Marcellus Shale
Natural Gas Roundup
Potter County, Pennsylvania
July 2011
Top Story:
‘Gas Rush’ Series Kicks Off In Potter County
Who’s going to benefit from the natural gas rush? Mineral rights owners, job-seekers, motel operators and supply companies, for starters.
And at what cost?
Those answers were fuzzier as three experts shared their findings to kick off of a series of workshops being held across the state to help local government officials and community leaders. Penn State professor Dr. Tim Kelsey (above) cautioned that building hotels/housing units, expanding schools and making other long-term changes could backfire. The gas industry tends to create a larger volume of short-term jobs and many of them require frequent relocations.
About 75% of the jobs do not require a college degree, although many do require specialized training. Average annual salary of gas-related jobs is nearly $70,000, Kelsey said, but in many cases the work is hard and requires travel and flexibility.
Dr. Jason Weigle from Mansfield University said rents and real estate prices have risen dramatically in Bradford and Tioga counties. He suggested that local leaders develop housing strategies and other measures to prepare.
Jerry Walls, a community planning consultant, emphasized the need for township and borough officials to coordinate their efforts and be aware of the measures they can use to control the impacts. Among options is a zoning ordinance that minimizes impacts on neighboring properties, the environment, roads and other infrastructure.
The men listed demands that could be placed on local services: sewage permitting; housing; reuse of vacant land and buildings; drilling pads and staging areas which need to operate 24/7 with extensive lighting and outdoor storage; high volumes of heavy truck traffic; road improvements and repairs; increased police and emergency management services; and use of water sources and treatment plants.
“There are a series of trade-offs coming,” Weigle said “Your job, as community leaders, is to maximize the positives and minimize the negatives, to the extent that you can.”
County Awarded Grants To Support Water Quality Programs
Potter County is taking steps to protect its water resources, in partnership with several stakeholder groups. The county was recently awarded two grants to support this mission. As the site of the only “triple divide” watershed in the eastern United States, Potter County has strategic significance to a broad variety of agencies and organizations with an interest in water quality.
Headwaters of the Allegheny, Genesee and Susquehanna rivers can all be traced to the same plateau in northern Potter County. Nearly 70 percent of the county’s streams are classified as “high value” or “exceptional value” by the Pa. Dept. of Environmental Protection. Many communities in Pennsylvania and New York rely on these watersheds for clean drinking water.
In an effort to most effectively monitor and protect these resources, the Potter County Board of Commissioners has pulled together watershed associations, conservation organizations, county agencies, Penn State Extension, school districts and others to form a Water Quality Workgroup.
A separate and affiliated group, the Triple Divide Watershed Coalition, addresses similar issues from the perspective of public water suppliers. (See the May 2011 edition of Natural Gas Roundup for more details on the coalition.)
Mission of the organization is to coordinate efforts to most effectively monitor water quality and address any issues that may arise from industrial activity or other threats. The Water Quality Workgroup’s goals are risk reduction, early detection of problems, and sharing of information.
Although the organization is in its formative stages, its credibility was recently confirmed by the awarding of two competitive grants to help support its mission. One is from the Water Resources Education Network and the other through the Colcom Foundation. Funds will primarily be used to purchase water monitoring equipment for volunteers, acquire and install 12 in-stream monitoring systems, pay for chain-of-custody testing for public water supplies, and develop educational materials.
Key elements of the workgroup’s plan include:
- collecting baseline data and monitoring water quality;
- creating a database that can be shared;
- educating students, the public, and professionals from various industries, including natural gas, on local water issues.
Water quality data and irregularities will be shared with state agencies and industry, with a goal of early detection and corrective action if needed. The Water Quality Workgroup is also exploring various options to provide long-term sustainability of these efforts after the grant funds are expended.
Local ‘Well Walk’ Focuses On State Forest Land
About two dozen people turned out for a tour of gas drilling sites on state forest land in the heart of Potter County. Forestry Bureau personnel participated in the “well walk,” organized by local concerned citizens, to discuss issues related to leasing of state forest land. The group toured a site on Denton Hill and observed a pipe that carries water from an impoundment on the Irish farm. Participants also toured a well site at Horton Run. Seneca Resources has leased 7,440 acres between Denton Hill and Fox Hill, for an initial bonus payment of $23.3 million. Penn Virginia paid $13.9 million for 3,640 acres in Eulalia and Roulette townships. The state will also receive 18% royalties. Other state forest land has been leased, as have some tracts of state game lands. Additionally, subsurface rights on a significant portion of the more than 250,000 acres of state-owned land in the county are privately owned and subject to drilling. (Photo by Curt Weinhold)
Job Training Opportunities Available Locally
Gas companies are looking for trained workers for a variety of jobs. Once pipelines and other infrastructure are in place, job opportunities will abound, from field workers, welders and truck drivers to professional careers such as biology, geology, accounting, law and engineering. Potter County Education Council, Penn State Extension and Seneca Highlands Career and Technical Center are sponsoring training courses to prepare area residents for employment. Upcoming classes include:
- Certified Well Tender and CDL Certification, Aug. 1 to Sept. 23, or Sept. 26 to Nov. 18;
- Introduction to Pipe Welding, Sept. 12 to Dec. 14.
