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THE ONG SPOTLIGHT - Page 3
A Message from Toby Z. Rice, President and COO, Rice Energy
WATER MANAGEMENT - Pages 6-7 ClO2 - Baker Hughes Gives the Facts
CHANGE SERVICE REQUESTED
MARCH 2014
HEALTH & SAFETY - p 10-11 ENVIRONMENTAL MANAGEMENT - p 14-15 INDUSTRY INSIGHT - p 18-19 NEW TECHNOLOGY - p 22-23 LEGAL & REGULATORY - p 24-25
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The Northeast ONG Marketplace
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In collaboration, Shale Media Group and The ONG Marketplace have worked hard to re-design our March edition and welcome your feedback. Enjoy! If you have any comments, questions or suggestions for the next edition, please email us at info@shalemediagroup.com or call 215-317-1177.
March 2014
Page 3
THE ONG SPOTLIGHT A Message from Toby Z. Rice, President and COO, Rice Energy, Inc.
On behalf of Rice Energy, I am proud to be a part of the oil and gas industry and am doing what I can to bring our nation closer to energy independence. An integral step in this journey towards energy independence is support from the communities in which we operate. Rice Energy and its team of 150 hard-working Americans are committed to informing, educating and speaking up on behalf of the industry. The Marcellus Shale and Utica Shale plays are generating jobs and economic prosperity to hundreds of thousands of residents in Pennsylvania, Ohio and West Virginia. The voices of these people, and the positive impact that shale development has had on their lives, is not heard loud enough at the local and state government level. As members of the oil and gas industry, it is incumbent on us to vocally express our support on our march towards energy independence. Th is nation became the greatest in the world because it fought its own fights. We cannot assume that someone else will fight for what we believe is just. We encourage you to speak up for what you believe is right for your state, county and local municipality. Whether it is attending local community meetings or explaining to your friends and neighbors how shale development has positively
benefitted your life and those within your community, we must all be involved in spreading this message. Publications like ONG Marketplace bring the oil and gas producer and contractor communities closer together. I am proud to support this industry and trust you will join me in making sure the voice of this industry’s supporters is heard loud and clear across our communities.
Toby Z. Rice will speak at the Ohio Valley Regional Oil & Gas Expo April 30 - May 1, 2014 • www.ohiovalleyoilgasexpo.com
Rice Energy began trading on the New York Stock Exchange (NYSE) on January 24, 2014 under ticker symbol ‘RICE’. On Monday, February 24, executives and guests of Canonsburg, