The Northeast ONG Marketplace - June 2014 by Northeast ONG

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JUNE 2014

THE HORSEPOWER TO STAY AHEAD IN THE SHALE REVOLUTION

LEGAL & FINANCE - Pages 24-25

Secondary Containment Regulations & Recommended Practices

INDUSTRY INSIGHT - Pages 14-15 Coal Bed Methane - Can it be Done Safely?

ONG SPOTLIGHT - p 3 WATER MANAGEMENT - p 6-11 HEALTH & SAFETY - p 10-11 ENVIRONMENTAL MANAGEMENT - p 12-13 NEW TECHNOLOGY - p 18-19 ALTERNATIVE FUELS - p 28-29

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The Northeast ONG Marketplace

June 2014

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THE ONG SPOTLIGHT America’s Energy Independence and the Role of Water Gary Evans, Chairman and Interim CEO, GreenHunter Resources It would be an understatement to say that the last five years have witnessed a fundamental change in the future of the oil and gas industry as we had previously known it. We have gone from concern of an ever dwindling petroleum supply to the reality that the United States can become energy independent in the near future. This is all due to the technological innovations that continue to reshape our industry today. It wasn’t that long ago that natural gas prices surged to more than twelve dollars per million cubic feet (MCF). Fears of a natural gas shortage plagued the industry and the country as American consumers struggled with potentially higher energy bills from heating and cooling their homes. Then, the combining of horizontal drilling and fracture stimulation technology (fracing) changed everything. Shale formations, previously uneconomic, are now being penetrated and accessed by exploration and production companies all across North America. Since 2008, natural gas production has increased substantially and now represents 40% of all natural gas produced in the United States. Projections of U.S. natural gas demand point to the power sector as the predominant source of future growth, rising to 11.0 Tcf in 2040. While natural gas basins throughout the U.S. contributed to the significant growth, two plays in particular are having a pronounced effect on today’s natural gas supply dynamics; the Marcellus Shale and Utica Shale. The EIA’s most recent report on U.S. Crude Oil and Natural Gas Proved Reserves (May 13, 2014) noted that proved natural gas reserves in Pennsylvania’s and West Virginia’s Marcellus Shale surpassed those in the Barnett Shale to become the largest natural gas shale play in the U.S. with proved reserves of 43 Tcf. Directly under the Marcellus - - approximately 2,000 – 3,000 feet, - - is the Utica Shale, a carbonate formation that has recently produced some of the largest onshore wells the industry has ever seen. Success in this formation however is largely found in the southeastern regions of the play in Ohio and now West Virginia. Unlike its sister natural gas formations - - the Barnett, the Fayetteville and the Haynesville, which require natural gas prices in the five dollar per Mcf to seven dollar per Mcf range to be economic; the Marcellus and Utica Shales can be economically developed and can produce natural gas as low as $2.00 per Mcf. According to the EIA, production from the Marcellus Shale exceeded 12 billion cubic feet per day in 2013 or approximately 2 million barrels of oil equivalent per day. Exploration and development continues to grow in the region. Seeing that it takes upwards of 250,000 bbls of water to frac a well, then the subsequent

transport, treatment, reuse, or disposal of produced water for the life of the well, the opportunities for future growth are enormous for those companies positioned in the water logistics and treatment business. When our affiliate E&P Company, Magnum Hunter Resources made the decision to fully focus on the “Unconventional Shale Resource Plays,” the current and future implications of water’s role in shales some 5 years ago were striking. The recognition of this role and its inevitable growth, led to our decision to assist in the build out of GreenHunter Water in 2011. Initially, GreenHunter began with a focus on water treatment technologies. Soon, we added Class II injection wells, a trucking fleet, and a proprietary, modular above-ground water storage tank (MAG Tank). Once this initial package offering was in place, we spearheaded the movement to barge brine water on navigable waterways in the tri-state area of Ohio, Pennsylvania, and West Virginia, recognizing that the key to being a top competitor as a water solutions provider was adaptation and evolution that paralleled and even stayed ahead of the ever-increasing cost to producers. We spent approximately a year on due diligence of various water treatment technologies, running pilot tests, and meeting with E&P companies to determine where the actual industry demand was headed. E&P companies had a genuine interest in aggressively pursuing water treatment and recycling due to concern for both economics and in the interest of being responsible corporate citizens. The environment in the tri-state area is dynamic, both because of varied access to freshwater and sporadic access to injection wells due to tight formations. Several regions are abundant with freshwater because of rivers and tributaries, which lowers the demand for treatment and reuse. In areas like Pennsylvania, where there are very few commercial injection wells and limited access to freshwater in many regions, there is a greater demand for treatment and reuse. Therefore, a continuous interplay between treatment, use of recycled water, and ultimate disposal of water continues to shake out. For any company to offer end-to-end water solutions in the Marcellus/Utica Shale, the ability to adapt and evolve is the key to staying competitive. The varied dynamics need to be met with varied solutions. As the E&P companies continue to try and find ways to cost-effectively implement their drilling and completion methods, solving their water issues is the mission of GreenHunter Water and the responsibility of water solutions companies on the whole. We must think out of the box and create solutions for an all-inclusive answer to water needs so the E&P companies can concentrate on what they do best, discovering hydrocarbons. The emergence of the United States as a global energy leader could not have been imagined by industry veterans. We are now talking about becoming a net exporter of natural gas (LNG) and most likely even exporting crude oil within the next 3 years. In the past several years, U.S. production of crude oil and natural gas liquids has jumped almost 30% or more than 2 million barrels per day. This makes the U.S. the world’s leading natural gas producer. We are on track to surpass both Russia and Saudi Arabia as a leading producer of oil over the next several years. The energy industry is all about change by applying new technology to improve drilling and completion results. That is why the U.S. is leading the world in energy independence. Due to fracture stimulation technology, water has become a key ingredient. By providing operators with multiple options in how they manage the huge volumes of water necessary to implement these new technologies, we can improve the overall process and cut the cost in order to improve overall efficiency.

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The Northeast ONG Marketplace

ASSOCIATION MEETINGS Flame-Resistant Work Wear

WVONGA Spring Meeting | June 16 - 18, 2014 Glade Springs, WV - www.wvonga.org

sales@lapco.com (800) 385-5380

IPAA Mid-Year Meeting | June 18 - 20, 2014 Colorado Springs, CO - www.ipaa.org

VOGA Summer Meeting | June 25 - 27, 2014 Virginia Beach, VA - www.vaoilandgas.com

OGA Annual Meeting | July 14 - 15, 2014 Columbus, OH - www.ohiogasassoc.org

KOGA Annual Meeting | July 15 - 18, 2014 Louisville, KY - www.kyoilandgas.org

ARTICLES

ADVERTISER INDEX

THE ONG SPOTLIGHT: Gary Evans, Chairman and Interim CEO, GreenHunter Resources..................... 3

ADELMAN’S......................................................... 16 ALPINE ELECTRIC............................................... 16 AMERICAN REFINING GROUP........................... 26 ARCADIA LAND SERVICES................................. 24 BRI-CHEM............................................................ 27 CHANCELLOR INSURANCE................................ 16 CPI SERVICE........................................................ 19 CST INDUSTRIES................................................ 11 CONSOLIDATED PIPE & SUPPLY....................... 30 D&S INDUSTRIAL PRODUCTS............................. 2 DMC DESIGN....................................................... 17 DR WELL SITE..................................................... 16 E-FINITY.............................................................. 16 ERNST SEED........................................................ 21 ETC......................................................................... 5 EWD EAST WEST DRILLING................................ 9 FABRICATED GEOMEMBRANE........................... 26 FALCON TECHNOLOGIES................................... 15 FOSSIL ROCK SERVICES...................................... 4 GLOBAL FABRICATION, INC................................. 7 GLUVCO............................................................... 30 GOODWIN PUMPS - XYLEM............................... 26 GREENHUNTER WATER........................................ 1 GREER INDUSTRIES........................................... 30 INDUSTRIAL TORQUE TOOLS............................ 27 JH TOMBLIN FENCE CO...................................... 17 JM MILLER........................................................... 17 LAPCO FR.............................................................. 4 LEE REGER BUILDS............................................ 17 MACHINERY STREET............................................ 2 MANSFIELD CRANE............................................ 17 MARCELLUS SAFETY CONSULTING.................. 27 MARTLIN DISTRIBUTING................................... 13 MID-ATLANTIC STORAGE.................................. 30 MIDSTREAMPHOTO.COM.................................. 16

