All Oil Activity Is Oil & Gas Development New? Data From The DNRC Montana Board of Oil and Gas Data Miner Application.

DRILLING, HYDRAULIC FRACTURINGAND DEQ IN THE BAKKEN

STEVE KILBREATH, MDEQ

SLIDES FROM VARIOUS SOURCESINCLUDING TOM RICHMOND, MBOGC

All Oil Activity

Is Oil & Gas Development New?

Data From The DNRC Montana Board of Oil and Gas Data Miner Application

Horizontal Drilling Activity

Horizontal Oil Activity - Bakken

Jan-

86

Jan-

87

Jan-

88

Jan-

89

Jan-

90

Jan-

91

Jan-

92

Jan-

93

Jan-

94

Jan-

95

Jan-

96

Jan-

97

Jan-

98

Jan-

99

Jan-

00

Jan-

01

Jan-

02

Jan-

03

Jan-

04

Jan-

05

Jan-

06

Jan-

07

Jan-

08

Jan-

09

Jan-

10

Jan-

11

Jan-

12

-500,000.0

0.0

500,000.0

1,000,000.0

1,500,000.0

2,000,000.0

2,500,000.0

3,000,000.0

3,500,000.0

Montana Oil Production by County, Through October 2012

Big Horn Blaine Carbon Carter Chouteau Custer Daniels Dawson Fallon

Fergus Garfield Glacier Golden Valley Hill Liberty McCone Musselshell Park

Petroleum Phillips Pondera Powder River Prairie Richland Roosevelt Rosebud Sheridan

Stillwater Sweetgrass Teton Toole Valley Wibaux Yellowstone

Barr

els o

f Oil

Per M

onth

Richland

Fallon

Roosevelt

INTERESTING DIFFERENCESMONTANA VS NORTH DAKOTA

Typical Bakken Well Production

923

436

153

99 84 76 68 62 55 50 45 40 36 33 29 26 24 21 19 17 16 14 13 11 10 9 8 7 7

0

100

200

300

400

500

600

700

800

900

1000

0 5 10 15 20 25 30

Year

Bar

rels

of

Oil

per

Day

North Dakota DataFrom NDIC Oil and Gas Division

0 9 18 27 36 45 54 63 72 81 90 99 108 117 126 135 144 153 162 171 180 189 198 207 216 225 234 243 252 261 270 279 288 297 306 315 324 333100

1000

10000

Normalized Average Montana Bakken Well Production And Forecasts

Fit1 BOPM_Bakken Forecast Forecast2

Months Following Completion

Prod

uctio

n, B

arre

ls of

Oil

per M

onth

Averaged actual well produc-tion through first 100 months

Forecast 1: 8% annual decline rate, 23 year well life, ultimate cumulative produc-tion of 300,000 barrels of oil.

23.3% recovery during 1st 18 months.

Forecasts extended to ~300 barrels per month production rate which is consistent with a 20 to 30 year well life.

Forecast 2: 6% annual decline rate, 28 year well life, ultimate cumulative produc-tion of 334,119 barrels of oil.

20.9% recovery during 1st 18 months.

Average of actual production dur-ing 1st 18 months is 69,853 bar-rels.

Projection of actual historical data indi-cates a lower decline rate and less than 20% of the ulimate recovery produced during the first 18 months.

Analysis is based upon primary production only and assumes no future enhanced recovery projects or ef-forts to improve individual well performance, both of which could increase ultimate recovery.

From Mt BOGC

Rigs and Production

December Production1. North Dakota 23.5 MBls2. Montana 2.3 Mbls

Current Rig Count1. North Dakota – 1762. Montana - 11

Montana vs North Dakota Daily Production

2008

DEQ Related IssuesPermitting and compliance

Gravel miningSubdivision Stuff – Temporary Work Force

Wastewater, Wastewater, WastewaterZombies

Air registry permitsSolid Waste

Discharge permits – produced waterSewage Pumpers

Water Quality Issues Enforcement Issues

Gravel Mining

2011 and 2012 average 100-110Applications per yearNo good data for previous years

Air Registry - Oil or Gas Well Facility

Well

Heater/Treater

Oil Storage Tanks

Flare Pit

Pumpjack (“Horse Head”)

Recycle Pump

Water Storage Tank

Pumpjack Engine

1100 registered sites

Impact timing for Montana

Anthropogenic impacts in Montana relate to North Dakota increases!

We weathered through Elm Coulee just fine!

Solid Waste E & P Waste – Oaks

permitted January 2013 in use mid 2013

New E&P application in Outlook

PreApp E&P in Brockton

UIC sites/ produced water

TENORM & Filter Socks

Temporary Work Force HousingRV Parks, Richland County

These are subdivisions under 76-4

Work CampSheridan County

These are public water and wastewater but not subdivisions

Truck Parking Facility

Septic Pumpers

Two new land app sites in Richland County

Community Challenges

RV’s and Blue water ?

Permitting Challenges

• Example of a zombie system: this development was approved and occupied in the early 1980s, then vacated and returned to agricultural land, and is now being occupied again. How does this fit our regulations?

Enforcement Issues

66 Enforcement cases based on complaints – mainly subdivision and public water mainly follow up on county referrals.

9 Formal enforcement cases that will be AO’s and administrative penalties.

Get involved – if you see something funning call us.

Chad Anderson 406-444-2964

Water Quality Issues“What the frack”

Fracturing Process

Water

Concentrated gelFrac fluid additives

Frac fluid mixing/blending

Proppant mixing/blending

High-pressure pumping equipment

Wellhead connection

Source: Schlumberger

Chesapeake Rock Cave Marcellus Shale Well, West Virginia

Gel Slurry Tanker Truck

Chemical Storage Trucks

Frac Head/Goat Head

Data Monitoring Van

Frac Pumps

Frac Tanks – Hold Fresh Water

Sand Storage Units

Blender Pumps

Frac Tanks – Hold Flowback Water

Where is this all going?

The End - Any questions?