What Kind of Umpire Is the Pennsylvania Public Utility Commission?

The Social Psychology of Organizing (Weick 1979) is a classic, cited more more than 12,700 times according to Google Scholar. The book opens with a series of vignettes about organizational events. One of my favorites is about balls and strikes:

“The story goes that three umpires disagreed about the task of calling balls and strikes. The first one said, ‘I calls them as they is.’ The second one said, ‘I calls them as I sees them.’ The third and cleverest umpire said, ‘They ain’t nothin’ till I calls them.'” (Simons 1976: 29 as cited in Weick 1979: 1).

What are we to make of this quote? Of course a number of interpretations are possible. But one straightforward interpretation is that the three umpires operate from different ontologies. Or as Michel Callon (1998) proposed: ontologies vary. In this case, the first umpire might be called a positivist; the second an interpretivist; the third a constructivist. Or to be more alliterative: realist, relativist and relationalist.

I thought of this illustration while reading StateImpact Pennsylvania’s description of the Pennsylvania Public Utility Commission (PUC). Among other things the PUC is responsible for assessing fees on spud unconventional gas wells under Act 13 of 2012. In this regard, Pennsylvania Senate President Pro Tem Joe Scarnati, “who shaped the majority of the impact fee, has said he envisions the commission serving as an umpire, ‘calling the balls and strikes’ of whether local regulations fit within the law’s framework.”

That got me thinking: Just what kind of umpire is the PUC?

National Geographic Bakken Shale Cover Story

The March 2013 issue of National Geographic proclaims: “America Strikes Oil: The Promise and Risk of Fracking.”

201303 National GeographicInside is a 32-page story entitled “The New Oil Landscape” by Edwin Dobb, with photographs by Eugene Richards. You can read the story online and view an album of the photos.

In his introductory column, editor-in-chief Chris Johns framed the stakes this way:

Flip a coin. Heads or tails? The odds are fifty-fifty either way. Make a bet and take your chances. A gamble is just that–a decision that has risk attached to it. Someone wins. But someone loses. When it comes to fracking–the process of extracting otherwise unreachable oil and natural gas by driving fresh water mixed with other substances, some toxic, into layers of rock–the bets become less mathematically clear…

As with other unconventional formations, such as the Barnett, Haynesville and Marcellus, extracting hydrocarbons from North Dakota’s Bakken Formation depends on a combination of horizontal drilling and hydraulic fracturing. What’s different about the Bakken Formation is that it produces shale oil. (Though considerable natural gas is also produced, it is often flared).

[A]dvances in drilling and extraction technology bave made it possible to remove oil from deep, widely dispersed deposits. Since early 2006, production from what’s known as the Bakken formation has increased nearly 150-fold, to more than 660,000 barrels a day, moving North Dakota into second place among domestic suppliers, behind Texas and ahead of Alaska.

But clearly more than technology, geology and economics are at stake. Early in the article, Dobb asks:

[C]an the inestimable values of the prairie–silence, solitude, serenity–be preserved in the face of full-throttle, regionwide development, of extracting as much oil as possible as fast as possible?

After reviewing the evidence firsthand, by the end of the article, Dobb concludes:

To believe the old lifestyle will survive intact is to ignore the wrenching changes that have already reshaped this corner of the prairie.

Note: In August 2010, National Geographic published a package of stories — “The Great Shale Gas Rush” — on the Marcellus Formation.

US Nuclear Power Update

According to the World Nuclear Association’s Weekly Digest first concrete was poured on two new US nuclear power reactors — the Summer 2 and the Vogtle 3. I previously discussed some of the dynamics behind this nuclear “renaissance.”

