoutinterferingwith
communityneeds.Whileavarietyofoptionsexist,theconditionsofobtainingwaterarecomplex
andvarybyregion.
Afterthedrillingandfracturingofthewellarecompleted,waterisproducedalongwiththenatural
gas.Someofthiswaterisreturnedfracturefluidandsomeisnaturalformationwater.Regardless
ofthesource,theseproducedwatersthatmovebackthroughthewellheadwiththegasrepresenta
streamthatmustbemanaged.States,localgovernments,andshalegasoperatorsseektomanage
producedwaterinawaythatprotectssurfaceandgroundwaterresourcesand,ifpossible,reduces
futuredemandsforfreshwater.BypursuingthepollutionpreventionhierarchyofReduce,Reuse,
andRecyclethesegroupsareexaminingbothtraditionalandinnovativeapproachestomanaging
shalegasproducedwater.Thiswateriscurrentlymanagedthroughavarietyofmechanisms,
includingundergroundinjection,treatmentanddischarge,andrecycling.Newwatertreatment
technologiesandnewapplicationsofexistingtechnologiesarebeingdevelopedandusedtotreat
shalegasproducedwaterforreuseinavarietyofapplications.Thisallowsshalegasassociated
producedwatertobeviewedasapotentialresourceinitsownright.
Somesoilsandgeologicformationscontainlowlevelsofnaturallyoccurringradioactivematerial
(NORM).WhenNORMisbroughttothesurfaceduringshalegasdrillingandproduction
operations,itremainsintherockpiecesofthedrillcuttings,remainsinsolutionwithproduced
ES-4
water,or,undercertainconditions,precipitatesoutinscalesorsludges.Theradiationfromthis
NORMisweakandcannotpenetratedensematerialssuchasthesteelusedinpipesandtanks.
Becausethegeneralpublicdoesnotcomeintocontactwithgasfieldequipmentforextended
periods,thereisverylittleexposureriskfromgasfieldNORM.Toprotectgasfieldworkers,OSHA
requiresemployerstoevaluateradiationhazards,postcautionsignsandprovidepersonal
protectionequipmentwhenradiationdosescouldexceedregulatorystandards.Although
regulationsvarybystate,ingeneral,ifNORMconcentrationsarelessthanregulatorystandards,
operatorsareallowedtodisposeofthematerialbymethodsapprovedforstandardgasfieldwaste.
Conversely,ifNORMconcentrationsareaboveregulatorylimits,thematerialmustbedisposedofat
alicensedfacility.Theseregulations,standards,andpracticesensurethatshalegasoperations
presentnegligiblerisktothegeneralpublicandtoworkerswithrespecttopotentialNORM
exposure.
Althoughnaturalgasoffersanumberofenvironmentalbenefitsoverothersourcesofenergy,
particularlyotherfossilfuels,someairemissionscommonlyoccurduringexplorationand
productionactivities.EmissionsmayincludeNOx,volatileorganiccompounds,particulatematter,
SO2,andmethane.EPAsetsstandards,monitorstheambientairacrosstheU.S.,andhasanactive
enforcementprogramtocontrolairemissionsfromallsources,includingtheshalegasindustry.
Gasfieldemissionsarecontrolledandminimizedthroughacombinationofgovernmentregulation
andvoluntaryavoidance,minimization,andmitigationstrategies.
Theprimarydifferencesbetweenmodernshalegasdevelopmentandconventionalnaturalgas
developmentaretheextensiveusesofhorizontaldrillingandhighvolumehydraulicfracturing.
Theuseofhorizontaldrillinghasnotintroducedanynewenvironmentalconcerns.Infact,the
reducednumberofhorizontalwellsneededcoupledwiththeabilitytodrillmultiplewellsfroma
singlepadhassignificantlyreducedsurfacedisturbancesandassociatedimpactstowildlife,dust,
noise,andtraffic.Whereshalegasdevelopmenthasintersectedwithurbanandindustrialsettings,
regulatorsandindustryhavedevelopedspecialpracticestoalleviatenuisanceimpacts,impactsto
sensitiveenvironmentalresources,andinterferencewithexistingbusinesses.Hydraulicfracturing
hasbeenakeytechnologyinmakingshalegasanaffordableadditiontotheNationsenergysupply,
andthetechnologyhasprovedtobeaneffectivestimulationtechnique.Whilesomechallenges
existwithwateravailabilityandwatermanagement,innovativeregionalsolutionsareemerging
thatallowshalegasdevelopmenttocontinuewhileensuringthatthewaterneedsofotherusers
arenotaffectedandthatsurfaceandgroundwaterqualityisprotected.Takentogether,stateand
federalrequirementsalongwiththetechnologiesandpracticesdevelopedbyindustryserveto
reduceenvironmentalimpactsfromshalegasoperations.
ES-5

TABLEOFCONTENTS
TableofContents....................................................................................................................................................i
ListofExhibits......................................................................................................................................................iii
INTRODUCTION......................................................................................................................................................1
THEIMPORTANCEOFSHALEGAS....................................................................................................................3
TheRoleofNaturalGasintheUnitedStatesEnergyPortfolio.......................................................................3
TheAdvantagesofNaturalGas.....................................................................................................................................5
NaturalGasBasics..............................................................................................................................................................6
UnconventionalGas...........................................................................................................................................................7
TheRoleofShaleGasinUnconventionalGas.........................................................................................................8
LookingForward...............................................................................................................................................................10
SHALEGASDEVELOPMENTINTHEUNITEDSTATES.............................................................................13
ShaleGasGeology..........................................................................................................................................................14
SourcesofNaturalGas....................................................................................................................................................16
ShaleGasintheUnitedStates.....................................................................................................................................16
TheBarnettShale..................................................................................................................................................................18
TheFayettevilleShale..........................................................................................................................................................19
TheHaynesvilleShale..........................................................................................................................................................20
TheMarcellusShale.............................................................................................................................................................21
TheWoodfordShale.............................................................................................................................................................22
TheAntrimShale...................................................................................................................................................................23
TheNewAlbanyShale.........................................................................................................................................................24
REGULATORYFRAMEWORK...........................................................................................................................25
FederalEnvironmentalLawsGoverningShaleGasDevelopment...............................................................25
StateRegulation................................................................................................................................................................25
LocalRegulation................................................................................................................................................................27
RegulationofImpactsonWaterQuality.................................................................................................................29
CleanWaterAct.....................................................................................................................................................................29
SafeDrinkingWaterAct....................................................................................................................................................32
OilPollutionActof1990SpillPreventionControlandCountermeasure................................................33
StateRegulationsandRegionalCooperation..........................................................................................................35
RegulationofImpactsonAirQuality........................................................................................................................35
CleanAirAct............................................................................................................................................................................35
AirQualityRegulations.......................................................................................................................................................36
AirPermits................................................................................................................................................................................36
RegulationofImpactstoLand.....................................................................................................................................37
ResourceConservationandRecoveryAct(RCRA).................................................................................................37
EndangeredSpeciesAct......................................................................................................................................................38
StateEndangeredSpeciesProtections........................................................................................................................39
OilandGasOperationsonPublicLands..................................................................................................................39
FederalLands..........................................................................................................................................................................39
StateLands...............................................................................................................................................................................40
OtherFederalLawsandRequirementsthatProtecttheEnvironment......................................................40
ComprehensiveEnvironmentalResponse,Compensation,andLiabilityAct.............................................40
EmergencyPlanningandCommunityRighttoKnowAct.................................................................................41
OccupationalSafetyandHealthAct.............................................................................................................................42
Summary..............................................................................................................................................................................42
ENVIRONMENTALCONSIDERATIONS..........................................................................................................43
HorizontalWells................................................................................................................................................................46
ReducingSurfaceDisturbance........................................................................................................................................47
ReducingWildlifeImpacts................................................................................................................................................48
ReducingCommunityImpacts.........................................................................................................................................49
ProtectingGroundwater:CasingandCementingPrograms...........................................................................51
HydraulicFracturing.......................................................................................................................................................56
FractureDesign......................................................................................................................................................................56
FracturingProcess................................................................................................................................................................58
FracturingFluidsandAdditives.....................................................................................................................................61
WaterAvailability.............................................................................................................................................................64
WaterManagement..........................................................................................................................................................66
NaturallyOccurringRadioactiveMaterial(NORM)............................................................................................70
AirQuality............................................................................................................................................................................71
SourcesofAirEmissions.....................................................................................................................................................72
CompositionofAirEmissions...........................................................................................................................................72
TechnologicalControlsandPractices..........................................................................................................................74
Summary..............................................................................................................................................................................76
AcronymsandAbbreviations.........................................................................................................................79
DEFINITIONS........................................................................................................................................................81
ENDNOTES.............................................................................................................................................................85
ii

LISTOFEXHIBITS
EXHIBIT
1. UnitedStatesEnergyConsumptionbyFuel(2007).......................................................................3
2. NaturalGasUsebySector.........................................................................................................................4
3. ComparisonofProduction,ConsumptionandImportTrendsfor
NaturalGasintheUnitedStates.............................................................................................................5
4. CombustionEmissions...............................................................................................................................5
5. TypicalCompositionofNaturalGas......................................................................................................6
6. NaturalGasProductionbySource.........................................................................................................7
7. UnitedStatesShaleGasBasins................................................................................................................8
8. UnitedStatesUnconventionalGasOutlook.......................................................................................9
9. TrendsinShaleGasProduction...........................................................................................................10
10. MarcellusShaleOutcrop.........................................................................................................................14
11. ComparisonofDatafortheGasShalesintheUnitedStates....................................................17
12. StratigraphyoftheBarnettShale........................................................................................................18
13. BarnettShaleintheFortWorthBasin..............................................................................................18
14. StratigraphyoftheFayettevilleShale...............................................................................................19
15. FayettevilleShaleintheArkomaBasin............................................................................................19
16. StratigraphyoftheHaynesvilleShale...............................................................................................20
17. HaynesvilleShaleintheTexas&LouisianaBasin.......................................................................20
18. StratigraphyoftheMarcellusShale...................................................................................................21
19. MarcellusShaleintheAppalachianBasin.......................................................................................21
20. StratigraphyoftheWoodfordShaleintheAnadarkoBasin....................................................22
21. WoodfordShaleintheAnadarkoBasin............................................................................................22
22. StratigraphyoftheAntrimShale.........................................................................................................23
iii

23. AntrimShaleintheMichiganBasin...................................................................................................23
24. StratigraphyoftheNewAlbanyShale...............................................................................................24
25. NewAlbanyShaleintheIllinoisBasin..............................................................................................24
26. OilandGasRegulatoryAgenciesinShaleGasStates..................................................................28
27. UICClassIIPrimacyMap........................................................................................................................33
28. ProcessofShaleGasDevelopment(Duration).............................................................................44
29. HorizontalandVerticalWellCompletions......................................................................................46
30. CasingZonesandCementPrograms..................................................................................................52
31. ComparisonofTargetShaleDepthandBaseofTreatableGroundwater...........................54
32. ExampleOutputofaHydraulicFractureSimulationModel...................................................57
33. MappingofMicroseismicEvents........................................................................................................57
34. ExampleofaSingleStageofaSequencedHydraulicFractureTreatment........................59
35. VolumetricCompositionofaFractureFluid..................................................................................62
36. FracturingFluidAdditives,MainCompounds,andCommonUses.......................................63
37. EstimatedWaterNeedsforDrillingandFracturingWellsin
SelectShaleGasPlays............................................................................................................................64
38. AnnualRainfallMapoftheUnitedStates........................................................................................67
39. CurrentProducedWaterManagementbyShaleGasBasin......................................................69
40. VOCEmissionsbySourceCategory....................................................................................................72
41. BenzeneEmissionsbySource1999...............................................................................................73
42. COEmissionsbySourceCategory.......................................................................................................73
iv
INTRODUCTION
Naturalgasproductionfromhydrocarbonrichshaleformations,knownasshalegas,isoneofthe
mostrapidlyexpandingtrendsinonshoredomesticoilandgasexplorationandproductiontoday.
Insomeareas,thishasincludedbringingdrillingandproductiontoregionsofthecountrythathave
seenlittleornoactivityinthepast.Newoilandgasdevelopmentsbringchangestothe
environmentalandsocioeconomiclandscape,particularlyinthoseareaswheregasdevelopmentis
anewactivity.Withthesechangeshavecomequestionsaboutthenatureofshalegasdevelopment,
thepotentialenvironmentalimpacts,andtheabilityofthecurrentregulatorystructuretodealwith
thisdevelopment.Regulators,policymakers,andthepublicneedanobjectivesourceof
informationonwhichtobaseanswerstothesequestionsanddecisionsabouthowtomanagethe
challengesthatmayaccompanyshalegasdevelopment.
ThisPrimerendeavorstoprovidemuchofthatinformation.Itdescribestheimportanceofshale
gasinmeetingthefutureenergyneedsoftheUnitedStates(U.S.),includingitsroleinalternative
energystrategiesandreducinggreenhousegas(GHG)emissions.ThePrimerprovidesanoverview
ofmodernshalegasdevelopment,aswellasasummaryoffederal,state,andlocalregulations
applicabletothenaturalgasproductionindustry,anddescribesenvironmentalconsiderations
relatedtoshalegasdevelopment.
ThePrimerisintendedtoserveasatechnicalsummarydocument,includinggeologicinformation
ontheshalegasbasinsintheU.S.andthemethodsofshalegasdevelopment.Byprovidingan
overviewoftheregulatoryframeworkandtheenvironmentalconsiderationsassociatedwithshale
gasdevelopment,itwillalsohelpfacilitatetheminimizationandmitigationofadverse
environmentalimpacts.Bysodoing,thePrimercanserveasaninstrumenttofacilitateinformed
publicdiscussionsandtosupportsoundpolicymakingdecisionsbygovernment.
1

THEIMPORTANCEOFSHALEGAS
TheRoleofNaturalGasintheUnitedStatesEnergyPortfolio
NaturalgasplaysakeyroleinmeetingU.S.energydemands.Naturalgas,coalandoilsupplyabout
85%ofthenationsenergy,withnatural
gassupplyingabout22%ofthetotal1 EXHIBIT1:UNITEDSTATESENERGY
(Exhibit1 ).Thepercentcontributionof
2
CONSUMPTIONBYFUEL(2007)
naturalgastotheU.S.energysupplyis
expectedtoremainfairlyconstantfor
thenext20years.
TheUnitedStateshasabundantnatural
gasresources.TheEnergyInformation
Administration(EIA)estimatesthatthe
U.S.hasmorethan1,744trillioncubic
feet(tcf)oftechnicallyrecoverable
naturalgas,including211tcfofproved
reserves(thediscovered,economically
recoverablefractionoftheoriginalgas
inplace)3,4.NavigantConsulting
estimatesthattechnicallyrecoverable
unconventionalgas(shalegas,tight
sands,andcoalbednaturalgas)accountsfor60%oftheonshorerecoverableresource5.AttheU.S.
productionratesfor2007,about19.3tcf,thecurrentrecoverableresourceestimateprovides
enoughnaturalgastosupplytheU.S.forthenext90years6.Notethathistorically,estimatesofthe
sizeofthetotalrecoverableresourcehavegrownovertimeasknowledgeoftheresourcehas
improvedandrecoverytechnologyhasadvanced.
Unconventionalgasresourcesareaprimeexampleof
WhatIsaTcf? thistrend.
Naturalgasisgenerallypricedand
Naturalgasuseisdistributedacrossseveralsectorsof
soldinunitsofathousandcubicfeet
theeconomy(Exhibit27).Itisanimportantenergy
(Mcf,usingtheRomannumeralfor
onethousand).Unitsofatrillion
sourcefortheindustrial,commercialandelectrical
cubicfeet(tcf)areoftenusedto generationsectors,andalsoservesavitalrolein
measurelargequantities,asin residentialheating8.Althoughforecastsvaryintheir
resourcesorreservesintheground, outlookforfuturedemandfornaturalgas,theyall
orannualnationalenergy haveonethingincommon:naturalgaswillcontinue
consumption.AtcfisonebillionMcf toplayasignificantroleintheU.S.energypicturefor
andisenoughnaturalgasto: sometimetocome9.
Heat15millionhomesfor
oneyear;
Naturalgas,duetoitscleanburningnatureand
Generate100billion economicalavailability,hasbecomeaverypopular
kilowatthoursofelectricity; fuelforthegenerationofelectricity10.Inthe1970s
Fuel12millionnaturalgas and80s,thechoiceforthemajorityofelectricutility
firedvehiclesforoneyear. generatorswasprimarilycoalornuclearpower;but,
duetoeconomic,environmental,technological,and
3

regulatorychanges,naturalgashasbecome EXHIBIT2:NATURALGASUSEBY
thefuelofchoiceformanynewpower SECTOR
plants.In2007,naturalgaswas39.1%11of
electricindustryproductivecapacity.
Naturalgasisalsothefuelofchoicefora
widerangeofindustries.Itisamajorfuel
sourceforpulpandpaper,metals,
chemicals,petroleumrefining,andfood
processing.Thesefiveindustriesalone
accountforalmostthreequartersof
industrialnaturalgasuse12andtogether
employfourmillionpeopleintheU.S.13
Naturalgasisalsoafeedstockforavariety
ofproducts,includingplastics,chemicals,
andfertilizers.Formanyproducts,thereis
noeconomicallyviablesubstitutefor
naturalgas.Industrialuseofnaturalgas
accountedfor6.63tcfofdemandin2007andisexpectedtogrowto6.82tcfby2030.
However,naturalgasisbeingconsumedbytheU.S.economyataratethatexceedsdomestic
productionandthegapisincreasing14.Halfofthenaturalgasconsumedtodayisproducedfrom
wellsdrilledwithinthelast3.5years15.Despitepossessingalargeresourceendowment,theU.S.
consumesnaturalgasataraterequiringrapidreplacementofreserves.Itisestimatedthatthegap
betweendemandanddomesticsupplywillgrow
Halfofthenaturalgasconsumedtodayis tonearly9tcfbytheyear202516.However,itis
producedfromwellsdrilledwithinthe believedbymanythatunconventionalnatural
last3.5years. gasresourcessuchasshalegascansignificantly
alterthatbalance.
Exhibit317showsacomparisonofproduction,consumption,andimporttrendsfornaturalgasin
theU.S.withdemandincreasinglyexceedingconventionaldomesticproduction.Withoutdomestic
shalegasandotherunconventionalgasproduction,thegapbetweendemandanddomestic
productionwillwidenevenmore,leavingimportstofilltheneed.Worldwideconsumptionof
naturalgasisalsoincreasing;thereforetheU.S.cananticipatefacinganincreasinglycompetitive
marketfortheseimports.
ThisincreasedrelianceonforeignsourcesofenergycouldposeatleasttwoproblemsfortheU.S.:
1)itwouldservetodecreaseourenergysecurity;and2)itcouldcreateamultibilliondollar
outflowtoforeigninterests,thusmakingsuchfundsunavailablefordomesticinvestment.
4

TheAdvantagesof EXHIBIT3:COMPARISONOFPRODUCTION,CONSUMPTIONAND
NaturalGas IMPORTTRENDSFORNATURALGASINTHEUNITEDSTATES
Inthe1800sandearly1900s,
naturalgaswasmainlyused
tolightstreetlampsandthe
occasionalhouse.However,
withavastlyimproved
distributionnetworkand
advancementsintechnology,
naturalgasisnowbeingused
inmanyways.Onereason
forthewidespreaduseof
naturalgasisitsversatilityas
afuel.ItshighBritish
thermalunit(Btu)content
andawelldeveloped
infrastructuremakeiteasyto
useinanumberof
applications.
Anotherfactorthatmakesnaturalgasanattractiveenergysourceisitsreliability.Eightyfour
percentofthenaturalgasconsumedintheU.S.isproducedintheU.S.,andninetysevenpercentof
thegasusedinthiscountryisproducedinNorthAmerica18.Thus,thesupplyofnaturalgasisnot
dependentonunstableforeigncountriesandthedeliverysystemislesssubjecttointerruption.
Akeyadvantageofnaturalgasisthatitisefficientandcleanburning19.Infact,ofallthefossilfuels,
naturalgasisbyfarthecleanestburning.Itemitsapproximatelyhalfthecarbondioxide(CO2)of
coalalongwithlowlevelsofotherairpollutants20.Thecombustionbyproductsofnaturalgasare
mostlyCO2andwatervapor,thesame
compoundspeopleexhalewhenbreathing.
EXHIBIT4:COMBUSTIONEMISSIONS
Coalandoilarecomposedofmuchmore
(POUNDS/BILLIONBTUOFENERGYINPUT)
complexorganicmoleculeswithgreater
Air Pollutant Combusted Source
nitrogenandsulfurcontent.Their
Natural Gas Oil Coal
combustionbyproductsincludelarger
Carbon dioxide 117,000 164,000 208,000
quantitiesofCO2,nitrogenoxides(NOx),
(CO2)
sulfurdioxide(SO2)andparticulateash
Carbon monoxide 40 33 208
(Exhibit421).Bycomparison,the
(CO)
combustionofnaturalgasliberatesvery
Nitrogen oxides 92 448 457
smallamountsofSO2andNOx,virtuallyno
(NOx)
ash,andlowerlevelsofCO2,carbon
Sulfur dioxide (SO2) 0.6 1,122 2,591
monoxide(CO),andotherhydrocarbons22.
Particulates (PM) 7.0 84 2,744
Formaldehyde 0.750 0.220 0.221 Becausenaturalgasemitsonlyhalfas
Mercury (Hg) 0.000 0.007 0.016 muchCO2ascoalandapproximately30%
lessthanfueloil,itisgenerallyconsidered
Sources: EIA, 1998
tobecentraltoenergyplansfocusedon
5

thereductionofGHGemissions23.AccordingtotheEIAin
itsreportEmissionsofGreenhouseGasesintheUnited Ofallthefossilfuels,
States2006,82.3%ofGHGemissionsintheU.S.in2006 naturalgasisbyfarthe
camefromCO2asadirectresultoffossilfuelcombustion24. cleanestburning.
SinceCO2makesupalargefractionofU.S.GHGemissions,
increasingtheroleofnaturalgasinU.S.energysupplyrelativetootherfossilfuelswouldresultin
lowerGHGemissions.
AlthoughthereisrapidlyincreasingmomentumtoreducedependenceonfossilfuelsintheU.S.and
elsewhere,thetransitiontosustainablerenewableenergysourceswillnodoubtrequire
considerabletime,effortandinvestmentinorderforthesesourcestobecomeeconomicalenough
tosupplyasignificantportionofthenationsenergyconsumption.Indeed,theEIAestimatesthat
fossilfuels(oil,gas,andcoal)willsupply82.1%ofthenationsenergyneedsin203025.Since
naturalgasisthecleanestburningofthefossilfuels,anenvironmentalbenefitcouldberealizedby
shiftingtowardproportionatelygreaterrelianceonnaturalgasuntilsuchtimeassourcesof
alternativeenergyaremoreefficient,economical,andwidelyavailable.
Additionally,themarchtowardssustainablerenewableenergysources,suchaswindandsolar,
requiresthatasupplementalenergysourcebeavailablewhenweatherconditionsandelectrical
storagecapacityprovechallenging26.Suchabackstopenergysourcemustbewidelyavailableon
nearinstantaneousdemand.Theavailabilityofextensivenaturalgastransmissionanddistribution
pipelinesystemsmakesnaturalgasuniquelysuitableforthisrole27.Thus,naturalgasisanintegral
facetofmovingforwardwithalternativeenergyoptions.Withthecurrentemphasisonthe
potentialeffectsofairemissionsonglobalclimatechange,airquality,andvisibility,cleanerfuels
likenaturalgasareanimportantpartofournationsenergyfuture28.
NaturalGasBasics
Naturalgasisacombinationofhydrocarbongasesconsistingprimarilyofmethane(CH4),and
lesserpercentagesof
EXHIBIT5:TYPICALCOMPOSITIONOFNATURALGAS
butane,ethane,propane,
andothergases29,30.Itis
odorless,colorless,and,
whenignited,releasesa
significantamountof
energy31.Exhibit532shows
thetypicalcompositional
rangeofnaturalgas
producedintheU.S.
Naturalgasisfoundinrock
formations(reservoirs)
beneaththeearthssurface;
insomecasesitmaybe
associatedwithoildeposits.
Explorationandproduction
companiesexploreforthese
6

depositsbyusingcomplextechnologiestoidentifyprospectivedrillinglocations.Onceextracted,
thenaturalgasisprocessedtoeliminateothergases,water,sand,andotherimpurities.Some
hydrocarbongases,suchasbutaneandpropane,arecapturedandseparatelymarketed.Onceithas
beenprocessed,thecleanednaturalgasisdistributedthroughasystemofpipelinesacross
thousandsofmiles33.Itisthroughthesepipelinesthatnaturalgasistransportedtoitsendpointfor
residential,commercial,andindustrialuse.
Naturalgasismeasuredineithervolumetricorenergyunits.Asagas,itismeasuredbythevolume
itdisplacesatstandardtemperaturesandpressures,usuallyexpressedincubicfeet.Gas
companiesgenerallymeasurenaturalgasinthousandsofcubicfeet(Mcf),millionsofcubicfeet
(MMcf),orbillionsofcubicfeet(bcf),andestimateresourcessuchasoriginalgasinplacein
trillionsofcubicfeet(tcf).
Calculatingandtrackingnaturalgasbyvolumeisuseful,butitcanalsobemeasuredasasourceof
energy.Similartootherformsofenergy,naturalgascanbecomputedandpresentedinBritish
thermalunits(Btu).OneBtuisthequantityofheatrequiredtoraisethetemperatureofonepound
ofwaterbyonedegreeFahrenheitatnormalpressure34.Thereareabout1,000Btusinonecubic
footofnaturalgasdeliveredtotheconsumer35.Naturalgasdistributioncompaniestypically
measurethegasdeliveredtoaresidencein'therms'forbillingpurposes36.Athermisequalto
100,000Btusapproximately100cubicfeetofnaturalgas37.
UnconventionalGas
TheU.S.increaseditsnaturalgasreservesby6%from1970to2006,producingapproximately725
tcfofgasduringthatperiod38.Thisincreaseisprimarilyaresultofadvancementsintechnology,
resultinginanincreaseineconomicallyrecoverablereserves(reservesbecomingproven)that
werepreviously EXHIBIT6:NATURALGASPRODUCTIONBYSOURCE(TCF/YEAR)
thoughttobe
uneconomic39.
In2007,Texas,
Wyoming,and
Coloradowerethe
stateswiththe
greatestadditionsto
provedgasreserves
fortheyear;these
additionswerefrom
shalegas,tightsands,
andcoalbedmethane,
allofwhichare
unconventionalgas
plays40.Similarly,the
statesofTexas(30%)
andWyoming(12%)
hadthegreatest
volumeofprovedgas Source: EIA, 2008
7

reservesintheU.S.in2007again,bothprimarilyasa
Unconventionalproductionnow
resultofdevelopingunconventionalnaturalgas
accountsfor46%ofthetotalU.S.
plays41.
production.
Overall,unconventionalnaturalgasisanticipatedto
becomeaneverincreasingportionoftheU.S.provedreserves,whileconventionalgasreservesare
declining42.Overthelastdecade,productionfromunconventionalsourceshasincreasedalmost
65%,from5.4trillioncubicfeetperyear(tcf/yr)in1998to8.9tcf/yrin2007(Exhibit6).This
meansunconventionalproductionnowaccountsfor46%ofthetotalU.S.production43.

EXHIBIT7:UNITEDSTATESSHALEGASBASINS

Source:ALLConsulting,ModifiedfromUSGS&othersources
TheRoleofShaleGasinUnconventionalGas
Thelower48stateshaveawidedistributionofhighlyorganicshalescontainingvastresourcesof
naturalgas(Exhibit744).Already,thefledglingBarnettShaleplayinTexasproduces6%ofall
naturalgasproducedinthelower48states45.Improveddrillingandfracturingtechnologieshave
contributedconsiderablytotheeconomicpotentialofshalegas.Thispotentialforproductionin
8

theknownonshoreshalebasins,coupledwithotherunconventionalgasplays,ispredictedto
contributesignificantlytotheU.S.sdomesticenergyoutlook.Exhibit846showstheprojected
contributionofshalegastotheoverallunconventionalgasproductionintheU.S.inbcf/day.
Threefactorshave
EXHIBIT8:UNITEDSTATESUNCONVENTIONALGASOUTLOOK(BCF/DAY) cometogetherin
recentyearsto
makeshalegas
production
economically
viable:1)
advancesin
horizontaldrilling,
2)advancesin
hydraulic
fracturing,and,
perhapsmost
importantly,3)
rapidincreasesin
naturalgasprices
inthelastseveral
yearsasaresultof
significantsupply
anddemand
pressures.
Advancesinthe
preexistingtechnologiesofdirectionaldrillingandhydraulicfracturingsetthestagefortodays
horizontaldrillingandfracturingtechniques,withoutwhichmanyoftheunconventionalnatural
gasplayswouldnotbeeconomical.Asrecentlyasthelate1990s,only40drillingrigs(6%oftotal
activerigsintheU.S.)intheU.S.werecapableofonshorehorizontaldrilling;thatnumbergrewto
519rigs(28%oftotalactiverigsintheU.S.)byMay200847.
Ithasbeensuggestedthattherapidgrowthofunconventionalnaturalgasplayshasnotbeen
capturedbyrecentresourceestimatescompiledbytheEIAandthat,therefore,theirresource
estimatesdonotaccuratelyreflectthecontributionofshalegas48.Since1998,annualproduction
hasconsistentlyexceededtheEIAsforecastsofunconventionalgasproduction.Agreatdealofthis
increaseisattributabletoshalegasproduction,
particularlyfromtheBarnettShaleinTexas.The Threefactorshavecometogether
potentialformostothershalegasplaysintheU.S.is inrecentyearstomakeshalegas
justemerging.Takingthisintoconsideration, productioneconomicallyviable:
Navigant,addingtheirownanalysisofshalegas 1)advancesinhorizontaldrilling,
resourcestoothernationalresourceestimates,has 2)advancesinhydraulic
estimatedthatU.S.totalnaturalgasresources(proved fracturing,and,perhapsmost
plusunprovedtechnicallyrecoverable)are1,680tcfto importantly,3)rapidincreasesin
2,247tcf,or87to116yearsofproductionat2007U.S. naturalgasprices.
productionlevels.ThiscompareswithEIAsnational
9

resourceestimateof1,744tcf,
whichiswithintheNavigant EXHIBIT9:TRENDSINSHALEGASPRODUCTION(MMCF/DAY)
range.Naviganthasestimated
thatshalegascomprises28%
ormoreoftotalestimated
technicallyrecoverablegas
resourcesintheU.S.49.Exhibit
950depictsthedailyproduction
(inMMcf/day)fromeachofthe
currentlyactiveshalegasplays.
Aswithmostresource
estimates,especiallyemerging
resourcessuchas
unconventionalnaturalgas,
theseestimatesarelikelyto
changeovertime.Inaddition,
thereareavarietyof
organizationsmakingresource
andfutureproduction
estimatesforshalegas.These
analysesusedifferentassumptions,data,andmethodologies.Therefore,onemaycomeacrossa
widerangeofnumbersforprojectedshalegasrecovery,bothnationallyandbybasin.Theseshale
gasresourceestimatesarelikelytochangeasnewinformation,additionalexperience,and
advancesintechnologybecomeavailable.
Analystshaveestimatedthatby2011mostnew
Shalegasresourceestimatesarelikely reservesgrowth(50%to60%,orapproximately3
tochangeasnewinformation, bcf/day)willcomefromunconventionalshalegas
additionalexperience,andadvancesin reservoirs51.Thetotalrecoverablegasresources
technologybecomeavailable. from4emergingshalegasplays(theHaynesville,
Fayetteville,Marcellus,andWoodford)maybeover
550tcf52.Totalannualproductionvolumesof3to4tcfmaybesustainablefordecades.An
additionalbenefitofshalegasplaysisthatmanyexistinareaspreviouslydevelopedfornaturalgas
productionand,therefore,muchofthenecessarypipelineinfrastructureisalreadyinplace.Many
oftheseareasarealsoproximaltothenationspopulationcentersthuspotentiallyfacilitating
transportationtoconsumers.However,additionalpipelineswillhavetobebuilttoaccess
developmentinareasthathavenotseengasproductionbefore53.
LookingForward
Consideringnaturalgasscleanburningnature,thenationsdomesticnaturalgasresources,and
thepresenceofsupportinginfrastructure,thedevelopmentofdomesticshalegasreserveswillbe
animportantcomponentoftheU.S.senergyportfolioformanyyears.Recentsuccessesinavariety
ofgeologicbasinshavecreatedtheopportunityforshalegastobeastrategicpartofthenations
energyandeconomicgrowth54.
10

TheEnvironmentalConsiderations
Recentsuccessesandimprovementsinavariety
sectionofthisPrimerdescribeshow
ofgeologicbasinshavecreatedtheopportunity
improvementsinhorizontaldrillingand
forshalegastobeastrategicpartofthe
hydraulicfracturingtechnologieshave
nationsenergyandeconomicgrowth.
openedthedoortotheeconomic
recoveryofshalegas.Italsodiscusses
additionalpracticesthathavealloweddevelopmentofareasthatmightpreviouslyhavebeen
inaccessibleduetoenvironmentalconstraintsorrestrictionsondisturbancesinbothurbanand
ruralsettings.Byusinghorizontaldrilling,operatorshavebeenabletoreducetheextentofsurface
impactcommonlyassociatedwithmultipleverticalwellsdrilledfrommultiplewellpads;
equivalentwellcoveragecanbeachievedthroughdrillingfewerhorizontalwellsfromasinglewell
pad.Thiscanresultinasignificantreductioninsurfacedisturbances:fewerwellpads,fewer
roads,reducedtraffic,fewerpipelines,andfewersurfacefacilities.Inurbansettings,thiscanmean
lessimpactonnearbypopulationsandbusinesses.Inruralsettings,thiscanmeanfewer
consequencesforwildlifehabitats,agriculturalresources,andsurfacewaterbodies.
Otherpracticesthatarenowcommonlyusedfordrilling,particularlyinurbansettings,include:the
useofsoundwallsandblanketstoreducenoise,theuseofdirectionalorshieldedlightingtoreduce
nighttimedisturbancetonearbyresidencesandbusinesses,theuseofpipelinestotransportwater
resultinginreducedtrucktraffic,andtheuseofsolarpoweredtelemetrydevicestomonitorgas
productionresultinginreducedpersonnelvisitstowellsites.Suchpracticesareusedinspecific
locationsorsituationsthatcallforthem,andarenotappropriateeverywhere,butwhereneeded,
theyprovideopportunitiesforsafe,environmentallysounddevelopmentthatmaynothavebeen
possiblewithoutthem.
Thesetechnologiesandpractices,alongwiththeincreasinggaspricesofthelastfewyears,have
providedthemeansbywhichshalegascanbeeconomicallyrecovered.Improvementsinreducing
theoverallfootprintandlevelofdisturbancefromdrillingandcompletionactivitieshaveprovided
theindustrywiththemethodsformovingforwardwithdevelopmentinnewareasthatwere
previouslyinaccessible.
11