WATER MANAGEMENT: 3 Ways to Make Water Flow..................................................................... 6-7 TEEMCO: Offereing Water Solutions for the Shale Plays3 Ways to Make Water Flow......................... 8-9 HEALTH & SAFETY: STEPS Network in the Appalachian Basin............................................ 10-11 ENVIRONMENTAL MANAGEMENT: Power Pellets - Manufactured by............................................ 12-13 INDUSTRY INSIGHT: Coal Bed Methane - Can it be Done ................ 14-15 NEW TECHNOLOGY: All Spoolable Composite Pipes are Created ............................................ 18-19 LEGAL & FINANCE: Secondary Containment Regulations...................................................... 24-25 ALTERNATIVE FUELS: The CNG Light Switch ........................................................................ 28-29

CALENDARS ASSOCIATION MEETINGS................................ 4 TRAINING & WORKSHOPS........................... 16 UPCOMING EVENTS....................................... 20 NETWORKING EVENTS.................................. 26

EVENTS EUOGS................................................................ 21 IOGAWV............................................................... 5 LDC GAS FORUMS.......................................... 29 NAPE SOUTH.................................................... 23 WVOGE............................................................... 23 YOUNG............................................................... 32

MJ PAINTING CONTRACTOR.............................. 30 NEW PIG.............................................................. 25 NORTH AMERICAN FIELD SERVICES................ 13 NUWELD INC....................................................... 30 OIL & GAS AWARDS........................................... 22 OIL CENTER RESEARCH..................................... 27 “O” RING............................................................. 27 PENNINGTON SEED............................................ 13 PPC LUBRICANTS.......................................... 27,17 PSB....................................................................... 13 RIGMAIDS............................................................ 17 SHALE MARKETS................................................ 22 SHANNON SAFETY PRODUCTS......................... 17 SKYCASTERS....................................................... 11 STEEL NATION STEEL BUILDINGS.................... 21 ST!CK................................................................... 16 TEEMCO................................................................. 9 UNIT LINER............................................................ 7 VEYANCE TECHNOLOGIES................................. 26 VIKING OIL TOOLS............................................. 17 WEAVERTOWN ENVIRONMENTAL.................... 16

The Northeast ONG Marketplace P. O. Box 1441 • Oak Hill, WV 25901 855-269-1188 Fax: 304-465-5065 E-mail: info@ongmarketplace.com The Northeast ONG Marketplace will not be liable for any misprint in advertising copy which is not the fault of The Northeast ONG Marketplace. If a misprint should occur, the limits of our liability will be the amount charged for the advertisement. We do not assume responsibility for the content of advertising or articles herein. Any warranties or representations made in the advertisements are those of the advertisers and not The Northeast ONG Marketplace.

June 2014

New Look New Website

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www.ongmarketplace.com

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The Northeast ONG Marketplace

WATER MANAGEMENT

3 WAYS TO MAKE WATER FLOW By: Kristie Kubovic, Director of Communications, Shale Media Group Edited By: Mindy Gattner, Editor, Shale Media Group Photos Provided By: Mustang Oilfield Services & midstreamphoto. com

Water is one of the most important agents on a shale oil and gas well site as it acts as the primary carrier fluid in both the drilling and hydraulic fracturing processes. Hydraulic fracturing is a technique used to drill for and release natural gas and oil from subterranean rock deep under the earth’s surface. A water mixture is first injected into a well site. During the process, this water mixture also mixes with other elements and then returns as flowback water. The vast majority of the time water is not available at a well site and must be transported in. According to Greg Cook, CEO, Mustang Oilfield Services LLC, one horizontal shale gas well exhausts an average of six million gallons of water in the various stages from drilling to hydraulic fracturing. Now-a-days there are three main ways to obtain water: truck, pipeline or recycling. Mustang Oilfield Services LLC is a freshwater and flowback water hauler, based out of St. Clairsville, Ohio that services the Marcellus and Utica Shale regions through two of these methods and is actively pursuing the third. Truck The first method and most common is hauling the water in by truck. If water is not readily available at a well-site or not permitted, shale oil and gas companies will often hire a water hauling company, such as Mustang Oilfield Services, to truck in the necessary water. The water is obtained from various water sources such as lakes, rivers, groundwater and municipal supplies. Most trucks that haul water to a well site hold approximately 100 to 130 barrels of water. The amount of trips to a well-site can be many, but the timing of them varies per well-site and is dependent on site storage, which includes frac tanks, above ground water containment and impoundment ponds. Cook explained, “More water is employed during hydraulic fracturing than during drilling, so the amount of freshwater being hauled in varies; however, with flowback water there is a constant draw, which yields a steady exit of trucks hauling water out.” Pipeline The wear and tear of these water hauling trucks on local roadways leads to the second method for water transfer, pipelines. Cook informed, “The big push going forward is to use temporary pipelines to pump and transfer water short distances from the water source to the well-site. “Due to the impact that frequent truck trips have on infrastructure, producers can save up to 50 percent by using a pipeline to transfer water if the distance is under a couple miles. However, some producers are using pipelines for water transfer for up to eight to ten miles. It all depends on the number of wells and hydraulic fractures to see if the increased pipeline distance is worth reducing the usage of water hauling trucks,” relayed Cook. Recycling A growing trend in the industry and another way to cut back on the amount of

water trucked on and off of a well site, is the third method, recycling the water on site. Companies are developing new treatment technologies to take water that is used in one form of drilling and filter or purify it, so that it may be utilized for other functions. This is the method that Mustang is currently pursuing. Cook added, “This is an area that we are exploring. We have been approached by other companies and feel it would be an added value to our other services.” Cook explained, “With recycling, the flowback water is passed through a micron filter, which separates the solids from the water. This process then allows the filtered water to be utilized at another wellpad, therefore giving it more than one use. This method is becoming more and more common as a way to reduce trucking costs and the amount of water employed in injection wells. Roughly one-quarter to one-third of the flowback water comes back right away. The rest returns over time. However, all of the water gets recycled back and reduces the amount of water needed at the next well, making the process relatively cheaper.” 3 Ways, 1 Result Instead of getting from point A to point B by plane, train or automobile, in this case, it is getting from the water source to the well site by truck, pipeline or recycling. All three play a key part in the shale oil and gas industry. Every producer has different views on how to obtain water and whether to bring it in via truck or pipe and also whether to recycle/reuse it or not. Many times it trickles down to a cost benefit analysis and what is best for wherever the producer is drilling. One item is for certain: no matter how it gets there, for now water will be used in one way or another in the shale oil and gas industry.

Shale Media Group (SMG) is a news, information, education and mapping resource dedicated to the shale oil and gas industries by messaging across video, Internet, publications, events and radio. For more, check out ShaleMediaGroup. com to access all platforms, including: TheMarcellusShale.com, The UticaShale. com, TheShaleAcademy.com and ShaleEnergyNow.com. In addition, join us on June 26th for our next Elite Energy Event in front of the Holiday Inn Express in Bentleyville, PA from 6-9pm. Register or find more details at ShaleMediaGroup. com. Kristie Kubovic is the Director of Communications at Shale Media Group. Contact her at Kristie@ShaleMediaGroup.com.

