### MEMORANDUM

TO: Lisa Biddle, U.S. EPA

Karen Milam, U.S . EPA

FROM: Brent Ruminski, ERG

DATE: June 6 , 2016

SUBJECT: Analysis of DI Desktop ® ( DCN SGE01180 )

This memorandum describes ERG’s analysis of Drillingi nfo’s (DI) Desktop ® Well File

Database that ERG used to supplement other analyses for the Technical Development Document for Effluent Limitations Guidelines and Standards for Oil and Gas Extraction (TDD) (DCN

SGE0 1188 )

. Specific ally, this memorandum focuses on how ERG developed a database of active unconventional oil and gas ( UOG ) wells ( DI Desktop ® Development Database

, DCN

SGE01180 .A 0 1 ) from Drillinginfo ’s nationwide database of all oil and gas wells

. Table 1 lists the relevant TDD tables and/or figures and the TDD analyses supported by the DI Desktop ®
Development database . TDD tables and figures not listed in Table 1 either did not require calculations and/or analyses by ERG or are described in separate, supporting memoranda. The Crosswalk Memorandum between Proposed and Final Technical Development Document for Effluent Limitations Guidelines and Standards for Oil and Gas Extraction: Tables and Figures (DCN SGE01334) contains a crosswalk of all ta bles and figures in the TDD. Appendix F of the

TDD contains the name of the relevant supporting memorandum for each TDD table and figure

, where applicable. This memorandum is organized into the following sections:

 Section 0 provides background information about the DI Desktop ® database and the purpose of this analysis.

 Section 2.0 discusses how ERG created the DI Desktop ® Development database

which is u sed to create a subset of the DI Desktop ® database containing only

active oil and gas wells and flag those that are drilled into UOG formations

.

 Section 3.0 summarizes the results of the DI Desktop ® database analysis and how they compare to literature.

 Section 4.0 describes ERG’s quality assurance procedures.

 Section 5.0 lists the references used for th i s analys i s.

For those figures/tables ERG genera ted specifically for this memorandum, the underlying data and analysis are contained in:

 Attachment 1

– DI Desktop® Development Database (DCN SGE01180.A01)

For the tables/figures explained in more detail in this memorandum

, Table 1 provides the

TDD chapter , memorandum section, and attachment information.Analysis of DI Desktop ® Memorandum

June 6 , 2016 Page 2

Table 1

. Other UOG Analyses Supported by t his Memorandum

TDD Chapter Supporting Analysis TDD Table or Figure Number Supporting Analysis

DCN

B UOG Potential by Resource Type as of January 1, 201 3 Table B

- 3 a SGE0 1179 .A 0 2

C DI Desktop ® Long

- term Produced Water Rates Table C

- 8 & C

- 9 b SGE0 1184 .A 0 2 and A 0 3

FracFocus ® Fracturing Fluid Volumes Table C

- 7 & C

- 9 b SGE01184 .A 0 4 and A 0 5

New Mexico Flowback Recovery Table C

- 7 & C

- 9 b SGE01184 .A 0 7

Wyoming Flowback Recovery Table C

- 7 & C

- 9 b SGE01184.A09

Niobrara Flowback Recovery Table C

- 7 & C

- 9 b SGE01184.A11

a

— Methodolog y used to generate this table is explained in ERG’s memorandum titled Data Compilation Memorandum for the Technical Development Document ( TDD) for Effluent Limitations Guidelines and Standards for Oil and Gas Extraction

– DCN SGE0 1179

. b

— Methodologies used to generate these tabl es are explained in ERG’s memorandum titled Unconventional Oil and Gas (UOG) Produced Water Volumes and Characterization Data Compilation

– DCN SGE0 1184

.

For definitions of common terms used throughout the TDD, the supporting memoranda,

and memoranda attachments, please refer to the Glossary in the introduction of the TDD.

