Loading...
HomeMy WebLinkAbout1.03 Project overviewPROJECT OVERVIEW EnCana Oil & Gas (USA) Inc. proposes to construct, operate and maintain approximately 9 miles of natural gas, water distribution, and produced water gathering pipelines within the South Parachute Area. The proposed pipeline will be immediately adjacent to the existing Canyon Gas Resources pipeline system. The natural gas is currently gathered by Canyon Gas Resources. The current Canyon Gas system is limited due to capacity and high pressure. EnCana is proposing to install a pipeline project that will include a main trunk line system consisting of up to 20 inch (natural gas), 8 inch (water distribution), and 6 inch (water gathering) pipeline. Temporary Right -Of -Way widths for construction will need to be 55 feet for the trunk line system and revert to a 30 foot permanent easement. No additional work space will be required on BLM land. The proposed pipelines will be steel grade x60, 0.375 wall thickness, to be installed subsurface with a minimum of 48" of cover above the pipe. The trunk system pipeline will begin at a tie in point at an existing pipeline in the SW '/4, NW %4, of Section 31, T7S, R95W and terminate in Section 15 and Section 27 of T7S, R95W. The proposed, up to 20 inch pipeline will gather and transport up to 100 million standard cubic feet per day of natural gas. The proposed pipeline will transport natural gas to the Orchard Compressor Station where it will be compressed to meet discharge pressure. The natural gas will then be transported through existing pipelines to West Mamm facility for additional conditioning and then distributed to existing transmission companies. The proposed 8 inch trunk pipeline will distribute water from the High Mesa Storage Pond into existing pipelines for drilling operations. Water will be pumped from the Una Bridge to the High Mesa storage pond and used as make up water. EnCana currently has water available from their contract with the West Divide Water Conservancy District, contract #010628BP (b), for 200 acre feet of water. The proposed 6 inch trunk pipeline will gather water from present and future wells to be transported to the High Mesa water storage and evaporation facility. The water will be filtered and recycled for drilling operations which will minimize the need for additional makeup water. Water from the West Divide Water Conservancy District will be utilized to hydrostatically test the pipeline. Following the completion of the test, the water will be discharged into temporary, above ground storage tanks and then filtered and reused for well drilling operations. There will be no ground water discharge. Construction for the trunk line will occur on one construction spread and is scheduled to commence upon arrival of land grants, land owners Right-of-Way agreements, and associated permits with a completion of approximately 8 weeks later. South Parachute Gathering Development Strategy History: Prior to the `EnCana — Toni Brown' merger, Tom Brown Inc, executed a contract with Canyon on April 1, 2001. Canyon agreed to provide gathering services for Tom Brown Inc. in the South Parachute area. Within the agreement it is stipulated that Canyon shall maintain the system pressure at or below 375 psig at each receipt point. Once the merger was finalized, EnCana adopted the original gathering services agreement. The term of this agreement is March 31, 2011. Pressure Optimization: EnCana's business focus is to maximize return on capital employed and increase reserves. Since South Parachute is one of EnCana's key development areas, EnCana plans to spend capital, support a drilling program and focus on maximizing returns. While developing this field, EnCana will be conducting a reserve analysis. This reserve analysis is very important, because it will provide the necessary data for project economic evaluation. Economic evaluations are the basis for EnCana to make sound business decisions. To make the South Parachute project successful, EnCana must maximize each well's performance and deliverability. As wellhead pressures are reduced, gas within the reservoir will migrate more readily to the well bore. Reservoir properties indicate that South Parachute wells will not deliver maximum rates when system pressures are at 375 psig. When rates are reduced, velocities are also reduced, causing wells to 'load up' with fluid. A well `loads up' when the gas velocity is not great enough to carry produced water up the production string (tubing) to the surface. This creates a water table within the production string. This water table adds backpressure to the reservoir, preventing gas flow into the well bore. When this occurs, production rates can become erratic or cease. EnCana's Low Pressure System: EnCana is proposing to install a pipeline system to operate at low pressure (-100 psig) within the South Parachute field that will gather gas from each well and route the gas to a centralized field compressor station. This field compressor station will compress the gas into Canyon's gathering system thereby staying within the terms of the above agreement. The purpose of this proposed line is to reduce wellhead pressures as described above. EnCana's proposed pipeline system is different from Canyon's gathering system. While Canyon is responsible for gathering and transporting EnCana's gas out of the South Parachute area, EnCana's pipeline system would be strictly for wellhead pressure reduction. Because of contractual terms, Canyon does not have an incentive or an obligation to reduce their system pressure. Because system pressures must be reduced to improve performance, two separate pipeline systems must exist. Pipeline Routine: EnCana's proposed route for the low pressure pipeline system is along the existing routes of Canyon's pipelines where possible. These routes were chosen to minimize additional disturbance. Alternative Low Pressure Solution: EnCana's alternative to installing a low pressure pipeline system is to install wellhead compression. If necessary, individual well pad compression can be installed. This would require the installation of a gas fired engine driven compressor on each South Parachute well pad. T c advantage of installing compression at each pad is that a separate low pressure pipeline system would not be required. Disadvantages include increased capital cost, noise, emissions, maintenance traffic, downtime and operating cost. Conclusion: While EnCana is trying to make the best financial decisions regarding the South Parachute development project, EnCana also realizes that they must make those decisions with minimum impact on the environment and the public. As detailed above, EnCana believes that installing the low pressure pipeline system provides the least impact to the environment and public while providing the necessary systems to make the South Parachute development project a success.