1 Talisman Marcellus Operations Overview Created: July 23 , 2012

The following summarizes information that Talisman Energy USA (Talisman) provided in response to the Environmental Protection Agency’s (EPA) May 12, 2011 request for information (RFI). EPA’s RFI requested data describing Talisman’s Marcellus shale gas operations between April 1, 2011 and December 31, 2011 (covering 2Q2011 through 4Q2011)

. All information submitted by Talisman was specific to Marcellus shale operations only and may not apply to other shale gas formations. Specific RFI topics summarized below include :

**•** Marcellus shale gas wells and wastewater volume;

**•** Wastewater management ;

**•** Wastewater handling and storage ; and

**•** Wastewater quality.

Suggested follow

- up question s to gain further operational and cost data from Talisman are presented at the end of this document.

Marcellus Shale Gas W ells and Wastewater Volume Talisman provided data on generated wastewater volume for each of its well s

. Talisman tracks flowback volumes directly, but estimates produced water volumes. Flowback volumes are measured during completion on a per

- well basis. Produced water volumes are estimated based on the following: “Talisman well pads have one or two interconn ected aboveground storage tanks (AST) with a range of 100 to 800

- bbl total capacity. Produced water is collected in the ASTs and then transported for treatment and/or recycling when the volume is sufficient to fill trucking capacity. The volumes reported b y the transportation company or the treatment facility are then used to estimate the volume produced at the well pad. The total well pad water volume is then allocated to each well as a percentage of gas produced by each well on the pad.” (File name: Lette r1.pdf, page 2)

Table 1 provides a summary of the wastewater volume data. Each quarter, Talisman operated approximately 30 more wells and 10 more well pads than the previous quarter. The average number of wells per pad was between three and four.

Table 1 . Talisman Marcellus Shale Gas Wastewater Volumes

Time Period Number of Completed Wells Number of Well Pads Total Wastewater

Volume 1 Average Wastewater Volume per Well per Day (barrels/day) 2Q2011 196 60 428,1 85 24.3 3Q2011 227 69 612,918 30.0 4Q2011 260 80 720,239 30.82 Wastewater Management Talisman provided quantitative information on wastewater management practices for the Marcellus shale gas wastewater volumes reported in Table 1

. 1

Table 2 Talisman reused 100 percent of the generated w ast ewater during the RFI period and hauled no wastewater to underground injection wells or POTW s

. Talisman conducted field tests at the point of generation ( well site) to determine whether wastewater required treatment prior to reuse for hydraulic fracturing

. If Talisman determined the water quality to be sufficient for fracturing, then the wastewater was reused directly without treatment. If Talisman determined that the water required treatment, Talisman transported the water to one of two CWTs: TerraAqua Re sources Management (TARM) or HydroRecovery. Starting December 1, 2011, Talisman began reusing all wastewater without any treatment in subsequent fracturing operations. summarizes Tal isman’s

wastewater management practices.

Table 2 . Talisman’s Marcellus Shale Gas Wastewater Management Practices

Management Option 2Q 2011 (barrels) 3Q 2011 (barrels) 4Q 2011 (barrels) Total Volume Generated (barrels)

Treated and reused (total) 202,54 1 226,132 142,111 570,78 4

47 % 37 % 20 % 32 %

Treated and reused (TARM) 194,512 199,274 124,580 518,36 5

Treated and reused (HydroRecovery) 8,030 26,858 17,531 52,419

Untreated and reused 225,6 50 386,786 578,128 1,190,5 64

53 % 63 % 80 % 68 %

Total Generated 428,1 91 612,918 720,239 1,761,34 8

**•** After December 1, 2011, Talisman:

o Ceased all treatment and reuse operations; and

o B egan reusing 100 percent of wastewater without treatment.

**•** CWTs (TARM and Hydrorecovery) :

o Both facilities use chemical precipitation to remove heavy metals and hardness. The treated wastewater is high TDS brine, which is returned to the field for reuse in fracturing.

o Both facilities dispose solid byproduct (non

- hazardous filter cake) at landfills.

**•** Volume of wastewater generated is estimated separately for flowback and produced:

o Flowback volumes are monitored on a per well basis

. o Produced water vo lumes are estimated on a per well basis. Wastewater from each well is collected in i nterconnected above ground storage tanks (ASTs). The

1 Wastewater includes flowback and produced water

.3 transportation company reports the volume of wastewater hauled from the tanks. The total well pad volume is divided among the wells based on the relative gas production.

**•** TerrAqua Resource Management (TA RM)

– Suite 201, 1000 commerce Park Drive, Williamsport, PA

o Treated 518,365 barrels of wastewater from Talisman over 2Q2011

– 4Q2011.

o Information from CWT_POTW Site Visit Matrix.2012.06.01.xlsx (EPA/ERG) :

 Contact: Marty Muggleton (VP)

**•** Office: 570

- 323

- 6603 ext. 307

**•** Cell: 570

- 337

- 0718

 A ccepted 398,241 barrels of brine, 350,874 barrels of f lowback, 49,085 barrels of drilling fluid in 2011 from shale gas wells (PA DEP, 2012).

