Introduction… ◦ Former Director of Western Colorado Congress ◦ Graduate of University of Colorado Law School ◦ Attorney specializing in representation.

Introduction…

◦ Former Director of Western Colorado Congress

◦ Graduate of University of Colorado Law School

◦ Attorney specializing in representation of landowners and mineral owners in oil and gas transactions and disputes

Attorney Matthew Sura

WCC Member Organizations (2008)

WCC member groups in San Miguel, Ouray, Montrose, Delta, Mesa, Garfield, and Routt counties.

Landowners Alliance for NE Douglas County

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Colorado’s Oil and Gas Basins

NIOBRARA:

Oil boom on the Front Range?

Horizontal Drilling and Multiple-Stage Hydraulic Fracturing

Jake well

The Jake well, which was drilled in October 2009 in Weld County, produced an average of 1,750 barrels of oil per day for the first few days -- 50,000 barrels over first 90 days.

Today, oil is trading at $100 / barrel. At that price, the well paid for itself in three months ($5 million)

Multi-Well Pad Coverage

“Anadarko estimates Colorado has up to 1.5 billion barrel oil reserve”

Denver Post headline…

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ANNUAL COLORADO DRILLING PERMITS ISSUED

There are over 47,000 active wells in the state.

Surface impactsAir

Emissions

Water SupplyWater HandlingWater Reuse & Disposal

Land ImpactPrivate Property Rights

PRIVATE PROPERTY RIGHTS

What if you had a neighbor who came on to your property and:

disturbed 2-7 acres of your land, Brought constant truck traffic through your

property, dug waste pits for toxic chemicals, and installed heavy, loud equipment; then tossed you $2500 for your troubles?

Troubles that could be there for up to 30 years.

Home on the range or industrial site?

Gas wells and pumpjacks can be located as close as 150 feet from a home.

Well pads and drill rigs in ranchers’ fields.

IMPACTS TO THE LAND

pipeline corridors across the landscape and through people’s yards,

IMPACTS TO WATER QUALITY

Hydraulic Fracturing

Example Horizontal Well

What is in fracking fluid?

4-5 million gallons per frack. 98% water and sand, 2% fracking chemicals.

Some fracking chemicals relatively safe: sodium chloride, guar gum, citric acid

Some more ominous: hydrochloric acid, diesel fuel, BTEX (benzene, ethylbenzene, toluene, xylene), polycyclic aromatic hydrocarbons; methanol; formaldehyde; ethylene glycol

Governor Hickenlooper called for the Colorado Oil and Gas Conservation Commission to require disclosure of the chemicals used in fracking.

Several month stakeholder process and an 11-hour public hearing led to the passage of the Colorado Fracking disclosure rule.

Colorado Fracking Disclosure Rule

Requires the disclosure of both the identities and concentrations of all fracking chemicals.

Companies may continue to seek trade secret protection for specific chemicals, but they will have to justify and certify their trade secret claims.

Citizens who dispute such claims will have enhanced opportunity to get their challenges heard by the oil and gas commission or in court.

Colorado Fracking Disclosure Rule

SPILLS

Denver Post study: From 2008-2010, average of more than a spill per day, average size of 5,300 gallons

Hydraulic fracturing pit.

Leaking Waste Pits

Methane Seeps

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Divide Creek in Silt Colorado, April 2004, contaminated with methane and ignitable. The accident also affected water wells in three homes.

4000’of Sediment

Surface Casing 550’

Cross sectional view

400’ Usable Fresh Water

2100’ Various AtokaSands & Shales

1300’ Upper Hale

600’ Morrow Shale

Hindsville

300’ Fayetteville Shale

FRESH WATER AQUIFER ZONE

SHALLOW PRODUCING ZONE

WELL CONSTRUCTION STANDARDS

TARGET PRODUCING ZONE

CONDUCTOR PIPE

SURFACE CASING

PRODUCTION CASING

CEMENT

CEMENT

CEMENT

FRESH WATER AQUIFER ZONE

SHALLOW PRODUCING ZONE

CONDUCTOR PIPE

SURFACE CASING

PRODUCTION CASING

TARGET PRODUCING ZONE

GOOD MECHANICAL INTEGRITY

CEMENT CHANNELING

PRESSURE BUILDS UP

CONDUCTOR PIPE

SURFACE CASING

PRODUCTION CASING

FRESH WATER AQUIFER ZONE

SHALLOW PRODUCING ZONE

TARGET PRODUCING ZONE

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FRESH WATER AQUIFER ZONE

SHALLOW PRODUCING ZONE

TARGET PRODUCING ZONE

INSUFFICIENT CEMENT COVERAGE

PRESSURE BUILDS UP

CONDUCTOR PIPE

SURFACE CASING

PRODUCTION CASING

IMPACTS TO AIR QUALITY

Reduction Technology• Catalytic reduction• Ultra-low sulfur diesel fuel• LNG and CNG fuels• Oxidation catalysts• Green completions, vapor

recovery units, low bleed/no bleed pneumatic devices, plunger lift systems, leak detection

Emission Type• NOx

• SO2

• CO• CH4

• VOCs (incl. BTEX)

Emission Levels• EPA• Industry• State regulators• Research groups

VOCsOZONE

SMOG

Uncontrolled Emissions Estimates from Oil and Natural Gas Well Completions and Recompletions

 Well Completion Category

Emissions(Mcf/event)

Emissions(tons/event)

Methane Methane VOC HAP

Natural Gas Well Completion withoutHydraulic Fracturing

 38.6

 0.8038

 0.12

 0.009

Natural Gas Well Completion withHydraulic Fracturing

 7,623

 158.55

 23.13

 1.68

Natural Gas Well Recompletion withoutHydraulic Fracturing

 2.59

 0.0538

 0.0079

 0.0006

Natural Gas Well Recompletion withHydraulic Fracturing

 7,623

 158.55

 23.13

 1.68

BOTTOM LINE: 240 times more air pollution from uncontrolled Oil and natural gas well completions and recompletions

 US EPA, Oil and Natural Gas Sector: Standards of Performance for Crude Oil and Natural Gas Production, Transmission, and Distribution. July 2011

Dust and emissions from heavy truck traffic

Current Issues:

Local regulations

Setbacks from homes

STATE VS. LOCAL CONTROL

Argument for state control:

oil and gas commission has expertise and experience in a highly technical field. There is a need for uniformity

Argument for local government role:

Local land use conflicts are best solved by local government. Local government should be part of monitoring of the industry. Local process gives local community a voice

Cannot ban or prohibit oil and gas development

Can exercise control over development up to the point of “operational conflict” with state authority

State setback: drilling and fracking can happen 350 feet from homes in residential areas, 150 feet elsewhere

Cities and Counties

SETBACKS FROM HOMES

For more information contact

Matthew SuraAttorney at Law(720) 563-1866

[email protected]