The SEAB Shale Gas Production Subcommittee Ninety-Day Report – August 18, 2011

081811_90_day_report_final.pdf (application/pdf Object).

The SEAB Shale Gas Production Subcommittee
Ninety-Day Report – August 18, 2011
Executive Summary
The Shale Gas Subcommittee of the Secretary of Energy Advisory Board is charged with
identifying measures that can be taken to reduce the environmental impact and improve
the safety of shale gas production.
Natural gas is a cornerstone of the U.S. economy, providing a quarter of the country’s
total energy. Owing to breakthroughs in technology, production from shale formations
has gone from a negligible amount just a few years ago to being almost 30 percent of
total U.S. natural gas production. This has brought lower prices, domestic jobs, and the
prospect of enhanced national security due to the potential of substantial production
growth. But the growth has also brought questions about whether both current and
future production can be done in an environmentally sound fashion that meets the needs
of public trust.
This 90-day report presents recommendations that if implemented will reduce the
environmental impacts from shale gas production. The Subcommittee stresses the
importance of a process of continuous improvement in the various aspects of shale gas
production that relies on best practices and is tied to measurement and disclosure.
While many companies are following such a process, much-broader and more extensive
adoption is warranted. The approach benefits all parties in shale gas production:
regulators will have more complete and accurate information; industry will achieve more
efficient operations; and the public will see continuous, measurable improvement in
shale gas activities.
A list of the Subcommittee’s findings and recommendations follows.
o Improve public information about shale gas operations: Create a portal for
access to a wide range of public information on shale gas development, to
include current data available from state and federal regulatory agencies. The
portal should be open to the public for use to study and analyze shale gas
operations and results.
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o Improve communication among state and federal regulators: Provide continuing
annual support to STRONGER (the State Review of Oil and Natural Gas
Environmental Regulation) and to the Ground Water Protection Council for
expansion of the Risk Based Data Management System and similar projects that
can be extended to all phases of shale gas development.
o Improve air quality: Measures should be taken to reduce emissions of air
pollutants, ozone precursors, and methane as quickly as practicable. The
Subcommittee supports adoption of rigorous standards for new and existing
sources of methane, air toxics, ozone precursors and other air pollutants from
shale gas operations. The Subcommittee recommends:
(1) Enlisting a subset of producers in different basins to design and rapidly
implement measurement systems to collect comprehensive methane and other
air emissions data from shale gas operations and make these data publically
available;
(2) Immediately launching a federal interagency planning effort to acquire data
and analyze the overall greenhouse gas footprint of shale gas operations through
out the lifecycle of natural gas use in comparison to other fuels; and
(3) Encouraging shale-gas production companies and regulators to expand
immediately efforts to reduce air emissions using proven technologies and
practices.
o Protection of water quality: The Subcommittee urges adoption of a systems
approach to water management based on consistent measurement and public
disclosure of the flow and composition of water at every stage of the shale gas
production process. The Subcommittee recommends the following actions by
shale gas companies and regulators – to the extent that such actions have not
already been undertaken by particular companies and regulatory agencies:
(1) Measure and publicly report the composition of water stocks and flow
throughout the fracturing and clean-up process.
(2) Manifest all transfers of water among different locations.
(3) Adopt best practices in well development and construction, especially
casing, cementing, and pressure management. Pressure testing of cemented
casing and state-of-the-art cement bond logs should be used to confirm
formation isolation. Microseismic surveys should be carried out to assure that
hydraulic fracture growth is limited to the gas producing
formations. Regulations and inspections are needed to confirm that operators
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have taken prompt action to repair defective cementing jobs. The regulation
of shale gas development should include inspections at safety-critical stages
of well construction and hydraulic fracturing.
(4) Additional field studies on possible methane leakage from shale gas wells
to water reservoirs.
(5) Adopt requirements for background water quality measurements (e.g.,
existing methane levels in nearby water wells prior to drilling for gas) and
report in advance of shale gas production activity.
(6) Agencies should review field experience and modernize rules and
enforcement practices to ensure protection of drinking and surface waters.
o Disclosure of fracturing fluid composition: The Subcommittee shares the
prevailing view that the risk of fracturing fluid leakage into drinking water sources
through fractures made in deep shale reservoirs is remote. Nevertheless the
Subcommittee believes there is no economic or technical reason to prevent
public disclosure of all chemicals in fracturing fluids, with an exception for
genuinely proprietary information. While companies and regulators are moving in
this direction, progress needs to be accelerated in light of public concern.
o Reduction in the use of diesel fuel: The Subcommittee believes there is no
technical or economic reason to use diesel in shale gas production and
recommends reducing the use of diesel engines for surface power in favor of
natural gas engines or electricity where available.
o Managing short-term and cumulative impacts on communities, land use, wildlife,
and ecologies. Each relevant jurisdiction should pay greater attention to the
combination of impacts from multiple drilling, production and delivery activities
(e.g., impacts on air quality, traffic on roads, noise, visual pollution), and make
efforts to plan for shale development impacts on a regional scale. Possible
mechanisms include:
(1) Use of multi-well drilling pads to minimize transport traffic and need for
new road construction.
(2) Evaluation of water use at the scale of affected watersheds.
(3) Formal notification by regulated entities of anticipated environmental and
community impacts.
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(4) Preservation of unique and/or sensitive areas as off-limits to drilling and
support infrastructure as determined through an appropriate science-based
process.
(5) Undertaking science-based characterization of important landscapes,
habitats and corridors to inform planning, prevention, mitigation and
reclamation of surface impacts.
(6) Establishment of effective field monitoring and enforcement to inform ongoing
assessment of cumulative community and land use impacts.
The process for addressing these issues must afford opportunities for affected
communities to participate and respect for the rights of surface and mineral rights
owners.
o Organizing for best practice: The Subcommittee believes the creation of a shale
gas industry production organization dedicated to continuous improvement of
best practice, defined as improvements in techniques and methods that rely on
measurement and field experience, is needed to improve operational and
environmental outcomes. The Subcommittee favors a national approach
including regional mechanisms that recognize differences in geology, land use,
water resources, and regulation. The Subcommittee is aware that several
different models for such efforts are under discussion and the Subcommittee will
monitor progress during its next ninety days. The Subcommittee has identified
several activities that deserve priority attention for developing best practices:
Air: (a) Reduction of pollutants and methane emissions from all shale gas
production/delivery activity. (b) Establishment of an emission
measurement and reporting system at various points in the production
chain.
Water: (a) Well completion – casing and cementing including use of
cement bond and other completion logging tools. (b) Minimizing water use
and limiting vertical fracture growth.
o Research and Development needs. The public should expect significant
technical advances associated with shale gas production that will significantly
improve the efficiency of shale gas production and that will reduce environmental
impact. The move from single well to multiple-well pad drilling is one clear
example. Given the economic incentive for technical advances, much of the R&D
will be performed by the oil and gas industry. Nevertheless the federal
government has a role especially in basic R&D, environment protection, and
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safety. The current level of federal support for unconventional gas R&D is small,
and the Subcommittee recommends that the Administration and the Congress
set an appropriate mission for R&D and level funding.
The Subcommittee believes that these recommendations, combined with a continuing
focus on and clear commitment to measurable progress in implementation of best
practices based on technical innovation and field experience, represent important steps
toward meeting public concerns and ensuring that the nation’s resources are responsibly
being responsibly developed.