Anyone interested in learning more about job training opportunities should call the Education Council at (814) 274-4877.
Complexities Of Pipelines Detailed For Gas Task Force
Members of the Potter County Natural Gas Task Force heard a detailed presentation on the complex issue of gas pipelines. Penn State Extension educator Jim Clark discussed the growing network of pipelines being laid across the region, from the smaller gathering lines carrying gas away from individual wells, to the massive interstate pipelines that usher it to a market that stretches around the world. Pennsylvania, as the epicenter of the Marcellus Shale gas rush, will see a flurry of pipeline construction. “The gas is here and it is going to be taken to market,” Clark said. “The infrastructure is being created and we are going to be seeing a lot of activity.” He detailed some of the environmental and aesthetic impacts of pipelines that can be mitigated and cautioned property owners who are being approached about right-of-way leases to become educated on their options. Clark also distributed a fact sheet, “Negotiating Pipeline Rights-Of Way in Pennsylvania.” (Copies are available by calling 814-865-6713.) He mentioned that the regulatory structure for pipelines has some gaps, including a lack of oversight on gathering lines in Pennsylvania, which may be addressed soon by the state legislature.
District Forester Chris Nicholas said the Bureau of Forestry has compiled a list of best management practices for pipeline construction in forested areas. He noted that impacts could be minimized if companies building the pipelines would work together.
Greg West (Gas Field Specialists) pointed out that pipeline builders must comply with a series of regulations from DEP, County Conservation Districts and the Pa. Public Utility Commission. Energy companies often face lengthy delays in obtaining pipeline approvals from the regulatory agencies, said Bruce Sampson, a representative of Pennsylvania General Energy Company of Warren, one of the region’s active drillers.
What’s Shakin’? Seismic Testing Continues In Region
An army of ground-shakers is descending on the region to get a better idea of what lies two miles or more beneath us. Seismic testing is underway in Potter, Cameron, Elk and McKean counties by contractor Geokinetics. Soon, a crew of about 40 will join the advance team with large “thumper” trucks. Work zones will require that one traffic lane be closed. Companies are anxious to learn more about the region’s geology as they prepare to harvest gas from not only Marcellus Shale, but =other shale formations. Penn State University’s Tom Murphy emphasized that the seismic tests are just part of the research. Core samples are also taken and data are analyzed to determine angles, veins and other subterranean characteristics.
How Much Gas?: It’s All About The ‘Sweet Spots’
Reports from companies that have tapped the Marcellus Shale in different parts of Pennsylvania underscore the vast differences in natural gas yields. Two especially productive wells in northeastern Pennsylvania caused quite a stir in late June. Days later, much more modest reports came in from three Potter County wells. The lesson was clear: the amount of gas that deep wells generate will fluctuate widely, based on geology and other factors. Cabot Oil & Gas Corp. reported wells in Susquehanna County capable of producing 30 million cubic feet per day -- believed to be a record for the Marcellus. Meanwhile, in a June 26 news release, Penn Virginia reported “disappointing production rates” on its first three horizontal Marcellus Shale natural gas wells, all in Potter County. Average daily production of two wells on the Risser farm and a well on the Dunn farm was 2.1, 1.7 and 2.7 million cubic feet, respectively. H. Baird Whitehead, the company's chief executive, said the test wells in the central part of Penn Virginia's 35,000-acre position in Potter and Tioga counties are expected to be connected to pipelines in August, when natural gas sales will begin. "We will monitor longer-term production once these wells are turned into the pipeline and determine if the reserves can support a development program in this immediate area," Whitehead said. He added that company's initial results are not unusual for operators drilling in areas outside of the "sweet spots" of the Marcellus Shale. Production rates can vary, depending upon the quality and thickness of the shale. Penn Virginia said an additional well in the western part of its acreage is waiting on completion, and it plans to drill several vertical test wells later this year. Operators are working to gain a greater understanding of the complicated geology of the Marcellus, allowing them to land their drill bits in its most productive sections. They're drilling horizontally at greater distances, giving them access to more of the gas locked within the rock. And they're tweaking how they break apart the shale. Many Marcellus wells are not running at full tilt, since the infrastructure required to take the gas from wellhead to market is not fully in place. An oversupply of natural gas and the availability of crews to fracture the wells are other limiting factors. (Source: Associated Press)
Natural Gas Resource Center Takes Shape
Potter County has established a Natural Gas Resource Center, in partnership with the Potter County Education Council. Primary purpose of the center is to serve as an information clearinghouse, particularly for economic development and business interests. Referrals are also made on other topics. To reach the Natural Gas Resource Center, call 814-260-5625. On a related note, commissioners from Potter, McKean and Cameron counties have joined forces to establish a website pulling together a broad variety of resources related to Marcellus Shale natural gas development and related topics. More details on that multi-county project will be announced.