1.0 DI D ESKTOP ® D EVELOPMENT D ATABASE B ACKGROUND

Drillinginfo (DI) is an oil and gas research firm located in Austin, Texas. DI Desktop ® is

a comprehensive database generated by Drilling i nfo that contains a record (i.e., row) for all oil and gas well s drilled in the United States. 1 Drillingi nfo uses oil and gas databases maintained by

indiv idual state oil and gas agencies to create the DI Desktop ® database

. For this analysis, ERG

downloaded a version of the DI Desktop ® database on March 30, 2015 . F or the most part , this

version of DI Desktop ® reflects wells drilled as of 201 4 but it varies by state

. State

- level

i nformation such as the oil and gas agency names, last production date 2 , production start date 3

, and update frequency (e.g., monthly, quarterly) is provided in Drillinginfo’s Data Coverage table ( DCN SGE0 1 171 ). The raw DI Desktop ® database ERG used for this analysis is contained in the

“ DI Desktop Wells (SGE01170) ” table of Attachment 1 (DCN SGE01180 .A 0 1) in addition to

DCN SGE0117 0

.

Basic well data contained in DI Desktop ® for each well includes: well API number 4

, location, operator, and well trajectory. DI Desktop ® also includes annual oil, gas, and produced

wat er production per well. Table 2 provid es the complete list of data fields in DI Desktop ®

. The fields ERG used either in this analysis or in other UOG TDD supporting an alyses are marked with an asterisk. All other fields were not used by ERG.

1 The database is subject to restrictions on its use and dissemination. Based on the license agreement discussions, access to the raw data in the database is limited to ERG and EPA personnel only; although summary data developed using queries can be disseminated more widely. Wholesale “data dumps” cannot be disseminated electronically. All disseminations of such summary data, however, should cite Drillinginfo as the source of the information.

2 This is the date that the state last updated the data that Drillinginfo included in ERG’s version of the DI Desktop ®
database downloaded on March 30, 2015.

3 First year that the state agency maintained records for oil and gas wells.

4 An API number is a uniqu e identifier assigned to each well drilled for oil and gas in the United States.Analysis of DI Desktop ® Memorandum

June 6 , 2016 Page 3

DI Desktop ® includes records for wells that are no longer active (i.e., shut in), underground injection wells 5 that do not produce oil and /or gas, conventional oil and gas (COG) wells, CBM wells, and U OG wells. It does not, however, contain a field that indicates if wells

are conventional or unconventional. Section 2.0 describes how ERG determined which active

wells in the raw DI Desktop ® database are drilled into UOG formations.

Table 2 . Field Names and Descriptions in DI Desktop ®

Field Name Description

ENTITY_ID* DI assigned ID unique to a given property. A well is referred to as a “property” in DI Desktop ®

. API_NO* API assigned number of a well on the property.

PROPERTY_TYPE Property type (e.g., lease, unit, well, completion, other, unknown).

PRODUCTION_TYPE Production type (e.g., oil, gas, injection).

PROD_TYPE_CLASS * Classification of production type into D&A (drilled and abandoned), gas, injection, O&G (oil and gas), oil, and other.

PROD_FLAG Production flag to indicate whether the well should be producing liquids. This is “Yes” for “Gas,” “Oil,” and “O&G” production type classification.

LIQUID_PROD_TYPE Liquid production type (i.e., unknown, condensate, or oil) based on the production type classification and well test data.

WELL_NAME Operator assigned well/lease n ame of the property.

FIELD Field name the property is reporting from.

CURR_OPER_NAME Current operator name.

SPUD_DATE* D ate drilling commenced on property.

COMMON_OPER_NAME Corporate entity that is determined by DI to own the current operator.

LATITUDE_NAD27 Surface latitude the property is located in; for multi

- well properties DI Desktop ® picked a well to designate the location of the property, in NAD27 format

. LONGITUDE_NAD27 Surface longitude the property is located in; for multi

- well properties DI Desktop ® picked a well to designate the location of the property, in NAD27 format

.

LATITUDE_NAD83 Surface latitude the property is located in; for multi

- well properties DI Desktop ® picked a well to designate the location of the property, in NAD83 format

.

