Islands in the sea of development

by Dorothy Atkins, Aspen Daily News Staff Writer

Five miles from the center of Rifle is a dirt road just south of the Garfield County Regional Airport that leads to a clearing in the brush about the size of a football field. Two black pipes line the road and disappear off to the left of the site’s entrance toward four large storage tanks. A drilling rig sits at the far end of the site and trailers line its perimeter. In the center of it all are nine metal cages about 4 feet apart from one another. With all of the machinery, the cages can easily be overlooked, but each protects a single wellhead that produces about a million cubic feet of natural gas a day. They are the end result of months of drilling and years of government process approving gas development in the area.
The site is home to nine of 50,375 active wells in the state, 20 percent of which are in Garfield County, according to the Colorado Oil and Gas Conservation Commission’s (COGCC) weekly oil and gas statistics. The number of active wells has steadily increased each year since 2002 when 22,500 were recorded. In 2011, the most recent data recorded, Colorado wells collectively produced 4.65 billion cubic feet of gas and 107,200 barrels of oil per day, according to the COGCC.
Encana Corp., a Canadian-based oil and gas company, is developing the site outside of Rifle, which is known in the industry as a well pad. Multiple wells can be drilled on a single pad and each pad ranges in size depending on the number of wells. At this particular site, Encana has nine wells which extract primarily natural gas, along with a hydrocarbon liquid called condensate, from 9,000 feet ( about 1.7 miles) beneath the surface. The company is in the process of drilling nine more wells on the pad. Encana currently owns about 3,000 producing wells in the Piceance Basin, a geological formation rich in natural minerals that stretches across northwest Colorado.
It takes about three months to get the natural gas out of the ground. The process includes drilling a hole, installing a metal pipe and concrete casing and performing a process called hydraulic fracturing, commonly known as “fracking,” which uses a sand, water and a chemical mixture to create fractures in subterranean rock to extract mineral deposits.
After the well is fracked and producing enough gas to sell, a 5-foot-high device called a “Christmas tree,” which has a series of valves to control emissions, is placed on top of the well and nearly all of the personnel leave the site along with the drilling rig. Workers will periodically service the well, but for the most part the site goes undisturbed during the 20-year period that it produces natural gas.

Solving environmental problems with infrastructure

One of the biggest environmental challenges oil companies face while drilling and fracking is how to transport and treat the large quantities of water required for the process. As many as 5 million gallons of water can be injected in fracking a single well, according to Michigan regulators.
Encana addresses the problem by using black pipes, which run alongside area roads, to transport water to their well pads that has been cleaned at a nearby company-owned water treatment facility. That reduces the site’s carbon footprint by minimizing the number of trucks needed to haul water, said John Grubich, Encana’s drilling superintendent at the site, who has over a decade of experience in the industry. Meanwhile, using a water treatment facility to clean used water and recycle it means that the company is using less fresh water during drilling and fracking. In 2011, Encana recycled over 400 million gallons of water by using its treatment facilities, according to Kathy Friesen, Encana’s environmental regulatory advisor.
The infrastructure around Rifle makes for a more environmentally friendly water transporting process, Grubich said.
Water treatment facilities cost millions of dollars to build, so companies only do it if there are many well pads nearby. If a company is only drilling on about five pads, it likely will opt to truck water to and from the site instead of building a treatment plant, he said.
The industry’s infrastructure around Rifle has been in the works since about 2000 and the number of water treatment facilities in the area has grown with it, said Doug Hock, Encana’s public relations director. There are currently five company treatment facilities in the area, he said.
“We’re probably more advanced in this field here than in some other areas,” Hock said.
Prior to the 2000s there was some gas development in the area, but it wasn’t extensive, Friesen said. That changed as technology has advanced, making the resource cheaper to extract, she said.

 Chris Council/Aspen Daily News
John Grubich, a drilling supervisor with Encana, explains during a recent tour that one of the company’s best practices is to encase producing wellheads in a metal structure to protect against accidents on an active well pad.