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The Northeast ONG Marketplace

WATER MANAGEMENT

TEEMCO: OFFERING WATER SOLUTIONS FOR THE SHALE PLAYS By: Kristie Kubovic, Director of Communications, Shale Media Group Edited By: Mindy Gattner, Editor, Shale Media Group Photos Provided By: TEEMCO

Water covers roughly 70 percent of the planet and is one of the most important compounds on Earth. Likewise, water is essential at a well site in the shale oil and gas industry. From fulfilling the needs of workers to acting as the primary carrier-fluid in both the drilling and hydraulic fracturing processes, water is a key ingredient. Realizing the importance of water and increasing environmental regulations affecting the oil and gas industry’s use of water; TEEMCO (Total Energy and Environmental Management Company) created TEEMCO WATER SOLUTIONS, LLC (TWS) with two distinct divisions - the Water Transfer Division and the Well Services Division. TEEMCO is a professional environmental engineering firm, providing engineering, design construction, remediation, and spill response solutions to shale oil and gas, agriculture and marine industries. TEEMCO’s Environmental Division provides engineering services, facility construction and remediation services. The Engineering Services Department creates all types of emergency response plans, spill prevention plans, and air permitting. It also provides field inspection services necessary to create and maintain all required plans and reports. The oil and gas industry is TEEMCO’s core market, in particular, the upstream oil and gas sector.

“Many of the services traditionally performed by roustabout and service companies are now heavily regulated by environmental rules. It’s only fitting that a professional environmental engineering firm like ours would now be providing these services,” pointed out Adam Warmuth, Director of Business Development, TEEMCO. Adams expressed, “TWS has the expertise, equipment and personnel to provide these services with the highest degree of professionalism to protect the health and safety of the oil field workers and of the environment. TWS keeps oil field housing and flowback jobs safe and in-compliance.” TWS’s well services division manages flowback fluids and disposes of waste as required by law. “Our flow hands and water drivers work together to make sure the client is getting the optimal return,” explained Tony Crawford, TWS Division President. Crawford also says the company is looking at ways to reuse, recycle and process flowback on site. TWS services provided on a 24/7 basis include: flowback management, potable water delivery, road spraying, vacuum and winch trucks. In addition TWS is National Sanitation Foundation (NSF) International Certified. The new TEEMCO division is already established in Oklahoma, New Mexico and Texas. TWS will also be available in Colorado and Pennsylvania in the upcoming weeks. In addition, the water solutions division is ready to expand into other shale plays, such as the Utica, Monterey and Bakken where TEEMCO is already an established company in other areas of the shale oil and gas industry. TEEMCO has made considerable environmental contributions and technological advances. With the company’s stewardship of water, more advances will follow.

TWS provides fresh and waste water services and flowback services; both of paramount importance for the shale oil and gas industry. Many people in the industry are unfamiliar with the environmental rules regulating fresh water, waste water and flowback.

“We deliver potable water and remove septic water in support of field operations. Due to the remote locations of most man camps and drill sites, access to fresh water and disposing of waste is not always readily accessible through established public water systems,” explained Bobbie Adams, COO, TEEMCO.

June 2014

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The Northeast ONG Marketplace

HEALTH & SAFETY

STEPS NETWORK IN THE APPALACHIAN BASIN By: Wayne Vanderhoof CSP, President, RJR Safety Inc. National STEPS (Adapted from the website www.natioanlstepsnetwork.org) The National Service, Transmission, Exploration & Production Safety (STEPS) Network is an all-volunteer organization founded in 2003 in South Texas by OSHA and the oil & gas industry in an attempt to reduce injuries and fatalities in South Texas. The effort was successful, and STEPS has continued to grow, currently including seventeen independent networks serving fifteen producing states. Eight of the networks have signed formal alliances with OSHA. The National STEPS Network includes Operators and Contractors in the Oil and Gas Exploration, Production and Product Transmission industry as equally valued members in partnership with OSHA, API, AESC, IADC, IPAA, other trade associations, and educators across the country. The Network’s goal is to serve all producing regions of the United States and to eventually share our philosophy internationally. The overall objective of the National STEPS Network is to promote “…safety, health and environmental improvement in the exploration and production of oil and gas in US onshore operations. The National STEPS Network fosters a work environment that relies upon open communication and trust…” between the Operators and Contractors. There are 21 current STEPS Networks chapters in the continental United States and 3 more that are in the progress of being developed (according the National STEPS Network website as of 5/11/2014). There are 3 STEPS Network chapters in the Appalachian Basin. However, as will be discussed later in the article, there is an additional chapter in the Appalachian Basin that is not currently listed on the website. The STEPS Network chapters meet “...periodically to share and discuss safety, health and environmental incidents, best practices and related issues”, “Establish focus groups to address specific issues”, and to partner with “…other organizations and associations, including but not limited to: OSHA, IADC, API, EPA., educational institutions and others interested in the advancement of worker health, safety, security and the environment.” In the Appalachian Basin there are four local chapters associated with the National STEPS Network. They are the STEPS of PA, Appalachian STESP Network, Buckeye STEPS, and the Twin Tiers STEPS Network. All of the chapters follow a similar scope, mission, and objective as the National STEPS Network. The STEPS of PA (website http://stepsofpa.com/) has been in existence almost three years. The STEPS of PA chapter meets about every two months throughout the year. Topics vary from meeting to meeting yet are timely safety topics recommended or requested by the participants. Representatives from both Operators and Contractors may attend the meetings after responding to an RSVP. There is no charge to attend and no membership fees are paid. All costs are covered through meeting sponsors which are different for each meeting. Over the course of about 4 hours there is instruction, discussion, socializing, lunch, and more instruction and discussions – all centered on worker safety and injury prevention methods.

The Appalachian STEPS Network (website http://appalachiasteps.nationbuilder. com/) focuses on operations within West Virginia and has been in existence almost three years. The local chapter of the Appalachian STEPS Network “…meets the second Thursday of the odd months usually at a location along the I-79 corridor between Bridgeport and Morgantown.” Topics vary from meeting to meeting yet are timely safety topics recommended or requested by the participants. Representatives from both operators and contractors may attend the meetings after responding to an RSVP. There is no charge to attend and no membership fees required. All costs are covered by meeting “The objective is to sponsors which are different for promote safety, health each meeting. Over the course of about 4 hours there is instruction, and environmental discussion, socializing, lunch, and improvement in more instruction and discussions – all centered on worker safety and the exploration and injury prevention methods.

production of oil and gas in the US onshore operations.”

