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Drought Forces Haynesville Operators to Look Elsewhere For Water

The Louisiana Department of Natural Resources (DNR) has asked four companies operating in the Haynesville Shale to temporarily refrain from withdrawing water for hydraulic fracturing (fracking) from Bayou Pierre because of an ongoing severe drought.

DNR spokeswoman Phyllis Darensbourg told NGI's Shale Daily that four companies -- EXCO Resources Inc., Chesapeake Energy Corp., QEP Resources Inc. and Devon Energy Corp. -- were notified about the drought conditions and asked to stop withdrawing water on Aug. 29.

"We conducted a review of Bayou Pierre and determined that the conditions and water levels there were extremely low," Darensbourg said Wednesday. "The department took the step of sending the companies that are working in that area, and have an agreement to use that particular water source, to take a conservative effort and to no longer make withdrawals."

Darensbourg said the companies had all voluntarily signed an agreement -- officially known as the running surface water use cooperative endeavor agreements (RWA) -- with the DNR. Under the terms of the RWA, oil and gas operators are asked to submit a plan that provides specific details over water withdrawal times, volumes and strategies to mitigate any environmental impacts.

"It is a voluntary program at the present time," Darensbourg said. "But this program could, at some point, evolve perhaps into something bigger. Or we may set up requirements at some point."

This year's drought has been particularly severe, with officials in Louisiana and neighboring Texas fretting about the health of the Carrizo-Wilcox Aquifer, which also underlies a small portion of the Eagle Ford (see Shale Daily, Oct. 21; Aug. 11; June 15). But Haynesville operators have been trying to rely as little as possible on the aquifer and are instead using surface water.

"Chesapeake is continuing its practice of using 95% surface water in its hydraulic fracturing operations in the Haynesville Shale," Chesapeake spokeswoman Katie McCullin told NGI's Shale Daily on Wednesday. "[Our] surface water sources include rivers, lakes, ponds and bayous."

According to McCullin, Chesapeake is using pipelines to transfer surface water "over greater distances" to Haynesville wells. She added that the Louisiana Office of Conservation had been encouraging the company to use the Red River Alluvial Aquifer.

McCullin did not say how much money the Oklahoma City-based company was spending to transport water to its wells in the Haynesville. "We are unable to specifically estimate additional costs as each well situation is different," she said. "Water transfer costs vary based on distance. So with certain sources of surface water now banned from use, completion costs have increased as a result of additional transfer required."

McCullin predicts that as the Haynesville "enters a more controlled period of progression, there will be less demand on local water sources as the majority of acreage leased by Chesapeake is quickly being held by production."

According to figures from the U.S. Drought Monitor on Nov. 10, the western half of Louisiana and most of Texas are in the midst of an exceptional drought.

Drilling activity in the Haynesville Shale has been waning in the last year, according to NGI's Shale Daily Unconventional Rig Count. For the week ending Nov. 11 there were 110 rigs in operation in the Haynesville/Bossier, which is a 2% decline from the 112 rigs operating the previous week and a 30% drop from the 158 rigs during the similar week one year ago.

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