The concrete basemat for South Carolina Electric & Gas’ (SCE&G) Summer-2 reactor has been poured in a 51-hour operation. Three days later that for Vogtle-3 was undertaken in 41 hours. The pours had been delayed for months because of discrepancies between construction plans and the original design documents. The NRC approved license amendments earlier this month that allowed the concrete pour of the 1.8m thick foundations to proceed. These are the first such construction starts in the USA in three decades. SCE&G is building two Westinghouse AP1000 reactors at the Summer site, each 1117 MWe net. Southern Nuclear is building another two AP1000 units at its Vogtle site. Reactor pressure vessels and steam generators for all units will come from Doosan in South Korea. The four units are expected to enter commercial operation in 2017 and 2018 in each case. There are also four Westinghouse AP1000 reactors under construction in China, at Sanmen and Haiyang, the first two of which are expected on line next year.

This comes on the heels of the February 2013 decommissioning of Duke Energy’s 860 MWe Crystal River PWR in Florida due to damage to the containment structure sustained when new steam generators were fitted in 2009-10, under previous owner Progress Energy. Its 40-year operating licence was due to expire in 2016. Some $835 million in insurance was claimed. Additionally, Dominion Energy’s 566 MWe Kewaunee PWR in Wisconsin is due to be decommissioned in May 2013, after 39 years operation.

For more, see Nuclear Power in the USA.

Act 13 Reporting Paper a Top 10 Download Again

According to SSRN, our paper — An Analysis of Unconventional Gas Well Reporting under Pennsylvania’s Act 13 of 2012 — is once again a top 10 download in several categories, including:

The paper was published in the December issue of Environmental Practice and analyzes the extent to which the Pennsylvania Department of Environmental Protection (DEP) complied with its reporting requirements under Act 13. Using publicly available data, we find that the DEP likely omitted between 15,300 and 25,100 unconventional gas wells from its Act 13 report. Left uncorrected, we estimate that Pennsylvania’s state, county, and municipal governments could forfeit fees of $205-$303 million in 2012 and up to $0.75-$1.85 billion cumulatively over the expected life of these wells. We propose the implementation of a relational database and geographic information system as a way for the DEP to fulfill its Act 13 obligations.

The Ashcroft #1

Another example of a spud unconventional gas well omitted from the Pennsylvania Department of Environmental Protection’s Act 13 report, this one in the West Falls Formation.

Ashcroft #1

In December 1975, St. Joe Petroleum Corporation spud the Richard J. Ashcroft #1 well in Greene Township, Beaver County, ultimately drilling to a total depth of 7,519 feet in the Queenston Shale (Heyman & Cozart, 1978). The Ashcroft #1 was originally drilled as a test of the Lower Silurian Medina Group (Piotrowski & Harper, 1979), and reportedly completed on December 6, 1975. Although there was a slight show of gas, the well was initially shut-in, pending further production tests (Heyman & Cozart, 1978). The well was later plugged back, and, on February 19, 1976, was reportedly completed in the Devonian Rhinestreet shale (Piotrowski & Harper, 1979). However, after being hydraulically fractured, there was no sustained flow, and as of 1979, the well was again reported as shut-in (Piotrowski & Harper, 1979). The Ashcroft #1 was assigned Permit #BEA-20060 (Heyman & Cozart, 1978), now API #37-007-20060 (Ryder, 2004; Ryder et al., 2012; Trippi & Crangle, 2009). See Figure 1.

Figure 1. Ashcroft #1 Gamma Ray Log 

ashcroftlog

Source: Trippi & Crangle, 2009

References

Heyman, L., & Cozart, C. L. 1978. Oil and Gas Developments in Pennsylvania in 1977. Harrisburg, PA: Pennsylvania Geological Survey, Fourth Series, Progress Report 191.

Piotrowski, R. G., & Harper, J. A. 1979. Black Shale and Sandstone Facies of the Devonian “Catskill” Clastic Wedge in the Subsurface of Western Pennsylvania. Washington, DC: U.S. Department of Energy.

Ryder, R. T. 2004. Stratigraphic Framework and Depositional Sequences in the Lower Silurian Regional Oil and Gas Accumulation, Appalachian Basin: From Ashland County, Ohio, through Southwestern Pennsylvania, to Preston County, West Virginia. Washington, DC: U.S. Geological Survey, Geologic Investigations Series, Map I-2810.