SHALEGASDEVELOPMENTINTHEUNITEDSTATES
ShaleformationsacrosstheU.S.havebeendevelopedtoproducenaturalgasinsmallbut
continuousvolumessincetheearliestyearsofgasdevelopment.Thefirstproducinggaswellinthe
U.S.wascompletedin1821inDevonianagedshalenearthetownofFredonia,NewYork55.The
naturalgasfromthisfirstwellwasusedby
townresidentsforlighting56.Earlysuppliesof ThefirstproducinggaswellintheU.S.was
naturalgaswerederivedfromshallowgas completedin1821inDevonianagedshale
wellsthatwerenotcomplicatedtodrilland nearthetownofFredonia,NewYork.
fromnaturalgasseeps57.Theshallowwells
andseepswerecapableofproducingsmallamountsofnaturalgasthatwereusedforilluminating
citystreetsandhouseholds58.Theseearlygaswellsplayedakeypartinbringingilluminationto
thecitiesandtownsoftheeasternU.S.59.
OthershalegaswellsfollowedtheFredoniawellwiththefirstfieldscaledevelopmentofshalegas
fromtheOhioShaleintheBigSandyFieldofKentuckyduringthe1920s60.TheBigSandyFieldhas
recentlyexperiencedarenewedgrowthandcurrentlyisa3,000squaremileplayencompassing
fivecounties61.Bythe1930s,gasfromtheAntrimShaleinMichiganhadexperiencedmoderate
development;however,itwasnotuntilthe1980sthatdevelopmentbegantoexpandrapidlytothe
pointthatithasnowreachednearly9,000wells62.Itwasalsoduringthe1980sthatoneofthe
nationsmostactivenaturalgasplaysinitiallykickedoffintheareaaroundFortWorth,Texas63.
TheplaywastheBarnettShale,anditssuccessgrabbedtheindustrysattention.Largescale
hydraulicfracturing,aprocessfirstdevelopedinTexasinthe1950s,wasfirstusedintheBarnettin
1986;likewise,thefirstBarnetthorizontalwellwasdrilledin199264.Throughcontinued
improvementsinthetechniquesandtechnologyofhydraulicfracturing,developmentoftheBarnett
Shalehasaccelerated65.Intheensuingtwodecades,thescienceofshalegasextractionhasmatured
intoasophisticatedprocessthatutilizeshorizontaldrillingandsequenced,multistagehydraulic
fracturingtechnologies.AstheBarnettShaleplayhasmatured,naturalgasproducershavebeen
lookingtoextrapolatethelessonslearnedintheBarnetttotheothershalegasformationspresent
acrosstheU.S.andCanada66.
InadditiontotheBarnettPlay,asecondshaleplaywithgreateroilproductionhasalsobeen
advancingtechniquesrelatedtohorizontalwellsandhydraulicfracturing.TheBakkenShaleofthe
WillistonBasinofMontanaandNorthDakotahasseenasimilargrowthratetotheBarnett.The
Bakkenisanothertechnicalplayinwhichthedevelopmentofthisunconventionalresourcehas
benefittedfromthetechnologicaladvancesinhorizontalwellsandhydraulicfracturing67.InApril
2008,theUnitedStatesGeologicalSurvey(USGS)releasedanupdatedassessmentofthe
undiscoveredtechnicallyrecoverablereservesforthisshaleplayestimatingthereare3.65billion
barrels(bbls)ofoil,1.85tcfofassociatednaturalgas,and148millionbblsofnaturalgasliquidsin
theplay68.
Thecombinationofsequencedhydraulicfracturetreatmentsandhorizontalwellcompletionshas
beencrucialinfacilitatingtheexpansionofshalegasdevelopment.Priortothesuccessful
applicationofthesetwotechnologiesintheBarnettShale,shalegasresourcesinmanybasinshad
beenoverlookedbecauseproductionwasnotviewedaseconomicallyfeasible69.Thelownatural
permeabilityofshalehasbeenthelimitingfactortotheproductionofshalegasresourcesbecause
13

itonlyallowsminorvolumesofgastoflownaturallytoawellbore70.Thecharacteristicoflow
matrixpermeabilityrepresentsakeydifferencebetweenshaleandothergasreservoirs.Forgas
shalestobeeconomicallyproduced,theserestrictionsmustbeovercome71.Thecombinationof
reducedeconomicsandlowpermeabilityofgasshaleformationshistoricallycausedoperatorsto
bypasstheseformationsandfocusonotherresources72.
ShaleGasGeology
Shalegasisnaturalgasproducedfromshaleformationsthattypicallyfunctionasboththereservoir
andsourceforthenaturalgas.Intermsofitschemicalmakeup,shalegasistypicallyadrygas
primarilycomposedofmethane(90%ormoremethane),butsomeformationsdoproducewetgas.
TheAntrimandNewAlbanyformationshavetypicallyproducedwaterandgas73.Gasshalesare
organicrichshaleformationsthatwerepreviouslyregardedonlyassourcerocksandsealsforgas
accumulatinginthestratigraphicallyassociatedsandstoneandcarbonatereservoirsoftraditional
onshoregasdevelopment74.Shaleisasedimentaryrockthatispredominantlycomprisedof
consolidatedclaysizedparticles.Shalesaredepositedasmudinlowenergydepositional
environmentssuchastidalflatsanddeepwaterbasinswherethefinegrainedclayparticlesfallout
ofsuspensioninthesequietwaters.Duringthedepositionoftheseveryfinegrainedsediments,
therecanalsobedepositionoforganicmatterintheformofalgae,plant,andanimalderived
organicdebris75.Thenaturallytabularclaygrainstendtolieflatasthesedimentsaccumulateand
subsequentlybecomecompactedasaresultofadditionalsedimentdeposition.Thisresultsinmud
withthinlaminarbeddingthatlithifies(solidifies)intothinlylayeredshalerock.Theveryfine
sheetlikeclaymineralgrainsandlaminatedlayersofsedimentresultinarockthathaslimited
horizontalpermeabilityandextremelylimitedverticalpermeability.Typicalunfracturedshales
havematrixpermeabilitiesontheorderof0.01to0.00001millidarcies76.Thislowpermeability
EXHIBIT10:MARCELLUSSHALEOUTCROP meansthatgastrappedinshale
cannotmoveeasilywithintherock
exceptovergeologicexpansesoftime
(millionsofyears).
Thenaturallayeringandfracturingof
shalescanbeseeninoutcrop.Exhibit
10showsatypicalshaleoutcrop
whichrevealsthenaturalbedding
planes,orlayers,oftheshaleand
nearverticalnaturalfracturesthat
cancutacrossthenaturallyhorizontal
beddingplanes.Althoughthevertical
fracturesshowninthispictureare
naturallyoccurring,artificialfractures
inducedbyhydraulicfracture
stimulationinthedeepsubsurface
reservoirrockwouldhaveasimilar
appearance.
Source: ALL Consulting, 2008
14

Thelowpermeabilityofshalecausesittobeclassifiedasanunconventionalreservoirforgas(orin
somecases,oil)production.Theselowpermeability,oftenorganicrichunitsarealsothoughttobe
thesourcebedsformuchofthehydrocarbonsproducedinthesebasins77.Gasreservoirsare
classifiedasconventionalorunconventionalforthefollowingreasons:
1. ConventionalreservoirsWellsinconventionalgasreservoirsproducefromsands
andcarbonates(limestonesanddolomites)thatcontainthegasininterconnectedpore
spacesthatallowflowtothewellbore.Muchlikeakitchensponge,thegasinthepores
canmovefromoneporetoanotherthroughsmallerporethroatsthatcreatepermeable
flowthroughthereservoir.Inconventionalnaturalgasreservoirs,thegasisoften
sourcedfromorganicrichshalesproximaltothemoreporousandpermeable
sandstoneorcarbonate.
2. UnconventionalreservoirsWellsinunconventionalreservoirsproducefromlow
permeability(tight)formationssuchastightsandsandcarbonates,coal,andshale.In
unconventionalgasreservoirs,thegasisoftensourcedfromthereservoirrockitself
(tightgassandstoneandcarbonatesareanexception).Becauseofthelowpermeability
oftheseformations,itistypicallynecessarytostimulatethereservoirtocreate
additionalpermeability.Hydraulicfracturingofareservoiristhepreferredstimulation
methodforgasshales.Differencesbetweenthethreebasictypesofunconventional
reservoirsinclude:
1. TightGasWellsproducefromregionallowporositysandstonesand
carbonatereservoirs.Thenaturalgasissourced(formed)outsidethereservoir
andmigratesintothereservoirovertime(millionsofyears)78.Manyofthese
wellsaredrilledhorizontallyandmostarehydraulicallyfracturedtoenhance
production.
2. CoalBedNaturalGas(CBNG)Wellsproducefromthecoalseamswhichactas
sourceandreservoirofthenaturalgas79.Wellsfrequentlyproducewateras
wellasnaturalgas.Naturalgascanbesourcedbythermogenicalterationsof
coalorbybiogenicactionofindigenousmicrobesonthecoal.Therearesome
horizontallydrilledCBNGwellsandsomethatreceivehydraulicfracturing
treatments.However,someCBNGreservoirsarealsoundergroundsourcesof
drinkingwaterandassuchtherearerestrictionsonhydraulicfracturing.CBNG
wellsaremostlyshallowasthecoalmatrixdoesnothavethestrengthto
maintainporosityunderthepressureofsignificantoverburdenthickness.
3. ShaleGasWellsproducefromlowpermeabilityshaleformationsthatarealso
thesourceforthenaturalgas.Thenaturalgasvolumescanbestoredinalocal
macroporositysystem(fractureporosity)withintheshale,orwithinthemicro
poresoftheshale80,oritcanbeadsorbedontomineralsororganicmatter
withintheshale81.Wellsmaybedrilledeitherverticallyorhorizontallyand
mostarehydraulicallyfracturedtostimulateproduction.Shalegaswellscanbe
similartootherconventionalandunconventionalwellsintermsofdepth,
productionrate,anddrilling.
15

SourcesofNaturalGas
Shalegasisbothcreatedandstoredwithintheshalebed.Naturalgas(methane)isgeneratedfrom
theorganicmatterthatisdepositedwithandpresentintheshalematrix.
Inorderforashaletohaveeconomicquantitiesofgasitmustbeacapablesourcerock.The
potentialofashaleformationtocontaineconomicquantitiesofgascanbeevaluatedbyidentifying
specificsourcerockcharacteristicssuchastotalorganiccarbon(TOC),thermalmaturity,and
kerogenanalysis.Together,thesefactorscanbeusedtopredictthelikelihoodoftheprospective
shaletoproduceeconomicallyviablevolumesofnaturalgas.Anumberofwellsmayneedtobe
analyzedinordertosufficientlycharacterizethepotentialofashaleformation,particularlyifthe
geologicbasinislargeandtherearevariationsin
thetargetshalezone.
KeyGasResourceTerms
ShaleGasintheUnitedStates
Shalegasispresentacrossmuchofthelower48 ProvedReserves:Thatportionof
States.Exhibit7showstheapproximatelocations recoverableresourcesthatis
ofcurrentproducinggasshalesandprospective demonstratedbyactualproductionor
shales.Themostactiveshalestodatearethe conclusiveformationteststobe
BarnettShale,theHaynesville/BossierShale,the technically,economically,andlegally
AntrimShale,theFayettevilleShale,theMarcellus producibleunderexistingeconomicand
Shale,andtheNewAlbanyShale.Thefollowing operatingconditions.
discussionprovidesasummaryofbasic
informationregardingtheseshalegasplays. TechnicallyRecoverableResources:
Thetotalamountofresource,
Eachofthesegasshalebasinsisdifferentandeach discoveredandundiscovered,thatis
hasauniquesetofexplorationcriteriaand thoughttoberecoverablewith
operationalchallenges.Becauseofthese availabletechnology,regardlessof
differences,thedevelopmentofshalegas economics.
resourcesineachoftheseareasfacespotentially
uniquechallenges.Forexample,theAntrimand OriginalGasInPlace:Theentire
NewAlbanyShalesareshallowershalesthat volumeofgascontainedinthe
producesignificantvolumesofformationwater reservoir,regardlessoftheabilityto
unlikemostoftheothergasshales.Development produceit.
oftheFayettevilleShaleisoccurringinruralareas
ofnorthcentralArkansas,whiledevelopmentof
theBarnettShaleisfocusedintheareaofForthWorth,Texas,inanurbanandsuburban
environment.
Asnewtechnologiesaredevelopedandrefined,shalegasplaysoncebelievedtohavelimited
economicviabilityarenowbeingreevaluated.Exhibit11summarizesthekeycharacteristicsof
themostactiveshalegasplaysacrosstheU.S.Thisexhibitsuppliesdatarelatedtothecharacterof
theshaleandalsoprovidesameanstocomparesomeofthekeycharacteristicsthatareusedto
evaluatethedifferentgasshalebasins.Notethatestimatesoftheshalegasresource,especiallythe
portionthatistechnicallyrecoverable,arelikelytoincreaseovertimeasnewdatabecome
availablefromadditionaldrilling,asexperienceisgainedinproducingshalegas,asunderstanding
oftheresourcecharacteristicsincreases,andasrecoverytechnologiesimprove.
16

EXHIBIT11:COMPARISONOFDATAFORTHEGASSHALESINTHEUNITEDSTATES
New
GasShaleBasin Barnett Fayetteville Haynesville Marcellus Woodford Antrim
Albany
EstimatedBasin
Area,square 5,000 9,000 9,000 95,000 11,000 12,000 43,500
miles
6,500 1,000 10,500 4,000 6,000 500
Depth,ft 6002,20087
8,50082 7,00083 13,50084 8,50085 11,00086 2,00088
NetThickness,
10060089 2020090 2009130092 5020093 12022094 7012095 5010096
ft
DepthtoBase
ofTreatable ~1200 ~50097 ~400 ~850 ~400 ~300 ~400
Water#,ft
RockColumn
Thickness
betweenTopof 5,300 10,100 5,600
5006,500 2,1257650 3001,900 1001,600
PayandBottom 7,300 13,100 10,600
ofTreatable
Water,ft
TotalOrganic
4.598 4.09.899 0.54.0100 312101 114102 120103 125104
Carbon,%
TotalPorosity,
45105 28106 89107 10108 39109 9110 1014111
%
GasContent, 300 200
60220113 100330114 60100115 40100117 4080118
scf/ton 350112 300116
Water
Production,
N/A N/A N/A N/A N/A 5500119 5500120
Barrels
water/day
Wellspacing,
60160121 80160 40560122 40160123 640124 40160125 80126
acres
OriginalGasIn
327 52 717 1,500 23 76 160
Place,tcf127
Technically
Recoverable
44 41.6 251 262 11.4 20 19.2
Resources,
tcf128
NOTE:Informationpresentedinthistable,suchasOriginalGasinPlaceandTechnicallyRecoverableResources,ispresentedfor
generalcomparativepurposesonly.Thenumbersprovidedarebasedonthesourcesshownandthisresearchdidnotincludea
resourceevaluation.Rather,publicallyavailabledatawasobtainedfromavarietyofsourcesandispresentedforgeneral
characterizationandcomparison.Resourceestimatesforanybasinmayvarygreatlydependingonindividualcompany
experience,dataavailableatthetimetheestimatewasperformed,andotherfactors.Furthermore,theseestimatesarelikelyto
changeasproductionmethodsandtechnologiesimprove.
Mcf=thousandsofcubicfeetofgas
scf=standardcubicfeetofgas
tcf=trillionsofcubicfeetofgas
#=FortheDepthtobaseoftreatablewaterdata,thedatawasbasedondepthdatafromstateoilandgasagenciesandstate
geologicalsurveydata.
N/A=Datanotavailable
17

TheBarnettShale
TheBarnettShaleislocatedintheFortWorthBasinofnorthcentralTexas.ItisaMississippian
ageshaleoccurringatadepthof6,500feetto8,500feet(Exhibit11andExhibit13131)andis
boundedbylimestoneformationsabove(MarbleFallsLimestone)andbelow(ChappelLimestone)
(Exhibit12).
Withover10,000wellsdrilledtodate,theBarnettShaleisthemostprominentshalegasplayinthe
U.S.132.Ithasbeenashowcaseformoderntightreservoirdevelopmenttypicalofgasshalesinthe
U.S.133.ThedevelopmentoftheBarnettShalehasbeenaprovinggroundforcombiningthe
technologiesofhorizontaldrillingandlargevolumehydraulicfracturetreatments.Drilling
operationscontinueexpandingtheplayboundariesoutward;atthesametime,operationshave
turnedtowardsinfilldrillingtoincreasetheamountofgasrecovered134.Horizontalwell
completionsintheBarnettareoccurringatwellspacingrangingfrom60to160acresperwell
(Exhibit11).
TheBarnettShalecoversanareaofabout5,000squaremileswithanapproximatethickness
rangingfrom100feet(ft)tomorethan600ft(Exhibit11).Theoriginalgasinplaceestimatefor
theBarnettShaleis327tcfwithestimatedtechnicallyrecoverableresourcesof44tcf(Exhibit11).
Thegascontentisthehighestamongthemajorshaleplays,rangingfrom300standardcubicfeet
perton(scf/ton)to350scf/tonofrock(Exhibit11).
EXHIBIT13:BARNETTSHALEINTHEFORT
EXHIBIT12:STRATIGRAPHYOFTHE
WORTHBASIN
BARNETTSHALE
Period Group/Unit
Clear Fork Grp
Permian
Leonardian
Wichita Grp
Wolfcampian
Cisco Grp
Virgilian
Pennsylvanian
Missourian Canyon Grp

Desmoinesian Strawn Grp
Atokan Bend Grp
Marble Falls
Morrowan
Limestone
Chesterian
Mississippian
- Meramecian Barnett Shale
Osagean Chappel
Limestone
Viola
Ordovician
Limestone
Simpson Grp
Canadian
Ellenburger Grp
Source: Hayden and Pursell, 2005129
AAPG, 1987 130
18
TheFayettevilleShale
TheFayettevilleShaleissituatedintheArkomaBasinofnorthernArkansasandeasternOklahoma
overadepthrangeof1,000ftto7,000ft(Exhibit15135andExhibit11).TheFayettevilleShaleisa
Mississippianageshaleboundedbylimestone(PitkinLimestone)aboveandsandstone(Batesville
Sandstone)below(Exhibit14).
DevelopmentoftheFayettevillebeganintheearly2000sasgascompaniesthathadexperienced
successintheBarnettShaleoftheFortWorthBasinidentifiedparallelsbetweenitandthe
MississippianagedFayettevilleShaleintermsofageandgeologiccharacter136.Lessonslearned
fromthehorizontaldrillingandhydraulicfracturingtechniquesemployedintheBarnett,when
adaptedtodevelopmentoftheFayettevilleShale,madethisplayeconomical137.Between2004and
2007thenumberofgaswellsdrilledannuallyintheFayettevilleshalejumpedfrom13tomore
than600,andgasproductionfortheshaleincreasedfromjustover100MMcf/yrtoapproximately
88.85bcf/yr138.Withover1,000wellsinproductiontodate,theFayettevilleShaleiscurrentlyon
itswaytobecomingoneofthemostactiveplaysintheU.S.139.
TheareaoftheFayettevilleShaleplayisnearlydoublethatoftheBarnettShaleat9,000square
miles,withwellspacingrangingfrom80to160acresperwell,andpayzonethicknessaveraging
between20ftand200ft(Exhibit11).ThegascontentfortheFayettevilleShalehasbeen
measuredat60to220scf/ton,whichislessthanthe300to350scf/tongascontentoftheBarnett.
ThelowergascontentoftheFayetteville,ascomparedtotheBarnett,resultsinlowerestimatesof
theoriginalgasinplaceandtechnicallyrecoverableresources:52tcfand41.6tcfrespectively
(Exhibit11).
EXHIBIT14:STRATIGRAPHYOF
THEFAYETTEVILLESHALE
Period Group/Unit
Atoka
Pennsylvanian
Bloyd EXHIBIT15:FAYETTEVILLESHALEINTHE
Prairie
ARKOMABASIN
Grove
Hale
CaneHill
CARBONIFEROUS
(IMO)
Pitkin
Mississippian
Fayetteville
Batesville
Moorefield
Boone
Source:Hillwood,2007140 Source: ALL Consulting, 2009
19
TheHaynesvilleShale
TheHaynesvilleShale(alsoknownastheHaynesville/Bossier)issituatedintheNorthLouisiana
SaltBasininnorthernLouisianaandeasternTexaswithdepthsrangingfrom10,500ftto13,500ft
(Exhibit17141andExhibit11).TheHaynesvilleisanUpperJurassicageshaleboundedby
sandstone(CottonValleyGroup)aboveandlimestone(SmackoverFormation)below(Exhibit16).
In2007,afterseveralyearsofdrillingandtesting,theHaynesvilleShalemadeheadlinesasa
potentiallysignificantgasreserve,althoughthefullextentoftheplaywillonlybeknownafter
severalmoreyearsofdevelopmentarecompleted142.
TheHaynesvilleShalecoversanareaofapproximately9,000squaremileswithanaverage
thicknessof200ftto300ft(Exhibit11).ThethicknessandarealextentoftheHaynesvillehas
allowedoperatorstoevaluateawidervarietyofspacingintervalsrangingfrom40to560acresper
well(Exhibit11).Gascontentestimatesfortheplayare100scf/tonto330scf/ton.The
HaynesvilleformationhasthepotentialtobecomeasignificantshalegasresourcefortheU.S.with
originalgasinplaceestimatesof717tcfandtechnicallyrecoverableresourcesestimatedat251tcf
(Exhibit11).
EXHIBIT16:STRATIGRAPHYOF
THEHAYNESVILLESHALE EXHIBIT17:HAYNESVILLESHALEIN
THETEXAS&LOUISIANABASIN
Period Group/Unit
Navarro
Taylor
Austin
EagleFord
Cretaceous
Tuscaloosa

Washita
Fredericksburg
TrinityGroup
NuevoLeon
CottonValleyGroup
Upper Haynesville
Jurassic
Smackover
Norphlet
Middle Louann
Lower Werner
Triassic
Upper EagleMills
Source: Johnson, et al., 2000143
20
TheMarcellusShale
TheMarcellusShaleisthemostexpansiveshalegasplay,spanningsixstatesinthenortheastern
U.S.(Exhibit19144).TheestimateddepthofproductionfortheMarcellusisbetween4,000ftand
8,500ft(Exhibit11).TheMarcellusShaleisaMiddleDevonianageshaleboundedbyshale
(HamiltonGroup)aboveandlimestone(TristatesGroup)below(Exhibit18).
Followinganincreaseingasprices,triggeredbytheNaturalGasPolicyAct(NGPA)of1978,
Devonianshalegasdevelopmentroseintheearlytomid1980sinthenortheast,butdecreasing
gaspricesresultedinuneconomicalwellsanddecliningproductionthroughthe1990s145.In2003,
RangeResourcesCorporationdrilledthefirsteconomicallyproducingwellsintotheMarcellus
formationinPennsylvaniausinghorizontaldrillingandhydraulicfracturingtechniquessimilarto
thoseusedintheBarnettShaleformationofTexas146.RangeResourcesbeganproducingthis
formationin2005.AsofSeptember2008,therewereatotalof518wellspermittedin
PennsylvaniaintheMarcellusshaleand277oftheapprovedwellshadbeendrilled147.
TheMarcellusShalecoversanareaof95,000squaremilesatanaveragethicknessof50ftto200ft
(Exhibit11).WhiletheMarcellusislowerinrelativegascontentat60scf/tonto100scf/ton,the
muchlargerareaofthisplaycomparedtotheothershalegasplaysresultsinahigheroriginalgas
inplaceestimateofupto1,500tcf(Exhibit11).
AtanaveragewellspacingintheMarcellusis40to160acresperwell(Exhibit11).Thedatain
Exhibit11showtechnicallyrecoverableresourcesfortheformationtobe262tcf,althoughmuch
liketheHaynesville,theplayspotentialestimatesarefrequentlybeingrevisedupwardduetoits
earlystageofdevelopment.
EXHIBIT19:MARCELLUSSHALEINTHE

APPALACHIANBASIN
MARCELLUSSHALE
Period Group/Unit
Penn Pottsville
Miss Pocono
Conewango
Conneaut
Canadaway
Upper
WestFalls
Sonyea
Devonian
Genesee
Tully
Moscow
Hamilton
Middle Ludlowville
Group
Skaneateles
Marcellus
Onandaga
Tristates
Lower
Helderberg
Source: Arthur et al, 2008148
21
TheWoodfordShale
LocatedinsouthcentralOklahoma,theWoodfordShalerangesindepthfrom6,000ftto11,000ft
(Exhibit21149andExhibit11).ThisformationisaDevonianageshaleboundedbylimestone
(OsageLime)aboveandundifferentiatedstratabelow(Exhibit20).
RecentnaturalgasproductionintheWoodfordShalebeganin2003and2004withverticalwell
completionsonly150.However,horizontaldrillinghasbeenadoptedintheWoodford,asinother
shalegasplays,duetoitssuccessintheBarnettShale151.
TheWoodfordShaleplayencompassesanareaofnearly11,000squaremiles(Exhibit11).The
Woodfordplayisinanearlystageofdevelopmentandisoccurringataspacingintervalof640
acresperwell(Exhibit11).TheaveragethicknessoftheWoodfordShalevariesfrom120ftto220
ftacrosstheplay(Exhibit11).
GascontentintheWoodfordShaleishigheronaverage
EXHIBIT20:STRATIGRAPHYOFTHE thansomeoftheothershalegasplaysat200scf/tonto
WOODFORDSHALE 300scf/ton(Exhibit11).Theoriginalgasinplace
Period Group/Unit
estimatefortheWoodfordShaleissimilartothe
FayettevilleShaleat23tcfwhilethetechnically
Ochoan
Cloyd Chief Fm recoverableresourcesare11.4tcf(Exhibit11).
Guadalupian White Horse Grp
Permian
El Reno Grp
Leonardian Enid Grp
Chase Grp
Wolfcampian Council Grove Grp
EXHIBIT21:WOODFORDSHALEINTHE
Admire Grp
ANADARKOBASIN
Atokan Atoka Grp
Penn.
Morrowan Morrow Grp

Chesterian Chester Grp
Mississippian
Meramecian Meramec Lime

Miss Lime
Osagean
Osage Lime
Kinderhookian
Woodford Shale
Upper
Devonian
Middle Undifferentiated

Hunton
HaraganFm
Lower
Grp
Henryhouse
Fm
Source: Cardott, 2007152
AAPG, 1983153
22
TheAntrimShale
TheAntrimShaleislocatedintheupperportionofthelowerpeninsulaofMichiganwithinthe
MichiganBasin(Exhibit23154).ThisLateDevonianageshaleisboundedbyshale(BedfordShale)
aboveandbylimestone(SquawBayLimestone)belowandoccursatdepthsof600ftto2,200ft
whichismoretypicalofCBNGformationsthanmostgasshales(Exhibit22andExhibit11).
AsidefromtheBarnett,theAntrimShalehasbeenoneofthemostactivelydevelopedshalegas
playswithitsmajorexpansiontakingplaceinthelate1980s155.
TheAntrimShaleencompassesanareaofapproximately12,000squaremilesandischaracterized
bydistinctdifferencesfromothergasshales:shallowdepth,smallstratigraphicthicknesswith
averagenetpayof70ftto120ft,andgreatervolumesofproducedwaterintherangeof5to500
bbls/day/well156(Exhibit11).
ThegascontentoftheAntrimShalerangesbetween40scf/tonand100scf/ton(Exhibit11).The
originalgasinplacefortheAntrimisestimatedat76tcfwithtechnicallyrecoverableresources
estimatedat20tcf(Exhibit11).Wellspacingrangesfrom40acresto160acresperwell.
ANTRIMSHALE
Period Group/Unit
Quaternary Pleistocene Glacial Drift
Jurassic Middle Ionia Formation EXHIBIT23:ANTRIMSHALEINTHE

MICHIGANBASIN
Late Grand River Formation
Pennsylvanian Saginaw Formation

Early
Parma Formation
Late
Bayport Limestone
Mississippian Michigan Formation
Marshall Sandstone
Early Coldwater Shale
Sunbury Shale
Berea
Ellsworth
Sandstone
Shale
Bedford
Shale
Devonian Late Upper Member
Lachine Member
Antrim
Shale
Paxton Member
Norwood
Member
Squaw Bay Limestone
Source: Catacosinos, et al., 2000 157
23
EXHIBIT24:STRATIGRAPHYOFTHE TheNewAlbanyShale
NEWALBANYSHALE
TheNewAlbanyShaleislocatedintheIllinoisBasin
Period Formation
inportionsofsoutheasternIllinois,southwestern
Mattoon
Missourian Bond Indiana,andnorthwesternKentucky159(Exhibit
Patoka 25160).SimilartotheAntrimShale,theNewAlbany
Pennsylvanian
Shelburn occursatdepthsbetween500ftand2,000ft
Dugger (Exhibit11)andisashallower,waterfilledshale
Desmoinesian Petersburg
Linton
withamoreCBNGlikecharacterthantheothergas
Staunton shalesdiscussedinthissection.TheNewAlbany
Atokan Brazil formationisaDevoniantoMississippianageshale
Morrowan Mansfield boundedbylimestoneabove(RockfordLimestone)
Tobinsport
andbelow(NorthVernonLimestone)(Exhibit24).
Branchville
Tar Springs
Glen Dean Limestone TheNewAlbanyShaleisoneofthelargestshalegas
Hardinsburg plays,encompassinganareaofapproximately
Haney Limestone 43,500squaremileswithapproximately80acre
Big Clifty
Chesterian Beech Creek Limestone spacingbetweenwells(Exhibit11).Similartothe
Cypress Elwren AntrimShale,theNewAlbanyplayhasathinner
Reelsville Limestone averagenetpaythicknessof50ftto100ftandhas
Sample
Beaver Bend Limestone
wellswhichaverage5to500bblsofwaterper
Bethel day161(Exhibit11).Themeasuredgascontentofthe
Mississippian
Paoli Limestone NewAlbanyShalerangesfrom40scf/tonto80