LONGITUDE_NAD83 Surface longitude the property is located in; for multi

- well properties DI Desktop ® picked a well to designate the location of the property, in NAD83 format

. COUNTY County the property is located in.

FIPS_CODE Federal Information Processing Standard (FIPS) county code based on county or GIS analysis using latitude and longitude.

DISTRICT District within a given state the property is assigned.

STATE* State the property is located in.

EPA_REGION EPA region the property is located in.

OFFSHORE Offshore waters indicator.

RESERVOIR * Reservoir, formation, zone, or pool that the property is reported as producing from.

BASIN* The basin the property is located i n.

FORMATION* Formation that the property is reported as producing from.

5 For more information about underground injection wells, see ERG’s TDD supporting memorandum titled Analysis of Active Underground Injection for Disposal Wells

- DCN SGE0118 7.Analysis of DI Desktop ® Memorandum

June 6 , 2016 Page 4

Table 2 . Field Names and Descriptions in DI Desktop ®

Field Name Description

STATUS* Current status of the well (e.g., active, inactive, shut in).

TOTAL_DEPTH Total depth the well was drilled to.

PLUG_DATE Date the well was plugged. Note: for instances where duplicate API numbers were combined, the maximum value was selected.

COMPLETION_DATE* Most recent completion date of the well.

COMPLETION_YEAR * Year of the completion date.

Well Trajectory This is the configuration of the wellbore. Options include: H

– Horizontal; D

– Directional; V

– Vertical; U

– Unknown.

FIRST_PROD_DATE First date of reported production for the property. Note: for instances where duplicate API numbers were combined, the minimum value was selected.

LAST_PROD_DATE* Last date production was reported for the property.

LATITUDE_BOTM Bottom hole latitude of the property.

LONGITUDE_BOTM Bottom hole longitude of the property.

SumOfLIQ [xx] Annual o il production in barrels. A separate column is provided for each year from

2000 ( i.e., “ SUMOFLIQ00 ” ) through 2014 ( i.e., “ SUMOFLIQ14 ” ).

SumOfGAS [xx] Annual Gas production in thousand cubic feet. A separate column is provided for each year from 2000 ( i.e., “ SUMOFGAS00 ” ) through 2014 ( i.e., “ SUMOFGAS14 ” ).

SumOfWTR [xx] * Annual p roduced water production in barrels. A separate column is provided for each

year from 2000 ( i.e., “ SUMOFWTR00 ” ) through 2014 ( i.e., “ SUMOFWTR14 ” ).

PROD[xx]_FLAG Yes/No flag indicating if oil and/or gas production was greater than zero for a given

year. A separate column is provided for each year from 200 0 ( i.e.,

“ PROD0 0 _FLAG ” ) through 2014 ( i.e., “ PROD14_FLAG ” )

. ACTIVE_FLAG Yes/No flag indicating whether or not a well is active based on production

. ACTIVE_PROD_FLAG Yes/No flag indicating whether the entity (i.e., property) is active (using the
ACTIVE_FL AG field) and had production in 2014 (using the PROD1 4 _FLAG field).

2.0 D EVELOPMENT D ATABASE M ETHODOLOGY

The following steps describe how ERG used the raw DI Desktop ® database to make a list

of active oil and gas extraction wells drilled into UOG formations. These steps outline the queries in Attachment 1 (DCN SGE01180 .A 0 1).

Step 1

– Create Active Oil and Gas Wells Table

ERG used query 100 in Attachment 1 to create a list of active oil and gas extraction

wells. This query checks each well record in the raw DI Desktop ® database (i.e., the table “DI Desktop Wells (SGE01170)” in Attachment 1) against the two sets of criteria listed below to identify oil and gas w ells that are active. It makes a new table called “Active Oil and Gas Wells” in Attachment 1 that contains the final list of active oil and gas wells.