 Treatment: Batch chemical treatment.

 Effluent is returned to wells for reuse only. After blending, the treated wastewater for reuse meets the following standards: Cl ≤ 30,000 mg/L, TDS ≤ 40,000 mg/L, Ba ≤ 10 mg/L, Sr ≤ 10 mg/L, and Mg ≤ 10 mg/L. Proposed to treat to 500 mg/L TDS for discharge but currently only treats for reuse.

 Permit number WMGR121, PA0233650

 Website: http://www.tarmsolutions.com/locations/lycoming

- county

williamsport

- pa/

**•** HydroRecovery

– 7 Riverside Plaza, P.O. Box 38, Blossburg, PA 16912

o Treated 52,419 barrels of wastewater from Talisman over 2Q2011

– 4Q2011.

o Information from CWT_POTW Site Visit Matrix.2012.06.01.xlsx (EPA/ERG) :

 Contact:

**•** O ffice: 570

- 638

- 0226

**•** C ell: 814

- 341

- 6304

 A ccepted 94,425 barrels of produced water and 26,742 barrels of drilling fluid in 2011 from shale gas wells

 Treatment: Chemical precipitation

 Permit type: WMGR123

 Website: http://www.hydrorecoverylp.com/

**•** Other wastewater management notes

o Talisman h as the ability to use disposal facilities that meet PA DEP Chapter 95 discharge regulations if short t erm storage capacity is reached.

o Talisman e xpect ed to achieve grea t than 90 percent reuse in 2011.

Wastewater Handl ing and Storage

**•** Talisman’s Marcellus operations have not use d pits, lagoons, or impoundments for wastewater handling.

**•** On site produced water storage:

o Above ground storage tanks (ASTs)4 o 100 to 800 barrels per tank

o Trucking companies:

 Gas Field Specialists, Inc

– 1171 SR 44, Shinglehouse, PA

**•** Company provides fracturing tank rental, trucking, construction, and fabrication.

**•** Website: http://www.gfsinc.net/

 Principle Enterprises, LLC

– PO Box 177, Canton , PA

**•** Company provides trucking services specifically for Marcellus oprators.

**•** Website: http://principleenterprises.com/

 QC Energy Resources, LLC

– 1720 Kendarbren Drive 713, Jamison, PA

**•** Has many locations thr oughout the country.

**•** Provides logistic services to shale gas operators.

**•** Website: http://www.qc

- energy.com/

Wastewater Quality

**•** Talisman p rovided waste sampling methods for :

o Flowback sand and d rill cuttings

 In accordance with PA Code 271.611 (a)(3) and 287.132 (a)(3)

 Utilize EPA method SW

- 846 (Chapter 9, Page 8)

 Every well’s flowback sand is sampled

 Sample is maintained at 4 degrees Celsius before reaching the laboratory

**•** PA DEP 26R reports do not require indi vidual chemical analysis to be submitted for “produced water and flowback fluids.” Instead, PA DEP requires a 95 percent upper confidence level (UCL) to represent the constituents of typical produced water and flowback.

**•** Talisman p rovided analytical results for:

o 95 percent UCL statistics for all Marcellus shale gas wastewater ( see talisman

quality

- seewald.pdf )

o Flowback sand (see talisman

- part1.pdf and talisman

- part2.pdf )

o Cuttings (see talisman

- part4.pdf )

Follow Up

**•** How many fresh water intakes/sources are use d ?

**•** Any volume restrictions or other requirements for source water withdrawals from the SRBC ?

**•** How is flowback handled and stored at the well site?

**•** What is the blending ratio for recycling and fresh water for fracturing fluid ?

**•** What are the water quality targ ets for hydraulic fracturing? Have these targets evolved?

**•** When is water quality monitored: At the point of flowback generation? Prior to CWT transport? Following CWT treatment? Prior to mixing with fracturing chemicals?

**•** What water quality constituents are monitored and what facilitated the decision to reuse all wastewater without any treatment ? Gas prices? Fracturing fluid quality criteria?5 **•** What is the volume of hydraulic fracturing fluid used per well?

**•** What is a typical flowback volume (over how many days) ?

**•** For fresh water storage:

o What are the storage devices

— tanks? What volume? Owned or rented?

o What is the length of time typically stored on site?

**•** For flowback and produced water storage:

o What are the storage devices for flowback

— tanks? What volume? Owned or rented?

o What is the length of time typically stored on site?

o How frequently is produced water hauled from well pads?

**•** Does Talisman anticipate being able to recycle with no treatment in 2012 ?

**•** What is the arrangement for wastewater disposal when fracturi ng activities are very slow, or if they stop?

**•** All cost info (did not see any cost info in the PA reporting)