The Buckeye STEPS Network (website http://www.buckeyesteps. org/) encompasses the geographic region of Ohio and welcomes participation and membership from neighbors in West Virginia and Pennsylvania. It has been in existence for about two years. The meetings are held monthly alternating locations. During the even months, it meets in Cambridge, OH and in the odd months the group meets in Canton, OH. There is no charge to attend and no membership fees required. There are no meeting sponsors though some organizations volunteer their facilities to meet and lunch is available for a nominal fee after most meetings at the meeting location. Over the course of about 2 ½ hours there is instruction and discussions centered on worker safety and injury prevention methods. Lunch is voluntary. This group always plans a social event the evening prior to the meeting such as dinner or bowling or similar activities at the participants cost. Twin Tiers STEPS Network (LinkedIn Group Twin-Tiers-STEPS-Safety-Network) includes Operators and Contractors in the oil and gas exploration, production and product transmission industry as equally valued members. Twin Tiers encompasses the geographic region of Western New York and North Western Pa. This group has been in existence for less than six months and is in the process of being chartered by the National STEPS Network. They meet, generally, monthly in Northwestern PA. Each of these STEPS organizations are run by a dedicated group of volunteers. The focus is on worker safety, injury prevention methods, past incident learnings discussions, and provides opportunities for field personnel to talk to other field personnel, safety professionals, Service Companies, Operators, state agencies, and federal agencies to focus on safety in the oil & gas industry. Wayne Vanderhoof CSP wayne@rjrsafety.com 724-809-4234

June 2014

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The Northeast ONG Marketplace

ENVIRONMENTAL MANAGEMENT

POWER PELLETS-MANUFACTURED BY MARTLIN DISTRIBUTING, LLC By: Mike Dorsch, President, Martlin Distributing Having spent several years representing a range of environmentally sound absorbents and bioremediation products, within the industrial/manufacturing industry, we recently found ourselves surrounded by the local oil and gas boom. With this opportunity in front of us we proceeded to introduce our products to the backyard operations as a more effective method of managing the large volumes of drill cuttings generated from each well. PRODUCT EVOLUTIONWhile excited to be supplying materials to the local new market segment, our “core” products were not really a “one size fits all” in terms of performance range. Desiring a more well-rounded and versatile product, and not wanting to be another wood pellet supplier, we set our sights on developing a high performance blend of organic materials, to Power Pellets effectively separate us from the norm. After absorb at a 5:1 ratio, months of detailed research and field testing we settled on a blended and fluids remain product of proprietary ingredients entrapped in the material that is by far the best “back-end” even when subject to product in the industry, offering the lowest cycle cost, in an allvibrations and shifting natural and complete product for during transport. the end user. Our product requires only 10% to manage drill cuttings post shaker. The larger particles contained within our product present a time released action resulting in continued drying efforts as time passes. The longer the mix-off material stands the more dry it becomes thus eliminating separation issues during transportation. CYCLE COST EXAMPLEOur recent exposure to back yard operations provided an education on all the heavy, ineffective and unsafe (in some cases hazardous) solidification materials being used, simply based on unit cost & availability. We quickly learned that cheaper is not always better, here’s why:

such as fly ash, gypsum, kiln dust, high calcium lime and Portland cement are commonly known as “bulking agents” and that’s just what they do. Adding bulk and unnecessary weight provides no redeeming value to the completion efforts. Some of these materials also present hazards to the well site workers. Fly ash based materials, conditioned or not, contain a range of poisons and pollutants unfit for human contact. High Calcium line also presents a range of hazards. Through chemical/thermal reaction, high calcium lime will “cook off ” moisture within a given waste stream by increasing temperatures more than a few hundred degrees instantly. In some cases flash-fire may result when used to manage cuttings that contain hydrocarbons. Airborne particles and dust from High Calcium Lime that come into contact with exposed skin may also cause chemical burns and long term discomfort. Obvious respiratory issues are also a concern when not handled properly. Other materials commonly used are organic in origin and include grass & straw pellets, saw dust, wood pellets, wood chips/shavings, peanut hulls and corn cob. If kiln dried wood pellets may absorb up to 2X’s their weight in liquids. Straw, grass and sawdust hold little to no absorption value and perform more as an adsorbent than an absorbent and may result in leaching/separation when subject to stacking and vibration due to transportation. Peanut hulls and corn cob materials do well but must be shipped in from long distances. Cob material is also in very limited supply and known to be much less effective now than it once was due to a new processing application incorporated to increase available volumes of material. Synthetic drying agents such as super absorbent polymers have been known to be extremely effective, however, they are very selective in their performance and very expensive. Super absorbent polymers perform very well on water or water based solutions but do not manage well at all on solutions containing elevated chloride levels, high or low Ph levels or infused with hydrocarbons. SELLING VALUEAt Martlin Distributing, we believe that providing environmentally safe & sound products to the oil & gas industry that, in fact, result in great value and savings as reflected in the material management, handling, transportation and disposal, substantially closes the gap in reducing our industrial operations footprint. Our Power Pellet product has been so well received in the oil & gas industry that we are in the process of growing our current production to several additional processing facilities, to service western operations. Our current production facility is located within 100 miles of the Pennsylvania line, can produce more than 50 loads per week and, in most cases, can ship next day.

It will require about 20 tons of fly ash to properly solidify 5 tons, or about 1,200 gallons of water. At $30/ton your material cost is $600. The finish weight to be hauled to landfill and disposed of is now 25 tons. Our Power Pellet materials will effectively absorb 5X’s its weight in water so for the same 1,200 gallons you need only one ton of product @ $350/ton. The finish weight is now 6 tons to haul off to landfill and dispose of. Clearly the result benefits are this: ½ the cost of drying agent needed and the haul-off and disposal costs are reduced by more than 70%. Additional savings are related to the reduction in material handling, site storage, over the road trucking, mix-off labor and liability.

CUSTOMER TESTIMONIALAt MAX Environmental, we have used practically every type of solidification reagent in our 57 year history as a landfill operator. Power Pellets is by far the best all natural and cost effective solidification material when it comes to high liquid content waste. Power Pellets effectively absorb at a 5:1 ratio, and fluids remain entrapped in the material even when subject to vibrations and shifting during transport. Chris Morgan Vice President of Sales MAX Energy Services

PRODUCT COMPARISON & HAZARDSWith such a range of materials being used to solidify and manage cuttings and other liquid waste streams generated on a well site, it is at times a daunting task to explain cycle cost to the end user. In some cases the site operators are not made aware of disposal costs resulting from their projects or have little to no time to properly examine or realize the effectiveness of high performance mix-off materials and simply figure why pay more when I can pay less. Mineral based materials

For additional of what our Power Pellet product can do to reduce your mix-off volumes please contact: Mike Dorsch President, Martlin Distributing Dir: 724-316-8780 Mike.dorsch@martlindistributing.com www.martlindistributing.com

June 2014

Page 13

Contact: Martlin Distributing @ 724-316-8780 www.martlindistributing.com

• High performance mix-off material. • Only 10% required for “post shaker” applications • Proven reduction in haul-off & disposal by as much as 80%, and now shipping more than 20 loads per week into local backyard operations. • Ample supply on-hand daily. • Western region facility opening soon. • Isn’t it time to use the best product on the market?

“The ONG Marketplace provides great technical content in a concise & professional format. I look forward to every issue.” - Ken Fleeman, Manager of Engineering ABARTA Energy

“The Northeast ONG Marketplace is a specific to my business. What is says is what we do.” - Tom Button, Industrial Piping Specialists

MORE THAN 2.4 MILLION MILES OF PIPELINE TRANSPORT NATURAL GAS

Custom Purification Systems - Natural Gas Drying & Purification - Regenerative Dryers - Refrigeration Dryers Deliquescent Dryers - Filtration Systems - Custom Fabrication High Pressure Ball Valves - Center Guided Check Valves Specialized Precision Machining Visit us at www.psbindustries.com Call us at 1-814-453-3651