An oil company decides to develop a lease based on whether it makes sense economically, Friesen said. That means accounting for the costs of drilling along with other factors like ensuring compliance and dealing with topographical challenges or lack of infrastructure in the area, she said.
The commodity’s price is a major determining factor as well, added Hock.
“If you have a [lower gas] price environment like we do now you’re probably not going to go into new terrain,” he said.

Fighting for the islands

Whether it’s profitable for gas companies to develop a handful of wells in pristine areas that lack infrastructure is a question currently being raised by local environmentalists.
In February, two oil and gas companies — SG Interests and Ursa Piceance, LLC — filed separate requests with the Bureau of Land Management (BLM) for more time to develop their natural gas wells in the Thompson Divide, which includes 221,500 acres of federal land running from the Sunlight Ski Area to McClure Pass crossing Pitkin, Gunnison, Garfield, Mesa and Delta counties. Both companies own leases that are due to expire this spring.
The companies have owned their leases for 10 years but did not develop them because the commodity prices were low and the venture wouldn’t be profitable, environmentalists argue.
While the Thompson Divide has put gas drilling on the radar of upper Roaring Fork Valley residents, people in Garfield County have been trying slow down development of the Roan Plateau, a 3,500-foot-tall mesa outside of Rifle, for longer. In 2008, the BLM sold leases to six gas companies for $113.9 million, setting a new record for the highest-grossing onshore oil and natural gas lease sale in BLM history in the lower 48 states.
After the lease sale, a group of 10 conservation groups sued the BLM, claiming it did not adequately follow its own National Environmental Policy Act (NEPA) process when it issued the leases. The BLM failed to consider alternatives to developing the area or the cumulative impacts that adding more wells would have on air quality, according to the lawsuit. One of those alternatives would have gas companies access mineral deposits beneath the plateau through horizontal drilling from its base.
Last summer, a judge ruled in favor of the conservation groups and the BLM is currently conducting a supplement environmental impact statement to create a new management plan for the area. The BLM is accepting public comments on development of the area through March 30.
With the judge’s recent ruling, environmental groups have made gains toward encouraging a more common sense approach to energy development, said Luke Schafer of the Colorado Environmental Coalition. Still, the BLM has a long way to go in order to manage energy development responsibly, because the conversation is still being driven by the push to drill, he said.
“We’re still discussing how we’re developing, when we should be asking why do we need to,” Schafer said.
One of the problems is that the responsibility falls on the public to make sure development doesn’t occur in inappropriate places, but for many people it can be intimidating and difficult to stay informed on the ongoing proposals, Schafer said.
“1,200-page plans aren’t easy for me either,” he added.
The fight to save the Thompson Divide and Roan Plateau from mass development is about preserving important pristine landscapes which have become even more crucial to wildlife and local users due to the amount of development surrounding the areas, said Mike Freeman, an attorney with Earthjustice, a nonprofit public interest law firm. Leases in both areas were issued in violation of NEPA, he added.
“When you’re thinking about places like the Thompson Divide and the Roan Plateau, it’s just about trying to protect pristine lands and roads,” Freeman said. “It doesn’t mean we’re shutting development down to the industry.”
The BLM estimates that there could be between 10,000 and 20,000 new wells in Garfield County in the next 20 years, he said. That would double the number of wells there are currently.
Oil and gas companies have enough areas to drill without having to venture into undeveloped areas, Freeman added. Of the 4 million acres of federal land leased, 65 percent is currently not being developed, he said.
“Companies have plenty of places to drill without those areas,” Freeman said. “The bottom line here is that both in the Roan [Plateau] and the Thompson Divide you have some of the most pristine lands that Colorado has to offer. We don’t need to develop those lands. We can protect those areas and still make plenty [of natural gas]. Industry doesn’t need to have everything.”