1. Query 100 only includes wells that are designated as “oil”, “gas”, or “O&G” i n the PROD_TYPE_CLASS field . This removes wells that are classified as injection wells, carbon storage wells, water wells, etc.Analysis of DI Desktop ® Memorandum

June 6 , 2016 Page 5

2. For all states, ERG considered active wells to be those that produced oil, gas,

and/or produced water during the year that the data was last updated by

Dri llinginfo

. 6 Because each state updates their data at different times, ERG used

different dates for each state to complete this step. 7 The most recent production date for each state is provided in Drillinginfo’s Data Coverage table (DCN

SGE01171 ).

Step 2

– Create Consolidated Formation Crosswalk

DI Desktop ® does not identify wells as unconventional or conventional. However, it

identifies the basin , reservoir, and formation in which the well is completed. ERG used this

information to identify UOG wells. H owever, because the se fields include inconsistent naming conventions and spelling errors, ERG created a comprehensive crosswa lk between the basin

, reservoir, and formation reported in DI Desktop ® ; consolidated UOG formation names (developed by ERG); and applicable resource type

. Table 3 provides examples of these

consolidations. The full crosswalk contains over 46 ,000 combinations and is in the table called

“For mation Consolidation Crosswalk” in Attachment 1 ( DCN SGE0 1180 .A 0 1). Section 3.0 discusses data quality related to this crosswalk.

To assign consolidated UOG format ion names, ERG searched the basin, reservoir, and/or formation names reported in DI Desktop ® for the basin and UOG formation names listed in

Table 9.3 of EIA’s Assumptions to the 201 5 Annual Energy Outlook report ( DCN SGE 0 1 190 )

, which is a complete list of UOG formations in the U.S. known by EIA as of the end of 2013. To assign resource type, ERG determined whether the formation is listed on EIA’s map of shale formations (DCN SGE01191) or EIA’s map of tight formations (DCN SGE00 155). ERG used other references to supplement the EIA report as needed to identify UOG formation name s and /or applicable resource type . The DOCUMENTATION field in the consolidated formation

crosswalk contains the DCN(s) for the reference (s) ERG used to ide ntify each UOG formation

.

Table 3 . Formation Consolidation Examples

Reported Basin in DI Desktop ® Reported Reservoir in DI Desktop ® Reported Formation in

DI Desktop ® Consolidated

UOG

Formation (assigned by ERG) Resource

Type (assigned by ERG)

TX & LA GULF COAST EAGLE FORD

- 1 EAGLEFORD

- 1 Eagle Ford shale

TX & LA GULF COAST [blank] EAGLE FORD Eagle Ford shale

TX & LA GULF COAST EAGLE FORD [blank] Eagle Ford shale

ANADARKO GRANITE WASH GRANITE WASH Granite Wash tight

6 This is the date that the state last updated the data that Drillinginfo included in ERG’s version of the DI Desktop®
database downloaded on March 30, 2015.

7 For KY and TN, the data were last updated in December 2012. For MD, NY, OH, OR, VA, and WV the data were last updated in December 2013. For MO, the data were last updated in April 2014. For AL, the data were last updated in September 2014. For MI and NV, the data were last updated in October 2014. For AR, CA, MS, MT, and OK, the data were last updated in November 2014. For AZ, CO, KS, LA, NE, NM, PA, SD, UT, and WY, the data were last updated in December 2014. For AK, FL, ND, and TX, the data were last upd ated in January 2015 (DCN SGE01171).Analysis of DI Desktop ® Memorandum

June 6 , 2016 Page 6

Table 3 . Formation Consolidation Examples

Reported Basin in DI Desktop ® Reported Reservoir in DI Desktop ® Reported Formation in

DI Desktop ® Consolidated

UOG

Formation (assigned by ERG) Resource

Type (assigned by ERG)

ANADARKO (N GRANITE WASH CONS Granite Wash tight

ANADARKO GRANITE WASH GRANITE WASH

- C

- Granite Wash tight

EAST TEXAS HA HA Haynesville shale

EAST TEXAS HAYNESVILLE SH HAYNESVILLE SH Haynesville shale

EAST TEXAS HAYNESVILLE HAYNESVILLE Haynesville shale

Step 3

– Update Active Oil and Gas Table (Query 2 00)

Lastly, ERG used Query 200 in Attachment 1 (DCN SGE01180.A01) to update the

“ Active Oil and Gas Wells ” table with consolidated UOG formation names and resource type

. This q uery updates the RESOURCE_TYPE and CONSOLIDATED FORMATION fields in the
“Active Oil and Gas Wells” table by cross referenc ing the reported basin and formation

combination against the “Consolidated Formation Crosswalk” table ERG created in S tep 2

.