Page 14

The Northeast ONG Marketplace

INDUSTRY INSIGHT

COAL BED METHANE - CAN IT BE DONE SAFELY? By: Gary Rodvelt, Chief Advisor – Global Technical Services, Halliburton Energy Services Natural gas from coal; coal bed methane (CBM) is, aside from the source rock, not so different from natural gas produced from the Marcellus shale. CBM activity has occurred in ~ 22 of the lower 48 states with estimates by Rightmire et al.1 of 400 – 850 Tcf CBM in place. Byrer et al.2 estimated that 90% of all coals in the United States could not be mined under the standards set for their extraction without plans to de-gasify ahead of mining. Can it be done safely? Do we have processes documented that will allow a coal operator to remove the gas prior to long wall mining? Absolutely! Couple mined coals with additional coal seams that will never be mined because they are too thin and you have a commercial operation that can make money selling CBM gas and at the same time improve the safety of mining operations. Our transportation sector is transitioning to compressed natural gas (CNG) vehicles, first in the heavy fleet vehicles such as waste trucks, public transportation buses, and other local business vehicles. Soon we will enjoy “filling stations” that can supply CNG alongside gasoline and diesel. CNG corridors have been identified and stations are being built to alleviate concerns of being stranded without fuel. Automobile manufacturers are offering factory vehicles made to run on CNG. CBM can be a part of this expanding fuel source. What does a client need to do to begin extracting CBM gas from coal? Up front testing using track proven methodology of geologic mapping, coring, desorption testing, and permeability testing, is key, as well as finally setting up a pilot project to determine the optimum spacing of vertical wells. While exploratory programs can take six months to two years to implement, a significant reduction in cost across the project is achieved through identification of the best seams to de-gas and physical location of pilot projects. If the drilling is being done within a mine plan, mining input is needed to locate surface holes for both CBM and gob production. Gob wells provide gas production from the “subsided” area behind mining operations. A good reference book for planning CBM production will be published in August, 2014, by the North American Coal Bed Methane Forum. “Prospect to Pipeline” will compile papers given at the 25th Proceedings- 2010 meeting- detailing

CBM resources, reservoir engineering, cementing and hydraulic fracturing, and production methods that will aid a an operator in establishing CBM production. In most Eastern US basins, vertical wells are based on the primary net footage of coal in the well broken into thin seams spanning 400 – 1000’ of vertical depth. Like conventional oil and gas wells, air drilled holes can be cased with pipe and cemented to protect fresh water aquifers. The stimulation engineer can then determine which coal seams to “couple” together in a “frac stage” and run frac operations from top to bottom of the coal measures. These treatments are much smaller in volume and rate than horizontal completions. Appalachian vertical completions utilize 70% less water as the fluid system would be a nitrogen foam with 30% liquid and proppant. Halliburton has CleanSuite™ chemical additives based on food industry products that can viscosify the fluid, break the fluid, and provide proppant transport to place frac jobs. Ultraviolet light is used in CleanStream® units to kill bacteria rather than chemical additives. These non-damaging, ecofriendly products allow operators to work in shallow coals that contain low total dissolved solids (TDS). In some cases, the area may lend itself to horizontal drilling and completion techniques similar to shale. This is needed when the coal is more “difficult” to frac than a boundary layer; hydraulic fractures will migrate out of the coal and off into non-productive rock. Horizontal drilling can mitigate this by tracking in the better part of the coal seam. Thickness must be greater than 2-3 feet for horizontal drilling. To date in Appalachia, no horizontal coal wells have been fractured; all are multiple laterals from one “mother” wellbore utilizing natural permeability of the coal to produce at economic rates. Multiple laterals spaced appropriate distances apart can drain gas and water low enough to promote gas desorption from the coal matrix. As CBM activity moves into deeper coals with lower permeability, fracturing techniques pioneered in shale completions must be utilized in deep coal completions. Coal bed methane wells are a long-lived gas resource. Halliburton can provide solutions to enhance gas production at any point in the life cycle of the field. We are entering into an age of natural gas fuel, and each American resource should be exploited economically and in an environmentally sound process to provide fuel for generations to come. Conversion of solid coal to a liquid or gas- insitucould be the best environmental solution. This is the challenge for current and next generation “miners” to solve. 1. Coalbed Methane Resources of the United States, Rightmire, C.T., Eddy, G.E., and Kirr, J.N. (eds), AAPG Studies in Geology, Series #17 (1984) 2. Byrer, C.W., Mroz, T.H., and Covatch, G.L.: ”Coalbed Methane Production Potential in U.S. Basins”, JPT (July 1987) 39, No. 7, 821-834.

June 2014

Page 15

Will you be in deep water if it leaks?

Falcon surface mount water impoundments feature a seamless, sprayed-on polymer lining that is superior to HDPE. The Falcon surface mount impoundment uses our proprietary Falcon Liner® technology to create a seamless, durable barrier ideal for water storage in oil and natural gas environments. The modified polymer liner maintains impermeability and puncture resistance under exposure to harsh UV and weather extremes, which results in long life and minimal maintenance. All Falcon products are engineered to protect your investment, the environment and your reputation.

Secondary containment | Water storage Tank bases | Equipment pads | Location liners

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Engineered to protect®

Page 16

The Northeast ONG Marketplace Dependable Power for the Oil & Gas Industry

TRAINING & WORKSHOPS

Flexible • Scalable & Portable • Low Emissions • Low Maintenance Power when and where you need it. Clean and simple.

E-Finity Distributed Generation Power To Be Independent Exclusive Capstone Distributor, E-Finity Distributed Generation Contact Jerry Todd • p 800.730.0011 x122 • www.e-ﬁnity.com

JUNE

JULY

3-6 Gas Operations School Eastern US - TBD www.northeastgas.org/events.html

3 PEC Basic Orientation - SafeLand USA Washington, PA www.rjrsafety.com

5 Energy Industry Training Series Washington, PA www.energytrainingseries.com

8 PEC Basic Orientation - SafeLand USA St. Clairsville, OH www.rjrsafety.com

5 PEC Basic Orientation - SafeLand USA Washington, PA www.rjrsafety.com

17 PEC Basic Orientation - SafeLand USA Washington, PA www.rjrsafety.com

10 PEC Basic Orientation - SafeLand USA St. Clairsville, OH www.rjrsafety.com

AUGUST

17 - 19 Marcellus and Utica Point Pleasant Geosciences Technology Workshop Pittsburgh, PA www.aapg.org 17 - 20 OSHA 5810 – Hazards Recognition and Standards for On-Shore Oil and Gas Exploration & Production Morgantown, WV www.safetyandhealth.ext.wvu.edu 19 PEC Basic Orientation - SafeLand USA Washington, PA www.rjrsafety.com 24 - 25 ShaleComm East Pittsburgh, PA www.shalecommeast.com

800-730-0011 www.e-finity.com

EFinity_BusinessCard_3.2x1.85.indd 1

7 PEC Basic Orientation - SafeLand USA Washington, PA www.rjrsafety.com 12 PEC Basic Orientation - SafeLand USA St. Clairsville, OH www.rjrsafety.com 17 - 22 SEG International Microseismic Technology Workshop Ashville, NC www.seg.org 19 - 22 OSHA 5810 – Hazards Recognition and Standards for On-Shore Oil and Gas Exploration & Production Morgantown, WV www.safetyandhealth.ext.wvu.edu 27 Energy Industry Training Series Washington, PA www.energytrainingseries.com

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June 2014

Page 17 FRACT OR FICTION? Shale gas extraction is not regulated. See the answer on page 22