Ryder, R. T., Trippi, M. H., Swezey, C. S., Crangle, R. D., Jr., Hope, R. S., Rowan, E. L., et al. 2012. Geologic Cross Section C–C’ through the Appalachian Basin From Erie County, North-Central Ohio, to the Valley and Ridge Province, Bedford County, South-Central Pennsylvania. Washington, DC: U.S. Geological Survey, Scientific Investigations Map 3172.

Trippi, M. H., & Crangle, R. D., Jr. 2009. Log ASCII Standard (LAS) Files for Geophysical (Gamma Ray) Wireline Well Logs and Their Application to Geologic Cross Section C-C’ through the Central Appalachian Basin. Washington, DC: U.S. Geological Survey, Open File Report 2009-1021.

The Fleck #1

Another example of a spud unconventional gas well omitted from the Pennsylvania Department of Environmental Protection’s Act 13 report, this one in the West Falls Formation.

Fleck #1

In 1975, Peoples Natural Gas Company spud the James Fleck #1 in Sandy Creek Township, Mercer County, reaching a total depth of 9,246 feet in “Precambrian granite” (Lytle et al., 1977: 23). The well was plugged back and fractured in the Lower Silurian Medina Group from 4,990 to 5,040 feet, discovering the Fleck Pool in the Sheakleyville Field (Lytle et al., 1977). In 1977, the Pennsylvania Geological Survey reported two different completion dates for this well: August 27, 1975, and March 12, 1976, creating indeterminacy as to when these events took place (Lytle et al., 1977). Regardless, initial production was reportedly 231 Mcfgpd, and the well was assigned Permit #MER-20116 (Lytle et al., 1977), or API #37-085-20116 under current nomenclature (Baranoski, 2002). The well was then shut-in (Heyman & Cozart, 1978). According to later reports, “although a significant amount of gas was encountered, it was not deemed sufficient to justify the expense of putting the well on line” (Harper & Abel, 1979: 41).

Around this same time, the Energy Research and Development Administration (ERDA) had launched a five-year study of Devonian organic-rich shales in the Appalachian Basin (Piotrowski & Krajewski, 1977).[1] As it relates to the James Fleck #1, in addition to production from the Medina Group, well logs indicated gas production in so-called Zone I facies, which were then thought to be “approximately equivalent to the Rhine Street Shale of New York” (Piotrowski & Krajewski, 1977: 41). Seizing upon this potential, Peoples Natural Gas Company and the ERDA began negotiating the possibility of using the James Fleck #1 to test the West Falls Formation (Frohne, 1978; Piotrowski & Krajewski, 1977).

These negotiations succeeded, and in March 1978, the newly formed U.S. Department of Energy (DOE) “attempted to stimulate the Rhinestreet facies … by means of a massive hydraulic fracturing treatment” (Harper & Abel, 1979: 41). In preparation for the treatment, the Devonian Shale was perforated with 50 holes between 3,112 and 3,360 feet deep (Frohne, 1978). The planned hydraulic fracturing treatment called for 270,000 gallons of nitrogen-water foam fracturing fluid, 324,000 pounds of sand proppant, and 12 major pieces of fracturing equipment (Frohne, 1978). Additionally, 6 gallons of surfactant, 1 gallon of clay stabilizer, and 44 pounds of calcium chloride per thousand gallons of water were injected with the foam (Frohne, 1978). The job also included 2,000 pounds of flaked benzoic acid to be used as a temporary diverting agent to insure that the entire perforated interval accepted some fracturing fluid (Frohne, 1978). See Table 1 for complete specifications of the planned massive hydraulic fracture treatment.

Table 1. Fleck #1 Massive Hydraulic Fracture Treatment Schedule

fleckmhf

Source: Frohne, 1978

However, during the hydraulic fracturing treatment, unexpectedly high pressures were encountered, as well as a mechanical packer problem, resulting in a catastrophic downhole casing failure (Frohne, 1978). During the curtailed foam frac operation, 1,582,000 SCF of nitrogen gas, 18,500 gallons of water, and 19,700 pounds of sand had been pumped into the well, most of which then rapidly escaped from the fractured interval and returned to the surface. During the flowback, a substantial amount of sand proppant was sprayed over the backside of the well location. Trees about 30 to 50 yards away had coats of sand plastered on trunks and branches, and there was a solid layer of sand over the rear quadrant of the well site (see Figure 1). “This served to illustrate the potential hazards associated with any stimulation effort, as well as the need for good wellhead arrangement and spectator control” (Frohne, 1978: 5).