Ste. Genevieve Ls.
scf/ton.TheoriginalgasinplacefortheNew
St. Louis Limestone
Salem Limestone Albanyformationisestimatedat160tcfwith
Harrodsburg Limestone technicallyrecoverableresourcesestimatedatless
Muldraugh Ramp Creek than20tcf(Exhibit11).
Valmeyeran Edwardsville
Spickert Knob
New Providence Sh. EXHIBIT25:NEWALBANYSHALEINTHE
ILLINOISBASIN
Coldwater
Rockford Ls
Sh.
Sunbury
Kinderhookian
Sh.
Ellsworth
New Albany Sh.
Senecan Shale
Chautauquan
Devonian
Antrim Sh.
North Vernon
Erian Transverse
Ls.
Jeffersonville Detroit
Ls. River
Source:IndianaGeologicalSurvey,1986158 Source: ALL Consulting, 2009
24
REGULATORYFRAMEWORK
ThedevelopmentandproductionofoilandgasintheU.S.,includingshalegas,areregulatedunder
acomplexsetoffederal,state,andlocallawsthataddresseveryaspectofexplorationand
operation.Allofthelaws,regulations,andpermitsthatapplytoconventionaloilandgas
explorationandproductionactivitiesalsoapplytoshalegasdevelopment.TheU.S.Environmental
ProtectionAgency(EPA)administersmostofthefederallaws,althoughdevelopmentonfederally
ownedlandismanagedprimarilybytheBureauofLandManagement(BLM),whichispartofthe
DepartmentoftheInterior,andtheU.S.ForestService,whichispartoftheDepartmentof
Agriculture.Inaddition,eachstateinwhichoilandgasisproducedhasoneormoreregulatory
agenciesthatpermitwells,includingtheirdesign,location,spacing,operation,andabandonment,
aswellasenvironmentalactivitiesanddischarges,includingwatermanagementanddisposal,
wastemanagementanddisposal,airemissions,undergroundinjection,wildlifeimpacts,surface
disturbance,andworkerhealthandsafety.Manyofthefederallawsareimplementedbythestates
underagreementsandplansapprovedbytheappropriatefederalagencies.Thoselawsandtheir
delegationarediscussedbelow.
FederalEnvironmentalLawsGoverningShaleGasDevelopment
Aseriesoffederallawsgovernsmostenvironmentalaspectsofshalegasdevelopment.For
example,theCleanWaterAct(CWA)regulatessurfacedischargesofwaterassociatedwithshale
gasdrillingandproduction,aswellasstormwaterrunofffromproductionsites.TheSafeDrinking
WaterAct(SDWA)regulatestheundergroundinjectionoffluidsfromshalegasactivities.The
CleanAirAct(CAA)limitsairemissionsfromengines,gasprocessingequipment,andothersources
associatedwithdrillingandproduction.TheNationalEnvironmentalPolicyAct(NEPA)requires
thatexplorationandproductiononfederallandsbethoroughlyanalyzedforenvironmental
impacts.
However,federalagenciesdonothavetheresourcestoadministeralloftheseenvironmental
programsforalltheoilandgassitesaroundthecountry.Also,asexplainedbelow,onesetof
nationwideregulationsmaynotalwaysbethemosteffectivewayofassuringthedesiredlevelof
environmentalprotection.Therefore,mostofthesefederallawshaveprovisionsforgranting
primacytothestates(i.e.,stateagenciesimplementtheprogramswithfederaloversight).By
statute,statesmayadopttheirownstandards;
however,thesemustbeatleastasprotectiveas Bystatute,statesmayadopttheir
thefederalstandardstheyreplace,andmayeven ownstandards;however,thesemust
bemoreprotectiveinordertoaddresslocal beatleastasprotectiveasthefederal
conditions.Oncethesestateprogramsare standardstheyreplace,andmayeven
approvedbytherelevantfederalagency(usually bemoreprotectiveinorderto
theEPA),thestatethenhasprimacyjurisdiction. addresslocalconditions.
StateRegulation
Stateregulationoftheenvironmentalpracticesrelatedtoshalegasdevelopment,usuallywith
federaloversight,canmoreeffectivelyaddresstheregionalandstatespecificcharacterofthe
activities,comparedtoonesizefitsallregulationatthefederallevel162.Someofthesespecific
factorsinclude:geology,hydrology,climate,topography,industrycharacteristics,development
history,statelegalstructures,populationdensity,andlocaleconomics.Thestateagenciesthat
25
permitthesepracticesandmonitorandenforcetheirlawsandregulationsmaybelocatedinthe
stateDepartmentofNaturalResources(suchasinOhio)orintheDepartmentofEnvironmental
Protection(suchasinPennsylvania).TheTexasRailroadCommissionregulatesoilandgasactivity
inthenationslargestoilandgasproducingstate,hometotheBarnettShale.Thenamesand
organizationalstructuresvary,butthefunctionsareverysimilar.Often,multipleagenciesare
involved,havingjurisdictionoverdifferentactivitiesandaspectsofdevelopment.
Thesestateagenciesdonotonlyimplementandenforcefederallaws;theyalsohavetheirownsets
ofstatelawstoadminister.Thesestatelawsoftenaddadditionallevelsofenvironmental
protectionandrequirements.Also,severalstateshavetheirownversionsofthefederalNEPAlaw,
requiringenvironmentalassessmentsandreviewsatthestatelevelandextendingthosereviews
beyondfederallandstostateandprivatelands.
Stateshavemanytoolsattheirdisposaltoassure
Thestateshavebroadpowersto thatshalegasoperationsdonotadverselyimpact
regulate,permit,andenforceall theenvironment.Theregulationofshalegas
activitiesthedrillingandfracture drillingandproductionisacradletograve
ofthewell,productionoperations, approach.Thestateshavebroadpowersto
managementanddisposalofwastes, regulate,permit,andenforceallactivitiesthe
andabandonmentandpluggingof drillingandfractureofthewell,production
thewell. operations,managementanddisposalofwastes,
andabandonmentandpluggingofthewell.
Differentstatestakedifferentapproachestothisregulationandenforcement,butstatelaws
generallygivethestateoilandgasdirectororagencythediscretiontorequirewhateveris
necessarytoprotecthumanhealthandtheenvironmenta.Inadditiontothegeneralprotection
regulations,moststateshaveageneralprohibitionagainstpollutionfromoilandgasdrillingand
productionb.Mostofthestaterequirementsarewrittenintorulesorregulations,whilesomeare
addedtopermitsonacasebycasebasisasaresultofenvironmentalreview,ontheground
inspections,publiccomments,orcommissionhearings.
Allstatesrequireapermitbeforeanoperatorcandrillandoperateagaswell.Theapplicationfor
thispermitincludesalltheinformationaboutawellslocation,construction,operationand
reclamation.Agencystaffreviewstheapplicationforcompliancewithregulationsandtoassure
adequateenvironmentalsafeguards.Ifnecessary,asiteinspectionwillbemadebeforepermit
approval.Also,moststatesrequireoperatorstopostabondorotherfinancialsecuritywhen
gettingadrillingpermittoensurecompliancewithstateregulationsandtomakesurethatthere
arefundstoproperlyplugthewellonceproductionceases.Anothersafeguardisthatproducers
a
An example of this type of provision is the following from Pennsylvanias statute: [T]he department shall have the authority to
issue such orders as are necessary to aid in the enforcement of the provisions of [the oil and gas] act. (58 P.S. section 601.503.).
b
An example of such language can be found in New Yorks rules, which state: The drilling, casing and completion program
adopted for any well shall be such as to prevent pollution. Pollution of the land and/or of surface or ground fresh water resulting
from exploration or drilling is prohibited. (6 NYCRR Part 554). Another example is the requirement in the rules of the Texas
Railroad Commission: No person conducting activities subject to regulation by the commission may cause or allow pollution of
surface or subsurface water in the state. (TAC 16.1.3.8).
26
generallymustnotifythestateagenciesofanysignificantnewactivitythroughasundrynoticeor
anewpermitapplicationsothattheagencyisawareofthatactivityandcanreviewitc.
Stateshaveimplementedvoluntaryreviewprocessestohelpensurethatthestateprogramsareas
effectiveaspossible.TheGroundWaterProtectionCouncil(GWPC)hasaprogramtoreviewstate
implementationoftheUndergroundInjectionControl(UIC)program.InadditiontotheGWPCUIC
review,stateoilandgasenvironmentalprogramsotherthanUICprogramscanalsobeperiodically
reviewedagainstasetofguidelinesdevelopedbyanindependentbodyofstate,industry,and
environmentalstakeholders,knownasSTRONGER(StateReviewofOilandNaturalGas
EnvironmentalRegulation,Inc.)163.Periodicevaluationsofstateexplorationandproductionwaste
managementprogramshaveprovenusefulinimprovingtheeffectivenessofthoseprogramsand
increasingcooperationbetweenfederalandstateregulatoryagencies.Todate,18stateshavebeen
reviewedunderthestatereviewguidelines,andseveralhavebeenreviewedmorethanonce.The
STRONGERprogramhasdocumentedtheeffectivenessofandimprovementsinthesestateoiland
gasenvironmentalprograms164,165.TheInterstateOilandGasCompactCommission(IOGCC)also
completedstatereviewsusingearlierversionsoftheguidelinespriortotheformationof
STRONGER.
Theorganizationofregulatoryagencieswithinthevariousoilandgasproducingstatesvaries
considerably.Somestateshaveseveralagenciesthatmayoverseesomefacetofoilandgas
operations,especiallyenvironmentalrequirements.Theseagenciesmaybeinvariousdepartments
ordivisionswithinthestatesorganizations.Thesevariousapproacheshavedevelopedovertime
withineachstate,andeachstatetriestocreateastructurethatbestservesitscitizenryandallof
theindustriesthatitmustoversee.Theoneconstantisthateachoilandgasproducingstatehas
oneagencywithprimaryresponsibilityforpermittingwellsandoverseeinggeneraloperations.
Whilethisagencymayworkwithotheragenciesintheregulatoryprocess,theycanserveasagood
sourceofinformationaboutthevariousagenciesthatmayhavejurisdictionoveroilandgas
activities.Exhibit26providesalistoftheagencieswithprimaryresponsibilityforoilandgas
regulationineachofthestatesthathaveorarelikelytohaveshalegasproduction.
LocalRegulation
Inadditiontostateandfederalrequirements,additionalrequirementsregardingoilandgas
operationsmaybeimposedbyotherlevelsofgovernmentinspecificlocations.Entitiessuchas
cities,counties,tribes,andregionalwaterauthoritiesmayeachsetoperationalrequirementsthat
affectthelocationandoperationofwellsorrequirepermitsandapprovalsinadditiontothoseat
thefederalorstatelevel.
c
See, for example, Louisiana Statewide Order 29-B, section 105, or Texas Administrative Code 16.1.3.5.
27
EXHIBIT26:OILANDGASREGULATORYAGENCIESINSHALEGASSTATES
State Agency WebAddress
GeologicalSurveyofAlabama,StateOiland
Alabama http://www.ogb.state.al.us/ogb/ogb.html
GasBoard
Arkansas ArkansasOilandGasCommission http://www.aogc.state.ar.us/
ColoradoDepartmentofNaturalResources,
Colorado http://cogcc.state.co.us/
OilandGasConservationCommission
IllinoisDepartmentofNaturalResources,
Illinois http://dnr.state.il.us/mines/dog/index.htm
DivisionofOilandGas
IndianaDepartmentofNaturalResources,
Indiana http://www.in.gov/dnr/dnroil/
DivisionofOilandGas
KentuckyDepartmentforEnergy
Kentucky DevelopmentandIndependence,Divisionof http://www.dogc.ky.gov/
OilandGasConservation
LouisianaDepartmentofNaturalResources,
Louisiana http://dnr.louisiana.gov/cons/conserv.ssi
OfficeofConservation
MichiganDepartmentofEnvironmental http://www.michigan.gov/deq/0,1607,7135
Michigan
Quality,OfficeofGeologicalSurvey 3306_28607,00.html
Mississippi MississippiStateOilandGasBoard http://www.ogb.state.ms.us/
MontanaDepartmentofNaturalResources
Montana http://bogc.dnrc.mt.gov/default.asp
andConservation,BoardofOilandGas
NewMexicoEnergy,MineralsandNatural
NewMexico ResourcesDepartment,OilConservation http://www.emnrd.state.nm.us/OCD/
Division
NewYorkDepartmentofEnvironmental
NewYork http://www.dec.ny.gov/energy/205.html
Conservation,DivisionofMineralResources
NorthDakotaIndustrialCommission,
NorthDakota DepartmentofMineralResourcesOilandGas https://www.dmr.nd.gov/oilgas/
Division
OhioDepartmentofNaturalResources, http://www.ohiodnr.com/mineral/default/tabid
Ohio
DivisionofMineralResourcesManagement /10352/Default.aspx
OklahomaCorporationCommission,Oiland http://www.occ.state.ok.us/Divisions/OG/neww
Oklahoma
GasConservationDivision eb/og.htm
PennsylvaniaDepartmentofEnvironmental
http://www.dep.state.pa.us/dep/DEPUTATE/MI
Pennsylvania Protection,BureauofOilandGas
NRES/OILGAS/oilgas.htm
Management
TennesseeDepartmentofEnvironmentand http://www.tennessee.gov/environment/boards
Tennessee
Conservation,StateOilandGasBoard /oilandgas.shtml
Texas TheRailroadCommissionofTexas http://www.rrc.state.tx.us/index.html
WestVirginiaDepartmentofEnvironmental
WestVirginia http://www.wvdep.org/item.cfm?ssid=23
Protection,OfficeofOilandGas
28
Whenoperationsoccurinornearpopulatedareas,localgovernmentsmayestablishordinancesto
protecttheenvironmentandthegeneralwelfareofitscitizens.Theselocalordinancesfrequently
requireadditionalpermitsforissuessuchaswellplacementinfloodzones,noiselevel,setbacks
fromresidencesorotherprotectedsites,sitehousekeeping,andtraffic.Forexample,ordinances
maysetlimitsonnoiselevelsthatmaybegeneratedduringbothdaytimeandnighttime
operations166,167,168,169.
Insomecases,regionalwaterpermittingauthoritiesthathavejurisdictioninmultiplestateshave
alsobeenestablished.Thesefederallyestablishedauthoritieshavebeencreatedtoprotectthe
waterqualityoftheentireriverbasinandtogovernusesofthewater170.Additionalapprovalsand
permitsmayberequiredforoperationsintheseriverbasins.Forexample,theDelawareRiver
BasinCommission(DRBC)coverspartsofNewYork,Pennsylvania,NewJerseyandDelaware171.
Naturalgasoperatorswishingtowithdrawwaterforconsumptiveuseinthisbasinmustfirst
receiveapermitfromtheDRBC,whichhasthelegalauthoritytofineviolatorsoftheirrulesand
regulations.
Thevarietyoflawsgoverningshalegasexplorationandproduction,andthemultitudeoffederal
andstateagenciesthatimplementthem,cansometimesbeconfusing.Therefore,thefollowing
discussionhasbeenorganizedaccordingtothevariousenvironmentalmediathatareaffectedby
theseactivities,i.e.,water,air,andland.Themajorlawsandprogramsaffectingeachoftheseare
discussedbelow.Additionalconsiderationsonfederallandanduniquestaterequirementsarealso
covered,alongwithsomeoftheprogramsthatcutacrosstheseenvironmentalmedia.
RegulationofImpactsonWaterQuality
Potentialimpactstowaterqualityareprimarilyregulatedunderseveralfederalstatutesandthe
accompanyingstateprograms.Theprimaryfederalstatutesgoverningwaterqualityissuesrelated
toshalegasdevelopmentaretheCleanWaterAct,theSafeDrinkingWaterAct,andtheOilPollution
Act.Thesestatutesandtheirrelationshipstoshalegasdevelopmentarediscussedbelow.
CleanWaterAct
TheCleanWaterAct(CWA)istheprimaryfederallawintheU.S.governingpollutionofsurface
water.Itwasestablishedtoprotectwaterquality,andincludesregulationofpollutantlimitsonthe
dischargeofoilandgasrelatedproducedwater.ThisisconductedthroughtheNationalPollutant
DischargeEliminationSystem(NPDES)permittingprocess.AlthoughEPAsetsnationalstandards
atthefederallevel,statesandtribalgovernmentscanacquireprimacyfortheNPDESprogramby
meetingEPAsprimacyrequirements.
TheCWAestablishesthebasicstructureforregulatingdischargesofpollutantsintothewatersof
theU.S.andqualitystandardsforsurfacewaters.ThebasisoftheCWAwasenactedin1948and
wascalledtheFederalWaterPollutionControlAct;theActwassignificantlyreorganizedand
expandedin1972."CleanWaterAct"becameitscommonname,withadditionalamendments
madein1977andlater.
UndertheCWA,EPAhasimplementedpollutioncontrolprogramssuchassettingwastewater
standardsforindustry.Theyhavealsosetwaterqualitystandardsforavarietyofcontaminantsin
surfacewaters.
29
TheCWAmadeitunlawfultodischargeanypollutantfromapointsourceintothenavigablewaters
oftheU.S.,unlessdoneinaccordancewithaspecificapprovedpermit.TheNPDESpermitprogram
controlsdischargesfrompointsourcesthatarediscreteconveyances,suchaspipesormanmade
ditches.Industrial,municipal,andotherfacilitiessuchasshalegasproductionsitesorcommercial
facilitiesthathandlethedisposalortreatmentofshalegasproducedwatermustobtainpermitsif
theyintendtodischargedirectlyintosurfacewaters172,173.Largefacilitiesusuallyhaveindividual
NPDESpermits.Dischargesfromsomesmallerfacilitiesmaybeeligibleforinclusionundergeneral
permitsthatauthorizeacategoryofdischargesundertheCWAwithinageographicalarea.A
generalpermitisnotspecificallytailoredforanindividualdischarger.Mostoilandgasproduction
facilitieswithrelateddischargesareauthorizedundergeneralpermitsbecausetherearetypically
numeroussiteswithcommondischargesinageographicarea.
Astatethatmeetsthefederalprimacyrequirementsisallowedtosetmorestringentstatespecific
standardsforthisprogram.Sinceindividualstatescanacquireprimacyovertheirrespective
programs,itisnotuncommontohavevaryingrequirementsfromstatetostate.Thisvariationcan
affecthowtheoilandgasindustrymanagesproducedwaterwithinadrainagebasinlocatedwithin
twoormorestates,suchastheMarcellusshaleintheAppalachianBasin.Effluentlimitationsserve
astheprimarymechanismunderNPDESpermitsforcontrollingdischargesofpollutantsto
receivingwaters.WhendevelopingeffluentlimitationsforanNPDESpermit,apermitwritermust
considerlimitsbasedonboththetechnologyavailabletocontrolthepollutants(i.e.,technology
basedeffluentstandards)andtheregulationsthatprotectthewaterqualitystandardsofthe
receivingwater(i.e.,waterqualitybasedeffluentstandards).
TheintentoftechnologybasedeffluentlimitsinNPDESpermitsistorequiretreatmentofeffluent
concentrationstolessthanamaximumallowablestandardforpointsourcedischargestothe
specificsurfacewaterbody.Thisisbasedonavailabletreatmenttechnologies,whileallowingthe
dischargertouseanyavailablecontroltechniquetomeetthelimits.Forindustrial(andothernon
municipal)facilities,technologybasedeffluentlimitsarederivedby:1)usingnationaleffluent
limitationsguidelinesandstandardsestablishedbyEPA,or2)usingbestprofessionaljudgment
(BPJ)onacasebycasebasisintheabsenceofnationalguidelinesandstandards.
Priortothegrantingofapermit,theauthorizingagencymustconsiderthepotentialimpactof
everyproposedsurfacewaterdischargeonthequalityofthereceivingwater,notjustindividual
discharges.Iftheauthorizingagencydeterminesthattechnologybasedeffluentlimitsarenot
sufficienttoensurethatwaterqualitystandardswillbeattainedinthereceivingwater,theCWA
[Section303(b)(1)(c)]andNPDESregulations[40CodeofFederalRegulations(CFR)122.44(d)]
requirethatmorestringentlimitsareimposedaspartofthepermit174.
EPAestablisheseffluentlimitationguidelines(ELGs)andstandardsfordifferentnonmunicipal
(i.e.,industrial)categories.Theseguidelinesaredevelopedbasedonthedegreeofpollutant
reductionattainablebyanindustrialcategorythroughtheapplicationofpollutioncontrol
technologies.
30
TheCWArequiresEPAtodevelopspecificeffluentguidelinesthatrepresentthefollowing:
1. Bestconventionaltechnology(BCT)forcontrolofconventionalpollutantsandapplicableto
existingdischargers.
2. Bestpracticabletechnology(BPT)currentlyavailableforcontrolofconventional,toxicand
nonconventionalpollutantsandapplicabletoexistingdischargers.
3. Bestavailabletechnology(BAT)economicallyachievableforcontroloftoxicand
nonconventionalpollutantsandapplicabletoexistingdischargers.
4. Newsourceperformancestandards(NSPS)forconventionalpollutantsandapplicableto
newsources.
Todate,EPAhasestablishedguidelinesandstandardsformorethan50differentindustrial
categories175.
TheELGsforOilandGasExtraction,whichwerepublishedin1979,canbefoundat40CFRPart
435.Theonshoresubcategory,SubpartC,isapplicabletodischargesassociatedwithshalegas
developmentandproduction176.
TheCWAalsoincludesaprogramtocontrolstormwaterdischarges.The1987WaterQualityAct
(WQA)addedSection402(p)totheCWArequiringEPAtodevelopandimplementastormwater
permittingprogram.EPAdevelopedthisprogramintwophases(PhaseI:1990;PhaseII:1999).
ThoseregulationsestablishNPDESpermitrequirementsformunicipal,industrial,andconstruction
sitestormwaterrunoff.TheWQAalsoaddedSection402(l)(2)totheCWAspecifyingthattheEPA
andstatesshallnotrequireNPDESpermitsforuncontaminatedstormwaterdischargesfromoil
andgasexploration,production,processingortreatmentoperations,ortransmissionfacilities.
Thisexemptionapplieswheretherunoffisnotcontaminatedbycontactwithrawmaterialsor
wastes.EPAhadpreviouslyinterpretedthe402(l)(2)exemptionasnotapplyingtoconstruction
activitiesofoilandgasdevelopment,suchasbuildingroadsandpads(i.e.,anNPDESpermitwas
required)177.
TheEnergyPolicyActof2005modifiedtheCWASection402(l)(2)exemptionbydefiningthe
excludedoilandgassectoroperationstoincludealloilandgasfieldactivitiesandoperations,
includingthosenecessarytoprepareasitefordrillingandforthemovementandplacementof
drillingequipment.EPApromulgatedarulethatimplementedthisexemption.However,onMay
23,2008,theU.S.CourtofAppealsfortheNinthCircuitreleasedadecisionvacatingthepermitting
exemptionfordischargesofsedimentfromoilandgasconstructionactivitiesthatcontributeto
violationsoftheCWA178.Thecourtbaseditsdecisiononthefactthatthenewruleexemptedrunoff
contaminatedwithsediment,whiletheCWAdoesnotexemptsuchrunoff.Asaresultofthecourt's
decision,stormwaterdischargescontaminatedwithsedimentresultinginawaterqualityviolation
requirepermitcoverageundertheNPDESstormwaterpermittingprogram.
WhiletheEPAstormwaterpermittingrulecontainsabroadexclusionforoilandgassector
constructionactivities,itisimportanttonotethatindividualstatesandIndiantribesmaystill
regulatestormwaterassociatedwiththeseactivities.EPAhasclarifieditspositionthatstatesand
tribesmaynotregulatesuchstormwaterdischargesundertheirCWAauthority,butarefreeto
regulateundertheirownindependentauthorities.EPAstatesthat[t]hisfinalruleisnotintended
31
tointerferewiththeabilityofstates,tribes,orlocalgovernmentstoregulateanydischarges
throughanonNPDESpermitprogram179.Inadditiontostateandtribalregulation,theindustry
hasavoluntaryprogramofReasonableandPrudentPracticesforStabilization(RAPPS)ofoiland
gasconstructionsites180.ProducersuseRAPPSinordertocontrolerosionandsedimentation
associatedwithstormwaterrunofffromareasdisturbedbyclearing,grading,andexcavating
activitiesrelatedtositepreparation.
SafeDrinkingWaterAct
CongressoriginallypassedtheSafeDrinkingWaterAct(SDWA)in1974toprotectpublichealthby
regulatingthenation'spublicdrinkingwatersupply.Thelawwasamendedin1986and1996and
requiresmanyactionstoprotectdrinkingwateranditssources,includingrivers,lakes,reservoirs,
springs,andgroundwaterwells.SDWAauthorizestheU.S.EPAtosetnationalhealthbased
standardsfordrinkingwatertoprotectagainstbothnaturallyoccurringandmanmade
contaminantsthatmaybefoundindrinkingwater.EPA,states,andmunicipalwatersystem
agenciesthenworktogethertomakesurethatthesestandardsaremet181.
Asoneaspectoftheprotectionofdrinkingwatersupplies,theSDWAestablishesaframeworkfor
theUndergroundInjectionControl(UIC)programtopreventtheinjectionofliquidwastesinto
undergroundsourcesofdrinkingwater(USDWs).TheEPAandstatesimplementtheUICprogram,
whichsetsstandardsforsafewasteinjectionpracticesandbanscertaintypesofinjection
altogether.TheUICProgramprovidesthesesafeguardssothatinjectionwellsdonotendanger
USDWs.ThefirstfederalUICregulationswereissuedin1980.
EPAcurrentlygroupsundergroundinjectionwellsintofiveclassesforregulatorycontrolpurposes,
andhasasixthclassunderconsideration.Eachclassincludeswellswithsimilarfunctions,
constructionandoperatingfeaturessothattechnicalrequirementscanbeappliedconsistentlyto
theclass.
1. ClassIwellsmayinjecthazardousandnonhazardousfluids(industrialandmunicipal
wastes)intoisolatedformationsbeneaththelowermostUSDW.Becausetheymayinject
hazardouswaste,ClassIwellsarethemoststrictlyregulatedandarefurtherregulated
undertheResourceConservationandRecoveryAct(RCRA).
2. ClassIIwellsmayinjectbrinesandotherfluidsassociatedwithoilandgasproduction.
3. ClassIIIwellsmayinjectfluidsassociatedwithsolutionminingofminerals.
4. ClassIVwellsmayinjecthazardousorradioactivewastesintooraboveaUSDWandare
bannedunlessspecificallyauthorizedunderotherstatutesforgroundwaterremediation.
5. ClassVincludesallundergroundinjectionnotincludedinClassesIIV.Generally,mostClass
VwellsinjectnonhazardousfluidsintooraboveaUSDWandareonsitedisposalsystems,
suchasfloorandsinkdrainswhichdischargetodrywells,septicsystems,leachfields,and
drainagewells.InjectionpracticesorwellsthatarenotcoveredbytheUICPrograminclude
singlefamilysepticsystemsandcesspoolsaswellasnonresidentialsepticsystemsand
cesspoolsservingfewerthan20personsthatinjectONLYsanitarywastewater.
6. ClassVIhasbeenproposedspecificallyfortheinjectionofCO2forthepurposeof
sequestration,buthasnotyetbeenestablished.
32
MostinjectionwellsassociatedwithoilandgasproductionareClassIIwells.Thesewellsmaybe
usedtoinjectwaterandotherfluids(e.g.,liquidCO2)intooilandgasbearingzonestoenhance
recovery,ortheymaybeusedtodisposeofproducedwater.Theregulationspecificallyprevents
thedisposalofwastefluidsintoUSDWsbylimitinginjectiononlytoformationsthatarenot
undergroundsourcesofdrinkingwater.EPA'sUICProgramisdesignedtopreventcontamination
ofwatersuppliesbysettingminimumrequirementsforstateUICPrograms.Thebasicpremiseof
theUICProgramistopreventcontaminationofUSDWsbykeepinginjectedfluidswithinthe
intendedinjectionzone.Theinjectedfluidsmustnotendanger,orhavethepotentialtoendanger,a
currentorfuturepublicwatersupply.TheUICrequirementsthataffectthesiting,construction,
operation,maintenance,monitoring,testing,and,finally,closureofinjectionwellshavebeen
establishedtoaddresstheseconcepts.Allinjectionwellsrequireauthorizationundergeneralrules
orspecificpermits.
Thelawwaswrittenwiththeunderstandingthatstatesarebestsuitedtohaveprimary
enforcementauthority(primacy)fortheUICProgram.IntheSDWA,CongresscautionedEPA
againstaonesizefitsallregulatoryscheme,andmandatedconsiderationoflocalconditionsand
practices.Section1421(b)(3)(A)requiresthatUICregulationspermitorprovideconsiderationof
varyinggeological,hydrological,orhistoricalconditionsindifferentstatesandindifferentareas
withinastate.Section1425allowsastatetoobtainprimacyfromEPAforoilandgasrelated
injectionwells,withoutbeingrequiredtoadoptthecompletesetofapplicablefederalUIC
regulations.Thestate
mustbeableto EXHIBIT27:UICCLASSIIPRIMACYMAP
demonstratethatits
existingregulatory
programisprotecting
USDWsaseffectively
asthefederal
requirements182.
Todate,40stateshave
obtainedprimacyfor
oilandgasinjection
wells(ClassII),
although,asshownin
Exhibit27notallof
thesestateshaveoil
andgasproduction.
TheU.S.EPA
administersUIC Source: EPA,, 2008
programsfortenstates,
sevenofwhichareoil
andgasstates,andallotherfederaljurisdictionsandIndianLands183(Exhibit27184).
OilPollutionActof1990SpillPreventionControlandCountermeasure
TheCWAandtheOilPollutionAct(OPA)includebothregulatoryandliabilityprovisionsthatare
designedtoreducedamagetonaturalresourcesfromoilspills.CongressaddedSection311tothe
33
CWA,whichinpartauthorizedthePresidenttoissueregulationsestablishingprocedures,methods,
equipment,andotherrequirementstopreventdischargesofoilfromvesselsandfacilities[Section
311(j)(1)(c)].InresponsetotheExxonValdezoilspillinAlaska,CongressenactedtheOPAin
1990185.TheOPAamendedCWASection311andcontainsprovisionsapplicabletoonshore
facilitiesandoperations.
Section311,asamendedbytheOPA,providesforspillpreventionrequirements,spillreporting
obligations,andspillresponseplanning.Itregulatesthepreventionofandresponsetoaccidental
releasesofoilandhazardoussubstancesintonavigablewaters,onadjoiningshorelines,oraffecting
naturalresourcesbelongingtoormanagedbytheU.S.Thisauthorityisprimarilycarriedout
throughthecreationandimplementationoffacilityandresponseplans.Theseplansareintended
toestablishmeasuresthatwillpreventdischargeofoilintonavigablewatersoftheU.S.oradjoining
shorelinesasopposedtoresponseandcleanupafteraspilloccurs.
AcornerstoneofthestrategytopreventoilspillsfromreachingthenationswatersistheoilSpill
Prevention,ControlandCountermeasure(SPCC)plan.EPApromulgatedregulationstoimplement
thispartoftheOPAof1990.Theseregulationsspecifythat:
1. SPCCPlansmustbeprepared,certified(byaprofessionalengineer)andimplementedby
facilitiesthatstore,process,transfer,distribute,use,drillfor,produce,orrefineoil;
2. Facilitiesmustestablishproceduresandmethodsandinstallproperequipmenttoprevent
anoilrelease;
3. Facilitiesmusttrainpersonneltoproperlyrespondtoanoilspillbyconductingdrillsand
trainingsessions;and,
4. Facilitiesmustalsohaveaplanthatoutlinesstepstocontain,cleanupandmitigateany
effectsthatanoilspillmayhaveonwaterways186.
BeforeafacilityissubjecttotheSPCCrule,itmustmeetthreecriteria:
1. Itmustbenontransportationrelated;
2. Itmusthaveanaggregateabovegroundstoragecapacitygreaterthan1,320gallons(31.4
bbls)oracompletelyburiedstoragecapacitygreaterthan42,000gallons(1,000bbls);and
3. Theremustbeareasonableexpectationofadischargeintooruponnavigablewatersofthe
U.S.oradjoiningshorelines.
AnSPCCPlanisasitespecificdocumentthatdescribesthemeasuresthefacilityownerhastakento
preventoilspills,andwhatmeasuresareinplace,ifneeded,tocontainandcleanspills.Itincludes
informationaboutthefacility,theoilstoragecontainment,inspections,andasitediagramwith
locationsoftanks(aboveandbelowground)anddrainage,andotherpertinentdetails.Prevention
measuresincludesecondarycontainmentaroundtanksandcertainoilcontainingequipment.
TheSPCCprogramisnotasapplicabletoshalegasoperationsasitistooilproductionsites.Shale
gasoperatorsmayhavetoprepareplansiftheystorelargeamountsoffuel(exceedingthevolumes
statedabove)onsite,orifoilfilledequipmentispresent,andthereisariskofthatoilimpacting
watersoftheU.S.
34
InOctober2007,EPAproposedamendmentstotheSPCCruleintendedtoincreaseclarityandtailor
certainrequirementstoensureincreasedcompliance.Amongotherthings,theseamendments
wouldstreamlinesomerequirementsbyallowingtheuseofaplantemplateforsmallerfacilities,
extendingsomedeadlinesforplanpreparation,andexemptingsomevesselsandflowlinesfrom
secondarycontainmentrequirements.Theywouldalsoaddspillpreventionrequirementsforsome
oilandgasfacilities.Theseproposedruleshavenotyetbeenmadefinal187.
StateRegulationsandRegionalCooperation
InadditiontoimplementingfederalstatutesfortheNPDES,UIC,andstormwaterprograms,states
andtribesmayimposetheirownrequirementstoprotecttheirwaterresources,bothsurfaceand
underground.Forexample,theyestablishwaterqualitystandardsforsomeoralloftheirsurface
water.ThesestandardsareapprovedbyEPAandbecomethebaselineforCWApermits188.
Inaddition,someareashaveestablishedregionalwaterauthoritiesthatregulatewater
withdrawalsanddischargeswithinariverbasin.Forexample,theSusquehannaRiverBasin
Commission(SRBC)189andtheDRBC190inNewYorkandPennsylvaniarequirethatentitiesseeking
towithdrawwaterfromtheirriversystemsfirstobtainpermits.Thesecommissionshaveauthority
separatefromthestates.Theyhaverecentlydirectedtheirattentiontothewaterrequirementsfor
drillingandhydraulicallyfracturingMarcellusShalegaswellsandareupdatingtheirrequirements
forbothwaterwithdrawalsanddischargeofthewaterafteruse.Otherriverbasincommissions
aremoreadvisoryinnature,providingwaterflowandqualityinformationandcoordinatingriver
conservationeffortsbystateagenciesandothers.
Stateagenciesaretheprincipalorganizationsforenforcingwaterqualityregulations.Theyhave
inspectors,usuallylocatedatregionalofficesthroughoutthestate,whovisitoilandgaswellsitesto
ensurecompliancewithregulations.Whenaviolationoccurs,stateenforcementandlegal
personneldevelopthecaseandordercompliance,inmanycasesalsoimposingpenaltiesagainst
theviolator.Penaltiescanrangefromfinestorevocationofpermits,andeventocriminalsanctions
inseverecases.Suchpenaltiesareusuallyimposedonlyafterhearingsbeforeaboardof
commissionersorotherstatebody.Inadditiontofinesandpenalties,companiesthatpollute
surfaceorgroundwatermustcleanuporremediatethecontaminationtheycaused.
RegulationofImpactsonAirQuality
AirqualityimpactsareregulatedundertheCleanAirAct(CAA).Asdescribedbelow,theActsets
nationalstandardsforemissionsofcertainpollutantsandrequirespermitsforsomeindustrial
operations.GreenhouseGasesarenotregulatedassuch,andarenot,therefore,discussedinthis
section.
CleanAirAct
TheCAAistheprimarymeansbywhichEPAregulatespotentialemissionsthatcouldaffectair
quality.TheU.S.CongresspassedtheCAAin1963,andtheyhaveamendeditonseveraloccasions
since,mostrecentlyin1990191.TheCAArequiresEPAtosetnationalstandardstolimitlevelsof
certainpollutants.EPAregulatesthosepollutantsbydevelopinghumanhealthbasedand/or
environmentallyandscientificallybasedcriteriaforsettingpermissiblelevels.Airregulationsdo
notnormallyincludeexceptionsforacompanyssize,theageofafield,orthetypeofoperation.
Typically,theairrulesaresilentonissuessuchasconventionalversusunconventionalplays,old
35
versusnewfields,andthedepthofawell.Forthemostpart,theairemissions,applicable
regulations,andassociatedemissionscontrolsforashaleplayarenodifferentthanthoseforany
othernaturalgasoperation.Theremaybedifferencesduetolocation(someareasofthecountry
havebetterairqualitythanothers),equipmentneeds(someshaleplaysmayproduceawettergas
thanothers),andsulfurcontentlevelofthegas.
GeographicareasthatdonotmeetEPAsstandardsforagivenpollutantaredesignatedas
nonattainmentareas192.ThisisthecasefortheBarnettShaleplay,muchofwhichislocatedinor
neartheDallasFortWorthozonenonattainmentarea.Asaresult,BarnettShaleproduction
activitiesmustoftencomplywithmuchmorestringentregulationsthansimilaroperations
proposedoutsideofanonattainmentarea.AsaresultoftheimplementationoftheCAA,airquality
hasimproveddramaticallyacrosstheU.S.duringthelastfewdecadesandexistingregulations
shouldcontinuetoreduceairpollutionemissionsduringthenexttwentyyearsorlonger193.
AirQualityRegulations
LikeanyotherU.S.industry,shalegasproducersmustcomplywithexistingandnewairregulations
includingthoseresultingfromthe1990CAAAmendments.Theserulesposeanongoingchallenge
tocompanyresourcesasproducersstrivetounderstandandcomplywithenforcement,fines,
publicreaction,andpossiblyevenprojectcancellationsinlightofnewstandards.
EPAhasestablishedNationalEmissionStandardsforHazardousAirPollutants(NESHAPs),which
arenationallyuniformstandardstocontrolspecificairemissions.In2007,EPAimplementeda
newstandardreferredtoastheMaximumAchievableControlTechnology(MACT)standardfor
hazardousairpollutants(HAP)thattargetedsmallareasourcessuchasshalegasoperations
locatedinareasnearlargerpopulations.ThesestandardslimitHAPemissions(primarilybenzene)
fromprocessventsonglycoldehydrationunits,storagevesselswithflashemissions,and
equipmentleaks.
Anotherexampleofneworamendedfederalregulationsthatwillhaveadirectimpacton
controllingemissionsfromshalegasoperationsistheStationarySparkIgnitionInternal
CombustionEnginenewsourceperformancestandard194andReciprocatingInternalCombustion
EngineNESHAP195rules,whichregulatenewandrefurbishedengines.Theserules,passedin2007,
targetallinternalcombustionenginesregardlessofhorsepowerrating,location,orfuel(electric
enginesarenotincluded)andincludeextensivemaintenance,testing,monitoring,recordkeeping,
andreportingrequirements196.
EPAisnotlargeenoughtoregulateeveryairemissionssourcenationwide,letaloneconsiderthe
localandregionaldifferences.Therefore,theytypicallydelegatethatroletolocal,state,andtribal
agencies.Thisdelegationofauthoritycanincluderuleimplementation,permitting,reporting,and
compliance.Anystategivensuchdelegationofauthoritycanpassmorerestrictiverules,butthey
areprohibitedfrompassingarulethatislessstringentthanitsfederalcounterpart.
AirPermits
Airpermitsarelegaldocumentsthatfacilityownersandoperatorsmustabideby.Thepermit
specifieswhatconstructionisallowed,whatemissionlimitsmustbemet,howtheemissions
source(s)mustbeoperated,andwhatconditionsspecifyingmonitoring,recordkeeping,and
36
reportingrequirementsmustbemaintainedtoassureongoingcompliance.Shalegasproducers
mayneedairqualitypermitsforanumberofemissionssources,includinggascompressorengines,
glycoldehydrators,andflares.
Acompanyspermittingresponsibilitydoesnotendwiththeissuanceoftheirinitialairpermit.
Theymustbeconstantlyvigilantthatanewregulation,modification,replacement,orprocess
changedoesnotimpacttheirexistingpermitandrequireapermitamendmentoramorestringent
permit.Althoughthesepermitsmaydifferacrossthecountry,theyallcontainspecificconditions
designedtoensurestateandfederalstandardsaremetandtopreventanysignificantdegradation
inairqualityasaresultofaproposedactivity.
RegulationofImpactstoLand
Impactstolandfromshalegasoperationsincludesolidwastedisposalandsurfacedisturbances
thatmayimpactthevisuallandscapeormayaffectwildlifehabitat.Operationsonfederallandsare
aspecialcasewithuniquerequirementsthatarediscussedbelow.
ResourceConservationandRecoveryAct(RCRA)
RCRAwaspassedin1976toaddressthegrowingproblemsoftheincreasingvolumeofmunicipal
andindustrialwaste.RCRAestablishedgoalsforprotectinghumanhealthandtheenvironment,
conservingresources,andreducingtheamountofwaste.RCRASubtitleCestablishedafederal
programtomanagehazardouswastesfromcradletogravetoensurethathazardouswasteis
handledinamannerthatprotectshumanhealthandtheenvironment.SubtitleDoftheRCRA
addressesnonhazardoussolidwastes,includingcertainhazardouswasteswhichareexempted
fromtheSubtitleCregulations197.
In1978,EPAproposedhazardouswastemanagementstandardsthatincludedreduced
requirementsforsomeindustries,includingoilandgas,withlargevolumesofwastes.EPA
determinedthattheselargevolumespecialwasteswerelowerintoxicitythanotherwastesbeing
regulatedashazardouswasteundertheRCRA198.
In1980,theSolidWasteDisposalAct(SWDA)amendedRCRAtoexemptdrillingfluids,produced
waters,andotherwastesassociatedwithexploration,development,andproductionofcrudeoil,
naturalgasandgeothermalenergy199.TheSWDAAmendmentsalsorequiredEPAtoprovidea
reporttoCongressonthesewastesandtomakearegulatorydeterminationastowhether
regulationofthesewastesunderRCRASubtitleCwaswarranted200.
In1987,EPAissuedaReporttoCongressthatoutlinedthe
resultsofastudyonthemanagement,volume,and
In1988,EPAissuedafinal toxicityofwastesgeneratedbytheoil,naturalgasand
regulatorydeterminationstating
geothermalindustries.In1988,EPAissuedafinal
thatcontrolofoilandgas regulatorydeterminationstatingthatcontrolofoiland
explorationandproduction gasexplorationandproductionwastesunderRCRA
wastesunderRCRASubtitleC
SubtitleCwasnotwarranted.EPAmadethis
wasnotwarranted. determinationbecauseitfoundthatotherstateand
federalprogramscouldprotecthumanhealthandthe
37
environmentmoreeffectively.InlieuofregulationunderSubtitleC,EPAimplementedathree
prongedstrategytoensurethattheenvironmentalandprogrammaticissueswereaddressed:
1. Improveotherfederalprogramsunderexistingauthorities;
2. Workwithstatestoimprovesomeprograms;and
3. WorkwithCongresstodevelopanyadditionalstatutoryauthoritiesthatmayberequired201.
ThesewasteshaveremainedexemptfromSubtitleCregulations,butthisdoesnotprecludethese
wastesfromcontrolunderstateregulationsorotherfederalregulations202.Theexemptionapplies
onlytothefederalrequirementsofRCRASubtitleC.AwastethatisexemptfromSubtitleC
regulationmightbesubjecttomorestringentorbroaderstatehazardousandnonhazardouswaste
regulationsandotherstateandfederalprogramregulations.Forexample,oilandgasexploration
andproductionwastesmaybesubjecttoregulationunderRCRASubtitleD,theCleanAirAct,the
CleanWaterAct,theSafeDrinkingWaterAct,and/ortheOilPollutionActof1990203,204.
In1989,EPAworkedwiththeInterstateOilandGasCompactCommission(IOGCC),state
regulatoryofficials,industryrepresentatives,andnationallyrecognizedenvironmentalgroupsto
establishaCouncilonRegulatoryNeeds.Thepurposeofthecouncilwastoreviewexistingstateoil
andgasexplorationandproductionwastemanagementprogramsandtodevelopguidelinesto
describetheelementsnecessaryforaneffectivestateprogram.ThiseffortwasbegunbyEPAas
partofthesecondprongoftheagencysapproach.Thesegroupsthenworkedtogetherwithstate
regulatoryagenciestoreviewthestateprograms,onavoluntarybasis,againsttheseguidelinesand
tomakerecommendationsforimprovement.Thisstatereviewprogramcontinuestodayunderthe
guidanceofanonprofitorganizationcalledSTRONGER.Thestateprogramsreviewedtodate
representover90%oftheonshoredomesticproduction205.
WorkingwiththeIOGCC,STRONGERhascontinuedtoupdatetheguidelinesconsistentwith
developingenvironmentalandoilfieldtechnologiesandpractices.Underthestatereviewprocess,
stateprogramshavecontinuedtoimprove,andfollowupreviewshaveshownsignificant
improvementwherestateshavesuccessfullyimplementedtherecommendationsofthereview
committees.
EndangeredSpeciesAct
TheEndangeredSpeciesAct(ESA)of1973(Pub.L.93205)protectsplantsandanimalsthatare
listedbythefederalgovernmentas"endangered"or"threatened"206.Sections7and9arecentralto
regulatingoilandgasactivities.Section9makesitunlawfulforanyoneto"take"alistedanimal,
andthisincludessignificantlymodifyingitshabitat207.Thisappliestoprivatepartiesandprivate
land;alandownerisnotallowedtoharmanendangeredanimaloritshabitatonhisorher
property.
Section7appliesnottoprivateparties,buttofederalagencies.Thissectioncoversnotonlyfederal
activitiesbutalsotheissuanceoffederalpermitsforprivateactivities,suchasSection404permits
issuedbytheCorpsofEngineers,topeoplewhowanttodoconstructionworkinwatersor
wetlands208.Section7imposesanaffirmativedutyonfederalagenciestoensurethattheiractions
(includingpermitting)arenotlikelytojeopardizethecontinuedexistenceofalistedspecies(plant
38
oranimal)orresultinthedestructionormodificationofcriticalhabitat.BothSections7and9
allowincidentaltakesofthreatenedorendangeredspecies,butonlywithapermit.
To"take"istoharass,harm,pursue,hunt,shoot,wound,kill,trap,capture,orcollectaplantor
animalofanythreatenedorendangeredspecies.Harmincludessignificanthabitatmodification
whenitkillsorinjuresamemberofalistedspeciesthroughimpairmentofessentialbehavior(e.g.,
nestingorreproduction).
Foranynonfederalindustrialactivity,theburdenisontheownerand/oroperatortodetermineif
anincidentaltakepermitisneeded.ThisistypicallyaccomplishedbycontactingtheU.S.Fishand
WildlifeService(FWS)todeterminewhetheranylistedspeciesarepresentorwillpotentially
inhabittheprojectsite.Abiologicalsurveymayberequiredtodeterminewhetherprotected
speciesarepresentonthesiteandwhetheraSection9permitmayberequired209,210.TheFWSas
wellasmanystatefishandgameagenciesofferservicestohelpoperatorsdeterminewhethera
givenprojectislikelytoresultinatakeandwhetherapermitisrequired.FWScanalsoprovide
technicalassistancetohelpdesignaprojectsoastoavoidimpacts.Forexample,theprojectcould
bedesignedtominimizedisturbancesduringnestingormatingseasons211.
ASection9permitmustincludeahabitatconservationplan(HCP)consistingof:anassessmentof
impacts;measuresthatwillbeundertakentomonitor,minimizeandmitigateanyimpacts;
alternativeactionsconsideredandanexplanationofwhytheywerenottaken;andanyadditional
measuresthattheFWSmayrequire212.Mitigationmeasures,whichareactionsthatreduceor
addresspotentialadverseeffectsofaproposedactivityuponspecies,mustbedesignedtoaddress
thespecificneedsofthespeciesinvolvedandbemanageableandenforceable.Mitigationmeasures
maytakemanyforms,suchaspreservation(viaacquisitionorconservationeasement)ofexisting
habitat;enhancementorrestorationofdegradedorformerhabitat;creationofnewhabitats;
establishmentofbufferareasaroundexistinghabitats;modificationsoflandusepractices;and
restrictionsonaccess213.
StateEndangeredSpeciesProtections
Allfiftystateshavefishandgame/wildlifeagenciesthatworkincooperationwiththeU.S.FWS
districtofficeswithregardtotheincidentaltakepermittingprocess.Manystatesalsohavetheir
ownendangeredandthreatenedspeciesliststhatmayincludespeciesnotonthefederallists,and
havetheirownrequirementsforprotectingendangeredspecies214.
OilandGasOperationsonPublicLands
FederalLands
TheU.S.DepartmentofInteriorsBureauofLandManagement(BLM)isresponsibleforpermitting
andmanagingmostonshoreoilandgasactivitiesonfederallands.TheBLMcarriesoutits
responsibilitytoprotecttheenvironmentthroughouttheprocessofoilandgasresource
explorationanddevelopmentonpubliclands.Resourceprotectionisconsideredthroughoutthe
landuseplanningprocesswhenResourceManagementPlans(RMPs)arepreparedandwhenan
ApplicationforPermittoDrill(APD)isprocessed215.TheBLMsinspectionandenforcementand
monitoringprogramisdesignedtoensurethatoperatorscomplywithrelevantlawsand
regulationsaswellasspecificstipulationssetforthduringthepermittingprocess.
39
SincemostshalegasactivityinthenearfutureisexpectedtooccurintheeasternU.S.basins,itis
notlikelythatmuchofthisdevelopmentwilloccuronfederallands.Whiletherearesomefederal
lands,suchasNationalParks,NationalForests,andmilitaryinstallations,thesearemuchless
extensiveintheeastthaninthewest.Whereshalegasoperationsdooccuronfederallands,BLM
hasawellestablishedprogramformanagingtheseactivitiestoprotecthumanhealthandthe
environment.
StateLands
Theamountofstateownedlandvariesconsiderablyfromstatetostateandeachstatemanages
theselandsdifferently.Inmoststates,leasingofstateownedmineralsoccursthroughlease
auctions.Sincestatesarealreadysetuptomanageoilandgasoperationswithintheirborders,no
specialpermittingorenforcementsystemsarerequired.SomestatesdohaveEnvironmentalPolicy
Actsthatrequireareviewofenvironmentalimpactsthatmayresultfromleasingoroperationson
statelandsorofanystateactionthatmayaffecttheenvironment.
OtherFederalLawsandRequirementsthatProtecttheEnvironment
ComprehensiveEnvironmentalResponse,Compensation,andLiabilityAct
TheComprehensiveEnvironmentalResponse,Compensation,andLiabilityAct(CERCLA),
commonlyknownasSuperfund,wasenactedbyCongressonDecember11,1980.Thislawcreated
ataxonthechemicalandpetroleumindustriesandprovidedbroadfederalauthoritytorespond
directlytoreleasesorthreatenedreleasesofhazardoussubstancesthatmayendangerpublic
healthortheenvironment.CERCLAestablishedprohibitionsandrequirementsconcerningclosed
andabandonedhazardouswastesites,providedforliabilityofpersonsresponsibleforreleasesof
hazardouswasteatthesesites,andestablishedatrustfundtoprovideforcleanupwhenno
responsiblepartycouldbeidentified.Overfiveyears,$1.6billionwascollectedandplacedina
trustfundforcleaningupabandonedoruncontrolledhazardouswastesites.
CERCLAwasamendedbytheSuperfundAmendmentsandReauthorizationAct(SARA)in1986.
SARAmadeseveralchangestotheSuperfundprogramthataugmenteditseffectiveness,provided
newenforcementauthorities,boostedstateandcitizeninvolvement,andincreasedthesizeofthe
trustfund.
Inadditiontotheprovisionsforcleaninguphazardouswastesites,CERCLArequiresthepersonin
chargeofavesselorfacilitytoimmediatelynotifytheNationalResponseCenterwhenthereisa
releaseofahazardoussubstanceinanamountequaltoorgreaterthanthereportablequantity
(RQ)forthatsubstance[CERCLASection103(a)].Thereportablequantitydependsonthe
substancereleased.
CERCLASection101(14)excludescertainsubstancesfromthedefinitionofhazardoussubstance,
thusexemptingthemfromCERCLAregulation.Thesesubstancesincludepetroleum,meaning
crudeoiloranyfractionthereofthatisnotspecificallylistedasahazardoussubstance,naturalgas,
naturalgasliquids,liquefiednaturalgas,andsyntheticgasusableforfuel.Ifareleaseofoneof
thesesubstancesoccurs,CERCLAnotificationisnotrequired.Thus,CERCLAreportingwillonly
applytoshalegasproductionandprocessingsitesifhazardoussubstancesotherthancrudeoilor
naturalgasarespilledinreportablequantities;sucharenotusuallypresentatthesesites.
40
However,thisparticularexclusionappliesonlytoCERCLASection103(a)reportingrequirements;
itdoesnotexemptafacilityfromtheEmergencyPlanningandCommunityRighttoKnowAct
(EPCRA)Section304reportingrequirements.Areleaseofapetroleumproductcontainingcertain
substancesispotentiallyreportableunderEPCRASection304ifmorethananRQofthatsubstance
isreleased216.
Manystateshaveseparaterequirementsregardinghazardoussubstances.Reportingofreleasesof
thematerialsexemptedunderCERCLAmayberequiredunderstatelaw.
EmergencyPlanningandCommunityRighttoKnowAct
CongressenactedEPCRAin1986toestablishrequirementsforfederal,stateandlocal
governments,tribes,andindustryregardingemergencyplanningand"communityrighttoknow"
reportingonhazardousandtoxicchemicals.ThecommunityrighttoknowprovisionsofEPCRA
arethemostrelevantpartofthelawforshalegasproducers.Theyhelpincreasethepublic's
knowledgeandaccesstoinformationonchemicalsatindividualfacilities,alongwiththeirusesand
potentialreleasesintotheenvironment.
UnderSections311and312ofEPCRA,facilitiesmanufacturing,processing,orstoringdesignated
hazardouschemicalsmustmakeMaterialSafetyDataSheets(MSDSs),describingtheproperties
andhealtheffectsofthesechemicals,availabletostateandlocalofficialsandlocalfiredepartments.
Facilitiesmustalsoprovidestateandlocalofficialsandlocalfiredepartmentswithinventoriesof
allonsitechemicalsforwhichMSDSsexist.Informationaboutchemicalinventoriesatfacilitiesand
MSDSsmustbeavailabletothepublic.Facilitiesthatstoreover10,000poundsofhazardous
chemicalsaresubjecttothisrequirement.Anyhazardouschemicalsabovethethresholdstoredat
shalegasproductionandprocessingsitesmustbereportedinthismanner.
Section313ofEPCRAauthorizesEPAsToxicsReleaseInventory(TRI),whichisapubliclyavailable
databasethatcontainsinformationontoxicchemicalreleasesandwastemanagementactivities
reportedannuallybycertainindustriesaswellasfederalfacilities.EPAissuesalistofindustries
thatmustreportreleasesforthedatabase.Todate,EPAhasnotincludedoilandgasextractionas
anindustrythatmustreportunderTRI.Thisisnotanexemptioninthelaw.Ratheritisadecision
byEPAthatthisindustryisnotahighpriorityforreportingunderTRI.Partoftherationaleforthis
decisionisbasedonthefactthatmostoftheinformationrequiredunderTRIisalreadyreportedby
producerstostateagenciesthatmakeitpubliclyavailable.Also,TRIreportingfromthehundreds
ofthousandsofoilandgassiteswouldoverwhelmtheexistingEPAreportingsystemandmakeit
difficulttoextractmeaningfuldatafromthemassiveamountofinformationsubmitted217,218.
EPCRAsection304requiresreportingofreleasestotheenvironmentofcertainmaterialsthatare
subjecttothislaw.Asnotedinthesectionabove,thisrequirementwouldapplytoanyreleasesof
petroleumproductsthatexceedreportingthresholds,evenifthoseproductsareexemptfrom
CERCLAreporting.Whileshalegasproductionfacilitiesdonotnormallystorethematerialssubject
toEPCRAreporting,knownasEPCRA"ExtremelyHazardousSubstances"andCERCLAhazardous
substances,alimitednumberofchemicalsusedinthehydraulicfracturingprocess,suchas
hydrochloricacid,areclassifiedashazardousunderCERCLA.Thesechemicalsmaybebroughton
siteforafewdays,atmost,duringfracturingorworkoveroperations.Businessesmustreport
nonpermittedreleasesintotheatmosphere,surfacewater,orgroundwaterofanylisted
41
chemicalabovethresholdamounts,knownasthe"reportablequantity",tofederal,state,andlocal
authorities.Therefore,whileeveryprecautionistakentopreventchemicalspills,intheeventofan
accidentalreleaseabovethereportablequantity,areportwouldbemadetotheseauthoritiesby
theoperator.
OccupationalSafetyandHealthAct
UndertheOccupationalSafetyandHealthActof1970,employersareresponsibleforprovidinga
safeandhealthyworkplacefortheiremployees.TheOccupationalSafetyandHealth
Administration(OSHA)promotesthesafetyandhealthofAmerica'sworkingmenandwomenby
settingandenforcingstandards;providingtraining,outreachandeducation;establishing
partnerships;andencouragingcontinualprocessimprovementinworkplacesafetyandhealth219.
OSHAhasdevelopedspecificstandardstoreducepotentialsafetyandhealthhazardsintheoiland
gasdrilling,servicingandstorageindustry220.Statesalsohaverequirementsthatprovidefurther
workerandpublicsafetyprotections.
Summary
TheU.S.hasalonghistoryofactivelyregulatingtheoilandgasindustryincludingtheshalegas
industry.Acomprehensivesetoffederalandstatelawsandprogramsregulateallaspectsofshale
gasexplorationandproductionactivities.Undertheseprograms,federal,stateandlocalagencies
enforceanarrayofrequirementsdesignedtoprotect
humanhealthandtheenvironmentduringdrilling,
Acomprehensivesetoffederaland
production,andabandonmentoperations.Together,
statelawsandprogramsregulate
theserequirementshavereducedenvironmentalrisk
allaspectsofshalegasexploration
andadverseimpactstoourwater,air,andland
andproductionactivities.
nationwide.
42
ENVIRONMENTALCONSIDERATIONS
Asdescribedintheprevioussections,naturalgasisanimportantpartofthenationsenergysupply.
Asacleanburning,affordableandreliablesourceofenergy,naturalgaswillcontinuetoplaya
significantroleintheenergysupplypictureforyearstocome.Unconventionalsourcesofnatural
gashavebecomeamajorcomponentofthatfuturesupplyandshalegasisrapidlyemergingasa
criticalpartofthatresource.
Thereexistsanextensiveframeworkoffederal,state,andlocalrequirementsdesignedtomanage
virtuallyeveryaspectofthenaturalgasdevelopmentprocess.Theseregulatoryeffortsare
primarilyledbystateagenciesandincludesuchthingsasensuringconservationofgasresources,
preventionofwaste,andprotectionoftherightsofbothsurfaceandmineralownerswhile
protectingtheenvironment221.Aspartoftheirenvironmentalprotectionmission,stateagencies
areresponsibleforsafeguardingpublicandprivatewatersupplies,preservingairquality,
addressingsafety,andensuringthatwastesfromdrillingandproductionareproperlycontained
anddisposedof222.
Inordertomakesounddecisionsaboutfutureshalegasdevelopment,itisimportanttounderstand
theprocessofdrillingandproducingshalegaswells(Exhibit28)andtheattendantenvironmental
considerations.Akeyelementintheemergenceofshalegasproductionhasbeentherefinementof
costeffectivehorizontaldrillingandhydraulicfracturingtechnologies.Thesetwoprocesses,along
withtheimplementationofprotectiveBMPs,haveallowedshalegasdevelopmenttomoveinto
areasthatpreviouslywouldhavebeeninaccessible.Accordingly,itisimportanttounderstandthe
technologiesandpracticesemployedbytheindustryandtheirabilitytopreventorminimizethe
potentialeffectsofshalegasdevelopmentonhumanhealthandtheenvironmentandonthequality
oflifeinthecommunitiesinwhichshalegasproductionislocated.
Manyofthehumanandenvironmentalconsiderationsassociatedwithshalegasproductionare
commontoalloilandgasdevelopment.However,thehorizontaldrillingandhydraulicfracturing
thathavebecomethestandardformodernshalegas
developmentbringwiththemnewconsiderationsas
Collaborationsbetweenindustry,
wellasnewwaystoreduceimpacts.Asshalegas
regulatorsandthepublichave
developmenthasspreadintomoredenselypopulated
createdinnovativeenvironmental
areas,newchallengeshavebeenencounteredand
solutionstoproblemsthatatfirst
newtechnologiesandpracticeshavebeendeveloped
seemedinsurmountable.
tomeetthesechallenges.Inaddition,collaborations
betweenindustry,regulatorsandthepublichave
createdinnovativeenvironmentalsolutionstoproblemsthatatfirstseemedinsurmountable.
Oneconsiderationassociatedwithtraditionalgasdevelopmenthasbeenthesurfacedisturbance
requiredforaccessroadsandwellpads.Asdescribedingreaterdetailbelow,horizontaldrilling
providesameanstosignificantlyreducesurfacedisturbanceandahostofrelatedconcerns.
43
EXHIBIT28:PROCESSOFSHALEGASDEVELOPMENT(DURATION)
44
Anothersetofconsiderationsassociatedwithtraditionaloilandgasdevelopmentaretheconflicts
thatarisefromsplitestates.Insomeinstancesmineralrightsandsurfacerightsarenotownedby
thesameparty.Thisisreferredtoassplitestateor"severedminerals".Theconditionofsplit
estateismoreprevalentinwesternstateswherethe
Itisimportanttounderstandthat federalgovernmentownsmuchofthemineralrights223.
surfaceownerswhodonotown Inthemidwestandeasternstates,whereshalegas
mineralsrightsarestillafforded developmentresourcesaremoreprevalent,only4%of
certainprotections. thelandsareassociatedwithafederalsplitestate224.
However,thesesameareasfrequentlyhaveprivate
privatesplitestatescenarioswherethesurfaceowner
differsfromthemineralestateowner.Inthesecasesthemineralownermaybeanotherindividual
orabusinessenterprisesuchasacoalcompany.
Asplitestatesituation,regardlessofitsnature,canresultinconflictsespeciallyinareaswhere
activemineralresourcedevelopmentisnotcommonplace.Landownerscanbesurprisedtofind
thatthemineralleaseholderisentitledtoreasonableuseofthelandsurfaceeventhoughtheydo
notownthesurface.However,itisimportanttounderstandthatsurfaceownerswhodonotown
mineralsrightsarestillaffordedcertainprotections.Ifthemineralownerdoesnotownthesurface
wheredrillingwilloccur,aseparateagreementmaybenegotiated(insomestatesitisrequired)
withthelandownertoensurethatheorsheiscompensatedfortheuseofthelandandtoset
requirementsforreclaimingthelandwhenoperationsarecomplete225.
Shalegasdevelopmentwithinornearexistingcommunitieshascreatedchallengesforproduction
companies.Newtechnologieshavegenerallyallowedthesechallengestobemetsuccessfully.In
somecases,acombinationofmodernshalegastechnologiesandtheinnovativeuseofBMPshas
beenrequiredtoallowdevelopmenttocontinuewithoutcompromisinghighlyvaluedcommunity
resources.
Inoneinstance,ChesapeakeEnergyCorporationconstructedawellpadnearapopularFortWorth
communityarea,knownastheTrinityTrailSystem,todevelopnaturalgasfromtheBarnettShale.
TheTrinityTrailSystemislocatedonprivatelandandconsistsofa35milenetworkofpavedand
naturalsurfacepathways.Thedrillingpadwasconstructedapproximately200feetfromone
portionofthetrail.Duringtheinitialplanningstages,proposeduseofthislandfordevelopmentof
naturalgaswasmetwithsignificantoppositionbythepublic.Maintaininghealthypopulationsof
uplandhardwoodforesthabitatwasimportanttothecommunitybecausesuchwoodlotsarerarein
urbansettings.Toaddresstheconcernsofthecommunity,thecompanysponsoredpublicmeetings
andopinionsurveys;providedlandscapeplans;plantedtreesandshrubs;andenhancedthe
generalareabyimprovingirrigationandloweringmaintenancerequirements.Thewellpadwas
specificallydesignedtobeassmallaspossibleinordertoreducethewellsfootprint.Preventative
constructionpracticeswereusedthathelpedtopreservemanyoftheexistingtrees.The
constructionzonewasisolatedfromviewusinga16ftbarrierfencewithsoundbaffling.This
approachbenefittedbothparties:thecompanywasabletoproducetheshalegas,important
communityresourceswereprotected,andatnopointintheprocesswasanyportionofthetrail
closed226.
45
Thefollowingdiscussions EXHIBIT29:HORIZONTALANDVERTICALWELLCOMPLETIONS
describethegeneralprocessof
developmentwithemphasison
thehorizontaldrillingand
hydraulicfracturingtechnologies
thatarethehallmarksofmodern
shalegasproduction.Thesection
alsodescribestheenvironmental
considerationsthataccompany
shalegasdevelopmentandthe
technologiesandpracticesthatare
inplacetopreventorminimize
impacts.
HorizontalWells
Modernshalegasdevelopmentisa
technologicallydrivenprocessfor
theproductionofnaturalgas
resources.Currently,thedrilling
andcompletionofshalegaswells
includesbothverticaland
horizontalwells(Exhibit29).The
emergingshalegasbasinsare
expectedtofollowatrendsimilar
totheBarnettShaleplaywith
increasingnumbersofhorizontal
wellsastheplaysmature227,228,229.
Thetechnologiesutilizedby
operatorstodrillshalegaswells
aresimilartothedrilling
Source: JohnPerez,Copyright,2008
techniquesthathavebeen
industrystandardsfordrillingofconventionalgaswells.Bothhorizontaldrillingandhydraulic
fracturingareestablishedtechnologieswithsignificanttrackrecords;horizontaldrillingdatesback
tothe1930sandhydraulicfracturinghasahistorydatingbacktothe1950s230.Thekeydifference
betweenashalegaswellandaconventionalgaswellisthereservoirstimulation(largescale
hydraulicfracturing)approachperformedonshalegaswells231.
TheevolutionoftheBarnettShaleplaytowardfavoringhorizontalwellsresultedfrom
improvementsinthetechnologycombinedwiththeeconomicbenefitsofthegreaterreservoir
exposurethatahorizontalwell
providesoveraverticalwell.While
Bothhorizontaldrillingandhydraulicfracturingare
bothwelltypesmaybeusedto
establishedtechnologieswithsignificanttrack
recovertheresource,shalegas
records;horizontaldrillingdatesbacktothe1930s
operatorsareincreasinglyrelying
andhydraulicfracturinghasahistorydatingbackto
onhorizontalwellcompletionsto
the1950s.
optimizerecoveryandwell
46
economics232.Exhibit29illustrateshowhorizontaldrillingprovidesmoreexposuretoaformation
thandoesaverticalwell.Forexample,intheMarcellusShaleinPennsylvania,averticalwellmay
beexposedtoaslittleas50ftofformationwhileahorizontalwellmayhavealateralwellbore
extendinginlengthfrom2,000to6,000ftwithinthe50to300ftthickformation233.Thisincrease
inreservoirexposurecreatesanumberofadvantagesoververticalwellsdrilling.
Thereareawiderangeoffactorsthatinfluencethechoicebetweenaverticalorhorizontalwell.
Whileverticalwellsmayrequirelesscapitalinvestmentonaperwellbasis,productionisoftenless
economical.Averticalwellmaycostasmuchas$800,000(excludingpadandinfrastructure)to
drillcomparedtoahorizontalwellthatcancost$2.5millionormore(excludingpadand
infrastructure)234.
ReducingSurfaceDisturbance
Completedevelopmentofa1squaremilesection
couldrequire16verticalwellseachlocatedona
separatewellpad.Alternatively,sixtoeight
horizontalwells(potentiallymore),drilledfrom
onlyonewellpad,couldaccessthesamereservoir
volume,orevenmore235.Thelownatural
permeabilityofshalerequiresverticalwellstobe
developedatcloserspacingintervalsthan
conventionalgasreservoirsinordertoeffectively
managetheresource.Thiscanresultininitial
developmentofverticalwellsatspacingintervalsof
40acresperwell,orless,toefficientlydrainthegas
resourcesfromthetightshalereservoirs.In
addition,horizontaldrillingcansignificantlyreduce
theoverallnumberofwellpads,accessroads,
pipelineroutes,andproductionfacilitiesrequired,
thusminimizinghabitatfragmentation,impactsto
thepublic,andtheoverallenvironmentalfootprint.
DevonEnergyCorporationreportsthattheuseof
horizontalwellsintheBarnettShalehasallowedthe
companytoreplace3or4verticalwellswitha
singlehorizontalwell.Whileitistooearlyto
determinethefinalwellspacingthatwillmost
efficientlyrecoverthegasresourceinallbasins,
experiencetodateindicatesthattheuseof
horizontalwelltechnologywillsignificantly
decreasethetotalenvironmentaldisturbance.
Exhibit11includesdataonwellspacingforsomeof
Active Drilling Rig in the Barnett Shale Play
thedevelopingshalegasbasins.Usingthisdataitis
possibletocomparethedevelopmentofatypical
640acre(1squaremile)areawithverticalversushorizontalwells.Thespacingintervalfor
verticalwellsinthegasshaleplaysaverages40acresperwellforinitialdevelopment.Thespacing
47
intervalforhorizontalwellsislikelytobeapproximately160acresperwell.Therefore,a640acre
sectionoflandcouldbedevelopedwithatotalof16verticalwells,eachonitsownindividualwell
pad,orbyasfewas4horizontalwellsalldrilledfromasinglemultiwelldrillingpad.Analysis
performedin2008fortheU.S.DepartmentoftheInteriorestimatedthatashallowverticalgaswell
completedintheFayettevilleShaleinArkansaswouldhavea2.0acrewellpad,0.10milesofroad
and0.55milesofutilitycorridor,resultinginatotalof4.8acresofdisturbanceperwell236.The
samesourceidentifiedahorizontalwellpadinArkansasasoccupyingapproximately3.5acresplus
roadsandutilities,resultinginatotalof6.9acres.Ifmultiplehorizontalwellsarecompletedfroma
singlewellpaditmayrequirethepadtobeenlargedslightly.Estimatingthatthisenlargementwill
resultina0.5acreincrease,the4wellhorizontalpadwithroadsandutilitieswoulddisturban
estimatedtotalof7.4acres,whilethe16verticalwellswoulddisturbapproximately77acres.In
thisexample,16verticalwellswoulddisturbmorethan10timestheareaof4horizontalwellsto
producethesameresourcevolume.Thisdifferenceindevelopmentfootprintwhenconsideredin
termsofbothruralandurbandevelopmentscenarioshighlightsthedesireforoperatorstomove
towardhorizontaldevelopmentofgasshaleplays.
ReducingWildlifeImpacts
Researchhasdocumentedthatactivitiesassociatedwithgasdevelopmentcanaffectwildlifeandits
habitatduringtheexploration,development,operations,andabandonmentphases237.The
developmentofshalegasutilizinghorizontalwellsandmultiwellpadsnotonlyreducessurface
areadisturbancesbyreducingthetotalnumberofwellsdrilledandwellpadsitesconstructed,but
alsoresultsinfewerroadwaysandutilitycorridors.Thisoverallreductioninaprojectsfootprint
resultsinsignificantlylesshabitatdisturbancewhileallowingformoreoperationalflexibility.
Furthermore,bydrillingunderneathsensitiveareassuchaswetlands,areasnearstreamsand
riversandwildernesshabitats,
gascanbeproducedwithout
disturbingsomeofthese
resources.Thisabilityto
reducesurfacedisturbanceis
especiallyimportantincertain
criticalhabitats.Forexample,
certainportionsofNewYork
(e.g.,CatskillPark,the
ShawangunkRidge,the
HudsonHighlandsandthe
Poconos)aredominatedby
hardwoodforests,whichare
June 2008, WVSORO
importantwildlifehabitats
www.wvsoro.org
thataresusceptibleto
fragmentation238. Source:WVSORO
Drilling Rig in Rural Upshur County, West Virginia
Inaddition,stateregulations
and,insomecases,localordinancesincludestipulationsdictatingoperationalrestrictionsto
provideaddedprotectionforwildlifeorsensitiveresources.InthecityofFlowerMound,Texas,
ordinanceshavebeenadoptedtoprotectthesurfaceresourcesandallowforfuturegrowthofthe
communitywithoutdetractingfromthelandvalueorsenseofcommunity.Theseordinances
48
preventconstructioninornearstreamsorrivers,floodplainsandsensitiveuplandforesttoprotect
wildlifespeciesandtheirassociatedhabitats.
Atthestatelevel,specialplansorwaiversarerequiredwhensurfaceuseactionsmayaffect
threatenedorendangeredspecies.Suchwaiversmustdemonstratethatcontemplated
disturbanceswillnotadverselyimpactthespeciesinquestion.InPennsylvania,wildlifearefurther
protectedonstatelands(bythePennsylvaniaGameCommission)byusingleaseagreementsthat
require,wheneverfeasible,theuseofexistingtimberandmaintenanceroadstoaccesswellsand
avoidanceofareassuchaswetlandsanduniqueandcriticalhabitatsforthreatenedorendangered
species239.
Whendisturbancestowildlifehabitatareunavoidable,energycompaniesmitigateland
disturbancesbyimplementinglandreclamationpracticestorestoredisturbedlandtooriginal
conditions.Ingeneral,reclamationpractices(ormitigationmeasures)designedtoprotectand
maintainwildlifewilldependonprojectfeatures,regionalcharacteristics,andthepotentially
affectedspecies.However,becausetechnologiesassociatedwithmodernshalegasdevelopment
canreduceimpactsinthefirstplace,theneedforadditionalprotectiverestorationmeasuresmay
alsobereduced.Regardlessofthesituation,thetimelyreclamationofdisturbedlands(e.g.,re
seeding,landcontouring,andrevegetating)canminimizeshortandlongtermdisturbancesto
naturalhabitats240.
ReducingCommunityImpacts
States,localgovernments,andindustrycanworktogetherintheinitialplanningphaseof
developmenttominimizelongtermeffectsandtoaddresscitizenconcernssuchastraffic
congestion,damagetoroads,dust,andnoise241.Theprocessofshalegasdevelopment,especially
drillingandhydraulicfracturing,cancreateshorttermincreasesintrafficvolume,dustandnoise.
Thesenuisanceimpactsareusuallylimitedtotheinitial20to30daydrillingandcompletion
period242.Alongwithincreasesin
trafficvolume,damagetoroad
surfacescanoccurifdesign
parametersfortrafficvolumeand
weightloadsareexceeded.Where
theseeffectsareanissue,
developershaveworkedwith
authoritiestoadjustworkschedules
tohelpalleviatecongestion;water
unpavedroadstoreducedust;and
adjusttimingofsomeoperations
andinstallspecialsoundbarriersto
reducenoisefornearbyresidents.
Whenfeasible,developerscanalso
useavoidancepracticestohelp
Source:ParkerCountyCommissionersOffice
minimizetrafficcongestionon
TankerTrucksinParkerCounty,Texas
heavilytraveledroads.Inthe
BarnettShaleplayaroundtheDallasFortWorthInternationalAirport,operatorshaveconstructed
permanentpipelinestotransferproducedwaterfromwellsitestodisposalfacilities,thereby
49
reducingtrafficandpotentialdamagetoroads243.Whenthesepracticesarecoupledwiththe
benefitsofmultipledirectionalwellsfromfewerpads,thenumberofaccessroadsandassociated
trafficcanbefurtherreduced.
Inmanycases,developershavenegotiatedtocompensatelocalmunicipalitiesforroaddamagethat
doesoccurasaresultoftheiractivities.Alternatively,theymaynegotiateroadmaintenanceand
repairagreementstoensurethatdamagetoroadwaysarerepairedandthatthecostisabsorbedby
thedrillingenterprises244.ThePerrymanGroup,intheir2007studyoftheBarnettShaleplay,
notedthatalthoughtrafficvolumeisalegitimateconcerninthearea,developerswereeffectively
addressingtheissuethroughmaintenanceagreementssothatroadrepairsdonotadverselyaffect
localtaxpayers245.
Fromatrafficperspective,membersofthepublicorlocalmunicipalitiesoftenhavetheabilityto
limittrafficvolumeinresidentialareasbydevelopingrestrictionsinneighborhoodlease
agreementsorbydevelopingordinancesthatpreventroadconstructionincertainareas,
respectively.Inurbanareastheseagreementscanbeusedtocoordinatelocaltrafficpatternsto
minimizecongestion,controlspeedlimitstoaddresssafetyconcerns,andspecifyweightzonesto
reduceroaddamage.
Withcontinuedadvancesintechnologies,moderndevelopersareaffordedahigherlevelofdrilling
flexibilitythaninthepast.Thisprovidesproducerswiththeabilitytoadjusttheiroperational
plansallowingthemtoaccessdrillinglocationsthatwouldotherwisebeinaccessible.Although
drillingcircumstancesvarybygeologicregionandwelllocation,inmanycases,shalegasplaysare
beingdevelopedwithbothverticallyandhorizontallydrilledwells(Exhibit29).Basedonthe
currentdevelopmentactivitiesofactivegasshalebasins,horizontaldrillinghasbecomethe
preferredmethodofdrillinginmostshalegasplays.Horizontalwellshavealsobeenusedinmany
areasofthecountrytoremotelyaccessnaturalgasresourcesbeneathexistinginfrastructure,
buildings,environmentallysensitiveareas,orotherfeaturesthatwouldpreventtheuseofvertical
wells.ThedevelopmentoftheBarnettShalenearDallasFortWorthInternationalAirportisa
primeexampleofhowdevelopmentofurbanareasispossiblewithhorizontalwellbores246.