Outdoors Groups Join Forces; To Meet With DEP
A new coalition of outdoors groups is emerging in the debate over natural gas drilling. The Sportsmen Alliance for Marcellus Conservation seeks to protect streams, forests, and wildlife. One of the group’s goals is to build a water quality database. Members of the Sportsmen Alliance are scheduled to meet this month with DEP Secretary Michael Krancer to discuss proposals such as new regulations protecting wild trout waters and designation of some environmentally sensitive areas as off-limits to drilling. Meanwhile, University of Pennsylvania biologist Margaret Brittingham, with support from the Pa. Game Commission, has started a study of how drilling changes forest habitat and how it could impact wildlife.
‘Impact Fee’ Proposals Run Aground
State lawmakers have stalled in their efforts to enact an “impact fee” on Marcellus Shale natural gas extraction. Under the threat of a veto by Gov. Tom Corbett, they’ve opted to wait for the report from a gubernatorial commission reviewing Marcellus Shale drilling issues later this month. No action is expected until this fall at the earliest. Many proposals have been considered, including a House bill that would distribute 37.5 percent of the revenue to the host counties, 25 percent to host municipalities, 17.5 percent to all municipalities within a host county, 10 percent to county conservation districts, and the final 10 percent to host counties strictly for use by first responders and emergency medical services.
News And Notes Of Interest
Frac Treatment/Salt Plant Plan Announced. Plans for a combined frac water treatment plant and salt manufacturing operation have been announced for a site near Clearfield. Officials from Integrated Water Technologies said the plant will be located in the Clearfield Firemen's Commerce Park, just off Route 879. An access road is being constructed by the Clearfield Foundation. The plant will have double-lined ponds with floating liners to hold the frac water. Trucks will deposit the used water and pick up clean, processed water. DEP’s decision to have traditional water treatment plants discontinue taking and treating the frac water has forced gas drillers to ship water to other states. The Clearfield plant will treat the frac water and process the chlorides to manufacture salts that can be used on roads in the winter as well as salt pellets to use in water softeners.
Attention, Townships & Boroughs. A Municipal Checklist has been prepared for townships and boroughs in Potter County to help them deal with issues that could arise as the result of natural gas drilling. Planning Director Charlotte Dietrich has compiled the document. Each township and borough could have special circumstances that would require it to consider local regulation or to seek technical or legal guidance. The checklist provides estimated timelines for different aspects of a drilling operation. Among ordinances they might consider are those affecting road bonding, hauling and road maintenance, mandatory 9-1-1 addresses, holding tanks for sewage, temporary work camp regulations and others. Townships and boroughs are being asked to inform the County Planning Department on the impact of each gas well site on the municipality -- traffic, roads and infrastructure, employment, housing. ripple effect on local business, economics, issues involving surface rights owners and contiguous properties, etc.
Coast-To-Coast On Natural Gas. Pittsburgh residents Murry and Cindy Gerber made a coast-to-coast tour to highlight capabilities of natural gas vehicles. They were greeted in Washington by Sen. Bob Casey, who said, “Increased use of natural gas-powered vehicles can create jobs in Pennsylvania and decrease our dependence on foreign oil. Converting vehicles, especially commercial vehicles, to run on natural gas could create new industry and new jobs in Pennsylvania.” The Gerbers drove a natural gas-fueled Hummer across the U.S. Along the way, the Gerbers visited middle schools to give a short presentation on the subject of natural gas vehicles and donated $2,500 to help each school’s science and engineering programs.
Concern Voiced in Cameron County. The Cameron County Board of Commissioners has contacted the Susquehanna River Basin Commission and other regulatory agencies to express concern over the potential impact of water withdrawals from the Driftwood Branch of Sinnemahoning Creek. Seneca Resources plans to pull water from the Driftwood Branch for two gas wells in Rich Valley, while Keystone Clearwater Solutions (a division of ARM Oil and Gas Solutions) wants to withdraw water from a location at the foot of Maple Street in Emporium and transport it for hydrofracturing.
EPA Studying Hydrofracturing. The U.S. Environmental Protection Agency has named seven geographic regions in which it will do case studies as part of its assessment of the potential effects of hydraulic fracturing on drinking water. Field work in some of the regions will begin this summer. The studies will be broken into two study groups: prospective (meaning looking at their future possible effects) and retrospective.