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Page 18

The Northeast ONG Marketplace

NEW TECHNOLOGY

ALL SPOOLABLE COMPOSITE PIPES ARE CREATED EQUAL…..OR ARE THEY? By: Steve Swanstrom, SoluForce As recently as seven to ten years ago, usage of high pressure reinforced spoolable composite pipe was still in the early adoption stage in North American oil and gas service. Since then, the technology has gained significant acceptance and has displaced a growing portion of Landowners appreciate the low impact that spoolable pipe installation has on their land. steel pipe usage in high pressure applications. These applications include flowlines, gathering lines, produced water lines, water and CO2 injection lines, saltwater disposal lines, and frack water management lines – all of which can be highly corrosive. There are at least five manufacturers of spoolable composite pipe who are active in North America. This paper will identify the value brought by spoolable composite pipe and the various types of technology in the market today. When properly applied and installed, reinforced spoolable composite pipe can provide many years of safe, reliable, and maintenance-free operation. The Value Proposition Usually reinforced spoolable pipe is first tried by the user to solve a corrosion problem. Because the pipe is non-metallic, solving corrosion issues is a key benefit. However, once users see how fast and easy the pipe is installed, they often then select the pipe for economic reasons. The benefits of using spoolable composite pipe also include: • Low installed costs and fast completion of projects. • Very safe because of small installation crews and less equipment on the Right-of-Way. • Low environmental footprint, again due to less equipment and activity on the ROW. • Low ownership costs, Elimination of expensive corrosion inhibitor chemical programs. • No welding, no x-rays, no cathodic protection. • Increased cash flow because production comes on quicker. • Able to handle high pressure and temperatures. • Light weight, low freight costs, easy to handle in the field. • Compliant with industry standards • Proven materials The Technology There are usually three materials used in the manufacture of spoolable composite pipe. The inner liner is usually made of High Density Polyethylene (HDPE), a

material that is corrosion resistant and has many decades of successful experience in low pressure oil and gas service. But HDPE by itself is pressure and temperature limited. Because of its low friction characteristics, HDPE has a higher flow rate than steel pipe of comparable diameters. For example, often an operator can deploy six inch composite pipe instead of eight inch steel pipe and accomplish flows that can satisfy the project requirements. The second material employed is used as a reinforcement material that allows the pipe to now handle higher pressures. The liner travels through a series of winders where the reinforcement wrap is applied at very specific angles. Depending on the pipe manufacturer, the reinforcement material could be braided Polyester, or fiberglass strands, or various types of steel bands and cords. Other reinforcement materials could include carbon fibers and Kevlar® aramid fibers, again, depending on the manufacturer. Some manufacturers wind these various fibers in a dry (or unbonded) process and others use an epoxy to bond the fibers. Either approach has its own merits and should be understood prior to making a purchase decision. The third and final pipe material that is utilized is an extruded HDPE (or other plastic) layer that is used as a protective outer jacket to protect the pipe during installation. Pictured here is one manufacturer’s design, SoluForce®RLP, that depicts a pipe cutaway showing the HDPE liner on the right, the Polyester braided reinforcement wrap in the middle, and the extruded HDPE jacket on the left. All of these materials are fully compatible with the chemistry seen in oil and gas production. Connecting multiple reels of pipe is accomplished by using couplings made of coated carbon steel, stainless steel, and now a totally non-metallic electrofusion coupling has been developed. Pipe terminations are done by installing weldneck or flange fittings, again made of a variety of corrosion-resistant materials. Steel risers can be welded directly to the weldneck fitting if the user wishes to bring steel pipe to the surface. All these fittings are typically installed in the field and most manufacturers provide field service training for the users chosen contractor. The fittings design varies from manufacturer to manufacturer but some utilize a fitting installation process that is pressed in to and then crimped on to the pipe – very similar to a hydraulic hose type of connection.

The real payoff is when the operator gets long lengths of pipe in the ground safely, quickly, and costeffectively. Note the lack of people and equipment normally seen in steel pipe projects. Spoolable pipe requires smaller crews and fewer pieces of equipment.

June 2014 The pipe is fully tested at the plant prior to shipment. Typically a section of pipe is pressured to a burst point that is several times higher than its rated design. The ratings are developed by following stringent industry standards that require extensive long-term testing at high pressure and high temperatures. Other tests include cyclic performance where continuous and constant pressure amplitudes are exerted on the pipe. Axial and circumferential strengths are developed through design and testing of various reinforcement materials and various winding angles of the reinforcement material. Long lengths of pipe are shipped on reels that are then deployed in a variety of installation methods including open trench, surface lines, and plowing. Diameters available range from two inch through eight inch and pressure ratings can be more than 2000psi. A variety of other fittings and accessories are available including T’s and Y’s, threaded terminations, tracer wire, etc. Because of its flexibility, elbows are usually unnecessary. Because of the durability of the outer jacket, padding the trench is usually not necessary. Spoolable pipe can be pigged and hot-oiled if warranted. However, this is usually unnecessary due to the smooth HDPE inner wall. High pressure reinforced spoolable composite pipe should be considered when pressures and temperatures exceed the limits of other low pressure pipe materials. If the project utilizes diameters in the two through eight inch range then it should be considered as a good alternative to steel pipe. Once the project hydrotest is successfully completed, the operator can be assured of safe and reliable operation throughout the project’s design lifetime.

Page 19

T HDPE 4710 COVER

HDPE 4710 Liner

Braided Polyester (PET) Fiber Reinforcement

Pipe is easily deployed with a pick-up truck and trailer.

Authors Note: Thank you to SoluForce®RLP for the use of their photos. For more information, the writer can be contacted at steve.swanstrom@pipelife-jetstream. com or by visiting www.soluforce-rlp.com

HYDRAULIC FRACTURING WILL ACCOUNT FOR NEARLY 75 PERCENT OF NATURAL GAS DEVELOPMENT IN THE FUTURE

Page 20

The Northeast ONG Marketplace

UPCOMING EVENTS JUNE

AUGUST

20-22

The Utica Capital Series – Midstream

NAPE South

North Canton, OH | www.cantonchamber.org

Houston, TX | www.napeexpo.com/nape-shows/nape-south

16-18 Cyber Security for Oil and Gas Houston, TX | www.oilandgasiq.com

16-18 LDC Gas Forums – Northeast Boston, MA | www.ldcgasforums.com

21-22 Frac Sand Supply and Logistics Conference San Antonio, TX | www.petroleumconnection.com/sand

SEPTEMBER

17 Northern Tier Marcellus Shale Business Expo Mansfield, PA | www.ntmarcellusexpo.com

8-10 U.S. GTL Congress Washington, DC | www.oilandgasiq.com

24-25 ShaleComm East Pittsburgh, PA | www.shalecommeast.com

JULY

8-10 AAPG/SEG Fall Expo Houston, TX | www.seg.org

9-11 NGL Gold Rush Summit Cleveland, OH | www.infocast.com

9-10

9-11

IOGAWV Annual Oil and Gas Equipment Show Buckhannon, WV | www.iogawv.com

Petroleum Innovation Expo Houston, TX | www.piexpo.net

21-23 ASCE Shale Energy Engineering Conference

10-11

Pittsburgh, PA | content.asce.org/conferences

YOUNG 2014 Youngstown, OH | www.regionalchamber.com

22-23 PIOGA Pig Roast, Equipment Show and Conference

18 SOOGA Fall Trade Show

Seven Springs, PA | www.pioga.org

www.sooga.org

PA Gas Expo

Northern Ohio Energy Management Conference

Indiana, PA www.pagasexpo.com

Akron, OH | www.mecseminars.com

24-25 Shale Insight 2014 Pittsburgh, PA | www.shaleinsight.com

Denotes National Event

Visit our website for links to these events

WWW.ONGMARKETPLACE.COM/EVENTS

June 2014

Page 21

MARCELLUS • UTICA ANTRIM • NEW ALBANY Each month over 10,500 professionals receive a free copy of The Northeast ONG Marketplace, the only publication that covers all of the shale plays in the northeast U.S. oil and gas industry. Our affordable rates allow large and small businesses alike to let the industry know that you are here to do business.