3.0 DI D ESKTOP ® A NALYSIS R ESULTS

Table 4 shows the total number of active well s identified by ERG in the DI Desktop ®
database by resource type and well trajectory . ERG generated the results in Table 4 using query

300 in Attachment 1 (DCN SGE01180.A01)

. 8 For comparison, the total number of active oil and gas wells reported by EIA for 2011 (DCN SGE0 1176 ) is included in Table 4

. Wells that ERG did not identify as UOG are included in the “ COG and CBM ” category.

T he total number of UOG wells that were active in 2014 may h ave been higher than t he

number ERG estimated . This is primarily because the FOR M ATION field for over 140,000 active oil and gas wells was reported as “N/A”, “0”, “N”, or blank such that ERG could not identify a common formation name and could not determin e if the well was in a conventional or

unconventional formation (see Step 3 in Section 2.0 )

.

Table 4

. Summary of Active Oil and Gas Extraction Wells

Resource Type Identified by ERG in DI Desktop ® by Well Trajectory ( 2014 ) a Reported by

EIA ( 2011 ) b,c H orizontal D irectional V ertical U nknown Total

UOG: Tight 11,175 12,565 82,954 36,208 142,902 NR

UOG: Shale 56,801 1,836 15,877 17,755 92,269 NR

COG and CBM 24,936 35,607 577,379 246,005 883,927 NR

Total 92,912 50,008 676,210 299,968 1,119,098 1,040,000

8 Query 300 is a crosstab query that counts the number of wells in the “Active Oil and Gas Wells” table by well trajectory and resource type.Analysis of DI Desktop ® Memorandum

June 6 , 2016 Page 7

a

— For the most part, this version of DI Desktop ® reflects wells drilled as of 2014 but it varies by state (see DCN

SGE01171 for state

- by

- state dates)

. b

— Source for EIA well c ounts : DCN SGE0 1176

.

c

— ERG was unable to identify a more recent national level count of active oil and gas wells

.

4.0 Q UALITY C ONTROL P ROCEDURES

All of the analyses presented in this memorandum adhered to the Environmental Engineering Support for Clean Water Regulations Programmatic Quality Assurance Project Plan (PQAPP) (DCN SGE00957) and the Unconventional Oil and Gas (UOG) Supplemental Quality A ssurance Project Plan (SQAPP) (DCN SGE00 958 ), including collecting, evaluating, and analyzing existing data and information

.

Specifically, ERG used the procedures described in Section 4 of the PQAPP to gather and manage existing data in support of the UOG rulemaking. ERG staff entered reference

information for relevant sources into the UOG Literature Review database. The ERG index keeper reviewed all reference information, assigned each reference a Document Control Number (DCN ), imported the reference infor mation into the UOG Project File Index database, and saved referenced files in the Electronic Project File folder.

ERG also used the procedures described in Section 3 of the SQAPP when collecting existing data for use in the UOG rulemaking. ERG used a comb ination of sources, including reports, papers, and online databases from state regulatory agencies such as departments (e.g., oil and gas commissions )

. As shown in Table 5 in this memorandum, ERG assigned a source flag (A, B, C or D ) to all references used in these analyses. ERG did not use any Source Flag C or D references in this analysis. ERG defines each source flag as follows:

 Source Flag A

- J ournal articles and documents prepared by or for a government agency (e.g., site visit reports, industry meeting notes);

 Source Flag B

- Documents prepared by a verified source 9 that include citation information (e.g., operator reports, vendor documents, conference presentations, university publications);

 Source Flag C

- Documents prepared by a verified source that do not include citation information (e.g., operator reports, vendor documents, conference presentations); and

 Source Flag D

- Documents prepa red by a source that could not be verified and that

do not include citation information

.

