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January 2012

Vol. 17, No. 3 Week of January 15, 2012

Fracking report sparks row

l ENVIRONMENT & SAFETY Encana says preliminary EPA report linking groundwater contamination to Wyoming shale wells filled with ‘mistakes, misjudgments’

Gary Park

For Petroleum News

Canadian gas producer Encana and the U.S. Environmental Protection Agency are locked in a dispute that is taking on a life of its own.

It started before Christmas with a draft EPA report claiming that synthetic chemicals consistent with those used in hydraulic well-fracturing fluids had been found in two deep monitoring wells it drilled outside Pavillion in west-central Wyoming where the well count outnumbers the town’s 150 residents.

The EPA said it had detected chemicals such as methane, petroleum hydrocarbons and other compounds “consistent with migration from areas of gas production,” adding it was concerned about the “movement of contaminants with the aquifer and the safety of drinking water wells over time.”

It didn’t matter much that the EPA also said the hydrocarbon levels were well within established health and safety standards and posed little public threat.

As well EPA investigators blamed some of the water problems on leaking waste disposal pits that Encana inherited in 2004 when it bought the original operator, Tom Brown Inc., and has since drilled 44 wells in the Wind River basin field, none since 2005.

The conclusions were drawn from a three-year study and now face a 45-day public comment period, followed by 30 days for peer review, before being released in final form.

Encana fires back

Encana quickly fired back, arguing the testing has “found limited, isolated and well-defined impact that has no effect on local drinking water.”

Eric Marsh, senior vice president of Encana U.S. division, said the “conclusions do not stand up to the rigor of a non-partisan, scientific-based review and that is of paramount importance to every natural gas producing community.”

Encana said the EPA ignored decades of reports from the U.S. Geological Survey that show Pavillion’s water has high concentrations of naturally occurring sulphate, total dissolved solids and elevated pH levels.

It said that in one case a laboratory found organic compounds in the two deep test wells EPA drilled, results that two other EPA labs were unable to replicate.

Encana said EPA should not be surprised that its deep wells, at 981 feet and 783 feet, collected methane because they were drilled directly into a hydrocarbon reservoir.

“Natural gas developers didn’t put the natural gas at the bottom of EP’s deep monitoring wells, Nature did,” Encana said.

Encana’s opinions not included

Labeling the EPA findings as “irresponsible” and “precipitous,” Encana said the report was contrary to its cooperative approach of providing regulators with the composition of its fracking fluids and voluntarily disclosing and cleaning up legacy pollution sites on its leases.

“It is our belief the EPA made critical mistakes and misjudgments in almost every step of the process — from the way it designed the study, to the way it drilled and completed its wells, to the way it collected and interpreted the data, and to its decision to release a preliminary draft report without an independent third-party review,” said David Stewart, the head of environment, health and safety for Encana’s Wyoming operations.

Encana said its opinions were not included in the report, prompting it to break off further discussions with the EPA.

The EPA countered that it and a contractor used “stringent standards for the installation and development of the two monitoring wells.”

Marsh said “safe and responsible natural gas development is vital to North America’s energy security and hydraulic fracturing is an important, necessary and safe part of that development.”

Growing controversy

But the EPA report coincides with a growing controversy over the shale gas industry which is struggling to assure governments, regulators and the public that its methods are safe.

While it is unusual for a company such as Encana to openly and bluntly take issue with a regulator, the Calgary-based company’s entire future — along with that of many other producers — hinges on its ability make itself heard and balance the debate.

It doesn’t help that a 4.0 magnitude earthquake in Ohio on New Year’s Eve suggests a link to fracking operations, according to a Won-Young Kim, a research professor at Columbia University, who has been hired by the state government.

He said data collected from four seismographs set up in November in the area confirm a connection between the quakes and deep well sites.

The Ohio Department of Natural Resources has suspended operations at five deep wells, while D&L Energy, the well owner, has agreed to fund a geological survey of the land in and around its operations.

But a spokesman for D&L said all of the authoritative sources insist no clear cause of the quakes has been established.






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