THE NORTHEAST ONG MARKETPLACE 855-269-1188 • 304-465-6640 info@ongmarketplace.com www.ongmarketplace.com

Eastern

UNCONVENTIONAL OIL & GAS

THE WORLD’S SAFEST, COOLEST, MOST QUIET COMPRESSOR STATIONS

Symposium 2014

November 5-7, 2014

Lexington, KY , Hilton Lexington Hotel

Call for Papers (1 to 2 pp abstract) due August 15

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Design • Manufacture • Erect Sound Mitigation & Air Handling ISNetworld Certified

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SHALE GAS IS SIMPLY NATURAL GAS THAT COMES FROM SHALE FORMATIONS INSTEAD OF OTHER ROCK

Page 22

The Northeast ONG Marketplace

2013 Northeast Winners Congratulations The Award for Drilling Excellence – Baker Hughes

The Progressive Global Energy & Natural Resources Future Industry Leader Award – Brandon Davis of URS Corporation

The New Technology Development of the Year Award (General / Products) – HalenHardy, LLC

The General Industry Service Award – Resource Environmental Solutions

The Oilfield Services Company of the Year Award – Halliburton

The Award for Excellence in Environmental Stewardship – Anadarko Petroleum Corporation

The Progressive Global Energy & Natural Resources Industry Leader Award – Dave Spiegelmeyer of The Marcellus Shale Coalition

The Recruitment Agency of the Year Award - Drill Baby Drill Staffing

The Award for Excellence in Health & Safety (Operational) – Range Resources Corporation

The Industry Supplier of the Year Award – Total Equipment Company

The Oil & Gas Financial Journal Transaction of the Year Award – Eclipse Resources

The Specialty Industry Supplier of the Year Award – The National Lime & Stone Company

The TEEMCO E&P Company of the Year Award – Range Resources Corporation

The Law Firm of the Year Award – The Law Offices of Cara C. Davis

The Trucking Company of the Year Award – QC Energy Resources

The Manufacturer of the Year Award – Worthington Industries

The Water Management Company of the Year Award – Hydro Recovery LP

The Award for Excellence in Corporate Social Responsibility – Range Resources Corporation

The Award for Excellence in Health & Safety (Products) – Cartasite The Preferred Technology Award for Excellence in Well Completion – FTS International The Construction Company of the Year Award – Cenergy, LLC The Consultancy of the Year Award – McTish, Kunkel & Associates The Engineering Company of the Year Award – Civil & Environmental Consultants, Inc.

The IPS Engineering / EPC Midstream Company of the Year Award – NiSource Midstream Services The New Technology Development of the Year Award (Software Application) – TEEMCO

Shale gas extraction is not regulated.

FICTION

Helping Companies to do More Business in the Oil & Gas Industry

An extensive set of laws govern and regulate various aspects of shale gas development through many different and often interconnected regulatory bodies. In the United States, these include: the National Environmental Policy Act, the Clean Water Act, the Clean Air Act, the Safe Drinking Water Act. International Gas Union #fractorfiction

IF INTERESTED IN ADVERTISING IN THE ONG MARKETPLACE, CONTACT US AT INFO@ONGMARKETPLACE.COM

June 2014

Page 23

34th Annual Summer Meeting July 16-17, 2014 Technical Sessions, Golf & Sporting Clay Tournaments, Barbecue and Equipment Show

Peek’n Peak Resort & Conference Center 1405 Olde Road, Findley Lake, NY 14736

2014 August 20–22

george r. Brown Convention Center Houston, tX

Hotel reservations: 716-355-4141 - mention IOGA of NY for room block & rates.

Wednesday, July 16th 8:15 am – 3:45 pm: Technical Session 5:00 pm: Fundraiser Reception for NYS Governor candidate Rob Astorino 7:00 pm: Get Acquainted Cocktail Reception

Thursday, July 17th

8:00 am: Golf Tournament (Over $5,000 in prizes!) Scramble or Play your own ball 9:00 am: Sporting Clays Tournament at Critter Path (Cash prizes) 12:00 pm: 34th Annual Barbecue & Oilfield Equipment Show Lunch and dinner provided. Vendor displays, great food, door prizes & music throughout the day! Outdoor Exhibiting is available on July 17th during the Barbecue. NO FEE for exhibits but registration form and barbecue ticket required. For more information on the meeting and sponsorship opportunities please visit the IOGA of NY website at: www.iogany.org / Events or call our office.

Golf and Meeting Sponsorships available! 38 Lake Street, Hamburg, NY 14075 · 716-202-4688 · 716-202-4689 fax

#NAPE_South2014

HYDRAULIC FRACTURING HAS BEEN USED FOR STIMULATING THE FLOW OF WATER FROM WATER WELLS

Page 24

The Northeast ONG Marketplace

LEGAL & FINANCE

SECONDARY CONTAINMENT REGULATIONS AND RECOMMENDED PRACTICES By: Beth Powell, Vice-President and General Manager, New Pig Energy There have been numerous studies regarding hydraulic fracturing and groundwater contamination. Surface spills, however, are one area where industry, regulators and environmentalists tend to agree on the risk. Sources of oil, fracturing fluid and flowback spills at the pad include the drilling rig, mud tanks, diesel tanks, frac tanks, sand kings, generator sets, light stands, contractor vehicles, and blowouts at the wellhead. The risk of surface spills can be mitigated by secondary containment, which is a safeguarding method in addition to the primary containment system (storage tanks, pipes, drums, blowout preventer). Depending on the liquid, secondary containment may be required by federal and state regulations. Common secondary containment options include dikes, berms, curbing, retention ponds, sorbent materials, drip pans, sumps, and collection systems. Types of Secondary Containment There are two types of secondary containment, according to the federal definition: specific and general. Specific secondary containment requirements are intended to address a major container failure (the entire contents) associated with a bulk storage container, single compartment of a tank car or tank truck, mobile/ portable containers, and production tank batteries. Provisions explicitly provide requirements for sizing, design, and freeboard (rainfall accumulation). General secondary containment requirements are intended to address the most likely discharge (typical failure mode and the most likely quantity) from bulk storage containers, mobile/ portable containers, production tank batteries, and oil-filled operational equipment. The systems can be passive (does not require human intervention to function) or active (does require human intervention). Due to the large volumes in the diesel tanks and frac tanks involved in drilling and completions, their secondary containment tends to be passive, such as liner and/or berm systems. Active measures such as vac trucks, spill trailer and absorbents are unlikely to be deployed in time to prevent a large spill from leaving the pad. Federal SPCC Regulation The major federal regulation regarding oil storage at well sites is the Spill Prevention, Control and Countermeasure (SPCC) Rule. This rule is part of the Clean Water Act’s Oil Pollution Prevention Regulations (40 CFR 112). The purpose of SPCC is to develop plans designed to prevent oil discharges from reaching the navigable waters. These plans should include containment and procedures to prevent oil discharges; proactive control measures to keep

an oil discharge from entering navigable waters; and effective countermeasures to contain, clean up, and mitigate any oil discharge that affects navigable waters. SPCC only regulates oil. But, it is oil of any kind or in any form, including petroleum oils, greases, fuel oil, sludge synthetic oils, mineral oils, oil refuse, oil mixed with waste, natural gas drip or condensate, synthetic, hydraulic, lubricating, and mineral oils. A good rule of thumb is if a substance coats or floats, it is probably an oil. Not included within the SPCC definition of “oil” is natural gas and highly volatile liquids that volatize on contact with air or water (liquid natural gas and liquefied petroleum gas). Pennsylvania Act 13 of 2012 Due to SPCC, secondary containment for drilling mud, diesel tanks and fracturing additives is common practice in most plays, unless drilling in an arid location that is unlikely to discharge to navigable waters. The use of liners under the drilling and completion operations, however, started out as industry’s response to limit state violations for surface spills to ground. It is important to point out that federal regulations trigger a violation when navigable waters are impacted (surface sheen), but Pennsylvania’s trigger is a spill to ground, not to water. According to the PA Spill Policy (550-5000-001), the reportable quantity is five gallons outside of secondary containment. Above 42 gallons inside secondary containment, notification is requested. Act 13 not only encompasses the oils used on site; it brings flowback water under secondary containment regulation. As such, Pennsylvania now has the strictest secondary containment regulations for the Marcellus and Utica plays. The containment plans required in Act 13 are called Master Containment Plans (MCP). These detailed plans should include the installation, utilization, integration and maintenance plan of all potentially used containment systems, as well as manufacturer’s specifications on materials used, installation directions, maintenance requirements, chemical compatibility, warranted uses and reuse/ disposal considerations. The MCP should state how the secondary containment system will be used in practice, either as local containment or as complete containment. Local containment is only deployed at the site of the reservoir (tanks), such as diesel fuel tanks, chemical tanks, roll offs, drilling rigs and trucking transfer stations. Complete containment is deployed for the entire well pad. Typically, a hybrid approach is used with some local containment and some large-area containment. In either case, the liner should be 1) durable, 2) impervious, and 3) chemically compatible with the liquid. Durability is needed to support the weight and traffic of heavy equipment, such as drilling rigs, frac tanks, and trucks, without punctures and tears. Impervious means that the system does not leak and is able to hold the liquid until clean up can occur. To be chemically compatible, the liner’s physical and chemical characteristics must not be adversely affected by the waste.

