MB Eco-Network Water Caucus April 26, 2012

Fracking Topics The Fracking Process Materials Fracking Chemicals Water issues ○ Water use ○ Contaminated water storage ○ Ground water contamination Fracking in MB Bakken Formation Current Legal Status

Fracking Topics (cont.) Other Jurisdictions British Columbia Quebec Maritimes Ontario Opportunities/ Challenges in Opposing Fracking in Manitoba Q & A / Discussion on Campaign Strategies

Intro Video  oLzDGgE oLzDGgE

Water and Chemical Use  Each fracture well requires 1-8 million gallons of water in total  Each frack requires 40,000 gallons of chemicals (average number of fracks per well is 15-20)

Fracking Solution 94.5 %Water 5.25 %Sand (Propping agent) 0.25 %Chemical Additives Chemical Functions Friction Reducer - allows higher flow rate at reduced pressure Fracking Fluids - acid to break down surrounding rock Biocides - prevents microorganism growth and biofouling Stabilizers - prevents corrosion of metal pipes

Product FunctionChemical NameChemical Purpose Acid Hydrochloric Acid Helps dissolve minerals and initiate cracks in the rock Biocide Glutaraldehyde Eliminates bacteria in the water that produces corrosive by-products Ammonium Chloride Quaternary Ammonium Chloride Tetrakis Hydroxymethyl- Phosphoium Sulphate Breaker Ammonium Persulphate Allows a delayed break down of the gel Magnesium Peroxide Magnesiom Oxide Calcium Chloride Product Stabilizer Sodium Chloride Clay Stabilizer Choline Chloride Prevents clays from swelling or shifting Tetramethyl ammonium chloride Sodium Chloride

Product FunctionChemical NameChemical Purpose Corrosion Inhibitor Isopropanol Product Stabilizer and/or winterizing agent Methanol Formic Acid Prevents the corrosion of the pipe Acetaldehyde Crosslinker Petroleum Distillate Carrier fluid for borate or zirconate crosslinker Hydrotreated Light Petroleum Distillate Potassium Metaborate Maintains fluid viscosity as temperature increases Triethanolamine Zirconate Sodium Tertaborate Boric Acid Zirconium Complex Borate Salts Ethylene Glycol Product Stabilizer and/or winterizing agent Methanol

Product FunctionChemical NameChemical Purpose Friction Reducer Polycrylamide " Slicks" the water to minimize friction Petroleum Distillate Carrier fluid for polyacrylamide friction reducer Gelling Agent Guar Gum Thickens the water in order to suspend the sand Polysaccharide Blend Petroleum Distillate Carrier fluid for guar gum in liquid gels Hydrotreated Light Petroleum Distillate Iron Control Citric Acid Prevents precipitation of metal oxides Acetic Acid Thioglcolic Acid Sodium Erythorbate Non-Emulsifier Lauryl Sulphate Used to prevent the formation of emulsions in the fracture fluid Scale Inhibitor Copolymer of Acrylamide and Sodium Acrflate Prevents scale deposit in the pipe Sodium Polycarboxylate Phosphonic Acid Salt

Product Function Chemical NameChemical Purpose pH Adjusting AgentSodium Hydroxide Adjusts the pH of fluid to maintain the effectiveness of other components, such as crosslinkers Potassium Hydroxide Acetic Acid Sodium Carbonate Potassium Carbonate Sufactant Lauryl Sulphate Used to increase the viscosity of the fracture fluid Naphthalene Carrier Fluid for the active surfactant ingredients Ethanol Product Stabilizers and/or winterizing agents Methanol Isopropyl Alcohol 2-Butoxyethanol

Contamination risks  Transport of hazardous chemicals to the mine site  Recovered fracture water or “produced water” sits in nearby tailings ponds. These tailing ponds allow volatile organic compounds and hazardous waste particles into the air 0nly 30-50% of the water is recyclable - the rest is disposed of onsite (buried in mine shaft) when well is dry.

Contamination Risks  The fracking fluid may contaminate the water supply through a leak in the well line or through leeching into the water table via the fractures the process creates  Naturally-occurring methane gas and other toxic chemicals may leech into the water table Methane gas concentration is 17 times higher in drinking-water wells near fracking sites

Bakken Formation

Bakken Formation Potential Reserves 3.65 billion barrels of crude oil 2.0 trillion cubic feet of natural gas 150 million barrels of gas liquids

Hydraulic Fracture Mining in Manitoba  Companies are not required to stipulate mining method - just what is extracted (ie. gas or oil), so no way to determine where exactly fracking is occurring Number of MB oil wells in 2003 – 1,400 Number of MB oil wells in 2009 – 3,000  It is estimated that wells will be drilled in MB in 2012  Many of these may be fracking sites

Hydraulic Fracture Mining In Manitoba  There is no special legal status or requirements for hydraulic fracture mines in MB  Hydraulic fracking would come under MB Oil and Gas Act (1993) and Drilling and Production Regulation (1994) both of which were designed for traditional oil and gas extraction and written before large scale hydraulic fracking was used in Canada (prior to exploitation of the Bakken reserve)

Hydraulic Fracture Mining In Manitoba  Thus, the legal framework in MB ignores: The likelihood of fracking chemicals entering the water table; and The possibility of natural gas leeching into the water supply once disturbed by fracking

Other Jurisdictions: BC  British Columbia has a large scale hydraulic fracture mining industry which has faced heavy opposition  Recently passed legislation requires companies to disclose the chemicals they use in the fracking process and this is published online at fracfocus.ca

Other Jurisdictions: BC Legislation weak points  Disclosure occurs 30 days after well has been closed so really just for legal recourse if your water or land has already been contaminated  Companies can still restrict chemical publication if said chemical is a proprietary trade secret there is just additional paperwork  Not sure of the penalties for non-compliance as it is a regulatory framework that works with industry

Other Jurisdictions: Quebec  Recently extended and expanded on previous fracking moratorium until study results due in 2013 are released  Currently, fracking no longer permitted even for research purposes

Other Jurisdictions: Maritimes Nova Scotia  Recently passed two year fracking moratorium until the process can be further studied New Brunswick  Liberal Opposition has been calling for moratorium in legislature  Moncton City Council has refused to sell water to fracking companies

Other Jurisdictions: Ontario  Small municipal regions around the Great Lakes have successfully opposed and stopped fracking deals

Challenges in Manitoba  We do not have a lot of information as to where hydraulic fracturing is occurring and how large the industry is at the present  Because MB’s oil and gas industry is small not many politicians are informed about the dangers  The NDP government may not want to spend political capital on an issue that affects few people and in a rural area that is a traditional Tory stronghold

Challenges in Manitoba  North Dakota is experiencing a huge industry boom as it jumps into hydraulic fracking with both feet

Opportunities in Manitoba  Several provinces have recognized the dangers posed by hydraulic fracking and have strengthened their regulation or placed moratoriums on it  Government is currently rewriting the new Groundwater and Well Water Act  Current mining legislation is outdated and needs to be refreshed to reflect growing industry Opportunity for shaping these reforms  Less pressure on politicians to keep natural gas prices low

Sources/ Links -good starting site business fallout over Quebec’s fracking moratorium