Shale Gas Activity at Dallas-Fort Worth International Airport
50
Changesinpracticesduringthedrillingand
completionofshalegaswellshaveevolvedfromthe Thepurposeofordinancesandbest
BarnettShaleplaynearDallasFortWorth managementpracticesisto
InternationalAirportandotherurbanareas facilitatethedevelopmentofthe
surroundingtheairport.Developmentpractices naturalgasresourcewhile
therehavebeenalteredtosuitlocalordinances protectingqualityoflifeand
implementedtolessencommunityimpactsand environmentalvaluesinthe
protectenvironmentalresources.Theseordinances surroundingareas.
includedetailedsetbacksfromresidences,roadways,
churches,andschools,andmeanstocontrolvisual
andnoiseimpactsincludingtherequireduseofdirectionallighting247.Thisresultsintheuseof
BMPsforsoundbarriersandlighting.Typically,drillingoperationsinruralgasdevelopmentareas
continuearoundtheclockuntilthewelliscompleted.Whenthesesameoperationsmovedintothe
urbanareasaroundthecitiesofArlington,Burleson,Cleburne,FortWorth,JoshuaandNorth
RichlandHills,specificordinancesweredevelopedrequiringadditionalpermitting,wellsetbacks
fromproperties,daytimeandnighttimenoiselimits,anddirectionallighting248.Directional
lightingprovidesilluminationofwell
sitesforworkersafety,directingthelight
downwardandshieldingthesurrounding
areatopreventilluminatingneighboring
residences,roadsorotherbuildings249.
Inasimilarconcept,thesedrillingrigsare
alsobeingoutfittedwithblanketlike
enclosuresthatactasanacousticbarrier
toreduceenginenoise.Sounddeadening
technologyisaBMPthatisalsobeing
appliedtoreducenoisesfrom
compressorfacilitiesinbothruraland
urbansettings250.Thesesoundbarriers
includedevelopingalternativebuilding
materialswithintegralsoundabsorbing
properties.
TheseBMPsarenotappropriateforall
operationsandmustbeappliedonacase
Source : Chesapeake Energy Corporation, 2008 bycasebasis.Insomecases,agivenBMP
Insulation Blankets Used to Deaden Noise from mayactuallybecounterproductive.In
Drilling Operations othercases,aparticularBMPmaycreate
otherenvironmental,safety,or
operationalproblemsthatmustbeweighedagainsteachother.WhileBMPshavecertainbenefits
incertainsituations,theycannotbeuniversallyappliedorrequired.
ProtectingGroundwater:CasingandCementingPrograms
Stateoilandgasregulatoryprogramsplacegreatemphasisonprotectinggroundwater.Current
wellconstructionrequirementsconsistofinstallingmultiplelayersofprotectivesteelcasingand
51
cementthatarespecificallydesignedandinstalledtoprotectfreshwateraquifersandtoensure
thattheproducingzoneisisolatedfromoverlyingformations.Duringthedrillingprocess,a
conductorandsurfacecasingstringaresetintheboreholeandcementedinplace.Insome
instances,additionalcasingstringsmaybeinstalled;theseareknownasintermediatecasings
(Exhibit30251).Aftereachstringofcasingisset,andpriortodrillinganydeeperintheborehole,
thecasingiscementedtoensureasealisprovidedbetweenthecasingandformationorbetween
twostringsofcasing252.Exhibit30
illustratesthecasingandcement EXHIBIT30:CASINGZONESANDCEMENTPROGRAMS
thatmaybeinstalledinshalegas
wellsandhighlightshowthecasing
canbesettoisolatedifferentwater
bearingzonesfromeachother.The
exhibitshowsthemultiplestrings
ofcasing,layersofcementandthe
productiontubing,whichareall
importantpartsofthewell
completioninpreventing
contaminationoffreshwaterzones
andassuringthatthegasresource
doesnotflowintoother,lower
pressurezonesaroundtheoutside
ofthecasingratherthanflowingup
thewelltobeproducedandsold.253.
Theconductorcasingservesasa
foundationforthewellconstruction
andpreventscavingofsurfacesoils.
Thesurfacecasingisinstalledto
sealoffpotentialfreshwater
bearingzones,thisisolationisnecessaryinordertoprotectaquifersfromdrillingmudand
producedfluids.Asafurtherprotectionofthefreshwaterzones,airrotarydrillingisoftenused
whendrillingthroughthisportionofthewellboreintervaltoensurethatnodrillingmudcomesin
contactwiththefreshwaterzone.Intermediatecasings,wheninstalled,areusedtoisolatenon
freshwaterbearingzonesfromtheproducingwellbore.Intermediatecasingmaybenecessary
becauseofanaturallyoverpressuredzoneorbecauseofasaltwaterzonelocatedatdepth.The
boreholeareabelowanintermediatecasingmaybeuncementeduntiljustabovethekickoffpoint
forthehorizontalleg.Thisareaofwellboreistypicallyfilledwithdrillingmuds.
Eachstringofcasingservesasalayerofprotectionseparatingthefluidsinsideandoutsideofthe
casingandpreventingeachfromcontactingtheother.Operatorsperformavarietyofchecksto
ensurethatthedesiredisolationofeachzoneisoccurringincludingensuringthatthecasingused
hassufficientstrength,andthatthecementhasproperlybondedtothecasing254.Thesechecksmay
includeacousticcementbondlogsandpressuretestingtoensurethemechanicalintegrityof
casings.Additionally,stateoilandgasregulatoryagenciesoftenspecifytherequireddepthof
protectivecasingsandregulatethetimethatisrequiredforcementtosetpriortoadditional
drilling.Theserequirementsaretypicallybasedonregionalconditionsandareestablishedforall
52
wildcatwellsandmaybemodifiedwhenfieldrulesaredesignated.Theserequirementsare
institutedbythestateoilandgasagencytoprovideprotectionofgroundwaterresources255.Once
thecasingstringsarerunandcementedtherecouldbefiveormorelayersorbarriersbetweenthe
insideoftheproductiontubingandawaterbearingformation(freshorsalt).
Analysisoftheredundantprotectionsprovidedbycasingsandcementswaspresentedinaseriesof
reportsandpaperspreparedfortheAmericanPetroleumInstitute(API)256inthe1980s.These
investigationsevaluatedthelevelofcorrosionthatoccurredinClassIIinjectionwells.ClassII
injectionwellsareusedfortheroutineinjectionofwaterassociatedwithoilandgasproduction.
Theresearchresultedinthedevelopmentofamethodofcalculatingtheprobability(orrisk)that
fluidsinjectedintoClassIIinjectionwellscouldresultinanimpacttoaUSDW.Thisresearch
startedbyevaluatingdataforoilandgasproducingbasinstodetermineiftherewerenatural
formationwaterspresentthatwerereportedtocausecorrosionofwellcasings.TheUnitedStates
wasdividedinto50basins,andeachbasinwasrankedbyitspotentialtohaveacasingleak
resultingfromsuchcorrosion.
Detailedanalysiswasperformedforthosebasinsinwhichtherewasapossibilityofcasing
corrosion257.Riskprobabilityanalysisprovidedanupperboundfortheprobabilityofthe
fracturingfluidsreachinganundergroundsourceofdrinkingwater.Basedonthevalues
calculated,amodernhorizontalwellcompletioninwhich100%oftheUSDWsareprotectedby
properlyinstalledsurfacecasings(andforgeologicbasinswithareasonablelikelihoodof
corrosion),theprobabilitythatfluidsinjectedatdepthcouldimpactaUSDWwouldbebetween2x
105(onewellin200,000)and2x108(onewellin200,000,000)ifthesewellswereoperatedas
injectionwells.OtherstudiesintheWillistonbasinfoundthattheupperboundprobabilityof
injectionwaterescapingthewellboreandreachinganundergroundsourceofdrinkingwateris
sevenchangesinonemillionwellyearswheresurfacecasingscoverthedrinkingwateraquifers258.
Thesevaluesdonotaccountforthedifferencesbetweentheoperationofashalegaswellandthe
operationofaninjectionwell.Aninjectionwellisconstantlyinjectingfluidunderpressureand
thusraisesthepressureofthereceivingaquifer,increasingthechanceofaleakorwellfailure.A
productionwellisreducingthepressureintheproducingzonebygivingthegasandassociated
fluidawayout,makingitlesslikelythattheywilltrytofindanalternativepaththatcould
contaminateafreshwaterzone.Furthermore,aproducinggaswellwouldbelesslikelyto
experienceacasingleakbecauseitisoperatedatareducedpressurecomparedtoaninjectionwell.
Itwouldbeexposedtolesservolumesofpotentiallycorrosivewaterflowingthroughthe
productiontubing,anditwouldonlybeexposedtothepumpingoffluidsintothewellduring
fracturestimulations.
TheAPIstudyincludedananalysisofwellsthathadbeeninoperationformanyyearswhenthe
studywasperformedinthelate1980s,anddoesnotaccountforadvancesthathaveoccurredin
equipmentandappliedtechnologiesandchangestotheregulations.Assuch,acalculationofthe
probabilityofanyfluids,includinghydraulicfracturefluids,reachingaUSDWfromagaswellwould
indicateanevenlowerprobability;perhapsbyasmuchastwotothreeordersofmagnitude.The
APIreportcametoanotherimportantconclusionrelativetotheprobabilityofthecontaminationof
aUSDWwhenitstatedthat:
53
forinjectedwatertoreachaUSDWinthe19identifiedbasinsofconcern,a
numberofindependenteventsmustoccuratthesametimeandgoundetected
[emphasisadded].Theseeventsincludesimultaneousleaksinthe[production]
tubing,productioncasing,[intermediatecasing,]andthesurfacecasingcoupled
withtheunlikelyoccurrenceofwatermovinglongdistancesuptheboreholepast
saltwateraquiferstoreachaUSDW259.
AsindicatedbytheanalysisconductedbyAPIandothers,thepotentialforgroundwatertobe
impactedbyinjectionislow.Itisexpectedthattheprobabilityfortreatablegroundwatertobe
impactedbythepumpingoffluidsduringhydraulicfracturetreatmentsofnewlyinstalled,deep
shalegaswellswhenahighlevelofmonitoringisbeingperformedwouldbeevenlessthanthe2x
108estimatedbyAPI.
Inadditiontotheprotectionsprovidedbymultiplecasingsandcements,therearenaturalbarriers
intherockstratathatactassealsholdingthegasinthetargetformation.Withoutsuchseals,gas
andoilwouldnaturallymigratetotheearthssurface.Afundamentalpreceptofoilandgasgeology
isthatwithoutaneffectiveseal,gasandoilwouldnotaccumulateinareservoirinthefirstplace
andsocouldneverbetappedandproducedinusablequantities.Thesesealingstrataalsoactas
barrierstoverticalmigrationoffluidsupwardtowarduseablegroundwaterzones.Mostshalegas
wells(outsideofthosecompletedintheNewAlbanyandtheAntrim)areexpectedtobedrilledat
depthsgreaterthan3,000feetbelowthelandsurface(basedonthedatapresentedinExhibit11).
Exhibit31comparesestimatedshallowestproducibledepthofthetarget(pay)shalezoneandthe
maximumbaseoftreatablewater.Foranyfluidpresentintheproducingzonetoreachtreatable
groundwaterthefluidmustmigratethroughtheseoverlyingzones.
EXHIBIT31:COMPARISONOFTARGETSHALEDEPTHANDBASEOFTREATABLEGROUNDWATER
Source:CompiledfromVariousDataSources
54
DrillingFluidsandRetentionPits
Afundamentalpreceptofoilandgas
Drillingfluidsareanecessarycomponentof
geologyisthatwithoutaneffectiveseal,
thedrillingprocess;theycirculatecuttings
gasandoilwouldnotaccumulateina
(rockchipscreatedasthedrillbitadvances
reservoirinthefirstplaceandsoitcould
throughrock,muchlikesawdust)tothe
neverbetappedandproducedinusable
surfacetocleartheborehole,theylubricate
quantities.Thesesealingstrataalsoactas
andcoolthedrillingbit,theystabilizethe
barrierstoverticalmigrationoffluids
wellbore(preventingcavein),andcontrol
upwardtowardgroundwaterzones.
downholefluidpressure260.Inorderto
maintainsufficientvolumesoffluidsonsite
duringdrilling,operatorstypicallyusepitstostoremakeupwaterusedaspartofthedrilling
fluids.Storagepitsarenotusedineverydevelopmentsituation.Inthecaseofshalegas
development,drillingoperationshavebeenoccurringinbothurbanandrurallocations,requiring
thatdrillingpracticesbeadaptedtofacilitatedevelopmentinbothsettings.Drillingwith
compressedairisbecominganincreasinglypopularalternativetodrillingwithfluidsduetothe
increasedcostsavingsfrombothreductioninmudcostsandtheshorteneddrillingtimesasaresult
ofairbaseddrilling261.Theair,like
drillingmud,functionstolubricate,
coolthebit,andremovecuttings.Air
drillingisgenerallylimitedtolow
pressureformations,suchasthe
MarcellusshaleinNewYork262.
Inruralareas,storagepitsmaybe
usedtoholdfreshwaterfordrilling
andhydraulicfracturing.Inanurban
setting,duetospacelimitations,steel
storagetanksmaybeused.Tankscan
alsobeusedinaclosedloopdrilling
system.Closedloopdrillingallows
Source: Compiled from Various Data Sources
forthereuseofdrillingfluidsand
theuseoflesseramountsofdrilling Source:ALLConsulting,2008
fluids263.Closedloopdrilling LinedFreshWaterSupplyPitfromtheMarcellus
systemshavealsobeenusedwith ShaleDevelopmentinPennsylvania
waterbasedfluidsin
environmentallysensitiveenvironmentsincombinationwithairrotarydrillingtechniques264.
Whileclosedloopdrillinghasbeenusedtoaddressspecificsituations,thepracticeisnotnecessary
foreverywelldrilled.Asdiscussedintheprevioussection,drillingisaregulatedpracticemanaged
atthestatelevel,andwhilestateoilandgasagencieshavetheabilitytorequireoperatorstovary
standardpractices,theagenciestypicallydosoonlywhenitisnecessarytoprotectthegas
resourcesandtheenvironment.
Inruralenvironments,storagepitsmaybeusedtoholdwater.Theyaretypicallyexcavated
containmentpondsthat,basedonthelocalconditionsandregulatoryrequirements,maybelined.
Pitscanalsobeusedtostoreadditionalmakeupwaterfordrillingfluidsortostorewaterusedin
thehydraulicfracturingofwells.
55
Waterstoragepitsusedtoholdwaterforhydraulicfracturingpurposesaretypicallylinedto
minimizethelossofwaterfrominfiltration(noticetheblacksyntheticlinerintheaccompanying
photograph).Waterstoragepitsarebecominganimportanttoolintheshalegasindustrybecause
thedrillingandhydraulicfracturingofthesewellsoftenrequiressignificantvolumesofwateras
thebasefluidforbothpurposes265.
HydraulicFracturing
Theothertechnologicalkeytotheeconomicrecoveryofshalegasishydraulicfracturing.Hydraulic
fracturingisaformationstimulationpracticeusedtocreateadditionalpermeabilityinaproducing
formation,thusallowinggastoflowmorereadilytowardthewellbore266,267.Hydraulicfracturing
canbeusedtoovercomenaturalbarrierstotheflowof
fluids(gasorwater)tothewellbore.Suchbarriers
Stimulationsareoptimizedto
mayincludenaturallylowpermeabilitycommonin
ensurethatfracturedevelopmentis
shaleformationsorreducedpermeabilityresulting
confinedtothetargetformation.
fromnearwellboredamageduringdrilling
activities268.
Hydraulicfracturinginvolvesthepumpingofafracturingfluidintoaformationatacalculated,
predeterminedrateandpressuretogeneratefracturesorcracksinthetargetformation.Forshale
gasdevelopment,fracturefluidsareprimarilywaterbasedfluidsmixedwithadditiveswhichhelp
thewatertocarrysandproppantintothefractures.Thesandproppantisneededtopropopen
thefracturesoncethepumpingoffluidshasstopped.Oncethefracturehasinitiated,additional
fluidsarepumpedintothewellboretocontinuethedevelopmentofthefractureandtocarrythe
proppantdeeperintotheformation.Theadditionalfluidsareneededtomaintainthedownhole
pressurenecessarytoaccommodatetheincreasinglengthofopenedfractureintheformation.
Eachrockformationhasinherentnaturalvariabilityresultingindifferentfracturepressuresfor
differentformations.Theprocessofdesigninghydraulicfracturetreatmentsinvolvesidentifying
propertiesofthetargetformationincludingfracturepressure,andthedesiredlengthoffractures.
Thefollowingdiscussionaddressessomeoftheprocessesinvolvedinthedesignofahydraulic
fracturestimulationofashalegas
formation.
FractureDesign
Modernformationstimulationpracticesare
sophisticated,engineeredprocesses
designedtoemplacefracturenetworksin
specificrockstrata269.Ahydraulicfracture
treatmentisacontrolledprocessdesigned
tothespecificconditionsofthetarget
formation(thicknessofshale,rock
fracturingcharacteristics,etc.).
Understandingtheinsitureservoir
conditionspresentandtheirdynamicsis
Source: ALL Consulting, 2008 criticaltosuccessfulstimulations.Hydraulic
A Fracture Stimulation Is Closely Monitored by fracturingdesignsarecontinuallyrefinedto
Many Specialists (Fayetteville Shale - Arkansas) optimizefracturenetworkingandmaximize
56
EXHIBIT32:EXAMPLEOUTPUTOFAHYDRAULICFRACTURE gasproduction.Whilethe
STIMULATIONMODEL conceptsandgeneralpractices
aresimilar,thedetailsofa
specificfractureoperationcan
varysubstantiallyfrombasin
tobasinandfromwelltowell.
Fracturedesigncan
incorporatemany
sophisticatedandstateofthe
arttechniquestoaccomplish
aneffective,economicand
highlysuccessfulfracture
stimulation.Someofthese
techniquesincludemodeling,
microseismicfracture
Source:Chesapeake,2008
mapping,andtiltmeter
analysis.
Acomputermodelcanbeusedtosimulatehydraulicfracturingdesigns270.Thisapproachhelps
maximizeeffectivenessandeconomicallydesignatreatmentevent.Themodelingprogramsallow
geologistsandengineerstomodifythedesignofahydraulicfracturetreatmentandevaluatethe
height,length,andorientationofpotentialfracturedevelopment(Exhibit32)271.Thesesimulators
alsoallowthedesignerstousethedatagatheredduringafracturestimulationtoevaluatethe
successofthefracturejobperformed.Fromthesedataandanalyses,engineerscanoptimizethe
designoffuturefracturestimulations.
Additionaladvancesinhydraulicfracturingdesigntargetanalysisofhydraulicfracturetreatments
throughtechnologiessuchasmicroseismicfracturemapping(Exhibit33272)andtilt
measurements273.These
EXHIBIT33:MAPPINGOFMICROSEISMICEVENTS
technologiescanbeusedtodefine
thesuccessandorientationofthe
fracturescreated,thusprovidingthe
engineerswiththeabilitytomanage
theresourcethroughthestrategic
placementofadditionalwells,taking
advantageofthenaturalreservoir
conditionsandexpectedfracture
resultsinnewwells.
Asmoreformationspecificdataare
gathered,servicecompaniesand
operatorscanoptimizefracture
patterns.Operatorshavestrong
economicincentivestoensurethat
fracturesdonotpropagatebeyond
Source: Oilfield Service Company, 2008
57
thetargetformationandintoadjacentrock
Operatorshavestrongeconomic strata274.Allowingthefracturestoextendbeyond
incentivestoensurethatfracturesdo thetargetformationwouldbeawasteofmaterials,
notpropagatebeyondthetarget time,andmoney.Insomecases,fracturingoutside
formationandintoadjacentrock ofthetargetformationcouldpotentiallyresultin
strata. thelossofthewellandtheassociatedgasresource.
Fracturegrowthoutsideofthetargetformation
canresultinexcesswaterproductionfromboundingstrata.Havingtopumpandhandleexcess
waterincreasesproductioncosts,negativelyimpactingwelleconomics.Thisisaparticularconcern
intheBarnettShaleofTexaswheretheunderlyingEllenbergerGrouplimestonesarecapableof
yieldingsignificantformationwater.
FracturingProcess
Hydraulicfracturingofhorizontalshalegaswellsisperformedinstages.Laterallengthsin
horizontalwellsforshalegasdevelopmentmayrangefrom1,000feettomorethan5,000feet.
Becauseofthelengthofexposedwellbore,itisusuallynotpossibletomaintainadownhole
pressuresufficienttostimulatetheentirelengthofalateralinasinglestimulationevent275.
Becauseofthelengthsofthelaterals,hydraulicfracturetreatmentsofhorizontalshalegaswellsare
usuallyperformedbyisolatingsmallerportionsofthelateral.Thefracturingofeachportionofthe
lateralwellboreiscalledastage.Stagesarefracturedsequentiallybeginningwiththesectionatthe
farthestendofthewellbore,movingupholeaseachstageofthetreatmentiscompleteduntilthe
entirelateralwellhasbeenstimulated276.Horizontalwellsinthevariousgasshalebasinsmaybe
treatedusingtwoormorestagestofracturetheentireperforatedintervalofthewell.Eachstageof
ahorizontalwellfracturetreatmentissimilartoafracturetreatmentforaverticalshalegaswell.
Foreachstageofafracturetreatment,aseriesofdifferentvolumesoffracturefluids,calledsub
stages,withspecificadditivesandproppantconcentrations,isinjectedsequentially.Exhibit34277
presentsanexampleofthesubstagesofasinglestagehydraulicfracturetreatmentforawell
completedintheMarcellusShale278.Thisisasinglestagetreatmenttypicalofwhatmightbe
performedonaverticalshalewellorforeachstageofamultistagehorizontalwelltreatment.The
totalvolumeofthesubstagesinExhibit34is578,000gallons.Ifthiswereonestageofafourstage
horizontalwell,theentirefractureoperationwouldrequireapproximatelyfourtimesthisamount,
or2.3milliongallonsofwater.
Beforeoperatorsorservicecompaniesperformahydraulicfracturetreatmentofawell(verticalor
horizontal),aseriesoftestsisperformed.Thesetestsaredesignedtoensurethatthewell,well
equipmentandhydraulicfracturingequipmentareinproperworkingorderandwillsafely
withstandtheapplicationofthefracturetreatmentpressuresandpumpflowrates.Thetestsstart
withthetestingofwellcasingsandcementsduringthedrillingandwellconstructionprocess.
Testingcontinueswithpressuretestingofhydraulicfracturingequipmentpriortothefracture
treatmentprocess279.Itshouldbenotedthatconstructionrequirementsforwellsaremandatedby
stateoilandgasregulatoryagenciestoensurethatawellisprotectiveofwaterresourcesandis
safeforoperation.
58
EXHIBIT34:EXAMPLEOFASINGLESTAGEOFASEQUENCEDHYDRAULICFRACTURE
TREATMENT
HydraulicFracture
Volume(gallons) Rate(gal/min)
TreatmentSubStage
DilutedAcid(15%) 5,000 500
Pad 100,000 3,000
Prop1 50,000 3,000
Prop2 50,000 3,000
Prop3 40,000 3,000
Prop4 40,000 3,000
Prop5 40,000 3,000
Prop6 30,000 3,000
Prop7 30,000 3,000
Prop8 20,000 3,000
Prop9 20,000 3,000
Prop10 20,000 3,000
Prop11 20,000 3,000
Prop12 20,000 3,000
Prop13 20,000 3,000
Prop14 10,000 3,000
Prop15 10,000 3,000
Flush 13,000 3,000