EPA and ERG followed the procedures described in Section 7.0 of the PQAPP to generate, evaluate, and analyze data. ERG conducted the following QA checks during the

ana lyses:

 ERG created the Microsoft Access database provided in Attachment 1 and performed a 100 percent check of all queries , and documented these in internal

versions of the databases

.

9 ERG considered sources as “verified” if we were able to find information about the author outside of the reference document. ERG primarily verified information by looking for company/organization websites that confirmed the

author’s affiliation with the U OG industry.Analysis of DI Desktop ® Memorandum

June 6 , 2016 Page 8

 ERG created two crosswalks in the Microsoft Access database provided in

Attachment 1 and performed a 20 percent check of all records in them.

 ERG had a senior staff member familiar with ELGs and the UOG rulemaking

review all analyses

.

5.0 R EFERENCES

Table 5 provides DCNs, citations , and source flags for references used in th i s analys i s

. The references in Table 5 are sorted numerically by DCN.

Table 5 . References

DCN Source Citation Source Flag a

SGE00155 U.S. Energy Information Administration (EIA). 201 0 . Tight Sands Gas Plays,

Lower 48 States. Prepared by EIA Office of Oil and Gas. ( June ). A

SGE00330 Energy Information Administration (EIA). 2011. Review of Emerging

Resources: U.S. Shale Gas and Shale Oil Plays. A

SGE00442.A06 Murray, Kyle E. 2013. Examining Water Production Volumes and Produced

Water Quality in the Mississippi Lime to Develop Appropriate Management Strategies. Mississippi Lime Production and Produced Water. B

SGE00957 Eastern Research Group, Inc. 2014. Environmental Engineering Support for

Clean Water Regulations Programmatic Quality Assurance Project Plan (PQAPP)

. A

SGE00958 Eastern Research Group, Inc. 2014. Unconventional Oil and Gas (UOG)

Supplemental Quality Assurance Project Plan (SQAPP)

. A

SGE00991 United States Geological Survey. 2008. Assessment of Undiscovered Oil and

Gas Resources of the Permian Basin Province of West Texas and Southeast New Mexico, 2007. A

SGE01023 Office of Governor Dennis Gaugaard. 2012. South Dakota Oil and Gas

Development/Preparedness Executive Branch Work Groups: Summary of Findings. (September). A

SGE01170 DrillingInfo. 2015. DI Desktop ® March 2015 Download_CBI. B

SGE01171 Drillinginfo. 2015. HPDI Data Coverage. (March 31). B

SGE01176 DrillingInfo, Inc. 2015. HPDI Data Coverage. (March 30). A

SGE01187 ERG. 2016. Analysis of Active Underground Injection for Disposal Wells. A

SGE011 90 U.S. Energy Information Administration. 2015. Assumptions to the Annual

Energy Outlook 2015. A

SGE01191 U.S. Energy Information Administration. 2015. Lower 48 States Shale Plays.

Prepared by EIA Office of Oil and Gas. (April). A

SGE01334 ERG. 2016. Memorandum Providing a Crosswalk between Tables and

Figures in the Proposed and Final Technical Development Document for

Effluent Limitations Guidelines and Standards for Oil and Gas Extraction

. A

a

— Source Flag A

— Journal articles and documents prepared by or for a government agency (e.g., site visit

re ports, industry meeting notes). Source Flag B

— Documents prepared by a verified source that include citation information (e.g., operator reports, vendor docum ents, university publications). Source Flag C

— Documents prepared by a verified source that do not include citation information (e.g., operator reports, vendor documents, conference presentations); andAnalysis of DI Desktop ® Memorandum

June 6 , 2016 Page 9

Source Flag D

— Documents prepared by a source that could not be verified and that do not include citation

information.Analysis of DI Desktop ® Memorandum

October 9, 2015 Page 10

A TTACHMENT 1 : DI D ESKTOP ® D EVELOPMENT D ATABASE ( DCN SGE01180 .A 0 1 )