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Appalachian Producers Outline Shale Recommendations

In an attempt to bring uniformity to the exploration and production of oil and natural gas in the shale plays of the Appalachian Basin, a consortium of 11 producers last Tuesday released recommended standards and practices on everything from the preparation of a regional spill and emergency response plan to the use of hydraulic fracturing (fracking) fluids, as well as on community engagement and well site selection.

The consortium, known as the Appalachian Shale Recommended Practices Group (ASRPG), said its recommendations were consistent with those made in the Secretary of Energy Advisory Board's final report, which was released last November, and a National Petroleum Council report issued last September (see NGI, Nov. 14, 2011, Sept. 19, 2011). Both reports cited regional differences in geology, land use and water resources in basins, the group said. And given those findings, the ASRPG said its recommended standards and practices reflect the existing primacy of state regulation over shale development.

The ASRPG's Recommended Standards and Practices for Exploration and Production of Natural Gas and Oil from Appalachian Shales follows the Marcellus Shale Coalition's (MSC) release of its first recommended practices report, which focused on drill site planning, as well as developing and restoring the landscape once operations are complete.

The MSC welcomed ASRPG's work. "Transparent operating standards are critical to the long-term growth and sustainability of our industry throughout Appalachia, and we will continue to collaborate with all stakeholders -- regulators, non-governmental agencies, academic institutions and others," MSC President Kathryn Klaber said. The American Petroleum Institute (API) also supported the ASRPG's proposed practices, which "affirm API's hydraulic fracturing guidance documents."

The standardization of best practices in the Marcellus-Appalachian region comes at a time when industry is attempting to convince the public and state and federal government that fracking can be done safely and responsibly. Although there's "some cross-pollination" between the recommended standards and practices of the ASRPG and MSC, "we're completely different" groups, MSC spokesman Travis Windle stressed. He doubted that the overlap in the standards/practices would confuse operators.

The ASRPG includes Anadarko Petroleum, Corp. Cabot Oil & Gas Corp., Chesapeake Energy Corp., Chevron Corp., EQT Corp., Seneca Resources, Royal Dutch Shell plc, Southwestern Energy Inc., Talisman Energy, WPX Energy and ExxonMobil Corp.'s XTO Energy. The group said it plans to forward its standards and practices for review to state regulators and legislators in the Appalachian areas of operations, as well as to the Interstate Oil & Gas Compact Commission and the State Review of Oil and Natural Gas Environmental Regulations, a nonprofit group made up of safety, industry and public interest representatives.

"This announcement demonstrates the commitment of these Appalachian producers to the continued safe and responsible development of this vital domestic resource. Despite regular practices employed daily that emphasize environmental, worker and community safety, the specific [recommended] measures are a recognition of the importance of public engagement and working with diverse stakeholders," said Regina Hopper, CEO of America's Natural Gas Alliance (ANGA). "These recommended practices show the significance of technical efforts that are responsive to specific regional geological conditions and supportive of appropriate state-led oversight that emphasizes on-the-ground expertise."

The recommendations call for producers to conduct local engagement meetings to enhance environmental, health and safety planning; consider alternative water sources as reasonably practicable; work with local water boards and/or other appropriate regulatory agencies to identify suitable water sources; conduct "on the ground" assessment to minimize impacts to the surface and environment; conduct operations in a manner that protects water; prepare a regional spill and emergency response plan that includes access to key equipment and material readily accessible in a timely manner; encourage development and use of more environmentally benign fracking fluid additives; design well pads to minimize erosion and contain a spill or release; and seek opportunities to develop regionally based casing design and cementing practices and standards.

The producer consortium plans to send the recommendations to the MSC, ANGA, American Petroleum Institute, West Virginia Oil and Natural Gas Association, Independent Petroleum Association of America, Independent Oil and Gas Association of West Virginia, Ohio Oil and Gas Association and the Pennsylvania Independent Oil and Gas Association.

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