ENERGY & RESOURCES AD HOC COMMITTEE

MEETING MINUTES

JUNE 28, 2010

 

** NOT APPROVED **

Members:  K. LaForge, F. Sinclair

 

Others Present:      M. Alger, C. Crandall, K. Dirlam, D. Fanton, J. Foels, J. Garmong, S. Grugel,  M. Healy, J. Margeson, B. Rigby-Riehle

 

1.                  CALL TO ORDER: 

The meeting was called to order by Chairman Kevin LaForge at 11:08 a.m.

 

2.                  APPROVAL OF MINUTES

The minutes from May 19, 2010 were reviewed. On a motion by F. Sinclair, and seconded by C. Crandall the minutes were approved.

 

3.                  GENERAL UPDATES:

·        K. LaForge reported that the NYS Legislature has not passed the Moratorium bill as of now.

·        A CD has been released by a Professor at Cornell University which Fred will work to get copies of.

 

4.                  GUEST SPEAKER:

·        Kevin LaForge introduced Art VanTyne, Geologist, to discuss the Marcellus Shale.

·        Reviewed the history of Geology as a science and the creation of the New York State Geological Survey in 1832. The Marcellus Shale was observed shortly thereafter south of Syracuse in the community of Marcellus as a black shale outcropping.

·        The Marcellus shale is a blanket formation that dips about 1 degree and stretches from Syracuse in the north, west toward Lake Erie and east almost to the Hudson River.  Covers an area well south into Pennsylvania and West Virginia.

·        Hydro Frac [short for hydro fracture] is a term used to describe a method of extracting gas out of the shale using water and chemical additives and sand.

·        In the 1970’s Art worked on an extensive investigation of the Appalachian Basin including the Marcellus Shale and other layers that contain oil & gas.  This information is all readily available through his office in Wellsville. At that time 2 wells were drilled for Houghton College.  One produced 50 million Cubic feet of gas which helped heat the campus.  The other was dry, probably due to errors in drilling and bringing on line.  These wells were using the Trenton-Black River layer.

·        In order to undertake any development of oil & gas reserves extensive seismic work needs to be done to determine the location and best methods of getting the gas out of the ground.

·        In this area the Marcellus Shale is about 50’ thick.  However there is a layer just above that is also a good gas material that is 20’ – 30’ thick for a total thickness of 60’ – 70’ thick useable material. 

·        F. Sinclair asked if there is some gas that is better than others?  The best is pure methane.  Sometimes an upper layer has undergone more chemical breakdown which will decrease the methane available but generally further into the layer it is all good.  There are also varying amounts of hydrogen sulfide.

·        Art discussed Horizontal drilling method wherein the well is drilled down almost to the level of the shale and then makes a curve through the last 500’ to become horizontal with the layer.  Then you can extend line 4,000’ along the layer.  This brings in a much greater area to be tapped than a conventional vertical well.  This does impact lease issues as you can be moving underground almost a mile from the drill site.

·        Hydro Frac is a relatively new technique that is based on the older technique but in much greater scale.  A typical well now requires 60 – 70 truckloads of sand and 40 – 50 tank trucks of water to make it work.  The cost is very high at $3.5 – $5.0 million.  With this kind of investment there is very little room for dry holes.  Early in the life of the drill hole the wells 5 – 6 million cubic feet per day.  After about a year this drops down to around 1 million cubic feet per day. Later the numbers drop down to around 500,000 cubic feet per day.  This can last 30 years.  Investors however want their payback within the first 5 years.

·        F. Sinclair asked if the old Nitro method would be a viable alternative?  Response: Nitro only impacts into the area 4 – 6 feet from the Nitro blast.  The old hydro Frac method impacted up to 600’.  The new Hydro Frac can extend 4000’ when incorporated into horizontal boring.

·        Art discussed slick water that is used in the drilling process.  This is mostly sand and water.  The sand works to keep the pores open and allow the gas to escape.  Other materials are also utilized such as Surfaction [similar material in Prell shampoo], clay stay, and maybe four other compounds.  All of these extras make up less than 1% of the material.

·        F. Sinclair asked if it would be worthwhile to investigate some of the older methods that utilize less water? Art responded that if there was a better system that used less water and materials but yielded similar results the Oil & Gas industry would love to have it and use it.  They have tried air Frac but that hasn’t worked very well.

·        F. Sinclair asked about the Radon in the waste materials. Art indicated the greatest concern there is for the drill workers as it dissipates fairly quickly after being exposed to the air.

·        What can the County do to revitalize the oil & gas industry? NYS is the issue especially NYSDEC which works hard to keep new drilling from happening.  The County has been supportive but so far there isn’t much more that can be done locally by law makers. Art indicated that in NYS 70 – 80% of the oil & gas that was ever in the ground, is still in the ground due to the NYS laws.

 

5.                  OTHER REPORTS:

·        Sherry Grugel reported that she had attended a Business Expo and had brought back much information.  There were many businesses there that are not what one typically thinks about for drilling businesses including: tree removal, tire service, RV dealers, real estate agents, attorneys, printers, welders, etc. Penn State did a study on the economic development impacts of the Marcellus Shale that she will get a copy of.

·        Jerry Garmong reported that Potter County has a program on training for these types of jobs including CDL’s, welders, OSHA training.  There is a WNY training consortium working on developing similar programs. Art VanTyne noted that Chautauqua County JCC’s been doing this type of program already as well as Corning Community College’s offering of a 60 hour training session for Natural Gas workers.

 

ADJOURN:

On a motion by F. Sinclair, seconded by C. Crandall and is carried to adjourn the meeting at 12:18 p.m.

 

Notes as taken by K. Dirlam