Figure 1. Fleck #1 Massive Hydraulic Fracture Treatment Schematic

fleckdiagram

Source: Frohne, 1978

Despite extensive remedial efforts, the treatment had to be aborted, and the well was plugged and abandoned (Frohne, 1978; Piotrowski, Cozart, Heyman, Harper, & Abel, 1979; Piotrowski & Harper, 1979). Following these events, the Pennsylvania Geological Survey published another completion record for this well, dated March 16, 1978 (Piotrowski et al., 1979).


[1] The ERDA was created on Oct 17, 1974 as part of the Energy Reorganization Act of 1974. On October 1, 1977, the ERDA was combined with the Federal Energy Administration to form the United States Department of Energy.

References

Baranoski, M. T. 2002. Structure Contour Map on the Precambrian Unconformity Surface in Ohio and Related Basement Features. Columbus, OH: Ohio Department of Natural Resources.

Frohne, K.-H. 1978. Technical Assessment: Massive Foam Stimulation Attempt in Mercer Co., Pa. Washington, DC: U.S. Department of Energy.

Harper, J. A., & Abel, K. D. 1979. Devonian Shale Research in Pennsylvania: An Update. In R. G. Piotrowski, C. L. Cozart, L. Heyman, J. A. Harper, & K. D. Abel (Eds.), Oil and Gas Developments in Pennsylvania in 1978: 34–43. Harrisburg, PA: Pennsylvania Geological Survey, Fourth Series, Progress Report 192.

Heyman, L., & Cozart, C. L. 1978. Oil and Gas Developments in Pennsylvania in 1977. Harrisburg, PA: Pennsylvania Geological Survey, Fourth Series, Progress Report 191.

Lytle, W. S., Heyman, L., Piotrowski, R. G., & Krajewski, S. A. 1977. Oil and Gas Developments in Pennsylvania in 1976. Harrisburg, PA: Pennsylvania Geological Survey, Fourth Series, Progress Report 190.

Piotrowski, R. G., Cozart, C. L., Heyman, L., Harper, J. A., & Abel, K. D. 1979. Oil and Gas Developments in Pennsylvania in 1978. Harrisburg, PA: Pennsylvania Geological Survey, Fourth Series, Progress Report 192.

Piotrowski, R. G., & Harper, J. A. 1979. Black Shale and Sandstone Facies of the Devonian “Catskill” Clastic Wedge in the Subsurface of Western Pennsylvania. Washington, DC: U.S. Department of Energy.

Piotrowski, R. G., & Krajewski, S. A. 1977. Devonian Shale Research in Pennsylvania. In W. S. Lytle, L. Heyman, R. G. Piotrowski, & S. A. Krajewski (Eds.), Oil and Gas Developments in Pennsylvania in 1976: 33–42. Harrisburg, PA: Pennsylvania Geological Survey, Fourth Series, Progress Report 190.

The Metropolitan Industry #1

Another example of a spud unconventional gas well omitted from the Pennsylvania Department of Environmental Protection’s Act 13 report, this one in the West Falls Formation.

Metropolitan Industry #1

In 1975, Quaker State Oil Refining Corporation completed the Metropolitan Industry #1 in Darlington Township, Beaver County, as a test of the Lower Silurian Medina Group (Harper & Abel, 1979; Lytle, Piotrowski, & Heyman, 1976; Piotrowski & Harper, 1979). The well was drilled to a total depth of 6,666 feet in the Queenston Shale (Lytle, Heyman, Piotrowski, & Krajewski, 1977; Lytle, Piotrowski, et al., 1976). After no gas was encountered in the Medina, the well was plugged back to test the Upper Devonian shale (Harper & Abel, 1979; Lytle, Piotrowski, et al., 1976). There was no natural production from the shale, but after hydraulic fracturing from just above the Onondaga limestone to above the Tully limestone the well initially produced 150 Mcfgepd (Harper & Abel, 1979; Lytle et al., 1977; Lytle, Piotrowski, et al., 1976; Piotrowski & Harper, 1979).