June 2014

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ALTERNATIVE FUELS

THE CNG LIGHT SWITCH By: Kristie Kubovic, Director of Communications, Shale Media Group Edited By: Chris Stroyne, Editor, Shale Media Group Photos Provided By: Beemac Trucking

Compressed Natural Gas (CNG) is domestically abundant, clean, safe, quiet, powerful, efficient, affordable and economical for the United States. It offers America energy security, and perhaps more importantly, is catching on across this country. Currently, there are just over 700 public CNG refueling stations in the United States. CNG has already caught on in other portions of the world. Bob Beatty, President, “O”Ring CNG Fuel Systems, pointed out, “The rest of the world uses CNG. Iran, which is the size of New Jersey, has over 2.8 million CNG vehicles. Currently, the U.S. has a little over 100,000 CNG vehicles. Natural gas is our opportunity. It offers energy independence and is green.”

8 vocational trucks. We are committed to transitioning our diesel fleet to CNG. In 2012, natural gas vehicles represented 80 percent of our annual new truck purchases, and we will continue in that mode for the next five years. Our fleet currently includes more than 2,000 natural gas trucks, the largest of its kind in the waste industry,” explained Amanda Marks-Cunningham, Public Affairs, Waste Management. Explaining the environmental and economic benefits of natural gas usage, MarksCunningham related, “For every diesel truck we replace with natural gas, we reduce our use of diesel fuel by an average of 8,000 gallons per year along with a reduction of 22 metric tons of greenhouse gas emissions per year (based on replacing diesel trucks that are 2006 and older). Our vehicles powered by CNG emit nearly zero air particulates, cut greenhouse gas emissions (based on replacing diesel trucks that are 2006 and older) by nearly 25 percent and are far quieter than their predecessors. Unlike diesel, most natural gas is produced domestically and provides a great opportunity to stimulate our economy throughout the supply chain. We are seeing more companies switch to natural gas as both an environmental and economic, sustainable practice.” Not only has Waste Management adopted CNG into its fleet, but it has also constructed its own CNG stations to fuel that fleet. Waste Management operates 40 fueling stations in North America and has one located in the heart of the Marcellus Shale at its Washington, PA site. Their CNG fueling stations are open 24/7 and available for public access.

Companies from Frito Lay to UPS and Giant Eagle are seizing this opportunity and making the switch to CNG. Beatty says, “High fuel use vehicles with return to base operations, repetitive routes or pre-set geographic operating areas are ideal to make the changeover. There are numerous CNG applications, including: airports (buses, shuttles, taxis, ground vehicles), refuse (trash haulers, recycling trucks), transit (city buses, maintenance, shuttles), short haul (food/beverage distributors, postal trucks, newspaper, uniforms, dry-cleaning, florists, service vehicles), utilities and energy (gas, electric, water, communication vehicles) and small businesses with fleets.” Waste Management and Beemac Trucking, two national companies with ties to the Marcellus and Utica Shale region, fall into these categories and are prime examples of the switch to CNG. Waste Management has already made the changeover, while Beemac Trucking is currently undergoing the transition. Waste Management: Already There Serving more than 20 million customers, Waste Management, a waste management, comprehensive waste and environmental services company, is the largest environmental solutions provider in North America. The company also has the largest trucking fleet in the waste industry. Additionally, Waste Management is a pioneer in the use of natural gas, utilizing it since the early 1990s. “Waste Management is a national leader in the use of alternative fuels for Class

Beemac Trucking: On Its Way Beemac Trucking, a long-haul, steel hauling, flatbed carrier and logistics company, headquartered in Ambridge, PA, provides services to customers throughout North America. “We were the ideal candidate for the CNG conversion due to the size, distance traveled and amount of gas consumed by our trucks,” explained Dave Dudo, Senior Vice President of Operations, Beemac Trucking. The trucking company purchased 20 Volvo tractors with 12-liter Cummins Westport engines that are OEM (Original Equipment Manufacturer) CNG. “We would have liked to have done this sooner; however, with the nature of the industry, hauling heavy loads of 70,000 to 80,000 pounds, this was the first engine capable of doing that,” relayed Dudo. Previously, companies like Giant Eagle were using an 8.9-liter engine, which was not enough horsepower for what Beemac was hauling. Not only is BEEMAC moving ahead with CNG trucks, but they are also building a CNG refueling facility in Ambridge. They will be the first flatbed carrier in U.S. to construct a CNG fueling station. In addition, it will be the first in Beaver County and one of only a handful across southwestern Pennsylvania. The station will also be open to the public 24/7. BEEMAC is changing their trucks to CNG and building a CNG refueling station for several reasons. Ron Phelps, Director of Operations, Beemac Trucking, expressed, “We decided about three years ago to look at optimizing CNG for our fleet in an effort to go green. Plus, fuel cost will be cheaper. In the long run, the trucks should help pay themselves off much quicker than if they were diesel products.” Dudo added, “It’s affordable and feasible to use alternative fuel. With a cleaner burning engine, it reduces greenhouse emissions and produces cleaner air for our children and grandchildren. Plus, we could rely less on foreign oil, which is important, especially

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June 2014 when we’re sitting on top of the Marcellus Shale. Plus, cleaner burning engines are better for the air—they’re not even comparable to diesel, and the cost to fill a CNG truck is approximately half the cost of a diesel unit. There is an upfront expense, but it is worth it in the long haul.” CNG offers a significant cost savings for the consumer. For example in the midAtlantic, gas is currently running around $3.70/ gallon, while diesel fuel is sitting near the $4.15/ gallon mark. However, the equivalent for CNG offers a savings of about half— costing approximately $2.00/gallon. For others interested in the process, Dudo related important steps, such as permitting, engineering and training, along with also knowing the size, location and pressure of CNG lines. Dudo shared his experiences with the process of building a CNG refueling station. He stated permitting takes time and recommended doing homework to find good quality engineers, equipment providers and construction crews that are all solid and reliable. In terms of advice to others, Dudo suggested crunching the numbers and doing the math to see if CNG is right for you, whether

you’re an individual or a large company. It is important to look at your monthly/ yearly fuel costs along with the cost of equipment. It is a lot of capital upfront, but the biggest users will have the fastest return on investment based on mileage ran and gallons consumed. Plus, grants are often available. Beemac is very close to completing their CNG station. They are just two compressors shy of concluding the project. The two main compressors are the last items set to arrive. Beemac is hoping the station will be available by early July. CNG: Coming Soon CNG is abundant, clean, safe, quiet, powerful, efficient, affordable, and economical; it is the way of the future that is present now. Plus, the number of CNG stations is expected to grow exponentially in the coming years. In today’s business environment, companies must adapt to succeed in business and go with the market demands. CNG is one avenue helping companies succeed. Stay tuned as more companies think about and flip the switch to CNG.

19 TH ANNUAL

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