Notes:
Volumesarepresentedingallons(42gals=onebarrel,5,000gals=~120bbls).
Ratesareexpressedingals/minute,42gals/minute=1bbl/min,500gal/min=~12bbls/min.
Flushvolumesarebasedonthetotalvolumeofopenborehole,thereforeaseachstageiscompletedthe
volumeofflushdecreasesasthevolumeofboreholeisdecreased.
Totalamountofproppantusedisapproximately450,000pounds
Source:Arthuretal.,2008

59
Afterthetestingofequipmenthasbeencompleted,thehydraulicfracturetreatmentprocessbegins.
Thesubstagesequenceisusuallyinitiatedwiththepumpingofanacidtreatment.Thisacid
treatmenthelpstocleanthenearwellboreareawhichcanbedamaged(poresandporethroats
becomepluggedwithdrillingmudorcasingcement)asaresultofthedrillingandwellinstallation
process.Thenextsequenceaftertheacidtreatmentisaslickwaterpad,whichisawaterbased
fracturingfluidmixedwithafrictionreducingagent.Thepadisavolumeoffracturingfluidlarge
enoughtoeffectivelyfillthewellboreandtheopenformationarea.Theslickwaterpadhelpsto
facilitatetheflowandplacementoftheproppantfurtherintothefracturenetwork.
Source:ChesapeakeEnergyCorporation,2008
HydraulicFracturingofaMarcellusShaleWell,WestVirginia
Afterthepadispumped,thefirstproppantsubstage,combiningalargevolumeofwaterwithfine
meshsandispumped.Thenextseveralsubstagesinthestageincreasethevolumeoffinegrained
proppantwhilethevolumeoffluidspumpedaredecreasedincrementallyfrom50,000gallons
(gals)to30,000gals.Thisfinegrainedproppantisusedbecausethefinerparticlesizeiscapableof
beingcarrieddeeperintothedevelopedfractures280.Inthisexample,thefineproppantsubstages
arefollowedbyeightsubstagesofacoarserproppantwithvolumesfrom20,000galsto10,000
gals.Afterthecompletionofthefinalsubstageofcoarseproppant,thewellandequipmentare
flushedwithavolumeoffreshwatersufficienttoremoveexcessproppantsfromtheequipmentand
thewellbore.
Hydraulicfracturingstimulationsareoverseencontinuouslybyoperatorsandservicecompaniesto
evaluateanddocumenttheeventsofthetreatment
process.Everyaspectofthefracturestimulation Everyaspectofthefracture
processiscarefullymonitored,fromthewellhead stimulationprocessiscarefully
anddownholepressurestopumpingratesand monitored.
densityofthefracturingfluidslurry.Themonitors
60
alsotrackthevolumesofeachadditiveandthewaterused,andensurethatequipmentis
functioningproperly.Fora12,000bbl(504,000gallon)fracturetreatmentofaverticalshalegas
welltheremaybebetween30and35peopleonsitemonitoringtheentirestimulationprocess.
Thestagingofmultiplefracturetreatmentsalongthelengthofthelaterallegofthehorizontalwell
allowsthefracturingprocesstobeperformedinaverycontrolledmanner.Byfracturingdiscrete
intervalsofthelateralwellbore,theoperatorisabletomakechangestoeachportionofthe
completionzonetoaccommodatesitespecificchangesintheformation.Thesesitespecific
variationsmayincludevariationsinshalethickness,presenceorabsenceofnaturalfractures,
proximitytoanotherwellborefracturesystem,andboreholesthatarenotcenteredinthe
formation.
FracturingFluidsandAdditives
Asdescribedabove,thecurrentpracticeforhydraulicfracturetreatmentsofshalegasreservoirsis
toapplyasequencedpumpingeventinwhichmillionsofgallonsofwaterbasedfracturingfluids
mixedwithproppantmaterialsarepumpedinacontrolledandmonitoredmannerintothetarget
shaleformationabovefracturepressure281.
Thefracturingfluidsusedforgasshalestimulationsconsistprimarilyofwaterbutalsoincludea
varietyofadditives.Thenumberofchemicaladditivesusedinatypicalfracturetreatmentvaries
dependingontheconditionsofthespecificwellbeingfractured.Atypicalfracturetreatmentwill
useverylowconcentrationsofbetween3and12additivechemicalsdependingonthe
characteristicsofthewaterandtheshaleformationbeingfractured.Eachcomponentservesa
specific,engineeredpurpose282.Thepredominantfluidscurrentlybeingusedforfracture
treatmentsinthegasshaleplaysarewaterbasedfracturingfluidsmixedwithfrictionreducing
additives(calledslickwater)283.
Theadditionoffrictionreducersallowsfracturingfluidsandproppanttobepumpedtothetarget
zoneatahigherrateandreducedpressurethanifwateralonewereused.Inadditiontofriction
reducers,otheradditivesinclude:biocidestopreventmicroorganismgrowthandtoreducebio
foulingofthefractures;oxygenscavengersandotherstabilizerstopreventcorrosionofmetal
pipes;andacidsthatareusedtoremovedrillingmuddamagewithinthenearwellborearea284.
Thesefluidsareusednotonlytocreatethefracturesintheformationbutalsotocarryapropping
agent(typicallysilicasand)whichisdepositedintheinducedfractures.
Exhibit35285demonstratesthevolumetricpercentagesofadditivesthatwereusedforaninestage
hydraulicfracturingtreatmentofaFayettevilleShalehorizontalwell.Themakeupoffracturing
fluidvariesfromonegeologicbasinorformationtoanother.Evaluatingtherelativevolumesofthe
componentsofafracturingfluidrevealstherelativelysmallvolumeofadditivesthatarepresent.
Theadditivesdepictedontherightsideofthepiechartrepresentlessthan0.5%ofthetotalfluid
volume.Overalltheconcentrationofadditivesinmostslickwaterfracturingfluidsisarelatively
consistent0.5%to2%withwatermakingup98%to99.5%.
61
EXHIBIT35:VOLUMETRICCOMPOSITIONOFA
FRACTUREFLUID