At the time, the Pennsylvania Geological Survey claimed the well “could be a most significant discovery” (Lytle, Piotrowski, et al., 1976: 25), and credited it with discovering the Darlington Field. This enthusiasm proved to be short lived, however, as production declined each day, and by the end of 30 days the well was non-productive (Lytle et al., 1977). “When shut-in, pressure would build up, but on opening up the well, it would blow off to nothing in a short time. Evidently, there was very little original fracture porosity. Gas accumulated mainly in fractures induced when the well was completed by hydraulic fracturing” (Lytle et al., 1977: 23). The well was eventually plugged and abandoned (Piotrowski & Harper, 1979).

Despite being completed on February 6, 1975, “the [well] record was not received until 1976” (Lytle, Piotrowski, et al., 1976: 25–26). In 1977, some two years after it had been completed, the state published the well record (Lytle et al., 1977). The well was originally assigned Permit #BEA-20054 (Lytle et al., 1977). Under current nomenclature, the Metropolitan Industry #1 is known as API #37-007-20054 (Hosterman & Whitlow, 1983; Ryder et al., 2012).

Initially, the Metropolitan Industry #1 was described as having been completed in the Upper Devonian shale (Lytle, Piotrowski, et al., 1976). The following year the Pennsylvania Geological Survey reported the well produced from so-called Zone I facies, “the second major black shale unit in Pennsylvania” (see Figure 1), which was thought to be “approximately equivalent to the Rhine Street Shale of New York” (Piotrowski & Krajewski, 1977: 41). By 1978, the Metropolitan Industry #1 was considered to produce from the “Rhinestreet shale facies” (Harper & Abel, 1979: 38). Finally, by 1979, it was shown that the well completed and produced from the West Falls, Sonyea, and Genesse Formations (see Figure 2) (Piotrowski & Harper, 1979).

Figure 1. Upper Devonian Cross Section Circa 1977

upperdevonian1977

Source: Piotrowski & Krajewski, 1977

Figure 2. Metropolitan Industry #1 Combined Well Logs

metro1logs

Source: Piotrowski & Harper, 1979

References

Harper, J. A., & Abel, K. D. 1979. Devonian Shale Research in Pennsylvania: An Update. In R. G. Piotrowski, C. L. Cozart, L. Heyman, J. A. Harper, & K. D. Abel (Eds.), Oil and Gas Developments in Pennsylvania in 1978: 34–43. Harrisburg, PA: Pennsylvania Geological Survey, Fourth Series, Progress Report 192.

Hosterman, J. W., & Whitlow, S. I. 1983. Clay Mineralogy of Devonian Shales in the Appalachian Basin. Washington, DC: U.S. Geological Survey.

Lytle, W. S., Heyman, L., Piotrowski, R. G., & Krajewski, S. A. 1977. Oil and Gas Developments in Pennsylvania in 1976. Harrisburg, PA: Pennsylvania Geological Survey, Fourth Series, Progress Report 190.

Lytle, W. S., Piotrowski, R. G., & Heyman, L. 1976. Oil and Gas Developments in Pennsylvania in 1975. Harrisburg, PA: Pennsylvania Geological Survey, Fourth Series, Progress Report 189.

Piotrowski, R. G., & Harper, J. A. 1979. Black Shale and Sandstone Facies of the Devonian “Catskill” Clastic Wedge in the Subsurface of Western Pennsylvania. Washington, DC: U.S. Department of Energy.

Piotrowski, R. G., & Krajewski, S. A. 1977. Devonian Shale Research in Pennsylvania. In W. S. Lytle, L. Heyman, R. G. Piotrowski, & S. A. Krajewski (Eds.), Oil and Gas Developments in Pennsylvania in 1976: 33–42. Harrisburg, PA: Pennsylvania Geological Survey, Fourth Series, Progress Report 190.

