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HomeMy WebLinkAbout3.1 SUP Amendment to Narrative 10-14-09Williams Production RMT Company GV 82-5 Special Use Permit Amendment to Narrative Extraction Processes The extraction of oil and natural gas within Colorado is permitted and regulated by the Colorado Oil and Gas Conservation Commission (COGCC), Colorado Department of Natural Resources, through a complex series of rules, regulations and policies. Copies of the rules are available at http://cogcc.state.co.us. The rules and regulations have been specifically promulgated to prevent waste and to conserve oil and gas in the State of Colorado while protecting public health, safety, and welfare, including the environment and wildlife resources. All associated wastes, fluids handling and disposal are also strictly regulated by the COGCC. The COGCC rules contain numerous required permit, technical, mitigation and safety requirements for oil and gas operations. As referenced in these rules, other State and Federal compliance programs are also required. These include USEPA Spill Prevention, Countermeasures and Control Plans and Colorado Department of Public Health and Environment's Storm Water Management Plans. Copies of these plans are included in Williams' Special Use Permit application. All wells located on the GV 82-5 well pad have been permitted and approved by the COGCC. Copies of approved well permits and Conditions of Approval are provided in Section 3.4.1 of Williams' Special Use Permit application. The extraction process can be divided into three major components; and generally occur in the following sequence. The first involves the actual drilling of the wells; the second, the completion of the wells through fracture stimulation; and the third the installation of production equipment to separate natural gas from fluids including oil and produced water. Fracture stimulation, described below, is a method for stimulating a rock formation next to the well bore to increase production of oil, gas, and other fluids from the rock formation. Extracted fluids include natural gas; oil also known as condensate, and water also known as produced water. Drilling and completion processes will run concurrently at the GV 82-5 well pad through a technique referred to as simultaneous operations, commonly referred to as SIMOPS. Under SIMOPS, after the first group of wells are drilled (there are typically 3-5 wells per group), the drill rig is repositioned to drill the next group of wells. As the second group is being drilled, the first group begins the completion process. SIMOPS significantly reduces the total amount of time to drill and complete the wells, allowing the drilling equipment and operations to be removed from the site. Drilling operations are scheduled for late August/September, 2009 and will continuing through February, 2010. Well completion activities typically lag behind the drilling operations and continue a few weeks after the cessation of drilling. Well completion activities are scheduled to begin in November, 2009 and continue into March, 2010. Extraction processes are described below. Page 1 Williams Production RMT Company GV 82-5 Special Use Permit Amendment to Narrative Drilling Operations The general configuration of the GV 82-5 well pad and the location of equipment are identified in Sheet 4 — Drill Rig Layout of Section 3.3.6 of Williams' Special Use Permit application. Drilling operations equipment includes the drill rig, drilling mud tanks, electrical generators, generator diesel fuel tank, bulk storage tanks and fire protection water tanks. The well control system is designed to meet the conditions likely to be encountered in the hole and would conform to COGCC requirements. Two temporary employee housing trailers, for a total of four essential wellsite personnel, are located onsite. Housing details and locations are provided in Section 3.4.5 of Williams' Special Use Permit application. Depending on the location, each producing well would be drilled to an approximate depth of 7,000 feet to 10,000 feet. Within this portion of the Piceance Basin, drilling wells from the surface to their total depth takes up to 15 days. Fresh water for use in drilling operations and dust control will be obtained from legal authorized sources. Water sources and estimated water demand for drilling operations are identified in Section 3.3.8 of Williams' Special Use Permit application. Only fresh water, biodegradable polymer soap, bentonite clay, and non-toxic additives would be used in the mud system. Drilling mud is circulated down the well to transport drill cuttings to the surface and hydrostatically counteract well bore pressure. Any produced crude oil or condensate generated during the well drilling process is captured in on-site tanks. Drill cuttings are stored onsite in a synthetic -lined cuttings trench or pit during drilling operations. Each well will generate approximately 500 cubic yards of cuttings with the total varying with well depth. The cuttings are tested for contaminates listed in Table 910-1 of the COGCC Series 900 Rules. Cuttings meeting the standards set forth on Table 910-1 are generally buried onsite and reclaimed within the well pad site. The cuttings are usually managed as they are generated so that once all the wells are drilled, all that remains is to cap the trench with native soils and re - contour the area. If the size of the well pad is not sufficient to support a cuttings trench large enough to hold all of the cuttings, an