## Attachment E

Hydraulically Fractured Oil Wells

Karen Olson

Southwestern EnergyPeer

- review of “Oil and Natural Gas Sector Hydraulically Fractured Oil Well Completions and Associated Gas during Ongoing Production ” , April 2014, U.S. EPA Office of Air Quality Planning and Standards (OAQPS)

By Karen Olson

, Director , Southwestern Energy (SWN)

The Report for Oil and Natural Gas Sector Hydraulically Fractured Oil Well Completions and Associated Gas during Ongoing Production Report (“White Paper”) is a compendium of prior measurements and analysis of methane emissions and control tec hnologies relating to the initial flowback of hydraulically fractured oil wells. The stated purpose of the white paper is to provide a “summary of the EPA’s understanding of emissions from hydraulically fractured oil well completions and associated gas du ring ongoing production, the mitigation techniques available to reduce these emissions, the efficacy of these techniques and prevalence of these techniques in the field.” In general, the summary developed in the white paper is an accurate reflection of cu rrent data. In addition to the sources that EPA refers to in the document, there are other technical documents that we recommend EPA consult to improve its understanding of the emissions profile and techniques.

Key Comments

**•** This paper is a compilation of emission studies that are based on uncontrolled i.e. venting of associated natural gas for a time period ranging from 3

- 7 days depending on the assumed length of time for the completion. Many states do not allow for uncontrolled emissions. The EPA
white paper does not include a review of state regulations that regulate flowback emissions and associatd gas emissions from oil wells. I would suggest a review of state regulations be a part of this white paper . The potential (uncontrolled) and actual (controll ed) emissions can be estimated after appropriate consideration of the current state regulatory requirements, operating practices, efficiency of the Reduced Emissions Completions (green completions) and flaring (which was mentioned on average of 95% efficie ncy ) . For example Colorado State Regulations related to flowbacks Rule 805 b. (3) applies to both oil and gas wells.

**•** Both completion and recompletions are assumed to have the same assumptions but, a typical recompletion is when a well is completed to a n ew horizon and occurs on a well that already has production equipment in place. On the other hand, refracturing which is usually defined as a workover and is a restimulation of an existing horizon. Both recompletions and refracturing operations occur where the well site has existing production equipment and flow lines. Hence

, I would recommend staying focused on new well completions and maybe expand this to clearly discuss oil wells with associated gas and gas

- condensate wells.

**•** The Fort Berthold Indian Reservation (FBIR) dataset discussed in the White Paper seemed to b e discounted because it was primarily from the Bakken and Three Forks formation which limits it to a regional dataset. Also, the data having a high variability in oil rates and a product composition containing a high amount of lighter end VOC components seems to be considerations in discounting the FBIR data set

. However, t his study could be relevant forunconventional oil plays which typically do have a high varia bility of oil rates and typically produce lighter ends due to the extreme tightness of the pore throats for the hydrocarbons to
flow through

.

**•** The white paper states “The n ational level estimates of uncontrolled methane emissions from hydraulically fracture d oil well completions range from 44,306 tons per year (ERG/ECR) to 247,000 tons per year (EDF/Stratus analysis)”. I recommend that the EPA also give a range of controlled methane emissions from hydraulically fractured oil well completions

.

**•** The same anal ysis can be done for the controlled VOC emissions from hydraulically fractured oil well completions

.

**•** This paper states that it cannot determine the number of oil wells that are controlled using REC or flaring, SWN would suggest this can be estimated by the number of wells completed in each

state based on each state’s regulations regarding associated gas.

**•** The discussion with respect to the e conomic al feasibility of gas capture technologies of oil wells should be expanded to show basic economics depending on the oil rate, GOR, gas price and investment cost. The figure below is one example based on oil rate and gas

- oil ratio (GOR)

.

**•** Reference to gas technologies that are being investigated for use in completions and for control of associated gas emissions should also include a discussion of the emerging technology of CNG in a box which allows for the storage of natural gas on a wellsite location and is portable . A New
York Times article dated Decem ber 17, 2013 by Clifford Krauss “Applying Creativity to a Byproduct of Oil Drilling” discusses the work GE in conjunction with Statoil is using their “C.N.G.
in a box” to compress and store natural gas (once the NGL’s are stripped). 0 500 1000 1500 2000 2500 3000 3500

0 200 400 600 800 1000 1200 1400GOR (SCF/BO)

BOPD 

## Breakeven Oil Rate

$6 MCF Case

$5 MCF Case

$4 MCF Case

### Note: Below are reference rules and regulations from Colorado and Texas



## Colorado Rules and Regulations



## http://cogcc.state.co.us/

Workover Remedial work to the equipment within a well, the well pipework, or relating to attempts to increase the rate of flow.

