1. Moving Beyond Misinformation: Education and Engagement

2. Misperception: Hydraulic Fracturing is Injecting Fluids into Groundwater

3. The Process

4. Drilling Distance Aquifer 400-800 ft. Wells Fargo Center ~700 ft

5. Casing Multiple layers surrounding the aquifer Cement Conductor Casing
Surface Casing
Drilling Mud/Cement
Production Casing
Production Tubing

6. Surface Casing Purpose Depth Requirements Cement Helps
Protect ground water
Provide stable wellbore during drilling operation
Provide well control during drilling
Depth Requirements
Set by State and BLM regulations
Extends below the aquifer
Cement Helps
Protect casing from corrosion
Provide zonal isolation
Support casing in wellbore

7. Production Casing Purpose Cement Requirements Cement Helps
Provide zonal isolation
Provide well control
Well path to productive intervals
Cement Requirements
Set by State regulations
Set by BLM regulations
Operator requirements
Cement Helps
Protect casing from corrosion
Support casing in wellbore

8. Misperception: Hydraulic Fracturing is Not Engineered

9. Fracture Design Data Required Petrophysics/Formation properties
k, Φ, ν, E, σ, Pp, BHT
Fluid properties
Multitude of fluid types
n’, K’, μ, break profile, Pf,
Proppant properties
Variety of proppant types
β, sg, size, CD
Designing and optimizing the best frac job is an involved process across multiple disciplines. We require an analysis of the rock and its surrounding layers. This comes from tools run on wireline in the open hole before the production pipe is run and cemented.
Predict-K 3.0

10. Pump Schedule
A pump schedule is required for the simulator to determine the predicted fracture geometry
Fluid and proppant volumes
Treatment rate
Additive rates
AFTER THIS SLIDE – ADD PICTURE OF FRAC TRAILER
Frac Job

11. Treatment Graph
This is a typical job chart showing the most relevant information from a typical job. Many experts”can look at a chart like this and derive a lot of information about the quality of job provided by the service company and the quality of wellbore and reservoir being treated.
Frac Job

12. Misperception: Drilling is Getting Riskier
AFTER THIS SLIDE – CAN YOU ADD A SLIDE THAT SHOWS PROGRESSION FROM VERTICAL WELL IMAGE TO DIRECTIONAL TO HORIZONTAL?
MAYBE WITH THE IMAGE THAT SHOWS APE GOING TO MAN?

14. Fractured Contact

15. Footprint
1 Well Pad or 32?
1280 acre, could require 32 vertical wells

16. Misperception: Drilling and Hydraulic Fracturing Uses Too Much Water

17. Colorado Water Use Total (Million gallons/Day)
Total (Million gallons/Day)
Total (Billion gallons/Year)
Irrigation (crop)
12,322
4497
Irrigation (golf course) 41 14
Public-supply
864
315
Domestic 34 12
Industrial
142 52
Livestock 33
Mining 21 8
Thermo-electric
123 45
Total withdrawals
13,581
4957
Source: USGS 2005 Estimated Withdrawals and Use of Water in Colorado, 2005

18. Horizontal Well Activity
2011
517 Horizontal wells permitted
295 Horizontal wells spud
Total wells spud
ADD TOTAL WELLS SPUD INFO

19. Estimate All Well Activity
2011 Estimate Water Use
1000 horizontal wells (5M gal)
1500 vertical wells (1M gal)
Conservative Estimate:
0.14% of Colorado annual irrigation water use
0.13% of Colorado annual water use

20. Water Requirements
Natural gas has one of the lowest water usage rates per MMBTU

21. Misperception: There is No Data Showing Groundwater is Protected

22. COGCC Groundwater complaints Hundreds of complaints
No verified instances of hydraulic fracturing harming groundwater in Colorado
Water sampling
Since 2000, baseline and periodic water sampling for over 2,000 water wells in the San Juan Basin
Independently verified; no significant increase in chemical concentrations
Add another slide after this that shows this information is available on the COGCC database

23. COGCC Data

24. Meaningful Engagement and Education

25. FracFocus Website

26. HF Disclosure Example

27. Baseline Water Sampling
Pre and Post-drilling water samples taken around new well starts
Increased transparency & accountability for industry

28. Colorado’s O&G Industry
46,426 active wells
7th highest state in natural gas production
7th highest state in number of natural gas wells drilled in 2010
12th highest state in crude oil production
18th highest state in number of crude oil wells drilled in 2010
$1.1B in public revenue
$9.1B production value in 2010
102,000 jobs
$1.1B in public revenue is just revenue that goes to the state of Colorado.
Sources: Colorado Oil and Gas Conservation Commission, Independent Petroleum Association of America.

29. Total Direct Public Revenue
$1.1 Billion 2010
Is this just to Colorado, or to Fed too? – All Colorado
What’s this as percentage of total Colorado public revenue – Spoke to Brian, and he doesn’t have a number for total Colorado Public revenue, but suggested that you could try comparing it to the Colorado general fund which this year was $7.1 Billion, so roughly 15%. They didn’t include this comparison in the study because they didn’t have a good way to really compare it.
Sources: Colorado Dept of Revenue, Office of Natural Resources Revenue, Colorado Dept of Local Affairs

30. COGA Fast Facts

31. Resources Hydraulic Fracturing Fact Sheet
COGCC Gasland Correction Document
COGA’s The Truth About Gasland
Other Fact Sheets
Natural Gas Facts
Socioeconomic Benefits
Produced Water
Natural Gas Supply

32. Thank you for your interest in Colorado’s oil and gas industry!
Questions?
Thank you for your interest in Colorado’s oil and gas industry!