off-site cuttings disposal area may be required. If an off- site disposal area were needed for cuttings disposal, Sundry Notice authorization would be obtained from COGCC. All wells will be drilled utilizing directional drilling technology. The distances horizontally from the center of the GV 82-5 location to the final end point for each well will vary from zero to 3000 feet. A plan -view layout of the directional well bores with a three-dimensional presentation are provided in Section 3.3.6 of Williams' Special Use Permit application. To achieve a distance of 3000' away from the pad's location, special directional tools are utilized while drilling. These tools transmit magnetic and spatial data at regular intervals to the surface from inside the wellbore. The data is used to calculate a wellbore's path or position at any given point. Although appearing quite rigid, drill pipe flexes and bends in a subtle manner. By controlling the pipe's ability to bend, it is possible to gradually gain distance from the location while drilling. The distance away from location increases with depth by creating an inclination or angle. The amount of distance gained, or the increase in angle, while drilling is no more than 3.5 degrees per 100 feet. Over the course of several hundred feet, the angle becomes sufficient to achieve Page 2 Williams Production RMT Company GV 82-5 Special Use Permit Amendment to Narrative the well's target distance. As drilling approaches the target distance, the process is reversed. The angle is decreased to bring the wellbore to a vertical position. All the wellbores on the GV 82-5 will be kept vertical through the production interval. Completion Operations Completion operations are processes applied to the well bore after drilling has finished. These steps include running casing, perforating casing, and fracture stimulation; steps necessary to maximize production of hydrocarbons from a well. Steel casing is installed in the well to provide structural integrity. Once installed, the casing is perforated to provide access to the natural gas geologic formations. Natural gas escapes through the perforations in the casing. The only explosives used during completion operations are those used in subsurface perforating operations. Proprietary engineered explosive charges are arranged in a perforating "gun" and are lowered to the appropriate depth. The perforating guns are not armed until they are at least 200 ft below the surface. Once at the correct depth the charges are set off to create perforations. An example result of perforating would be a hole in the casing that is approximately 3/8" of an inch in diameter and may create a tunnel into the rock that is 2-3 ft in length. Fracture stimulation occurs after the casing is perforated and is a method for stimulating a rock formation next to a well bore to increase production of oil, gas, and other fluids from the rock formation. Fracture stimulation consists of pumping a water and proppant (sand) mixture at high rates and pressures into the rock intervals that contain natural gas. The water is produced back leaving the proppant behind to keep the small fracture open. Each proposed well would use approximately 504,000 gallons of water for fracture stimulation. The water used for completion operations would be recycled produced water from wells operated by Williams throughout the valley. Water sources and estimated water demand for completion operations are identified in Section 3.3.8 of Williams' Special Use Permit application. Because of the number of wells being drilled on this location, the limited size of the drilling pad, and the desire to simultaneously drill, complete and produce the wells, there is not sufficient room on the well pad for pumping equipment to conduct fracture stimulation operations. In order to accomplish these activities, pumping equipment will be located at the adjacent GV 64-5 well pad located approximately 1600 ft. east of the GV 82-5 site. The GV 64-5 well pad and adjacent property are on privately owned land accessible to Williams. Two high-strength steel 4.5 inch diameter pipes will convey fracturing water and proppant (sand) from the GV 64-5 pad to the GV 82-5 well pad. The fracture stimulations are typically conducted without a service rig and consist of pump trucks, sand trucks, and produced water tanks. Mobile wireline trucks would be used to set plugs between zones and to set plugs in the wellbore to isolate the stimulations. Once the wells have completed all of the fracture stimulations, a mobile service rig (or coiled tubing unit or a snubbing unit) would be used to drill out all the plugs, clean out the wellbore, and land the production tubing. The production tubing transports natural gas and other fluids to the surface. Page 3 Williams Production RMT Company GV 82-5 Special Use Permit Amendment to Narrative Completion operations are expected to average 35 days per 4 wells, which includes all of the time to fracture stimulate each zone, drill out the plugs, and install the production tubing. During this time, natural gas is expected to be sold instead of vented or flared, however some venting may be required in order to get the perforating guns to depth due to sand fill. . All water produced during this time would be recycled for use in subsequent fracture stimulations or transported to the Parachute Water Treatment Facility. Condensate produced would be stored in tanks for sale. Fracture stimulation fluids are comprised of a few basic chemicals. The