Source:ALLConsultingbasedondatafromafractureoperationintheFayetteville
Shale,2008
Becausethemakeupofeachfracturingfluidvariestomeetthespecificneedsofeacharea,thereis
noonesizefitsallformulaforthevolumesforeachadditive.Inclassifyingfracturingfluidsand
theiradditivesitisimportanttorealizethatservicecompaniesthatprovidetheseadditiveshave
developedanumberofcompoundswithsimilarfunctionalpropertiestobeusedforthesame
purposeindifferentwellenvironments.Thedifferencebetweenadditiveformulationsmaybeas
smallasachangeinconcentrationofaspecificcompound.Althoughthehydraulicfracturing
industrymayhaveanumberofcompoundsthatcanbeusedinahydraulicfracturingfluid,any
singlefracturingjobwouldonlyuseafewoftheavailableadditives.Forexample,inExhibit35
thereare12additivesused,coveringtherangeofpossiblefunctionsthatcouldbebuiltintoa
fracturingfluid.Itisnotuncommonforsomefracturingrecipestoomitsomecompoundcategories
iftheirpropertiesarenotrequiredforthespecificapplication.
Mostindustrialprocessesusechemicalsandalmostanychemicalcanbehazardousinlargeenough
quantitiesorifnothandledproperly.Evenchemicalsthatgointoourfoodordrinkingwatercanbe
hazardous.Forexample,drinkingwatertreatmentplantsuselargequantitiesofchlorine.
Whenusedandhandledproperly,itissafeforworkersandnearbyresidentsandprovidesclean,
safedrinkingwaterforthecommunity.Althoughtheriskislow,thepotentialexistsforunplanned
releasesthatcouldhaveseriouseffectsonhumanhealthandtheenvironment.Bythesametoken,
hydraulicfracturingusesanumberofchemicaladditivesthatcouldbehazardous,butaresafe
whenproperlyhandledaccordingtorequirementsandlongstandingindustrypractices.In
addition,manyoftheseadditivesarecommonchemicalswhichpeopleregularlyencounterin
everydaylife.
62
EXHIBIT36:FRACTURINGFLUIDADDITIVES,MAINCOMPOUNDS,ANDCOMMONUSES.
Additive MainCompound(s) Purpose CommonUseofMain
Type Compound
Diluted Acid Hydrochloricacidor Helpdissolvemineralsand Swimmingpoolchemicaland
(15%) muriaticacid initiatecracksintherock cleaner
Biocide Glutaraldehyde Eliminatesbacteriainthewater Disinfectant;sterilizemedical
thatproducecorrosive anddentalequipment
byproducts
Breaker Ammoniumpersulfate Allowsadelayedbreakdownof Bleachingagentindetergent
thegelpolymerchains andhaircosmetics,
manufactureofhousehold
plastics
Corrosion N,ndimethylformamide Preventsthecorrosionofthe Usedinpharmaceuticals,
Inhibitor pipe acrylicfibers,plastics
Crosslinker Boratesalts Maintainsfluidviscosityas Laundrydetergents,hand

temperatureincreases soaps,andcosmetics
Friction Polyacrylamide Watertreatment,soil
Reducer Minimizesfrictionbetweenthe conditioner
Mineraloil fluidandthepipe Makeupremover,laxatives,
andcandy
Gel Guargumorhydroxyethyl Thickensthewaterinorderto Cosmetics,toothpaste,sauces,
cellulose suspendthesand bakedgoods,icecream
IronControl Citricacid Preventsprecipitationofmetal Foodadditive,flavoringin
oxides foodandbeverages;Lemon
Juice~7%CitricAcid
KCl Potassiumchloride Createsabrinecarrierfluid Lowsodiumtablesalt

substitute
Oxygen Ammoniumbisulfite Removesoxygenfromthewater Cosmetics,foodandbeverage
Scavenger toprotectthepipefrom processing,watertreatment
corrosion
pHAdjusting Sodiumorpotassium Maintainstheeffectivenessof Washingsoda,detergents,
Agent carbonate othercomponents,suchas soap,watersoftener,glassand
crosslinkers ceramics
Proppant Silica,quartzsand Allowsthefracturestoremain Drinkingwaterfiltration,play
opensothegascanescape sand,concrete,brickmortar
Scale Ethyleneglycol Preventsscaledepositsinthe Automotiveantifreeze,
Inhibitor pipe householdcleansers,andde
icingagent
Surfactant Isopropanol Usedtoincreasetheviscosityof Glasscleaner,antiperspirant,
thefracturefluid andhaircolor
Note:Thespecificcompoundsusedinagivenfracturingoperationwillvarydependingoncompanypreference,
sourcewaterqualityandsitespecificcharacteristicsofthetargetformation.Thecompoundsshownaboveare
representativeofthemajorcompoundsusedinhydraulicfracturingofgasshales.
63
Exhibit36286providesasummaryoftheadditives,theirmaincompounds,thereasontheadditiveis
usedinahydraulicfracturingfluid,andsomeoftheothercommonusesforthesecompounds.
Hydrochloricacid(HCl)isthesinglelargestliquidcomponentusedinafracturingfluidasidefrom
water;whiletheconcentrationoftheacidmayvary,a15%HClmixisatypicalconcentration.A
15%HClmixiscomposedof85%waterand15%acid,therefore,thevolumeofacidisdilutedby
85%withwaterinitsstocksolutionbeforeitispumpedintotheformationduringafracturing
treatment.Oncetheentirestageoffracturingfluidhasbeeninjected,thetotalvolumeofacidinan
examplefracturingfluidfromtheFayettevilleshalewas0.123%,whichindicatesthefluidhadbeen
dilutedbyafactorof122timesbeforeitispumpedintotheformation.Theconcentrationofthis
acidwillonlycontinuetobedilutedasitisfurtherdispersedinadditionalvolumesofwaterthat
maybepresentinthesubsurface.Furthermore,ifthisacidcomesintocontactwithcarbonate
mineralsinthesubsurface,itwouldbeneutralizedbychemicalreactionwiththecarbonate
mineralsproducingwaterandcarbondioxideasabyproductofthereaction.
WaterAvailability
Thedrillingandhydraulicfracturingofahorizontalshalegaswellmaytypicallyrequire2to4
milliongallonsofwater287,withabout3milliongallonsbeingmostcommon.Itshouldbenoted
thatthevolumeofwaterneededmayvarysubstantiallybetweenwells.Inadditionthevolumeof
waterneededperfootofwellboreappearstobedecreasingastechnologiesandmethodsimprove
overtime.Exhibit37288presentsatableofestimatedperwellwaterneedsforfourshalegasplays
currentlybeingdeveloped.

EXHIBIT37:ESTIMATEDWATERNEEDSFORDRILLINGANDFRACTURINGWELLSIN
SELECTSHALEGASPLAYS
VolumeofDrilling VolumeofFracturing TotalVolumesofWater
ShaleGasPlay Waterperwell Waterperwell perwell
(gal) (gal) (gal)
Barnett
400,000 2,300,000 2,700,000
Shale
Fayetteville
60,000* 2,900,000 3,060,000
Shale
Haynesville
1,000,000 2,700,000 3,700,000
Shale
Marcellus
80,000* 3,800,000 3,880,000
Shale
*Drillingperformedwithanairmistand/orwaterbasedoroilbasedmudsfordeephorizontalwell
completions.
Note:Thesevolumesareapproximateandmayvarysubstantiallybetweenwells.
Source:ALLConsultingfromdiscussionswithvariousoperators,2008
64
Waterfordrillingandhydraulicfracturingofthesewellsfrequentlycomesfromsurfacewater
bodiessuchasriversandlakes,butcanalsocomefromgroundwater,privatewatersources,
municipalwater,andreusedproducedwater.Mostoftheproducingshalegasbasinsoccurin
areaswithmoderatetohighlevelsofannualprecipitationasshowninExhibit38289.However,even
inareasofhighprecipitation,duetogrowingpopulations,otherindustrialwaterdemands,and
seasonalvariationinprecipitation,itcanbedifficulttomeettheneedsofshalegasdevelopment
andstillsatisfyregionalneedsforwater.
Whilethewatervolumesneededtodrilland
stimulateshalegaswellsarelarge,they
generallyrepresentasmallpercentageofthe
totalwaterresourceuseintheshalegas
basins.Calculationsindicatethatwateruse
willrangefromlessthan0.1%to0.8%by
basin290.Thisvolumeissmallintermsofthe
overallsurfacewaterbudgetforanarea;
however,operatorsneedthiswaterwhen
drillingactivityisoccurring,requiringthatthe
waterbeprocuredoverarelativelyshort
periodoftime.Waterwithdrawalsduring
Source:ALLConsulting,2008
periodsoflowstreamflowcouldaffectfish
LittleRedRiver,Arkansas andotheraquaticlife,fishingandother
recreationalactivities,municipalwater
supplies,andotherindustriessuchaspowerplants.Toputshalegaswateruseinperspective,the
consumptiveuseoffreshwaterforelectricalgenerationintheSusquehannaRiverBasinaloneis
nearly150milliongallonsperday,whiletheprojectedtotaldemandforpeakMarcellusShale
activityinthesameareais8.4milliongallonsperday291.
Onealternativethatstatesandoperatorsarepursuingistomakeuseofseasonalchangesinriver
flowtocapturewaterwhensurfacewaterflowsaregreatest.Utilizingseasonalflowdifferences
allowsplanningofwithdrawalstoavoidpotentialimpactstomunicipaldrinkingwatersuppliesor
toaquaticorripariancommunities.IntheFayettevilleShaleplayofArkansas,oneoperatoris
constructinga500acreftimpoundmenttostorewaterwithdrawalsfromtheLittleRedRiver
obtainedduringperiodsofhighflow(stormeventsorhydroelectricpowergenerationreleases
fromGreersFerryDamupstreamoftheintake)whenexcesswaterisavailable292(oneacrefootis
equivalenttothevolumeofwaterrequiredtocover
oneacrewithonefootofwater).Theprojectis
Thisprojectwasdevelopedwith
limitedto1,550acreftofwaterannually.As
inputfromalocalchapterofTrout
additionalmitigation,thecompanyhas
Unlimited,anactiveconservation
constructedextrapipelinesandhydrantsto
organizationinthearea,and
provideportionsofthisruralareawithwaterfor
representsaninnovative
fireprotection.Alsoincludedismonitoringofin
environmentalsolutionthatserves
streamwaterqualityaswellasgameandnon
boththecommunityandthegas
gamefishspeciesinthereachofriver
developer.
surroundingtheintake.Thisdesignprovidesa
waterrecoverysystemsimilarinconcepttowhat
65
somemunicipalwaterfacilitiesuse.Itwillminimizetheimpactonlocalwatersuppliesbecause
surfacewaterwithdrawalswillbelimitedtotimesofexcessflowintheLittleRedRiver.This
projectwasdevelopedwithinputfromalocalchapterofTroutUnlimited,anactiveconservation
organizationinthearea,andrepresentsaninnovativeenvironmentalsolutionthatservesboththe
communityandthegasdeveloper.
Becausethedevelopmentofshalegasisnewinsome
areas,thesewaterneedsmaychallengesuppliesand
infrastructure.Asoperatorslooktodevelopnew Onekeytothesuccessful
shalegasplays,communicationwithlocalwater developmentofshalegasisthe
planningagenciescanhelpoperatorsand identificationofwatersupplies
communitiestocoexistandeffectivelymanagelocal capableofmeetingtheneedsofa
waterresources.Understandinglocalwaterneeds developmentcompanyfordrilling
canhelpoperatorsdevelopawaterstorageor andfracturingwaterwithout
managementplanthatwillmeetwithacceptancein interferingwithcommunityneeds.
neighboringcommunities.Althoughthewater
neededfordrillinganindividualwellmayrepresentasmallvolumeoveralargearea,the
withdrawalsmayhaveacumulativeimpacttowatershedsovertheshortterm.Thispotential
impactcanbeavoidedbyworkingwithlocalwaterresourcemanagerstodevelopaplanoutlining
whenandwherewithdrawalswilloccur(i.e.,avoidingheadwaters,tributaries,smallsurfacewater
bodies,orothersensitivesources).
Insomebasins,onekeytothesuccessfuldevelopmentofshalegasistheidentificationofwater
suppliescapableofmeetingtheneedsofadevelopmentcompanyfordrillingandfracturingwater
withoutinterferingwithcommunityneeds.Whileavarietyofoptionsexist,theconditionsof
obtainingwaterarecomplexandvarybyregionandevenwithinaregionsuchthatdeveloperswill
alsoneedtounderstandlocalwaterlaws293.
WaterManagement
Afterahydraulicfracturetreatment,whenthepumpingpressurehasbeenrelievedfromthewell,
thewaterbasedfracturingfluid,mixedwithanynaturalformationwaterpresent,beginstoflow
backthroughthewellcasingtothewellhead.Thisproducedwatermayalsocontaindissolved
constituentsfromtheformationitself.Thedissolvedconstituentsarenaturallyoccurring
compoundsandmayvaryfromoneshaleplaytothenextorevenbyareawithinashaleplay.Initial
producedwatercanvaryfromfresh(<5,000ppmTotalDissolvedSolids(TDS))tovaryingdegrees
ofsaline(5,000ppmto100,000ppmTDS294orhigher).Themajorityoffracturingfluidis
recoveredinamatterofseveralhourstoacoupleofweeks.Invariousbasinsandshalegasplays,
thevolumeofproducedwatermayaccountforlessthan30%tomorethan70%oftheoriginal
fracturefluidvolume295.Insomecases,flowbackoffracturingfluidinproducedwatercan
continueforseveralmonthsaftergasproductionhasbegun296.
66
EXHIBIT38:ANNUALRAINFALLMAPOFTHEUNITEDSTATES

Source: NRCS
Asuiteofcircumstancesexplainsthedispositionoffracturingfluidsthatarenotrecoveredthrough
production.However,itisimportanttounderstandthatunrecoveredfluids,ifany,willremain
containedwithinthetargetformations.Someofthesefluidswilloccupymacroporosity(typically
naturalfractureporosity)intheshaleformationandsomewilloccupythemicroporespace
vacatedbythegasthatisproduced.Also,someofthefracturingfluidsremainstrandedinfractures
withinthereservoirrockthathealafterfracturing,thuspreventingthefluidsfromflowingbackto
thewell.Someofthesestrandedfluidsmayflowbacktothewellinverysmallvolumesoveran
extendedtimespan.Thelongercontacttimethesefluidshavewiththeformationfurtheraltersthe
chemistryofthesefluidsthroughincreaseddissolutionofformationminerals,makingthemsimilar
tothenaturalformationwater.Forthesereasonsitisnotpossibletounequivocallystatethat
100%ofthefracturingfluidshavebeenrecoveredortodifferentiateflowbackwaterfromnatural
formationwater.
Naturalformationwaterhasbeenincontactwiththereservoirformationformillionsofyearsand
thuscontainsmineralsnativetothereservoirrock.Thesalinity,TDS,andoverallqualityof
formationwatervarybygeologicbasinandspecificrockstrata.Afterinitialproduction,produced
watercanvaryfrombrackish(5,000ppmto35,000ppmTDS),tosaline(35,000ppmto50,000
ppmTDS),tosupersaturatedbrine(50,000ppmto>200,000ppmTDS)297,andsomeoperators
67
reportTDSvaluesgreaterthan400,000ppm298.Thevariationincompositionchangesprimarily
withchangesinthenaturalformationwaterchemistry.
States,localgovernments,andshalegasoperatorsseektomanageproducedwaterinawaythat
protectssurfaceandgroundwaterresourcesand,ifpossible,reducesfuturedemandsforfresh
water.BypursuingthepollutionpreventionhierarchyofReduce,Reuse,andRecyclethese
groupsareexaminingbothtraditionalandinnovativeapproachestomanagingshalegasproduced
water.Thiswateriscurrentlymanagedthroughavarietyofmechanisms,includingunderground
injection,treatmentanddischarge,andrecycling.Exhibit39summarizescurrentproducedwater
managementpracticesforthevariousshalegasbasins,andiscompiledfromdatacollectedfrom
producersandregulatoryagenciesinthesebasins.
Undergroundinjectionhastraditionallybeentheprimarydisposaloptionforoilandgasproduced
water.Inmostsettings,thismaybethebestoptionforshalegasproducedwater.Thisprocess
usessaltwaterdisposalwellstoplacethewaterthousandsoffeetundergroundinporousrock
formationsthatareseparatedfromtreatablegroundwaterbymultiplelayersofimpermeablerock
thousandsoffeetthick.Undergroundinjectionoftheproducedwaterisnotpossibleineveryplay
assuitableinjectionzonesmaynotbeavailable.Similartoaproducingreservoir,theremustbea
porousandpermeableformationcapableofreceivinginjectedfluidsnearby.Ifsuchisnotlocally
available,itmaybepossibletotransporttheproducedwatertoamoredistantinjectionsite.In
welldevelopedurbanplayssuchastheBarnettShalearoundtheCityofFortWorth,pipelineshave
beenconstructedtotransportproducedwatertoinjectionwelldisposalsites.Thisminimizes
truckingthewaterandtheresultanttraffic,exhaustemissions,andwearonlocalroads299.Injection
disposalwellsarepermittedunderthefederalSafeDrinkingWaterAct(SDWA),Underground
InjectionControl(UIC)program(orinthecaseofstateprimacy,underequivalentstateprograms),
astringentlypermittedandmonitoredprocesswithmanyenvironmentalsafeguardsinplace.
Treatmentofproducedwatermaybefeasiblethrougheitherselfcontainedsystemsatwellsitesor
fieldsormunicipalwastewatertreatmentplantsorcommercialtreatmentfacilities.The
availabilityofmunicipalorcommercialtreatmentplantsmaybelimitedtolargerurbanareas
wheretreatmentfacilitieswithsufficientavailablecapacityalreadyexist.Asinunderground
injection,transportationtotreatmentfacilitiesmayormaynotbepractical300.
Reuseoffracturingfluidsisbeingevaluatedbyservicecompaniesandoperatorstodeterminethe
degreeoftreatmentandmakeupwaternecessaryforreuse301.Thepracticaluseofonsite,self
containedtreatmentfacilitiesandthetreatmentmethodsemployedwillbedictatedbyflowrate
andtotalwatervolumestobetreated,constituentsandtheirconcentrationsrequiringremoval,
treatmentobjectivesandwaterreuseordischargerequirements.Insomecasesitwouldbemore
practicaltotreatthewatertoaqualitythatcouldbereusedforasubsequenthydraulicfracturing
job,orotherindustrialuse,ratherthantreatingtodischargetoasurfacewaterbodyorforuseas
drinkingwater.AtthetimethisPrimerwasdevelopedtherewereplanstoconstructcommercial
wastewatertreatmentfacilitiesspecificallydesignedforthetreatmentofproducedwater
associatedwithshalegasdevelopmentinsomelocationsaroundthecountry302.Thecompletion
andsuccessofsuchplantsnodoubtwillbecloselytiedtothesuccessfulexpansionofproductionin
thevariousshalegasplays.
68
EXHIBIT39:CURRENTPRODUCEDWATERMANAGEMENTBYSHALEGASBASIN.
WaterManagement
ShaleGasBasin Availability Comments
Technology
DisposalintotheBarnett
Commercialandnon
ClassIIinjectionwells303 andunderlying
commercial
BarnettShale EllenbergerGroup304
Onsitetreatmentand Forreuseinsubsequent
Recycling305
recycling fracturingjobs306
Wateristransportedto
twoinjectionwells
ClassIIinjectionwells307 Noncommercial ownedandoperatedbya
FayettevilleShale singleproducing
company308
Forreuseinsubsequent
Recycling Onsiterecycling
fracturingjobs309
Commercialandnon
HaynesvilleShale ClassIIinjectionwells
commercial
Commercialandnon LimiteduseofClassII
ClassIIinjectionwells
commercial injectionwells310,311
Municipalwastewater
treatmentfacilities,
MarcellusShale Primarilyin
Treatmentanddischarge commercialfacilities
Pennsylvania
reportedly
contemplated312
Forreuseinsubsequent
Recycling Onsiterecycling
fracturingjobs313
Disposalintomultiple
ClassIIinjectionwells Commercial
confiningformations314
Permitrequiredthrough
theOklahoma
WoodfordShale LandApplication
Corporation
Commission315
Waterrecyclingand
Recycling Noncommercial storagefacilitiesata
centrallocation316
Commercialandnon
AntrimShale ClassIIinjectionwells
commercial
Commercialandnon
NewAlbanyShale ClassIIinjectionwells
commercial