Fracturing A method of breaking down a formation by pumping fluid at very high pressures. The objective is to increase production rates from a reservoir

### 800 Series AESTHETIC AND NOISE CONTROL REGULATIONS

Rule 805 b. (3)

Green completion practices shall include, but not be limited to, the following emission reduction

measures : i. The operator shall employ sand traps, surge vessels, separators, and tanks as soon as practicable during flowback and cleanout operations to safely maximize resource recovery and minimize releases to the environment. ii. Well effluent during flowback and cleanout operations prior to encountering hydrocarbon gas of salable quality or significant volumes of condensate may be directed to tanks or pits (where permitted) such that oil or condensate volumes shall not be allowed to accumulate in excess of twenty (20) barrels and must be removed within twenty

- four (24) hours. The gaseous phase of non

- flammable effluent may be directed to a flare pit or vented from tanks for safety purposes until flammable gas is encountered. iii. Well effluent containing more than ten (10) barrels per day of condensate or within two (2) hours after first encountering hydrocarbon gas of salabl e quality shall be directed to a combination of sand traps, separators, surge vessels, and tanks or other equipment as needed to ensure safe separation of sand, hydrocarbon liquids, water, and gas and to ensure salable products are efficiently recovered fo r sale or conserved and that non

- salable products are disposed of in a safe and environmentally responsible

manner. iv. If it is safe and technically feasible, closed

- top tanks shall utilize backpressure systems that exert a minimum of four (4) ounces of backpressure and a maximum that does not exceed the pressure rating of the tank to facilitate gathering and combustion of tank vapors . Vent/backpressure values, the combustor, lines to the combustor, and knock

- outs shall be sized and maintained so as to sa fely accommodate any surges the system may encounter. v. All salable quality gas shall be directed to the sales line as soon as practicable or shut in and conserved. Temporary flaring or venting shall be permitted as a safety measure during upset conditio ns and in accordance with all other applicable laws, rules, and regulations. C. An operator may request a variance from the Director if it believes that using green completion practices is infeasible due to well or field conditions, or would endanger the safety of wellsite personnel or the public. D. In instances where green completion practices are not technically feasible, operators shall employ Best Management Practices (BMPs) to reduce emissions. Such BMPs shall consider safety and shall include measu res or actions to minimize the time period during which gases are emitted directly to the atmosphere, and monitoring and recording the volume and time period of such emissions.



### 900 Series Exploration and Production Waste Management

912. VENTING OR FLARING NATURAL GAS a. The unnecessary or excessive venting or flaring of natural gas produced from a well is prohibited. b. Except for gas flared or vented during an upset condition, well maintenance, well stimulation flowback, purging

o perations, or a productivity test, gas from a well shall be flared or vented only after notice has been given and approval obtained from the Director on a Sundry Notice, Form 4, stating the estimated volume and content of the gas. The notice shall indicate whether the gas contains more than one (1) ppm of hydrogen sulfide. If necessary to protect the public health, safety or welfare, the Director may require the flaring of gas.

## Texas

Texas Administrative Code Title 16 Part 1 Chapter 3 Rule 3.32 Gas Well Gas and Casinghead Gas Shall Be Utilized for Legal Purposes 

### Texas Railroad Commission

**•** Fugitive emissions

-- Releases of gas from lease production, gathering, compression, or gas plant equipment components, including emissions from valve stems, pressure relief valves, flanges and connections, gas

- operated valves, compressor and pump seals, pum ping well stuffing boxes, casing

- to

casing bradenheads subject to the provisions of §3.17 of this title (relating to Pressure on Bradenhead), pits, and sumps, that cannot reasonably be captured and sold or routed to a vent or flare.

(1) Releases of gas t hat are not readily measured by devices routinely used in the operation of oil wells, gas wells, gas gathering systems, or gas plants, such as meters, are not required by the commission to be reported or charged against lease allowable production and are n ot subject to the remaining requirements of this section. Releases of gas exempt from the requirements of this section under this paragraph include, but are not limited to, the following: (A) tank vapors from crude oil storage tanks, gas well condensa te storage tanks, or salt water storage tanks, including makeup gas for gas blanket maintenance; (B) fugitive emissions of gas; (C) amine treater, glycol dehydrator flash tank and/or reboiler emissions; (D) blowdown gas from flow lines, gath ering lines, meter runs, pressurized vessels, compressors, or other gas handling equipment for construction, maintenance or repair; (E) gas purged from compressor cylinders or other gas handling equipment for startup; (F) gas released at a wellsi te during drilling operations and prior to the completion date of the well , including gas produced during air or gas drilling operations or gas which must be separated from drilling fluids using a mud

- gas separator, or mud

degasser; or (G) gas released at a wellsite during initial completion, recompletion in another field, or workover operations in the same field, including but not limited to perforating, stimulating , deepening , cleanout, well maintenance or repair operations.(2) Notwithsta nding the foregoing, the commission or the commission's delegate may require the flaring of releases of gas not readily measured by devices routinely used in the operation of oil wells, gas wells, gas gathering systems, or gas plants, such as meters, if th e commission or the commission's delegate determines that flaring is required for safety reasons.