Ryder, R. T., Trippi, M. H., Swezey, C. S., Crangle, R. D., Jr., Hope, R. S., Rowan, E. L., et al. 2012. Geologic Cross Section C–C’ through the Appalachian Basin From Erie County, North-Central Ohio, to the Valley and Ridge Province, Bedford County, South-Central Pennsylvania. Washington, DC: U.S. Geological Survey, Scientific Investigations Map 3172.

Some Recent Unconventional Shale Research

Recently, I’ve stumbled across a growing number of studies related to various aspects of unconventional shale drilling and hydraulic fracturing, a number of which are specific to the Marcellus Formation. Below are a few highlights:

Estimation of Regional Air-Quality Damages from Marcellus Shale Natural Gas Extraction in Pennsylvania, by Aviva Litovitz, Aimee Curtright, Shmuel Abramzon, Nicholas Burger and Constantine Samaras, in Environmental Research Letters

The Relationship between Marcellus Shale Gas Development in Pennsylvania and Local Perceptions of Risk and Opportunity, by Kai A. Schafft, Yetkin Borlu, and Leland Glenna, in Rural Sociology

Source Signature of Volatile Organic Compounds from Oil and Natural Gas Operations in Northeastern Colorado, by J. B. Gilman, B. M. Lerner, W. C. Kuster, and J. A. de Gouw, in Environmental Science & Technology

Analysis of BTEX Groundwater Concentration from Surface Spills Associated with Hydraulic Fracturing Operations, by Sherilyn A. Gross, Heather J. Avens, Amber M. Banducci, Jennifer Sahmel, Julie M. Panko, and Brooke E. Tvermoes, in Journal of the Air & Waste Management Association

Generation, Transport, and Disposal of Wastewater Associated with Marcellus Shale Gas Development, by Brian D. Lutz, Aurana N. Lewis, and Martin W. Doyle, in Water Resources Research

These studies are all in addition to the 13 articles published as part of Environmental Practice’s December 2012 special issue on hydraulic fracturing.

Paper on Act 13 Reporting Published

Our paper — An Analysis of Unconventional Gas Well Reporting under Pennsylvania’s Act 13 of 2012 — was published in the December issue of Environmental Practice. According to SSRN, the paper has been among the most frequently downloaded papers in the following categories:

In the paper we analyze the extent to which the Pennsylvania Department of Environmental Protection (DEP) complied with its reporting requirements under Act 13. Using publicly available data, we find that the DEP likely omitted between 15,300 and 25,100 unconventional gas wells from its Act 13 report. Left uncorrected, we estimate that Pennsylvania’s state, county, and municipal governments could forfeit fees of $205-$303 million in 2012 and up to $0.75-$1.85 billion cumulatively over the expected life of these wells. We propose the implementation of a relational database and geographic information system as a way for the DEP to fulfill its Act 13 obligations.

The paper’s findings were reported by several newspapers and industry publications, including the Pittsburgh Post-Gazette and Platt’s Gas Business Briefing.

Utica Shale Update

A recent report from the United State Geological Survey (USGS) estimates that the Utica Formation contains a mean of 38 trillion cubic feet (tcf) of undiscovered, technically recoverable natural gas, plus a mean of 940 million barrels of unconventional oil resources and a mean of 208 million barrels of unconventional natural gas liquids.

The estimate of undiscovered natural gas ranges from 21 to 61 tcf (95% to 5% probability, respectively). The estimate of undiscovered oil ranges from 590 million barrels to 1.39 billion barrels (95% to 5% probability, respectively). The estimate of natural gas liquids ranges from 75 to 398 million barrels (95% to 5% probability, respectively).

That makes the Utica Formation the third largest unconventional basin in the United States. By comparison, the USGS has estimated the Marcellus Formation contains 84 tcf of natural gas, making it the largest unconventional gas basin in the United States. The USGS estimated that extracting these reserves would take approximately 110,000 gas wells and another 17,500 oil wells.