69
Newwatertreatmenttechnologiesandnewapplicationsofexistingtechnologiesarebeing
developedandusedtotreatshalegasproducedwater.Thetreatedwatercanbereusedas
fracturingmakeupwater,irrigationwater,andinsomecasesevendrinkingwater.Recyclingorre
useofproducedwatercandecreasewaterdemandsandprovideadditionalwaterresourcesfor
droughtstrickenoraridareas.Thisallowsnaturalgasassociatedproducedwatertobeviewedas
apotentialresourceinitsownright317,318.Inonecase,DevonEnergyCorporation(Devon)is
currentlyusingwaterdistillationunitsatcentralizedlocationswithintheBarnettShaleplayto
treatproducedwaterfromhydraulicfracturestimulations319.Asofearly2008,Devonhad
hydraulicallyfractured50wellsusingrecycledwater.Devonreportsthattheprogramisstillinits
testinganddevelopmentstages.Withfurtherdevelopment,suchspecializedtreatmentsystems
mayprovebeneficial,particularlyinmorematureplayssuchastheBarnett;however,their
practicalitymaybelimitedinemergingshalegasplays.Currentlevelsofinterestinrecyclingand
reusearehigh,butnewapproachesandmoreefficienttechnologiesareneededtomaketreatment
andreuseawidespreadreality.
Whilechallengesstillexist,progressisbeingmade.Newtechnologiesandnewvariationsonold
technologiesarebeingintroducedonaregularbasis,andsomeindustryresearchersarepursuing
waystoreducetheamountoftreatmentneeded.Inearly2009,studieswereunderwayto
determinetheminimumqualityofwaterthatcouldsuccessfullybeusedinhydraulicfracturing.If
hydraulicfracturingproceduresorfluidadditivescanbedevelopedthatwillallowuseofwater
withahighTDScontent,thenmoretreatmentoptionsbecomeviableandmorewatercanbere
used.Treatmentandreuseofproducedwatercouldreducewaterwithdrawalneedsaswellasthe
needforadditionaldisposaloptions.Thisapproachcouldalsohelptoresolvemanyoftheconcerns
associatedwiththesewithdrawals.
NaturallyOccurringRadioactiveMaterial(NORM)
Somesoilsandgeologicformationscontainlowlevelsofradioactivematerial.Thisnaturally
occurringradioactivematerial(NORM)emitslowlevelsofradiation,towhicheveryoneisexposed
onadailybasis.Radiationfromnaturalsourcesisalsocalledbackgroundradiation.Othersources
ofbackgroundradiationincluderadiationfromspaceandsourcesthatoccurnaturallyinthe
humanbody.Thisbackgroundradiationaccountsforabout50%ofthetotalexposurefor
Americans.Mostofthisbackgroundexposureisfromradongasencounteredinhomes(35%ofthe
totalexposure).TheaveragepersonintheU.S.isexposedtoabout360millirem(mrem)of
radiationfromnaturalsourceseachyear(amrem,oroneonethousandthofarem,isameasureof
radiationexposure)320.Theother50%ofexposuresforAmericanscomesprimarilyfrommedical
sources.Consumerproducts,industrial,andoccupationalsourcescontributelessthan3%ofthe
totalexposure321.
Inadditiontothebackgroundradiationattheearthssurface,NORMcanalsobebroughttothe
surfaceinthenaturalgasproductionprocess.WhenNORMisassociatedwithoilandnaturalgas
production,itbeginsassmallamountsofuraniumandthoriumwithintherock.Theseelements,
alongwithsomeoftheirdecayelements,notablyradium226andradium228322,canbebroughttothe
surfaceindrillcuttingsandproducedwater.Radon222,agaseousdecayelementofradium,can
cometothesurfacealongwiththeshalegas.
70
WhenNORMisbroughttothesurface,itremainsintherockpiecesofthedrillcuttings,remainsin
solutionwithproducedwater,or,undercertainconditions,precipitatesoutinscalesorsludges323.
TheradiationfromthisNORMisweakandcannotpenetratedensematerialssuchasthesteelused
inpipesandtanks324.
TheprincipalconcernforNORMintheoilandgasindustryisthat,overtime,itcanbecome
concentratedinfieldproductionequipment325andassludgeorsedimentinsidetanksandprocess
vesselsthathaveanextendedhistoryofcontactwithformationwater326.Becausethegeneral
publicdoesnotcomeintocontactwithoilfieldequipmentforextendedperiods,thereislittle
exposureriskfromoilfieldNORM.Studieshaveshownthatexposurerisksforworkersandthe
publicarelowforconventionaloilandgasoperations327,328.
IfmeasuredNORMlevelsexceedstateregulatorylevelsorOSHAexposuredoserisks(29CFR
1910.1096),thematerialistakentolicensedfacilitiesforproperdisposal.Inallcases,OSHA
requiresemployerstoevaluateradiationhazards,postcautionsignsandprovidepersonal
protectionequipmentforworkerswhenradiationdosescouldexceed5mreminonehouror100
mreminanyfiveconsecutivedays.Inadditiontothesefederalworkerprotections,stateshave
regulationsthatrequireoperatorstoprotectthesafetyandhealthofbothworkersandthepublic.
Currentlytherearenoexistingfederalregulationsthatspecificallyaddressthehandlingand
disposalofNORMwastesd.Instead,statesproducingoilandgasareresponsibleforpromulgating
andadministeringregulationstocontrolthereuseanddisposalofNORMcontaminated
equipment,producedwater,andoilfieldwastes.Althoughregulationsvarybystate,ingeneral,if
NORMconcentrationsarelessthanregulatorystandards,operatorsareallowedtodisposeofthe
materialbymethodsapprovedforstandardoilfieldwaste.Conversely,ifNORMconcentrationsare
aboveregulatorylimits,thenthematerialmustbedisposedofatalicensedfacility.
Theseregulations,standards,andpracticesensurethatoilandgasoperationspresentnegligible
risktothegeneralpublicwithrespecttopotentialNORMexposure.Theyalsopresentnegligible
risktoworkerswhenpropercontrolsareimplemented329.
AirQuality
Manyoftodaysairqualityruleswereprimarilydesignedtoregulateemissionsfromsinglesources
withlargevolumesofemissionsoutputsuchasrefineries,chemicalplants,ironandsteel
manufacturingfacilities,andelectricalpowergeneratingsites.However,smallersourcessuchas
individualshalegaswellsitesarealsosubjecttostateandfederalregulations.Shalegas
explorationandproductionoperationsaresimilartomostotherconventionalandunconventional
naturalgasexplorationandproductionoperationsintermsoftheirairemissions.However,
varyinggascompositionandthefactthatthereislittleornoassociatedoilproductionaffectsthe
natureofpotentialemissions.
d
EPA does have drinking water standards for NORM.
71
SourcesofAirEmissions
Theexplorationandproductionofshalegasmayincludeavarietyofpotentialairemissionsources
thatchangedependingonthephaseofoperation.Intheearlyphasesofoperation,emissionsmay
comefromsuchsourcesasdrillingrigswhoseenginesmaybefueledbyeitherdieselornaturalgas
andfromfracturingoperationswheremultipledieselpoweredpumpsareoftenusedtoachievethe
necessarypressure.Othersourcesmayincludethewellcompletionprocess,whichmayinvolvethe
ventingorflaringofsomenaturalgas,andvehiculartrafficwithengineexhaustanddustfrom
unpavedroads.
Onceproductionhasbegun,emissionsourcesmayincludecompressorsorpumpsthatmaybe
neededtobringtheproducedgasuptothesurfaceoruptopipelinepressure.Fugitiveemissions
suchasleaksfrompipeconnectionsandassociatedequipmentmayalsooccur.Pipingandpumping
equipmentmayincludepneumaticinstrumentsystems,which,aspartoftheirnormaloperations,
releaseorbleedsmallamountsofnaturalgasintotheatmosphere.Othersourcesofemissionsin
thisphaseofoperationsincludeflaringorblowdownofgasinnonroutinesituations,dehydration
unitstoremovewaterfromtheproducedgas,andsulfurremovalsystemsthatmayincludeflares
and/oramineunits.
CompositionofAirEmissions
EPAsetsstandards,monitorstheambientairacrosstheU.S.,andhasanactiveenforcement
programtocontrolairemissionsfromallsources,includingtheshalegasindustry.Although
naturalgasoffersanumberofenvironmentalbenefitsoverothersourcesofenergy,particularly
otherfossilfuels,someairemissionscommonlyoccurduringexplorationandproduction
activities330.Theseemissionsandtheirsourcesarediscussedbelow.
Asinanyconstructionorindustrialactivity,NOxareformedwhenfossilfuelisburnedtoprovide
powertomachinerysuchascompressorenginesandduringflaringoperations.Inaddition,VOCs
maybeemittedduringthedehydrationofnaturalgas.VOCemissionsaretypicallylowerinnatural
gasactivitiesthanthoseassociatedwithoilproductionbecausegasproductionisessentiallya
closedprocessfromwelltopipelinewithfeweropportunitiesforemissions.Inaddition,emissions
ofbenzene,toluene,
EXHIBIT40:VOCEMISSIONSBYSOURCECATEGORY
ethylbenzene,andxylenes
arelowsimplybecause
thesecompoundsdonot
existinsignificant
quantitiesinthenaturalgas
stream.Theoilandgas
industryingeneralisa
lessercontributortoair
emissionsthannumerous
othercommonsources(see
Exhibit40331).Further,oil
andnaturalgasproduction
contributesonly2%ofthe
totalbenzeneemissionsin
theU.S.332,andshalegas
72
representsaverysmallsubsetof EXHIBIT41:BENZENEEMISSIONSBYSOURCE1999
this2%.
ParticulateMatter(PM)may
occurfromdustorsoilentering
theairduringpadconstruction,
trafficonaccessroads,anddiesel
exhaustfromvehiclesand
engines.Inaddition,COmaybe
emittedduringflaringandfrom
theincompletecombustionof
carbonbasedfuelsusedin
engines.Flaringisseldom
necessarywithnaturalgas
operationsexceptduringshort
periodsofwelltesting,
completionsorworkoversand
nonroutinesituationssuchasa
temporarypipelineclosure.
Exhibit42333showsthatCOemissionsfromthenaturalgasindustryrepresentaverysmallpartof
thetotal334.
SO2mayformwhenfossilfuelscontainingsulfurareburned.Thus,SO2maybeemittedfrom
gasolineordieselpoweredequipmentusedatashalegasproductionsite.However,emissionsof
SO2aretypicallyverysmallforshalegasoperationscomparedtocoaloroil335.
Ozone(O3)itselfisnotreleaseddirectlyduringnaturalgasdevelopment,buttwoofitsmain
precursors,volatileorganiccompounds(VOCs)andNOx,maycombinewithsunlighttoform
groundlevelO3whichcan
EXHIBIT42:COEMISSIONSBYSOURCECATEGORY
thenbeassociatedwith
explorationand
productionoperations.
Hydrogensulfide(H2S)
emissionsarenota
concerninshalegas
productionas,basedon
discussionswithoperators
fromeachofthemajor
basins,theshalegasplays
developedtodatehavenot
producedsourgas.IfH2S
isencounteredas
productioncontinues,both
statesandoperatorsare
wellequippedto
73
implementappropriatesafetymeasures.Stateshavewellestablishedpublicsafetyandworker
protectionrequirementsinplaceandoperatorshaveaccesstoprovenproceduresforworkingwith
naturalgascontaminatedwithH2S.
TheAmericanPetroleumInstitute(API)hasaRecommendedPractice(RP49)forDrillingandWell
ServicingOperationsInvolvingH2S336.Producersvoluntarilyfollowthispracticetominimizethe
releaseofandexposuretoH2S.InareaswhereconcentrationsofH2Smayexceed10partsper
million(ppm),producersimplementanH2Scontingencyplan.Theplanincludesappropriate
instructionintheuseofhydrogensulfidesafetyequipmenttoallpersonnelpresentatallhydrogen
sulfidehazardareas,gasdetectionwherehydrogensulfidemayexist,andappropriaterespiratory
protectionfornormalandemergencyuse.
Methane(CH4)istheprincipalcomponentofnaturalgasandaknownGHG.Althoughthe
processingofnaturalgasisessentiallyconfinedfromthewelltosales,CH4maybereleasedasa
fugitiveemissionfromgasprocessingequipment,especiallyequipmentinhighpressureservice
suchaspneumaticcontrols.Producershavestrongeconomicincentivestolimitfugitivemethane
emissionstothegreatestdegreepossibleinordertomaximizedeliveryofmethanetomarket.
Therefore,theyrelyonmultipleBMPs(e.g.,lowbleedgaugesandvalves,inspectionand
maintenanceprograms,infrared(IR)cameras,etc.337)toreduceanypotentialenergyloss.
Anotherpotentialsourceofemissionsinnaturalgasfieldsarecompressorengines.Manygas
compressorenginesarefueledbynaturalgasfromthelease.Enginemanufacturersareconstantly
improvingtheirtechnologytoreducetheamountofNOxemissionsfromtheirengines.Onekeyhas
beentheuseofcatalytictechnologiestochemicallyconvertNOxintoinertcompounds.The
additionofcatalyticemissionscontrolshassuccessfullyloweredengineemissionsfrom20grams
perhorsepowerhourdownto2gramsofNOxperhorsepowerhourorless.Also,theadditionof
airfuelratiocontrollerscanbeusedtoensurethecontinuouslowemissionsperformanceofthese
engines.RecentEPAregulationsrequirenewenginestomeetmorestringentlowNOxemissions
standardsregardlessofenginesizeorfuel.
TechnologicalControlsandPractices
Thebestwaytoreduceairpollutionistopreventitfromoccurringinthefirstplace.Pollution
preventioncantakemanyformsupgradingequipment,improvingoperationalpractices,reducing
wastethroughbyproductsynergies,improvingmanagementpractices,andinstallingemissions
controls.Severalgovernmentprogramshavebeenestablishedthatencompassavoidance,
minimization,andmitigationstrategiesapplicabletoexplorationandproductionactivities.Some
aremandatoryregulations,asdescribedintheRegulatoryFrameworksection,whileothersare
voluntary.
AnexampleofthelatteristheNaturalGasSTARprogram,avoluntarypartnershipbetweentheEPA
andthenaturalgasindustryformedin1995tofindcosteffectivewaystoensurethenaturalgas
industryisdoingeverythingpossibletopreventenergylossesandtominimizeGHGemissions338.
Theprimarygoalsoftheprogramaretopromotetechnologytransferandimplementcosteffective
BMPswhilereducingCH4emissions.Theprogramprovidesinformationonmanypracticesthatnot
onlyreduceCH4emissions,butalsoworkstoretaingreatervolumesofnaturalgasforproducersto
sell.
74
Someofthemosteffectiveandeconomictechnologiespromotedbythisprograminclude:
1. Identificationofhighbleedpneumaticdevices(transducers,valves,controllers,etc.)and
replacementwithlowbleedonestoreducefugitiveproductlosses.Traditionalpneumatic
devicescontrolprocessesbymeasuringchangesinpressure,releasingsmallquantitiesof
naturalgasintheprocess.Newerdevicesarenowavailablethatperformthesame
functionswhilereleasingmuchsmalleramountsofgas.
2. UseofIRcamerasinthefieldtovisuallyidentifyanyfugitivehydrocarbonleakssothatthey
mayberapidlyrepairedtoreducepotentialenergylosses.Thesecamerasaretunedtothe
wavelengthsthatarereflectedbyhydrocarbongases,sothatthosenormallyinvisiblegases
actuallybecomevisibleassmokeinthecameraimage,thusallowingcompaniestoquickly
detectandrepairleaks.
3. Installationofflashtankseparatorsinsituationsthatrequiretheuseofdehydrators.This
canrecover90to99%ofthemethanethatwouldotherwisebeflaredorventedintothe
atmosphere339.
4. Performanceofgreenwellcompletionsandworkovers.Theseshalegasoperations
typicallyuseportableequipmenttoprocessanddirecttheproducednaturalgasintotanks
ordirectlyintothepipelineratherthanthetraditionalpracticeofventingorflaringthegas.
Onaverage,greencompletionsrecover53%ofthenaturalgasthatwouldotherwisehave
beenflaredorvented.Thatcapturedgasisnowretainedandsoldtomarket340.
ManyotherpollutionreductiontechnologiesandpracticesaredescribedonEPAsGasSTARweb
site.In2004,theMethanetoMarketsPartnershipwasformedasavoluntaryinternational
programaimedatadvancingtherecoveryanduseofmethaneasavaluablecleanenergysource341.
Theprogramincludestheoilandgassectorasafocusareaalongwithcoalmines,landfills,andthe
agriculturalbusiness.Thereareapproximately400programmembersacrosstheglobe
representingtheoilandgassector342.Thecollectiveresultsofthesevoluntaryprogramshavebeen
substantial.TotalU.S.methaneemissionsin2005wereover11%lowerthanemissionsin1990,in
spiteofeconomicgrowthoverthatsametimeperiod343.EPAexpectsthattheseemissionswill
continuetofallinthefutureduetoexpandedindustryparticipationandtheongoingcommitment
oftheparticipatingcompaniestoidentifyandimplementcosteffectivetechnologiesandpractices.
Additionaltechnologiesandpracticeshavebeenidentifiedthatmaybeusedinsomesettingsto
reduceairemissionsinshalegasfields.Onesuchpracticeistheuseofnaturalgasinsteadofdiesel
tofueldrillingrigs.Anotheremissionreducingpracticeapplicabletosomesettingsistheuseof
centralizedprocessingfacilities;thisreducesvehicletrips,andthereforeengineexhaustanddust
emissions.Operatorshavealsofoundthatreducingglycolpumpratesondehydrationunitsfrom
theirmaximumsettingtoanoptimizedpumpratewillminimizebenzene,toluene,ethylbenzene,
andtotalxylenes(BTEX)emissions.Theseunitsareoftenoperatedatarate(basedonatornear
maximumthroughput)thataccommodatestheinitial,highrateofgasproductionfromafield.
However,asproductionratesdecline,thedehydrationunitscanbeadjustedtoconformtothe
lowergasthroughputandreduceemissions.Otheremissionreducingtechnologiesincludethe
installationofplungerliftsystemsintoshalegaswellheadstooptimizegasproductionandreduce
methaneemissionsassociatedwithblowdownoperationsaswellastheoptimizationof
75
compressorandpumpsizestoreducethenecessaryhorsepowerandthusthesubsequentexhaust
emissions.
Aswithalloperationalpractices,theseBMPsmustbeappliedonacasebycasebasis.Insome
casesagivenBMPmayactuallybecounterproductive.Inothercases,aparticularBMPmaycreate
otherenvironmentaloroperationalproblemsthatmustbeweighedagainsteachother.Whileeach
BMPhascertainbenefitsincertainsituations,itcannotbeuniversallyappliedorrequired.
Stateandfederalrequirementsalongwiththetechnologiesandpracticesdevelopedbyindustry
servetolimitairemissionsfromshalegasoperations.Asdescribedearlier,stateandfederal
requirementsensurethatlocalconditionsandotheremissionsourcesintheareaareconsideredin
issuingpermits.Inaddition,advancedtechnologiesandcurrentpracticesservetolimitair
emissionsfrommodernshalegasdevelopment.
Summary
Theprimarydifferencesbetweenmodernshalegasdevelopmentandconventionalnaturalgas
developmentaretheextensiveuseofhorizontaldrillingandmultistagehydraulicfracturing.
Horizontaldrillingallowsanareatobedevelopedwithsubstantiallyfewerwellsthanwouldbe
neededifverticalwellswereused.Theoverallprocessofhorizontaldrillingvarieslittlefrom
conventionaldrilling,withcasingandcementingbeingusedtoprotectfreshandtreatable
groundwater.Theuseofhorizontaldrillinghasnotintroducednewenvironmentalconcerns.On
thecontrary,thereducednumberofhorizontalwellsneeded,coupledwithmultiplewellsdrilled
fromasinglepad,hassignificantlyreducedsurfacedisturbancesandtheassociatedimpactsto
wildlifeandimpactsfromdust,noise,andtraffic.Whereshalegasdevelopmenthasintersected
withurbanandindustrialsettings,regulatorsandindustryhavedevelopedspecialpracticestohelp
reducecommunityimpacts,impactstosensitiveenvironmentalresources,andinterferencewith
existingbusinesses.
Hydraulicfracturinghasbeenakeytechnologyinmakingshalegasanaffordableadditiontothe
Nationsenergysupply,andthetechnologyhasproventobeasafeandeffectivestimulation
technique.Groundwaterisprotectedduringtheshalegasfracturingprocessbyacombinationof
thecasingandcementthatisinstalledwhenthewellisdrilledandthethousandsoffeetofrock
betweenthefracturezoneandanyfreshortreatableaquifers.Themultistagehydraulicfracture
operationsusedinhorizontalwellsmayrequire3to4milliongallonsofwater.Sinceitisa
relativelynewuseintheseareas,withdrawalsforhydraulicfracturingmustbebalancedwith
existingwaterdemands.Oncethefracturetreatmentiscompleted,mostofthefracturewater
comesbacktothesurfaceandmustbemanagedinawaythatconservesandprotectswater
resources.Whilechallengescontinuetoexistwithwateravailabilityandwatermanagement,
innovativeregionalsolutionsareemergingthatallowshalegasdevelopmenttocontinuewhile
ensuringthatthewaterneedsofotheruserscanbemetandthatsurfaceandgroundwaterquality
isprotected.
Anadditionalconsiderationinshalegasdevelopmentisthepotentialforlowlevelsofnaturally
occurringradioactivematerial(NORM)tobebroughttothesurface.WhileNORMmaybe
encounteredinshalegasoperations,thereisnegligibleexposureriskforthegeneralpublicand
therearewellestablishedregulatoryprogramsthatensurepublicandworkersafety
76
Althoughtheuseofnaturalgasoffersanumberofenvironmentalbenefitsoverotherfossilenergy
sources,someairemissionscommonlyoccurduringexplorationandproductionactivities.EPA
setsstandards,monitorstheambientairqualityacrosstheU.S.,andhasanactiveenforcement
programtocontrolairemissionsfromallsources,includingtheshalegasindustry.Gasfield
emissionsarecontrolledandminimizedthroughacombinationofgovernmentregulationand
voluntaryavoidance,minimization,andmitigationstrategies.
Takentogether,stateandfederalrequirements,alongwiththetechnologiesandpractices
developedbyindustry,servetoprotecthumanhealthandtohelpreduceenvironmentalimpacts
fromshalegasoperations.
77
ACRONYMSANDABBREVIATIONS
API AmericanPetroleumInstitute
bbls barrels,petroleum(42gallons)
bcf billioncubicfeet
BLM BureauofLandManagement
BMP BestManagementPractices
Btu Britishthermalunits
CAA CleanAirAct
CBNG CoalBedNaturalGas
CEQ CouncilonEnvironmentalQuality
CFR CodeofFederalRegulations
CERCLA ComprehensiveEnvironmentalResponse,Compensation,andLiabilityAct
CH4 Methane
CO CarbonMonoxide
CO2 CarbonDioxide
CWA CleanWaterAct
DRBC DelawareRiverBasinCommission
EIA EnergyInformationAdministration
ELG EffluentLimitationGuidelines
EPA EnvironmentalProtectionAgency
EPCRA EmergencyPlanningandCommunityRighttoKnowAct
FR FederalRegister
ft foot/feet
FWS FishandWildlifeService
gal gallon
GHG GreenhouseGases
GWPC GroundWaterProtectionCouncil
H2S HydrogenSulfide
HAP HazardousAirPollutant
HCl Hydrochloricacid
IOGCC InterstateOilandGasCompactCommission
IR infrared
Mcf thousandcubicfeet
MMcf millioncubicfeet
mrem millirem
mrem/yr milliremperyear
MSDSs MaterialSafetyDataSheets
NEPA NationalEnvironmentalPolicyAct
NESHAPs NationalEmissionStandardsforHazardousAirPollutants
NETL NationalEnergyTechnologyLaboratory
79
NORM NaturallyOccurringRadioactiveMaterial
NOx NitrogenOxides
NPDES NationalPollutionDischargeEliminationSystem
NYDEC NewYorkStateDepartmentofEnvironmentalConservation
O3 Ozone
OPA OilPollutionAct
OSHA OccupationalSafetyandHealthAdministration
PM ParticulateMatter
ppm partspermillion
RAPPS ReasonableandPrudentPracticesforStabilization
RCRA ResourceConservationandRecoveryAct
RP RecommendedPractice
RQ ReportableQuantity
SARA SuperfundAmendmentsandReauthorizationAct
SCF standardcubicfeet
SDWA SafeDrinkingWaterAct
SO2 SulfurDioxide
SPCC SpillPrevention,ControlandCountermeasures
SRBC SusquehannaRiverBasinCommission
STRONGER StateReviewofOilandNaturalGasEnvironmentalRegulation,Inc.
SWDA SolidWasteDisposalAct
tcf trillioncubicfeet
TDS TotalDissolvedSolids
tpy tonsperyear
TRI ToxicsReleaseInventory
UIC UndergroundInjectionControl
U.S. UnitedStates
U.S.C. UnitedStatesCode
USDW UndergroundSourceofDrinkingWater
USGS UnitedStatesGeologicalSurvey
VOC VolatileOrganicCompound
WQA WaterQualityAct
yr year
80
DEFINITIONS
AIRQUALITY.Ameasureoftheamountofpollutantsemittedintotheatmosphereandthe
dispersionpotentialofanareatodilutethosepollutants.
AQUIFER.Abodyofrockthatissufficientlypermeabletoconductgroundwaterandtoyield
economicallysignificantquantitiesofwatertowellsandsprings.
BASIN.Aclosedgeologicstructureinwhichthebedsdiptowardacentrallocation;theyoungest
rocksareatthecenterofabasinandarepartlyorcompletelyringedbyprogressivelyolderrocks.
BIOGENICGAS.Naturalgasproducedbylivingorganismsorbiologicalprocesses.
CASING.Steelpipingpositionedinawellboreandcementedinplacetopreventthesoilorrock
fromcavingin.Italsoservestoisolatefluids,suchaswater,gas,andoil,fromthesurrounding
geologicformations.
COALBEDMETHANE/NATURALGAS(CBM/CBNG).Acleanburningnaturalgasfounddeep
insideandaroundcoalseams.Thegashasanaffinitytocoalandisheldinplacebypressurefrom
groundwater.CBNGisproducedbydrillingawellboreintothecoalseam(s),pumpingoutlarge
volumesofgroundwatertoreducethehydrostaticpressure,allowingthegastodissociatefromthe
coalandflowtothesurface.
COMPLETION.Theactivitiesandmethodstoprepareawellforproductionandfollowingdrilling.
Includesinstallationofequipmentforproductionfromagaswell.
CORRIDOR.Astripoflandthroughwhichoneormoreexistingorpotentialutilitiesmaybeco
located.
DISPOSALWELL.Awellwhichinjectsproducedwaterintoanundergroundformationfor
disposal.
DIRECTIONALDRILLING.Thetechniqueofdrillingatananglefromasurfacelocationtoreacha
targetformationnotlocateddirectlyunderneaththewellpad.
DRILLRIG.Themast,drawworks,andattendantsurfaceequipmentofadrillingorworkoverunit.
EMISSION.Airpollutiondischargeintotheatmosphere,usuallyspecifiedbymassperunittime.
ENDANGEREDSPECIES.ThosespeciesofplantsoranimalsclassifiedbytheSecretaryofthe
InteriorortheSecretaryofCommerceasendangeredpursuanttoSection4oftheEndangered
SpeciesActof1973,asamended.SeealsoThreatenedandEndangeredSpecies.
EXPLORATION.Theprocessofidentifyingapotentialsubsurfacegeologictargetformationandthe
activedrillingofaboreholedesignedtoassessthenaturalgasoroil.
FLOWLINE.Asmalldiameterpipelinethatgenerallyconnectsawelltotheinitialprocessing
facility.
81
FORMATION(GEOLOGIC).Arockbodydistinguishablefromotherrockbodiesandusefulfor
mappingordescription.Formationsmaybecombinedintogroupsorsubdividedintomembers.
FRACTURINGFLUIDS.Amixtureofwaterandadditivesusedtohydraulicallyinducecracksinthe
targetformation.
GROUNDWATER.Subsurfacewaterthatisinthezoneofsaturation;sourceofwaterforwells,
seepage,andsprings.Thetopsurfaceofthegroundwateristhewatertable.
HABITAT.Theareainwhichaparticularspecieslives.Inwildlifemanagement,themajor
elementsofahabitatareconsideredtobefood,water,cover,breedingspace,andlivingspace.
HORIZONTALDRILLING.Adrillingprocedureinwhichthewellboreisdrilledverticallytoakick
offdepthabovethetargetformationandthenangledthroughawide90degreearcsuchthatthe
producingportionofthewellextendshorizontallythroughthetargetformation.
HYDRAULICFRACTURING.Injectingfracturingfluidsintothetargetformationataforce
exceedingthepartingpressureoftherockthusinducinganetworkoffracturesthroughwhichoil
ornaturalgascanflowtothewellbore.
HYDROSTATICPRESSURE.Thepressureexertedbyafluidatrestduetoitsinherentphysical
propertiesandtheamountofpressurebeingexertedonitfromoutsideforces.
INJECTIONWELL.Awellusedtoinjectfluidsintoanundergroundformationeitherforenhanced
recoveryordisposal.
LEASE.Alegaldocumentthatconveystoanoperatortherighttodrillforoilandgas.Also,the
tractofland,onwhichaleasehasbeenobtained,whereproducingwellsandproductionequipment
arelocated.
NORM(NaturallyOccurringRadioactiveMaterial).Lowlevel,radioactivematerialthat
naturallyexistsinnativematerials.
ORIGINALGASINPLACETheentirevolumeofgascontainedinthereservoir,regardlessofthe
abilitytoproduceit.
PARTICULATEMATTER(PM).Asmallparticleofsolidorliquidmatter(e.g.,soot,dust,andmist).
PM10referstoparticulatematterhavingasizediameteroflessthan10millionthsofameter(micro
meter)andPM2.5beinglessthan2.5micrometersindiameter.
PERMEABILITY.Arockscapacitytotransmitafluid;dependentuponthesizeandshapeofpores
andinterconnectingporethroats.Arockmayhavesignificantporosity(manymicroscopicpores)
buthavelowpermeabilityiftheporesarenotinterconnected.Permeabilitymayalsoexistorbe
enhancedthroughfracturesthatconnectthepores.
PRIMACY.Arightthatcanbegrantedtostatebythefederalgovernmentthatallowsstateagencies
toimplementprogramswithfederaloversight.Usually,thestatesdeveloptheirownsetof
regulations.Bystatute,statesmayadopttheirownstandards,however,thesemustbeatleastas
protectiveasthefederalstandardstheyreplace,andmaybeevenmoreprotectiveinorderto
82
addresslocalconditions.Oncethesestateprogramsareapprovedbytherelevantfederalagency
(usuallytheEPA),thestatethenhasprimacyjurisdiction.
PRODUCEDWATER.Waterproducedfromoilandgaswells.
PROPPINGAGENTS/PROPPANT.Silicasandorotherparticlespumpedintoaformationduringa
hydraulicfracturingoperationtokeepfracturesopenandmaintainpermeability.
PROVEDRESERVESThatportionofrecoverableresourcesthatisdemonstratedbyactual
productionorconclusiveformationteststobetechnically,economically,andlegallyproducible
underexistingeconomicandoperatingconditions.
RECLAMATION.Rehabilitationofadisturbedareatomakeitacceptablefordesignateduses.This
normallyinvolvesregrading,replacementoftopsoil,revegetation,andotherworknecessaryto
restoreit.
SETBACK.Thedistancethatmustbemaintainedbetweenawellorotherspecifiedequipmentand
anyprotectedstructureorfeature.
SHALEGAS.Naturalgasproducedfromlowpermeabilityshaleformations.
SLICKWATER.Awaterbasedfluidmixedwithfrictionreducingagents,commonlypotassium
chloride.
SOLIDWASTE.Anysolid,semisolid,liquid,orcontainedgaseousmaterialthatisintendedfor
disposal.
SPLITESTATE.Conditionthatexistswhenthesurfacerightsandmineralrightsofagivenareaare
ownedbydifferentpersonsorentities;alsoreferredtoasseveredestate.
STIMULATION.Anyofseveralprocessesusedtoenhancenearwellborepermeabilityand
reservoirpermeability.
STIPULATION.Aconditionorrequirementattachedtoaleaseorcontract,usuallydealingwith
protectionoftheenvironment,orrecoveryofamineral.
SULFURDIOXIDE(SO2).Acolorlessgasformedwhensulfuroxidizes,oftenasaresultofburning
traceamountsofsulfurinfossilfuels.
TECHNICALLYRECOVERABLERESOURCESThetotalamountofresource,discoveredand
undiscovered,thatisthoughttoberecoverablewithavailabletechnology,regardlessofeconomics.
THERMOGENICGAS.Naturalgasthatisformedbythecombinedforcesofhighpressureand
temperature(bothfromdeepburialwithintheearthscrust),resultinginthenaturalcrackingof
theorganicmatterinthesourcerockmatrix.
THREATENEDANDENDANGEREDSPECIES.Plantoranimalspeciesthathavebeendesignatedas
beingindangerofextinction.SeealsoEndangeredSpecies.
83
TIGHTGAS.Naturalgastrappedinahardrock,sandstoneorlimestoneformationthatisrelatively
impermeable.
TOTALDISSOLVEDSOLIDS(TDS).Thedryweightofdissolvedmaterial,organicandinorganic,
containedinwaterandusuallyexpressedinpartspermillion.
UNDERGROUNDINJECTIONCONTROLPROGRAM(UIC).Aprogramadministeredbythe
EnvironmentalProtectionAgency,primacystate,orIndiantribeundertheSafeDrinkingWaterAct
toensurethatsubsurfaceemplacementoffluidsdoesnotendangerundergroundsourcesof
drinkingwater.
UNDERGROUNDSOURCEOFDRINKINGWATER(USDW).40CFRSection144.3Anaquiferorits
portion:
(a) (1)Whichsuppliesanypublicwatersystem;or
(2)Whichcontainsasufficientquantityofgroundwatertosupplyapublicwatersystem;
and
(i)Currentlysuppliesdrinkingwaterforhumanconsumption;or
(ii)Containsfewerthan10,000mg/ltotaldissolvedsolids;and
(b) Whichisnotanexemptedaquifer.
WATERQUALITY.Thechemical,physical,andbiologicalcharacteristicsofwaterwithrespectto
itssuitabilityforaparticularuse.
WATERSHED.Alllandswhichareenclosedbyacontinuoushydrologicdrainagedivideandlay
upslopefromaspecifiedpointonastream.
WELLCOMPLETION.SeeCompletion.
WORKOVER.Toperformoneormoreremedialoperationsonaproducingorinjectionwellto
increaseproduction.Deepening,pluggingback,pulling,andresettingthelinerareexamplesof
workoveroperations.
84
ENDNOTES
1
EIA. 2008. Annual Energy Outlook 2008 with Projections to 2030. http://www.eia.doe.gov/oiaf/aeo/pdf/0383(2008).pdf. June
2008.
2
Ibid.
3
EIA. 2007. Annual Energy Review 2007, Tables 4.1 and 4.2. http://www.eia.doe.gov/emeu/aer/resource.html. June 2008.
4
EIA. 2009. U.S. Crude Oil, Natural Gas, and Natural Gas Liquids Reserves 2007 Annual Report.
http://www.eia.doe.gov/oil_gas/natural_gas/data_publications/crude_oil_natural_gas_reserves/cr.html. February 2009.
5
Navigant Consulting. 2008. North American Natural Gas Supply Assessment. Prepared for American Clean Skies Foundation.
July 4, 2008.
6
EIA. 2007. Annual Energy Review 2007, Table 6.1. http://www.eia.doe.gov/emeu/aer/natgas.html. June 2008.
7EIA. 2009. March 2009 Monthly Energy Review, Table 4.3. http://www.eia.doe.gov/emeu/mer/natgas.html. March 2009.
8
EIA. 2008. Annual Energy Outlook 2008 with Projections to 2030. http://www.eia.doe.gov/oiaf/aeo/pdf/0383(2008).pdf. June
2008.
9
EIA. 1999. Natural Gas 1998: Issues and Trends.
http://www.eia.doe.gov/pub/oil_gas/natural_gas/analysis_publications/natural_gas_1998_issues_trends/pdf/it98.pdf. April 1999.
10
NaturalGas.org. Electrical Generation Using Natural Gas. http://www.naturalgas.org/overview/uses_eletrical.asp. Accessed:
September 2008.
11
EIA. 2007. Annual Energy Review 2007, Table 8.11b. http://www.eia.doe.gov/emeu/aer/elect.html. June 2008.
12
EIA. 2002 Manufacturing Energy Consumption Survey.
http://www.eia.doe.gov/emeu/mecs/mecs2002/data02/shelltables.html. March 2005.
13
U.S. Bureau of Labor Statistics. 2007. Monthly Labor Review, November 2007.
http://www.bls.gov/opub/mlr/2007/11/contents.htm.
14
EIA. Natural Gas Basic Statistics. http://www.eia.doe.gov/basics/quickgas.html. Accessed: September 2008.
15
Independent Petroleum Association of Mountain States (IPAMS). Americas Independent Natural Gas Producers. Producing
Todays Clean Energy, Ensuring Tomorrows Innovation. http://www.ipams.org/media/docs/Callupdraft10.pdf. Accessed:
September 2008.
16
Ambrose, W. A., E. C. Potter, & R. Briceno. 2008. An Unconventional Future for Natural Gas in the United States.
http://www.geotimes.org/feb08/article.html?id=feature_gas.html. February 2008.
17
EIA. 2008 Natural Gas Summary. http://tonto.eia.doe.gov/dnav/ng/ng_sum_lsum_dcu_nus_a.htm. Accessed June 2008. .
18
EIA. 2008. Annual Energy Outlook 2008 with Projections to 2030. http://www.eia.doe.gov/oiaf/aeo/pdf/0383(2008).pdf.
June 2008.
19
EIA. 2007. International Energy Outlook 2007, Chapter 4: Natural Gas.
http://tonto.eia.doe.gov/FTPROOT/forecasting/0484(2007).pdf. May 2007.
20
EIA. 1999. Natural Gas 1998: Issues and Trends.
http://www.eia.doe.gov/pub/oil_gas/natural_gas/analysis_publications/natural_gas_1998_issues_trends/pdf/it98.pdf. April 1999.
21
Ibid.
22
NaturalGas.org. 2008. Natural Gas and the Environment. http://www.naturalgas.org/environment/naturalgas.asp. Accessed:
September 2008.
23
American Clean Skies Foundation. Natural Gas Myth vs. Fact. www.CleanSkies.org. Accessed: September 2008.
24
EIA. 2008. Greenhouse Gases, Climate Change, and Energy.
http://www.eia.doe.gov/bookshelf/brochures/greenhouse/Chapter1.htm. May 2008.
25
June 2008.
85
26
September 2008.
27
Public Lands Advocacy. 2008. Energy Insecurity. Presentation at Public Lands Advocacy NEPA-Permitting Seminar/2008
Annual Meeting. http://www.publiclandsadvocacy.org/presentations.htm. June 11, 2008.
28
American Clean Skies Foundation. U.S. Fuel Goals. www.cleanskies.org. Accessed: September 2008.
29
Chemistry and Technology of Fuels and Oils. 2000. Volume 36, Number 2, pp 82-88. March 2000.
30
NaturalGas.org. Overview of Natural Gas. Background. www.naturalgas.org/overview/background.asp. Accessed:
September 2008.
31
Ibid.
32
Ibid.
33
EIA. About U.S. Natural Gas Pipelines Transporting Natural Gas.
www.eia.doe.gov/pub/oil_gas/natural_gas/analysis_publications/ngpipeline. Accessed: September 2008.
34
EIA. Glossary. www.eia.doe.gov/glossary/glossary_b.htm. Accessed: September 2008.
35
NaturalGas.org. Overview of Natural Gas. Background. www.naturalgas.org/overview/background.asp. Accessed:
September 2008.
36
Oklahoma Natural Gas Company. 2005. Rate Schedule 701. Compressed Natural Gas Service. Individual Metering.
http://www.oneok.com/ong/pdf/rate_schedule/701.pdf. October 4, 2005.
37
NW Natural. Science Facts. www.nwnatural.com/content_safety.asp?id=297. Accessed: September 2008.
38
BP. 2008. Statistical Review of World Energy 2008. Natural Gas.
http://www.bp.com/subsection.do?categoryId=9023762&contentId=7044550. Accessed: September 2008.
39
Navigant Consulting. 2008. North American Natural Gas Supply Assessment. Prepared for American Clean Skies
Foundation. July 4, 2008.
40
EIA. 2009. U.S. Crude Oil, Natural Gas, and Natural Gas Liquids Reserves 2007 Annual Report. Available online:
http://www.eia.doe.gov/oil_gas/natural_gas/data_publications/crude_oil_natural_gas_reserves/cr.html. Accessed February 2009.
41
Williams, P. 2008. American Clean Skies. A Vast Ocean of Natural Gas. p 44-50. Summer 2008.
42
June 2008.
43
44
ALL Consulting modified from USGS and other sources. March 2009.
45
EIA. 2008. Is U.S. Natural Gas Production Increasing? http://tonto.eia.doe.gov/energy_in_brief/natural_gas_production.cfm.
June 11, 2008.
46
American Clean Skies Foundation. 2008. Natural Gas Planet. Summer 2008.
47
EIA. 2008. Is U.S. Natural Gas Production Increasing? http://tonto.eia.doe.gov/energy_in_brief/natural_gas_production.cfm.
June 11, 2008
48
49
Ibid.
50
Ibid.
51
Ibid.
52
Ibid.
53
CERA. The Shale Gale: The Implications for North American Natural Gas Pipeline Development. March 2009.
86
54
September 2008.
55
Harper, J. 2008. The Marcellus Shale An Old New Gas Reservoir in Pennsylvania. v. 28, no 1. Published by the Bureau
of Topographic and Geologic Survey, Pennsylvania Department of Conservation and Natural Resources. Pennsylvania Geology.
Spring 2008.
56
Schlumberger. 2005. Shale Gas White Paper. 05-OF299. Modified from: J. K., Frantz and V. Jochen. Schlumberger