largest component is treated, recycled produced water which is blended with a friction reducer, a surfactant, and a water conditioning agent to control bacteria. The stimulation fluid additives are in concentrations based on gallons of chemical per 1000 gallons of water. For example, friction reducer is typically added at 0.5 gallons per 1000 gallons of water. COGCC Rule 205.c. specifically requires that the operator maintain a chemical inventory by well site for each chemical product used downhole or stored for use downhole during drilling, completion, and workover operations, including fracture stimulation, in an amount exceeding five hundred (500) pounds during any quarterly reporting period. Operators shall also maintain a Chemical Inventory by well site for fuel stored at the well site during drilling, completion, and workover operations, including fracture stimulation, in an amount exceeding five hundred (500) pounds during any quarterly reporting period. As these products are stored on site or utilized, copies of actual chemical inventories will be forwarded to COGCC as required. A summary of typical Fracturing Additives and a depiction of the typical components by volume are attached below. Additive Type Summary of Typical Fracturing Additives Main Compounds Use in Fracturing Fluids Common Use Acid Hydrochloric Acid Pumped ahead of the frac treatment and used to clean up materials within the perforation tunnel caused from mud, cement, or debris during the perforating process. Swimming pool pH chemical and household cleaner additive Biocide Sodium Hypochlorite, Sodium Hydroxide With the use of flowback or produced water there is an increase in the ability of bacteria to grow. This will eliminate and help with any bacteria issues that may cause odors and possibly lead to the souring of wells. Clothes washing bleach, household cleaners, bacteria control in swimming pools Surfactant Variety of anionic, cationic, and nonionic. Ethanol, Petroleum Naphtha, Naphthalene, Poly alpha -omega -hydroxy Help to reduce fluid retention in the formation and prevent the creation of emulsions by changing the surface tension of the liquids. Household detergent, fabric softener, soap, shampoo Friction Reducer Polyacrylamide, Petroleum Distillate or Mineral Oil Reduces friction in the wellbore allowing pumping operations at higher rates and pressures Cosmetics including hair, make-up, and skin products. Food packaging and baby diapers Conductivity Enhancer Petroleum naphtha, Isopropanol Adheres and coats the sand grains immediately and is not considered part of the fluid system. Used to improve the flow of fluid through the proppant pack in the formation. Page 4 Williams Production RMT Company GV 82-5 Special Use Permit Amendment to Narrative Typical Frac Treatment Components by V. Total Volume Biocide (0.0478%) Conductivity Enhancer (0.086%) Surfactant r ricui (C•.�35t%1 I Reduccee r Well Production Operations Production equipment typically includes piping from the well heads to the separators; three- phase separators; dehydrators; above ground condensate and produced water tanks, meters and cathodic protection equipment. Production facilities are designed and installed to accomplish the following objectives: 1. Separate well stream fluids into manageable products (gas, condensate, and water) from each well individually for production accountability. 2. Deliver each product to its ultimate destination. Natural gas would be delivered to the gas gathering system via pipeline. Condensate would be pipelined or trucked to a point at which it can be sold, and water would be transported via pipeline or truck to Williams' Parachute Water Treatment Facility or to the site of a future fracture stimulation staging areas. 3. Accurately meter the volume of gas and condensate produced from each well/lease to assure mineral interest owners receive the correct value for these components. Each well can be controlled (choked) separately and production rates can be determined for each well every day. Natural gas would be metered prior to entering the gas gathering system. Condensate would be tank gauged or metered prior to sales. To the extent feasible, Williams would consolidate the use of production facilities. Facilities will be painted to match the surrounding landscape in order to reduce the visual contrast of the improvements over the life of the producing wells. Condensate and produced water tanks will be provided with secondary containment structures to prevent discharges. Production Operations and Maintenance Williams will operate all wells and ancillary production facilities in a safe manner, as set forth by standard industry operating guidelines and procedures. Routine maintenance of producing wells would be necessary to maximize performance and to recover all of the economic reserves possible. Critical data for each well would be accessible via radio telemetry with the host computer system in Williams' Parachute, Colorado office. Using this system, the parameters Page 5 Williams Production RMT Company GV 82-5 Special Use Permit Amendment to Narrative can be viewed and controlled remotely. Each well location would be visited several times per week to ensure that operations are proceeding in an efficient and safe manner. The visits would include checking separators, meters, valves, fittings, and on-site storage of produced water and condensates. In addition to these visits, water and condensate would be hauled off of pad to existing centralized facilities. Page 6