(e) Gas Releases to be Burned in a Flare. Except as otherwise provided in subsections (d), (f)(1)(B) and (C), (g)(2), or an exception granted under subsectio n (h) of this section, all gas releases of greater than 24 hours duration authorized under the provisions of this section shall be burned in a flare if the gas can be burned safely. All gas releases of 24 hours' duration or less authorized under the provis ions of this section may be vented to the air if flaring is not required for safety reasons or by other regulation and the gas can be safely vented. Gas releases authorized under this section must be managed in accordance with the provisions of §3.36 of t his title (relating to Oil, Gas, or Geothermal Resource Operation in Hydrogen Sulfide Areas) when applicable. An exception to the requirements of this subsection may be granted under subsection (h) by the commission or the commission's delegate to allow t he venting of gas to the air for releases of greater than 24 hours' duration if the operator presents information that shows the gas cannot be both safely and continuously burned in a flare, and the gas can be safely vented.

(4) Notwithstanding the prov isions of paragraph (1) of this subsection or an exception granted under subsection (h), the commission or the commission's delegate may require that the gas be flared if flaring is required for safety reasons.

RULE §3.49 Gas

- Oil Ratio

Any oil well producing with a gas

- oil ratio in excess of 2,000 cubic feet of gas per barrel of oil produced shall be allowed to produce daily only that volume of gas obtained by multiplying its maximum daily oil allowable, as determined by the allocation f ormula applicable to the well, by 2,000. The gas volume thus obtained shall be known as the daily gas limit of the well. The daily oil allowable of the well shall then be determined by dividing its daily gas limit, obtained as provided in this section, by its producing gas

- oil ratio in cubic feet per barrel of oil produced.

(b) Any gas well producing from the same reservoir in which oil wells are completed and producing shall be allowed to produce daily only that amount of gas which is the volumetric equiv alent in reservoir displacement of the gas and oil produced from the oil well in the reservoir that withdraws the maximum amount of gas in the production of its daily oil allowable.(1) The following formula shall be used in the determination of the all owable of a gas well producing with a gas

- oil ratio of 100,000 or more.

Attached Graphic

(2) The following formula shall be used in the determination of the allowable of a gas well producing with a gas

- oil ratio of less than 100,000 under the provisions of
the rule stated.

At tached Graphic

(3) The allowable for an associated gas well as determined by this subsection shall be limited to the lesser of:

(A) the gas well allowable as calculated by paragraph (1) or (2) of this subsection;

(B) the well's capability as d etermined by §3.31(e) of this title (relating to Gas Reservoirs and Gas Well Allowable) (Statewide Rule 31); or

(C) the highest monthly production during those months averaged to a daily amount for wells that reported production during any of the thre e most recently reported production months.

(c) The necessary reservoir data shall be obtained from the file of the most recent MER hearing or shall be estimated by the commission unless more recent information is submitted by the operators.

(d) If the g as produced from an oil reservoir is returned to the same reservoir from which it was produced, only the volume of gas not returned to the reservoir shall be considered in applying the rule stated.

(e) Associated gas wells.

(1) Subsection (b) of this s ection will not be applicable to associated gas wells in reservoirs for which unlimited net gas

- oil ratio authority has been granted for oil wells, where such net gas is defined as total gas produced less gas diverted to legal uses; however, this subsectio n does not apply to reservoirs where net gas is defined as total gas produced less gas returned to the reservoir from which it was produced, or where special field rules have been adopted for associated gas wells, or where a total gas volume limitation is placed upon the oil well producing under a net ratio, except that each associated gas well in such a reservoir shall be entitled to an additional gas voidage not to exceed the limitation placed upon the net ratio authority granted and the facts are shown o n the current oil proration schedule for the field.(2) Allowables for associated gas wells producing from reservoirs that are subject to an unlimited net gas

- oil ratio authority will be dropped from the associated gas well schedule, effective that date such an unlimited net gas

- oil ratio is authorized for any oil well in such reservoir.

(f) All gas

- oil ratios determined by test or allocation shall be reported on the oil well status report form in accordance with instructions thereon and the provisions of §3.53(a) of this title (relating to Annual Well Tests and Well Status Reports Required).

(g) Allowables.

(1) No well shall have its allowable curtailed below the allowable fixed by the applicable field rules and the general statewide market demand o rder, unless such well is incapable of producing this allowable on a calendar day basis.

(2) Any well that has a gas

- oil ratio in excess of the prescribed ratio for the field in which it is located will have its schedule daily allowable penalized due to such ratio.

Hydraulic fracturing treatment

-- A completion process involving treatment of a well by the application of hydraulic fracturing fluid under pressure for the express purpose of initiating or propagating fractures in a target geologic formation to enhance production of oil and/or natural gas. The term does not include acid treatment, perforation, or other non

- fracture treatment completion activities.