Operations

The Ohio Department of Natural Resources (ODNR) on Friday took an unprecedented step to establish what is believed to be the country’s first set of permitting conditions for hydraulic fracturing (fracking) in horizontal wells near fault lines or areas of previous seismic activity.

The Ohio Department of Natural Resources (ODNR) has ordered Hilcorp Energy Co. to temporarily halt its operations in Northeast Ohio after a series of minor earthquakes were felt in several townships just miles from where the company has drilled seven wells and has plans for others.

Independence Oilfield Chemicals LLC (IOC) said it has developed a fluid for use in hydraulic fracturing (fracking) operations that has a lower chemical content.

Under increasing community and political pressure, Allenco Energy Co. agreed to shut down operations at a controversial urban drilling site a few miles south of downtown Los Angeles in a working class neighborhood just north of the University of Southern California campus. Allenco said it will use the pause in drilling to improve its operations.

Continued drilling efficiency improvements are driving record production growth in the Williston Basin’s Bakken Shale and helping to push down costs, according to top Oasis Petroleum executive.

Offshore operators on Thursday were bringing nonessential personnel to shore and shuttering some production facilities after National Hurricane Center (NHC) forecasters said Tropical Storm Karen could reach hurricane strength by Friday.

Colorado Interstate Gas Pipeline(CIG) is back in full operations after being forced to shut down operations on a portion of its 4,300-mile pipeline system in the Rockies, aKinder Morgan Inc.(KMI) spokesperson said Tuesday. Inspection and recovery have been completed on two buried laterals that were exposed by the historic flooding and runoff in areas north and west of Denver. A force majeure had been declared and the pipeline taken out of service in mid-September (seeDaily GPI,Sept. 17). CIG is a unit ofEl Paso Pipeline, a subsidiary of KMI. The laterals were taken out of service as a precaution until they could be inspected, recovered and brought back online. CIG Lines 59A and 252A had been taken out of service; 59A delivers to theYoung Gas Storage Co., and 252A transports gas to the Tritown delivery point. CIG includes 4.5 Bcf capacity pipelines linked to gas production areas in the Rockies and the Anadarko Basin. It links directly to customers in Colorado and Wyoming and indirectly to other areas. CIG also owns interests in five storage facilities with 35 Bcf of working capacity in Colorado and Kansas.

Pennsylvania State Universityresearchers who have been charged with monitoring 21 seismograph stations across the state are also reportedly studying the geological structure of the South Newark Basin. The $269,000 study is part of a federal program to research earthquakes nationwide, and was contracted to the university by theDepartment of Conservation and Natural Resources(DCNR) this summer, according to Philadelphia’sIntelligencernewspaper, which gathered the information through a series of right-to-know requests. In 2012 theU.S. Geological Survey(USGS) said the South Newark was one of three Mesozoic shale basins along the East Coast with the “most resource potential” for oil and gas producers (seeShale Daily,June 21, 2012). There is a 95% chance that at least 363 Bcf of undiscovered natural gas is locked in the formation, along with 1 million bbl of undiscovered natural gas liquids, USGS said. Following the USGS report, the General Assembly days later adopted a drilling moratorium for the South Newark Basin, which is located across upscale, ex-urban Philadelphia counties (seeShale Daily,July 3, 2012). The legislation forbid the state’sDepartment of Environmental Protectionfrom issuing well permits in the basin until DCNR completed a study of “the practical resource recovery implications” of the USGS report and the fiscal impact of oil and gas operations in the basin. Oil and gas operations in the South Newark Basin are already restricted by theDelaware River Basin Commission’s de facto moratorium on exploration and development (see Shale Daily,June 16, 2010).

Despite the shutdown of the federal government, all of the Department of Energy’s Energy Information Administration (EIA) reports should be released on schedule this week and next, the agency said Tuesday. FERC also was conducting business as usual Tuesday for an unspecified time until its reserve funds run out. The Commodity Futures Trading Commission (CFTC) had only key personnel continuing to work.