Marketing Communications. October 2005.
57
NY DEC. 1992. Division of Mineral Resources. Final Generic Environmental Impact Statement on the Oil, Gas and Solution
Mining Regulatory Program. 1992.
58
Harper, J. 2008. The Marcellus Shale An Old New Gas Reservoir in Pennsylvania. v 28, no 1. Published by the Bureau
Spring 2008.
59
Ibid.
60
Engelder, T., and G. G. Lash. 2008. Marcellus Shale Plays Vast Resource Potential Creating Stir in Appalachia. The
American Oil & Gas Reporter. May 2008.
61
Williams, P. 2005. Big Sandy: Kentuckys Big Sandy Field Remains a Locus of Exploration Activity, More than 90 years
after its Discovery. Oil and Gas Investor. August 2005.
62
Harrison, W. 2006. Production History and Reservoir Characteristics of the Antrim Shale Gas Play, Michigan Basin.
Western Michigan University. 2006.
63
Hayden, J., and D. Pursell, D. 2005. Pickering Energy Partners Inc. The Barnett Shale. Visitors Guide to the Hottest Gas
Play in the US. October 2005.
64
Ibid.
65
Halliburton Energy Services. 2008. U.S. Shale Gas: An Unconventional Resource. Unconventional Challenges. 2008.
66
Hayden, J., and D. Pursell, D. 2005. Pickering Energy Partners Inc. The Barnett Shale. Visitors Guide to the Hottest Gas
Play in the US. October 2005.
67
Cohen, D. 2008. Energy Bulletin. An Unconventional Play in the Bakken. April 2008.
68
USGS. Assessment of Undiscovered Oil Resources in the Devonian-Mississippian Bakken Formation, Williston Basin
Province, Montana and North Dakota. USGS fact sheet 2008-3021.
69
Harper, J. 2008. The Marcellus Shale An Old New Gas Reservoir in Pennsylvania. v 28, no 1. Published by the Bureau
Spring 2008.
70
Ameri, S., K. Aminian, J. A. Miller, D. Doricich, and A. B. Yost. A Systematic Approach for Economic Development of the
Devonian Shale Gas Resources. SPE 14504.
71
72
Airhart, M. Geology.com. The Barnett Shale Gas Boom: Igniting a Hunt for Unconventional Natural Gas Resources.
http://geology.com/research/barnett-shale-gas.shtml. Accessed: September 2008.
73
Boyer, C., J. Kieschnick, R. Suarez-Rivera, R. Lewis, and G. Walter. 2006. Schlumberger. Oilfield Review. Producing Gas
from Its Source. Autumn 2006.
74
Schlumberger. 2005. Shale Gas White Paper. 05-OF299. Modified from: J. K., Frantz and V. Jochen. Schlumberger
75
Davis ,R., Jr. 1992. Depositional Systems: An Introduction to Sedimentology and Stratigraphy. Prentice Hall. 2nd Edition.
1992.
76
Freeze, R., and J. Cherry. 1979. Groundwater. Prentice Hall. 1979.
77
Nuttal, B.C. 2007. Kentucky Geological Survey. Predicting Cumulative Production of Devonian Shale Gas Wells from Early
Well Performance Data, Appalachian Basin of Eastern Kentucky. September 2007.
87
78
NaturalGas.org. Unconventional Natural Gas Resources. Accessed: September 2008.
79
ALL Consulting and the Montana Board of Oil and Gas Conservation. 2004. Coal Bed Methane Primer: New Source of
Natural Gas Environmental Implications. Prepared for the U.S. Department of Energy, National Petroleum Technology Office.
February 2004.
80
Frantz, J.K., and Jochen, V. 2005. Schlumberger. Shale Gas White Paper. 05-OF299. Schlumberger Marketing
Communications. October 2005.
81
Geology.com. Marcellus Shale- Appalachian Basin Natural Gas Play: New Research Results Surprise Everyone on the
Potential of this Well-known Devonian Black Shale. http://geology.com/articles/marcellus-shale.shtml. Accessed: September
2008.
82
Hayden, J., and D. Pursell. 2005. Pickering Energy Partners, Inc. The Barnett Shale: Visitors Guide to the Hottest Gas Play
in the US. October 2005.
83
84
Ibid.
85
Ibid.
86
87
88
Ibid.
89
Ibid.
90
Ibid.
91
Boughal, K. 2008. Unconventional Plays Grow in Number After Barnett Shale Blazed the Way. World Oil Magazine. v 229,
no 8. August 2008.
92
Berman, A. 2008. The Haynesville Shale Sizzles with the Barnett Cools. World Oil Magazine. v 229, no 9. September 2008.
93
Drilling Contractor. 2000. Alabama Lawsuit Poses Threat to Hydraulic Fracturing Across U.S. pp 42-43. January/February
2000.
94
Haines, L. 2006. Supplement to Oil & Gas Investor. Shale Gas: Activity Builds in the Woodford Shale. p 17.
http://www.oilandgasinvestor.com/pdf/ShaleGas.pdf. January 2006.
95
96
Ibid.
97
Arkansas Oil and Gas Commission. 2008. Field Rules and Rule B-15.
98
Hayden, J., and D. Pursell. 2005 . Pickering Energy Partners, Inc. The Barnett Shale: Visitors Guide to the Hottest Gas Play
99
Ibid.
100
Berman, A. 2008. The Haynesville Shale Sizzles while the Barnett Cools. World Oil Magazine. v 229, no 9. September
2008.
101
Nyahay, R., J. Leone, L. Smith, J. Martin, and D. Jarvie. 2007. Update on Regional Assessment of Gas Potential in the
Devonian Marcellus and Ordovician Utica Shales of New York.
http://www.searchanddiscovery.net/documents/2007/07101nyahay/index.htm. October 1, 2007.
102
Cardott, B. 2004. Oklahoma Geological Survey. Overview of Unconventional Energy Resources of Oklahoma.
http://www.ogs.ou.edu/fossilfuels/coalpdfs/UnconventionalPresentation.pdf. March 9, 2004.
103
Hayden, J., and D. Pursell. 2005. Pickering Energy Partners ,Inc. The Barnett Shale: Visitors Guide to the Hottest Gas Play
104
Ibid.
88
105
Ibid.
106
Ibid.
107
Berman, A. 2008. The Haynesville Shale Sizzles while the Barnett Cools. World Oil Magazine. v 229, no 9. September
2008.
108
Soeder, D.J. 1986. Porosity and Permeability of Eastern Devonian Gas Shale. SPE Formation Evaluation. v 3, no 1.
January 1, 1986.
109
Vulgamore, T., T. Clawson, C. Pope, S. Wolhart, M. Mayerhofer, S. Machovoe, and C. Waltman. 2007. Applying Hydraulic
Fracture Diagnostics to Optimize Stimulations in the Woodford Shale. SPE 110029. 2007.
110
111
Ibid.
112
Ibid.
113
Ibid.
114
Petroleum Listing Services. 2008. Other Players Reporting Haynesville Success. August 15, 2008.
115
Soeder, D.J. 1986. Porosity and Permeability of Eastern Devonian Gas Shale. SPE Formation Evaluation. v 3, no 1.
January 1, 1986.
116
Jochen, V. Schlumberger. 2006. New Technology Needs to Produce Unconventional Gas. November 29, 2006.
117
118
Ibid.
119
Ibid.
120
Ibid.
121
Ibid.
122
Sumi, L. 2008. Oil and Gas Accountability Project (OGAP). Shale Gas: Focus on the Marcellus Shale.
http://www.earthworksaction.org/pubs/OGAPMarcellusShaleReport-6-12-08.pdf. May 2008.
123
Ibid.
124
Ibid.
125
126
Ibid.
127
128
Ibid.
129
130
AAPG. 1987. Correlation of Stratigraphic Units of North America (CASUNA) Project. Texas-Oklahoma Tectonic Region.
CSD No. 420, Col 9. 1987.
131
Modified from: Frantz, J.K., and V. Jochen. 2005. Schlumberger. Shale Gas White Paper. 05-OF299. Schlumberger
132
Railroad Commission of Texas. 2009. Newark, East (Barnett Shale) Field.
http://www.rrc.state.tx.us/data/fielddata/barnettshale.pdf. Accessed March 2009.
133
Parshall, J. 2008. Barnett Shale Showcases Tight-gas Development. Journal of Petroleum Technology. September 19, 2008.
134
89
135
136
University of Arkansas. 2008. Projecting the Economic Impact of the Fayetteville Shale Play for 2008-2012. Sam M.
Walton College of Business. March 2008.
137
no 8. August 2008.
138
Ibid.
139
Williams, P. 2008 . American Clean Skies. A Vast Ocean of Natural Gas. p 44-50. Summer 2008.
140
Hillwood International Energy. 2007. Fayetteville Shale Power. Arkansas, USA.
http://hillwoodenergy.com/Portals/0/Content/Fayetteville_Shale.pdf. July 12, 2007.
141
142
Durham, L. 2008. Louisiana Play a Company Maker? AAPG Explorer. July 2008.
143
Johnston, J., III, P. Heinrich, J. Lovelace, R. McCulloh, and R. Zimmerman. Louisiana Geological Survey. Stratigraphic
Charts of Louisiana. Folio series no 8. 2000.
144
Modified from: USGS. Energy Resources Program. National Oil and Gas Assessment.
http://certmapper.cr.usgs.gov/noga/broker.jsp?theServlet=NogaNewGISResultsServ&theProvince=67&thePage=play. Accessed:
September 2008.
145
West Virginia Geological and Economic Survey. 1997. Enhancement of the Appalachian Basin Devonian Shale Resource
Base in the GRI Hydrocarbon Model. Prepared for: Gas Research Institute. December 1997.
146
Harper, J. 2008. Published by the Bureau of Topographic and Geologic Survey, Pennsylvania Department of Conservation
and Natural Resources. Pennsylvania Geology. The Marcellus Shale An Old New Gas Reservoir in Pennsylvania. v 28, no
1. Spring 2008.
147
Ibid.
148
Arthur, J.D., B. Bohm, and M. Layne. 2008. ALL Consulting. Hydraulic Fracturing Considerations for Natural Gas Wells
of the Marcellus Shale. Presented at the GWPC Annual Forum in Cincinnati, OH. September 2008.
149
150
Cardott, B. 2007. Oklahoma Geological Survey. Overview of Woodford Gas-Shale Play in Oklahoma. 2007.
151
no 8. August 2008.
152
Cardott, B. 2007. Oklahoma Geological Survey. Overview of Woodford Gas-Shale Play in Oklahoma. 2007.
153
AAPG. 1983. Correlation of Stratigraphic Units of North America (CASUNA) Project. Southwest/Southwest Mid-Continent
Region. CSD No. 360, Col 27. 1983.
154
155
Harrison, W. 2006. Production History and Reservoir Characteristics of the Antrim Shale Gas Play, Michigan Basin.
Western Michigan University. 2006.
156
157
Catacosinos, P., W. Harrison III, R. Reynolds, D. Westjohn, and M. Wollensak. 2000. Michigan Department of
Environmental Quality (DEQ), Geological Survey Division, and Michigan Basin Geological Survey. Stratigraphic
Nomenclature for Michigan. 2000.
158
Indiana Geological Survey. Indiana University. General Stratigraphic Column for Paleozoic Rocks in Indiana. Adapted from
Shaver, H., et al. 1986. Indiana Geological Survey Bulletin 59.
90
159
Illinois State Geological Survey. GeoNote 1. Mississipian Rocks in Illinois. http://www.isgs.uiuc.edu/maps-data-
pub/publications/geonotes/pdf-files/GeoNote1.pdf.
160
161
162
Interstate Oil and Gas Compact Commission (IOGCC). Issues: States Rights. http://www.iogcc.state.ok.us/states-rights.
Accessed: September 2008.
163
State Review of Oil and Natural Gas Regulations (STRONGER). http://www.strongerinc.org. Accessed: September 2008.
164
STRONGER. List of State Reviews. http://www.strongerinc.org/reviews/reviews.asp. Accessed: September 2008.
165
STRONGER. History of STRONGER - Helping To Make An Experiment Work.
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166
Southlake, Texas, Gas Well Ordinance. Article IV. Gas and Oil Well Drilling and Production.
167
Richard Hills, Texas, Gas Well Ordinance. Ordinance No. 996-04. September 14, 2004.
168
Haltom City Ordinance No. 0-2004-026-15. November 22, 2004.
169
Fort Worth, Texas, Ordinance No. 16986-06-2006. June 21, 2006.
170
Susquehanna River Basin Commission. Regulation of Projects. 18 CFR 801, 806, 807, and 808.
http://srbc.net/policies/docs/srbc_regulation_of_projects.PDF. Effective: February 20, 2007. Accessed: September 2008.
171
Delaware River Basin Commission Basin. Administrative Manual Part III. Water Quality Regulations. 18 CFR PART 410.
http://www.state.nj.us/drbc/regs/WQRegs_071608.pdf. September 12, 2008.
172
33 U.S.C. section 1251 et. Seq.
173
EPA. Summary of the Clean Water Act. http://www.epa.gov/lawsregs/laws/cwa.html. Accessed: September 2008.
174
EPA. Water Quality and Technology-Based Permitting. http://cfpub.epa.gov/npdes/generalissues/watertechnology.cfm.
Accessed : September 2008.
175
EPA. Effluent Limitations Guidelines and Standards. http://cfpub.epa.gov/npdes/techbasedpermitting/effguide.cfm.
176
National Archives and Records Administration. Electronic Code of Federal Regulations. Protection of the Environment. Oil
and Gas Extraction Point Source Category. 40 CFR Part 435. http://ecfr.gpoaccess.gov/cgi/t/text/text-
idx?c=ecfr&rgn=div5&view=text&node=40:29.0.1.1.11&idno=40. Effective: June 12, 2006. Accessed: September 2008.
177
EPA. Final Rule: Amendments to the Storm Water Regulations for Discharges Associated with Oil and Gas Construction
Activities. http://www.epa.gov/npdes/regulations/final_oil_gas_factsheet.pdf. Effective: June 12, 2006. Accessed: September
2008.
178
NRDC v. EPA. 9th Cir. p.5947. 2008.
179
EPA . Final Rule: Amendments to the Storm Water Regulations for Discharges Associated with Oil and Gas Construction
Activities. http://www.epa.gov/npdes/regulations/final_oil_gas_factsheet.pdf. Effective June 12, 2006. Accessed: September
2008.
180
Independent Petroleum Association of America (IPAA). 2004. Guidance Document: Reasonable and Prudent Practices for
Stabilization (RAPPS) Of Oil and Gas Construction Sites. Prepared by Horizon Environmental Services, Inc. April 2004.
181
EPA. 2004. Understanding the Safe Drinking Water Act. EPA 816-F-04-030.
http://www.epa.gov/safewater/sdwa/30th/factsheets/understand.html. June 2004.
182
EPA. Drinking Water Academy (DWA). 2003. Introduction to the Underground Injection Control Program.
http://www.epa.gov/safewater/dwa/electronic/presentations/uic/uic.pdf. January 2003.
183
EPA. US EPA's Program to Regulate the Placement of Waste Water and other Fluids Underground. EPA 816-F-04-040.
June 2004.
91
184
EPA. Underground Injection Control Program. UIC Program Primacy.
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185
EPA. Region 9: Superfund. Oil Program. http://www.epa.gov/region09/waste/sfund/oilpp/. Accessed: September 2008.
186
Ibid.
187
EPA. Spill Prevention, Control, and Countermeasure (SPCC). Proposed Rule Amendments, Information about October 2007
proposed amendments to the SPCC Rule. http://www.epa.gov/emergencies/content/spcc/index.htm. Accessed: September 2008.
188
EPA. Water Quality Standards. State, Tribal & Territorial Standards.
http://www.epa.gov/waterscience/standards/wqslibrary/. Accessed: September 2008.
189
SRBC. http://www.srbc.net/. Accessed: September 2008.
190
DRBC. http://www.state.nj.us/drbc/. Accessed: September 2008.
191
Clean Air Act. http://www.epa.gov/air/caa/. Amended in: 1990. Accessed: September 2008.
192
EPA. The Green Book Nonattainment Areas for Criteria Pollutants. http://www.epa.gov/oar/oaqps/greenbk/. Accessed:
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193
EPA. Air Trends. Basic Information. http://www.epa.gov/airtrends/sixpoll.html. Accessed: September 2008.
194
Texas Commission on Environmental Quality (TCEQ). Standard of Performance for New Stationary Sources, Spark Ignition
Internal Combustion Engines. 40 CFR Part 60, Subpart JJJJ.
195
Texas Commission on Environmental Quality (TCEQ). National Emission Standard for Hazardous Air Pollutants for
Stationary Reciprocating Internal Combustion Engines. 40 CFR Part 63, Subpart ZZZZ.
196
EPA. 2007. Final Emission Standards of Performance for Stationary Spark Ignition Internal Combustion Engines; and Final
Air Toxics Standards for Reciprocating Internal Combustion Engines. http://www.epa.gov/ttn/oarpg/t3pfpr.html. December 20,
2007.
197
EPA. Region2. Solid Waste; RCRA Subtitle D. http://www.epa.gov/region2/waste/dsummary.htm. Accessed: September
2008.
198
EPA. 2002. Exemption of Oil and Gas Exploration and Production Wastes from Federal Hazardous Waste Regulations.
http://epa.gov/epawaste/nonhaz/industrial/special/oil/oil-gas.pdf. October 2002.
199
Public Law 96-482, Sec. 1. Oct. 21, 1980. 94 Stat. 2334.
200
Federal Register Volume 58, Number 5. EPA. 1993. Clarification of the Regulatory Determination for Wastes From the
Exploration, Development and Production of Crude Oil, Natural Gas and Geothermal Energy. pp 15284 15287. March 22,
1993.
201
Federal Register Volume 53. EPA. 1988. Regulatory Determination for Oil and Gas and Geothermal Exploration,
Development and Production Wastes. pp 25447- 25458. July 6, 1988.
202
EPA. 2002. Exemption of Oil and Gas Exploration and Production Wastes from Federal Hazardous Waste Regulations.
http://epa.gov/epawaste/nonhaz/industrial/special/oil/oil-gas.pdf. October 2002.
203
EPA. 53 FR 25447. Regulatory Determination for Oil and Gas and Geothermal Exploration, Development and Production
Wastes. http://epa.gov/osw/nonhaz/industrial/special/oil/og88wp.pdf. Accessed: September 2008.
204
EPA. Laws, Regulations, Guidance and Dockets. Summary of the Oil Pollution Act. 33 U.S.C. Section 2702 et seq. (1990).
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205
STRONGER. Process Success and Breakdown. http://www.strongerinc.org/about/success.asp. Accessed: September 2008.
206
National Archives and Records Administration. Electronic Code of Federal Regulations. Wildlife and Fisheries. Endangered
and Threatened Wildlife and Plants. 50 CFR Part 17. http://ecfr.gpoaccess.gov/cgi/t/text/text-
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207
Babbitt v. Sweet Home Chapter of Communities for a Great Oregon. 515 U.S. 687. 1995.
208
Christman, J., and V. Albrecht. Hunton and Williams, LLP. http://library.findlaw.com/1999/Jan/1/241467.html. 1999.
209
ALL Consulting. 2004. Coal Bed Natural Gas Handbook. Resources for the Preparation and Reviews of Project Planning
Elements and Environmental Documents. October 2004.
92
210
Construction Industry Compliance Assistance (CICA). The CICA Center. http://www.cicacenter.org/index.cfm. Accessed:
September 2008.
211
Ibid.
212
U.S. Fish & Wildlife Service (USFS). Endangered Species Program. Endangered Species Related Laws, Regulations,
Policies & Notices. http://www.fws.gov/Endangered/policy/index.html. Accessed: September 2008.
213
Ibid.
214
Construction Industry Compliance Assistance (CICA). The CICA Center. http://www.cicacenter.org/index.cfm. Accessed:
September 2008.
215
ALL Consulting. 2002. Handbook on Best Management Practices and Mitigation Strategies for Coal Bed Methane in the
Montana Portion of the Powder River Basin. 2002.
216
EPA. 1998. RCRA: Superfund & EPCRA Hotline Training Module. EPA 540-R-98-022. June 1998.
217
IOGCC. 1996. Review of Existing Reporting Requirements for Oil and Gas Exploration and Production Operators in Five
Key States. 1996.
218
IPAA. 2000. Environment & Safety Fact Sheets. IPAA Opposes EPA's Possible Expansion of TRI.
http://www.ipaa.org/issues/factsheets/environment_safety/tri.asp. May 2000.
219
U.S. Department of Labor. Occupational Safety & Health Administration. www.osha.gov. Accessed: September 2008.
220
U.S. Department of Labor. Occupational Safety & Health Administration. Oil and Gas Well Drilling, Servicing and Storage
Standards. http://www.osha.gov/SLTC/oilgaswelldrilling/standards.html. Accessed: September 2008.
221
Arkansas Oil and Gas Commission. Mission Statement. http://www.aogc.state.ar.us/mission.pdf. Accessed: September
2008.
222
Ohio Department of Natural Resources, Oil and Gas Division. Ohio Revised Code 1509.
223
224
Bureau of Land Management (BLM). 2006. Scientific Inventory of Onshore Federal Lands Oil and Gas Resources and the
Extent and Nature of Restrictions or Impediments to Their Development. Prepared by the U.S. Departments of the Interior,
Agriculture, and Energy. 2006.
225
Bonner, T., and L. Willer. 2005. National Association of Royalty Owners, Inc (NARO). The New Generation. Royalty
Management 101: Basics for Beginners and a Refresher Course for Everyone. 25th Anniversary Convention in Oklahoma City,
OK. November 3-5, 2005.
226
Lantz, G. 2008 .The Barnett Shale Magazine. Drilling Green Along Trinity Trails. Summer 2008.
227
Harper, J. 2008. The Marcellus Shale An Old New Gas Reservoir in Pennsylvania. Pennsylvania Geology. v 28, no 1.
Spring 2008. Published by the Bureau of Topographic and Geologic Survey, Pennsylvania Department of Conservation and
Natural Resources.
228
Frantz, J.K., and V. Jochen. 2005. Schlumberger. Shale Gas White Paper. 05-OF299. Schlumberger Marketing
Communications. October 2005.
229
230
Natural Resources.
231
232
Natural Resources.
233
Ibid.
234
Marshall Miller & Associates, Inc. Marcellus Shale. Presented to: Fireside Pumpers in Bradford, PA.
93
235
236
U.S. Department of the Interior. 2008. Reasonably Foreseeable Development Scenario for Fluid Minerals: Arkansas.
Prepared for the Bureau of Land Management Eastern States Jackson Field Office. March 2008.
237
Bromley, M. 1985. U.S. Department of Agriculture, Forest Service, Intermountain Research Station. Ogden, Utah. Wildlife
Management Implications of Petroleum Exploration and Development in Wildland Environments. General Technical Report
INT-199. 1985.
238
Catskill Mountainkeeper. The Marcellus Shale America's next super giant. http://catskillmountainkeeper.org/node/290.
Accessed: October 2008.
239
Venesky, T. 2008. State-Owned Parcels Eyed for Gas Deposits. The Times Leader.
http://www.timesleader.com/news/hottopics/shale/20080304_01gas_wells_ART.html. October 14, 2008. Accessed: September
2008.
240
United States Department of the Interior and United States Department of Agriculture. 2007. Surface Operating Standards
and Guidelines for Oil and Gas Exploration and Development. BLM/WO/ST-06/021+3071/REV07. Bureau of Land
Management. Denver, Colorado. 2007.
241
242
The Perryman Group. 2007. Bounty from Below: The Impact of Developing Natural Gas Resources Associated with the
Barnett Shale on Business Activity in Fort Worth and the Surrounding 14-County Area. May 2007.
243
Satterfield, J., M. Mantell, D. Kathol, F. Hiebert, K. Patterson, and R. Lee. 2008. Chesapeake Energy Corp. Managing
Water Resources Challenges in Select Natural Gas Shale Plays. Presented at the GWPC Annual Meeting. September 2008.
244
Douglas, D. Anger over road damage caused by Barnett Shale development.
http://www.wfaa.com/sharedcontent/dws/wfaa/latestnews/stories/wfaa080822_lj_douglas.18a895d.html. Accessed: October
2008.
245
The Perryman Group. 2007. Bounty from Below: The Impact of Developing Natural Gas Resources Associated with the
Barnett Shale on Business Activity in Fort Worth and the Surrounding 14-County Area. May 2007.
246
247
Various City Ordinances including Arlington ON2006-015, Burleson B-710, Cleburne Chapter 118, Crowley Chapter 37, Fort
Worth ON. 16986-06-2006, and Richland Hills, ON.996-04.
248
Ibid.
249
Chesapeake Energy Corporation. 2008. Drilling 101. Presented to the NY DEC. September 2008.
250
ALL Consulting. 2002. Handbook on Best Management Practices and Mitigation Strategies for Coal Bed Methane in the
Montana Portion of the Powder River Basin. 2002.
251
ALL Consulting. 2008. Casing and Cement Programs. Horizontal Well Diagram.
252
Bellabarba, M., H. Bulte-Loyer, B. Froelich, S. Roy-Delage, R. Van Kuijk, S. Zeroug, D. Guillot, N. Moroni, S. Pastor, and
A. Zanchi. 2008. Ensuring Zonal Isolation Beyond the Life of the Well. Oilfield Review. Spring 2008.
253
Railroad Commission of Texas (RRC). http://www.rrc.state.tx.us/. Accessed: September 2008.
254
Bellabarba, M., H. Bulte-Loyer, B. Froelich, S. Roy-Delage, R. Van Kuijk, S. Zeroug, D. Guillot, N. Moroni, S. Pastor, and
A. Zanchi. 2008. Ensuring Zonal Isolation Beyond the Life of the Well. Oilfield Review. Spring 2008.
255
Arkansas Oil and Gas Commission. General Rules and Regulations. Accessed: September 2008.
256
Michie & Associates. 1988. Oil and Gas Water Injection Well Corrosion. Prepared for the American Petroleum Institute.
1988.
257Ibid.
258
Michie, T.W., and C.A. Koch. Evaluation Of Injection-Well Risk Management In The Williston Basin, June, 1991.
259
Michie & Associates. 1988. Oil and Gas Water Injection Well Corrosion. Prepared for the American Petroleum Institute.
1988.
94
260
Schlumberger. Drilling Fluids: The Many Roles of Drilling Fluids. http://www.seed.slb.com/en/scictr/watch/mud/char.htm.
261
Singh,, M. M., Jr. The Pennsylvania State University. Goodwin, Robert J. Gulf Research and Development Company. 1965.
Mechanism of Drilling Wells with Air as the Drilling Fluid. SPE 1052-MS.
262
Kennedy, J. Technology Limits Environmental Impact of Drilling. Drilling Contractor. July/August 2000. 33-35.
263
Swaco, M. 2006. Reclaim Technology: The system that extends the life of oil- and synthetic-base drilling fluids while
reducing disposal and environmental costs. Published by M-I LLC. 2006.
264
Oklahoma Department of Environmental Quality. Pollution Prevention Case Study for Oxy USA, Inc.
http://www.deq.state.ok.us/CSDnew/P2/Casestudy/oxyusa~1.htm. Accessed: September 2008.
265
Natural Resources..
266
Veatch, R.W., Jr., Z. A. Moschovidis, and C. R. Fast. An Overview of Hydraulic Fracturing. Recent Advances in Hydraulic
Fracturing, Edited by J.L. Gidley, S.A. Holditch, D.E. Nierode, and R.W. Veatch Jr. Society of Petroleum Engineers, Henry L
Doherty Series Monograph. v 12.
267
Jennings, A.R., Jr., and W. G. Darden. 1979. Gas Well Stimulation in the Eastern United States. SPE 7914. 1979.
268
Veatch, R.W., Jr., Z. A. Moschovidis, and C. R. Fast. An Overview of Hydraulic Fracturing. Recent Advances in Hydraulic
Fracturing, Edited by J.L. Gidley, S.A. Holditch, D.E. Nierode, and R.W. Veatch Jr. Society of Petroleum Engineers, Henry L
Doherty Series Monograph. v 12.
269
Boyer, C., J. Kieschnick, R. Suarez-Rivera, R. Lewis, and G. Walter. 2006. Schlumberger. Oilfield Review. Producing Gas
from Its Source. Pp 36-49. Autumn 2006.
270
Meyer & Associates, Inc. Users Guide for the Meyer Fracturing Simulators. Sixth Edition.
271
Schlumberger. PowerSTIM.. http://www.slb.com/content/services/stimulation/fracturing/powerstim.asp? Accessed:
September 2008.
272
Mapping of Microseismic Events Courtesy of: Oilfield Service Company.
273
Meyer & Associates, Inc. Users Guide for the Meyer Fracturing Simulators. Sixth Edition.
274
275
Overbey, W.K., A.B. Yost, and D.A. Wilkins. 1988. Inducing Multiple Hydraulic Fractures from a Horizontal Wellbore.
SPE Paper 18249.
276
Chesapeake Energy Corporation. Components of Hydraulic Fracturing, Presented to the NY DEC. October 2008.
277
Arthur, J.D., B. Bohm, and M. Layne. 2008. ALL Consulting. Hydraulic Fracturing Considerations for Natural Gas Wells
of the Marcellus Shale. Presented at the GWPC Annual Forum in Cincinnati, OH. September 2008.
278
Ibid.
279
Natural Resources..
280
Cramer, D. Stimulating Unconventional Reservoirs: Lessons Learned, Successful Practices, Areas for Improvement. SPE
114172.
281
Natural Resources..
282
Schlumberger. Fracturing. http://www.slb.com/content/services/stimulation/fracturing/index.asp? Accessed: September
2008.
283
Ketter, A.A., J. L. Daniels, J. R. Heinze, and G. Waters. A Field Study Optimizing Completion Strategies for Fracture
Initiation in Barnett Shale Horizontal Wells. SPE 103232.
95
284
Schlumberger. PowerSTIM. http://www.slb.com/content/services/stimulation/fracturing/powerstim.asp? Accessed:
September 2008.
285
Compiled from Data collected at a Fayetteville Shale Fracture Stimulation by ALL Consulting 2008.
286
Modified from: Arthur, J.D., B. Bohm, and M. Layne. 2008. ALL Consulting. Hydraulic Fracturing Considerations for
Natural Gas Wells of the Marcellus Shale. Presented at the GWPC Annual Forum in Cincinnati, OH. September 2008.
287
Satterfield, J., M. Mantell, D. Kathol, F. Hiebert, K. Patterson, and R. Lee. 2008. Chesapeake Energy Corp. Managing
288
Personal conversations with various operators. September 2008.
289
NRCS. National Water & Climate Center. http://www.wcc.nrcs.usda.gov/. Accessed: September 2008.
290
Satterfield, J, M. Mantell, D. Kathol, F. Hiebert, K. Patterson, and R. Lee. 2008. Chesapeake Energy Corp. Managing Water
Resources Challenges in Select Natural Gas Shale Plays. Presented at the GWPC Annual Meeting. September 2008.
291
Gaudlip, A., L. Paugh (SPE, Range Resources Appalachia LL), and T. Hayes (Gas Technology Institute). Marcellus Shale
Water Management Challenges in Pennsylvania. Presented at the SPE Shale Gas Production Conference, November 2008.
292
Chesapeake Energy Corporation. Little Red River Project. Presentation to Trout Unlimited. May 6, 2008.
293
Weston, R.T. 2008. Development of the Marcellus Shale-Water Resource Challenges. Published by Kirkpatrick & Lockhart
Preston Gates Ellis LLP. 2008.
294
Satterfield, J., M. Mantell, D. Kathol, F. Hiebert, K. Patterson, and R. Lee. . 2008. Chesapeake Energy Corp. Managing
295
Personal communication with numerous operator and service companies in a variety of shale gas plays.
296
Willberg, D.M., N. Steinsberger, R. Hoover, R. J. Card, and J. Queen. 1998. Optimization of Fracture Cleanup Using
Flowback Analysis. SPE 39920-MS. 1998.
297
Satterfield, J., M. Mantell, D. Kathol, F. Hiebert, K. Patterson, and R. Lee. Managing Water Resources Challenges in Select
Natural Gas Shale Plays. Chesapeake Energy Corp. Presented at the GWPC Annual Meeting. September 2008.
298Personalconversationswithvariousoperators.March,2009.
299
Satterfield, J., Mantell, M., Kathol, D., Hiebert, F., Patterson, K., and Lee, R. 2008. Chesapeake Energy Corp. Managing
300
Natural Resources.
301
Railroad Commission of Texas (RRC). v2008.v Water Use in the Barnett Shale.
vhttp://www.rrc.state.tx.us/divisions/og/wateruse_barnettshale.html. vUpdated: vJune 30, 2008. vAccessed: vOctober 2008.
302
Personal communication with a variety of producing and service companies operating in shale gas basins. 2008.
303
Burnett, D.B., and C. J. Vavra. 2006. Global Petroleum Research Institute (GPRI) and Food Protein Research Center. Texas
A&M Produced Water Treatment. Desalination of Oilfield Brine. New Resources: Produced Water Desalination. August 2006.
304
Grable, R.C. 2008. Kelly Hart & Hallman, Attorneys at Law. Saltwater Disposal and Other Hot Issues in Urban Drilling.
Safety-Wellbore. Presented at the 19th Annual State Bar of Texas Advanced Real Estate Drafting Course in Dallas. February 29,
2008.
305
306
Ibid.
307
University of Arkansas. Argonne National Laboratory. Fayetteville Shale Natural Gas: Reducing Environmental Impacts.
Well Production and Water Management. http://lingo.cast.uark.edu/LINGOPUBLIC/index.htm. Accessed: October 2008.
308
Ibid.
309
Well Production and Water Management. http://lingo.cast.uark.edu/LINGOPUBLIC/environ/wellprod/index.htm. Accessed:
October 2008.
96
310
Darbonne, N. Oil and Gas Investor. Engelder: Marcellus, Mona Lisa Share Structural-Fracturing Features.
http://www.oilandgasinvestor.com/Headlines/WebJuly/item5298.php. July 18, 2008.
311
Personal communication with Pennsylvania Department of Environmental Protection, Bureau of Oil and Gas Management.
October 2008.
312
Personal communication with operators and service industry personnel in the Pennsylvania area. October 2008.
313
Well Production and Water Management. http://lingo.cast.uark.edu/LINGOPUBLIC/environ/wellprod/index.htm. Accessed:
October 2008.
314
Personal communication with Tim Baker from Oklahoma Corporation Commission, Oil and Gas Conservation Division.
October 16, 2008.
315
Ibid.
316
Ibid.
317
318
Grable, R.C. 2008. Kelly Hart & Hallman, Attorneys at Law. Saltwater Disposal and Other Hot Issues in Urban Drilling.
Safety-Wellbore. Presented at the 19th Annual State Bar of Texas Advanced Real Estate Drafting Course in Dallas. February 29,
2008.
319
Ewing, J. 2008. Devon Energy Corp. Taking a Proactive Approach to Water Recycling in the Barnett Shale. Presented at
the Fort Worth Business Press Barnett Shale Symposium. February 29, 2008.
320
Texas Railroad Commission. NORM Naturally Occurring Radioactive Material.
http://www.rrc.state.tx.us/divisions/og/key-programs/norm.html. Accessed: October 2008.
321
NCRP. 2009. Ioning Radiation Exposure of the Populations of the United States. National Council on Radiation Exposure
and Measurements, report No. 160. March, 2009.
322
USGS. 1999. Naturally Occurring Radioactive Materials (NORM) in Produced Water and Oil-Field Equipment An Issue
for the Energy Industry. USGS Fact Sheet FS-142-99. September 1999.
323
Smith, K.P., D. L. Blunt, G. P. Williams, and C. L. Tebes. 1996. Argonne National Laboratory. Environmental Assessment
Division. Radiological Dose Assessment Related to Management of Naturally Occurring Radioactive Materials Generated by
the Petroleum Industry. September 1996.
324
Ibid.
325
API. 2004. Naturally Occurring Radioactive Material in North American Oilfields A Fact Sheet from the American
Petroleum Institute. 2004.
326
Barnett Shale Energy Education Council. Environment. www.bseec.org/index.php/content/facts/environment. Accessed:
September 2008.
327
Ibid.
328
Smith, K.P., D. L. Blunt, G. P. Williams, and C. L. Tebes. 1996. Argonne National Laboratory. Environmental Assessment
Division. Radiological Dose Assessment Related to Management of Naturally Occurring Radioactive Materials Generated by
the Petroleum Industry. September 1996.
329
Ibid.
330
NaturalGas.org. Natural Gas and the Environment. www.naturalgas.org/environment/naturalgas.asp. Accessed: September
2008.
331
EPA. Emissions by Category Chart Criteria Air Pollutants. Volatile Organic Compounds - 2001.
www.epa.gov/oar/data/emcatbar.html?us~USA~United%20States. Accessed: September 2008.
332
EPA. Technology Transfer Network: 1999 National-Scale Air Toxics Assessment. Benzene Emissions 1999.
http://www.epa.gov/ttn/atw/nata1999/99pdfs/benzene.pdf. Accessed: September 2008.
333
EPA. Emissions by Category Chart Criteria Air Pollutants. Carbon Monoxide 2001.
www.epa.gov/oar/data/emcatbar.html?us~USA~United%20States. Accessed: September 2008.
97
334
Ibid.
335
Triplepundit. 2008. Shale Gas: Energy Boon or Environmental Bane, Part One . www.triplepundit.com/pages/shale-gas-
energy-boon-or-envir-003396.php. August 11, 2008.
336
American Petroleum Institute (API). 2001. RP 49,. Recommended Practice for Drilling and Well Servicing Operations
Involving Hydrogen Sulfide. 2nd Edition. May 2001. Reaffirmed, March 2007.
337
EPA, 2008. Partner Update: Partner Profile: ConocoPhillips Makes New Commitment to Natural Gas Star.
www.epa.gov/gasstar/pdf/ngspartnerup_spring2007.pdf. Spring 2008.
338
Ibid.
339
NaturalGas.org. Processing Natural Gas. www.naturalgas.org/naturalgas/processing_ng.asp. Accessed: September 2008.
340
EPA. 2005. Reduced Emission Completions (Green Completions ). www.epa.gov/gasstar/workshops/houston-
oct26/green_c.pdf. October 26, 2005.
341
Methane to Markets. About the Partnership. www.methanetomarkets.org/about/index.htm. Accessed: September 2008.
342
Methane to Markets. Oil and Gas Sector Members. www.methanetomarkets.org/partners/network/pnmList.aspx?type=oil.
343
Methane to Markets. Methane Partnership Program s. www.epa.gov/methanetomarkets/partnership.htm. Accessed:
September 2008.
98
THIS PAGE INTENTIONALLY LEFT BLANK
Ground Water Protection Council
Oklahoma City, OK 73142
405-516-4972
www.gwpc.org
ALL Consulting
Tulsa, OK 74119
918-382-7581
www.all-llc.com
National Energy Technology Laboratory

Strategic Center for Natural Gas and Oil
Morgantown, WV 26507
1-800-533-7681
www.netl.doe.gov
U.S. Department of Energy

Office of Fossil Energy
Washington, DC 20585
202-586-5600
www.fossil.energy.gov
April 2009
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Department of Energy Office of Fossil Energy

Modern Shale Gas

Work Performed Under DE-FG26-04NT15455

Source: ALL Consulting, 2008

Missourian Canyon Grp

- Meramecian Barnett Shale

Source:Hillwood,2007140 Source: ALL Consulting, 2009

Source: Johnson, et al., 2000143

Source: ALL Consulting, 2009

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Source: ALL Consulting, 2009

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Texas TheRailroadCommissionofTexas http://www.rrc.state.tx.us/index.html

Source: ALL Consulting, 2008

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National Energy Technology Laboratory

U.S. Department of Energy

Printed on recycled paper

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