Chesapeake Energy Corp. gained control of a blowout of a Marcellus Shale well in northeast Pennsylvania last week, but now must manage inquiries from state and federal regulators, and criticism from lawmakers, environmental groups and the public.

The company said crews regained “permanent well control” of the Atgas 2H well at about 6:05 p.m. last Monday (April 25) by replacing the damaged wellhead. The well blew out late on April 19, but had been in “stable” condition for days (see NGI, April 25a), with no hydraulic fracturing (fracking) fluids released from the wellhead since April 21 and all fluids contained at the pad site since April 20.

As Chesapeake worked to regain control of the well, the U.S. Environmental Protection Agency (EPA) sent a letter via overnight certified mail on April 24 ordering the company to answer five preliminary questions — including the disclosure of frack chemicals used in the well — by last Tuesday. Chesapeake also was given 15 days from receipt of the EPA notice to respond to 68 additional questions surrounding the spill.

The Pennsylvania Department of Environmental Protection (DEP) issued a Notice of Violation (NOV) to Chesapeake on April 22, charging the company with three violations related to “frack fluid,” the mixture of water, sand and chemicals used to frack shale formations. Chesapeake released “an unknown quantity of frack fluid” from the well site, allowed frack fluid to enter an unnamed tributary of Towanda Creek and also allowed it to hit the ground, according to the NOV. Those violations could yield fines in excess of $100,000.

The NOV required the company to respond within days about the composition of the fluids used at the well, the root cause of the blowout, proposed corrective actions and “an explanation of why Chesapeake took 12 hours to address the uncontrolled release of fluids off the well pad” and “to have a well control service company at the site when there are other well control service companies located closer to the Atgas 2H well,” referring to Boots & Coots, the Texas well control specialist Chesapeake hired.

Chesapeake still does not know the cause of the incident, other than to blame wellhead equipment.

“Chesapeake will continue to work with the appropriate regulatory agencies to investigate and determine the cause of the equipment failure,” spokesman Brian Grove said. “Chesapeake greatly appreciates the professional and responsive assistance of federal, state and local agencies that participated in these efforts, specifically the efforts of local responders, including Bradford County EMA [Emergency Management Agency], the Western Alliance EMA and the Canton Fire Department.”

However, the company voluntarily suspended completion activities in the Marcellus while it investigates. The DEP wants that suspension to remain in effect until the incident is completely understood.

“It is our expectation that Chesapeake will continue to be in a stand-down mode on hydraulic fracturing activities until it can diagnose the cause of the equipment failure at the Atgas 2H well, report those findings to the department and provide assurances sufficient to the department inspectors and technical staff that there will be no repeat of the Atgas 2H well site event at any Chesapeake site, and receive the department’s concurrence that it is appropriate to resume hydraulic fracturing activities,” Jennifer Means, an environmental program manager with the DEP, wrote in its NOV.

Chesapeake and the DEP continue to test soil and water in the area to gauge the impact of the spilled frack fluids. Chesapeake said early testing showed “minimal environmental impact.” The DEP found dead tadpoles and frogs in a local pond, but not any dead fish. The DEP also plans to test at a creek, located 16 miles from the well pad, that feeds into the Susquehanna River.

The Atgas 2H well is located in Leroy, a small township in Bradford County, the most productive county in the Marcellus with 65.8 Bcf in the final six months of 2010. Chesapeake is the largest leaseholder in the Marcellus, with more than 1.7 million acres.

The blowout drew broad, but not universal criticism.

The statewide environmental group Citizens for Pennsylvania’s Future called on the DEP to suspend all Chesapeake operations, not just completion events, “until the company can prove it can operate safely,” a call that went unheeded.

Mark Smith, chairman of the Bradford County Commission, sent a letter to Pennsylvania Gov. Tom Corbett challenging DEP policy for the Marcellus, including a much-criticized program to get NOVs pre-approved by top department officials, and claiming that his county did not have enough of a voice in statewide policy deliberations, such as the Marcellus Shale Advisory Commission. That commission, convened by Corbett in early March to study a wide range of issues, is set to hold its next meeting on Wednesday, and the issue of the Chesapeake well is almost certain to be discussed (see NGI, April 4).

The blowout reverberated outside of Pennsylvania as well.

New York Attorney General Eric Schneiderman used the event to reiterate his plans to sue the federal government if it doesn’t review the Delaware River Basin Commission’s proposed regulations on shale development (see NGI, April 25b). But Sen. Jim Inhofe (R-OK) told Fox News Radio that the incident was an “above-ground surface spill” that “has nothing to do with hydraulic fracturing.”

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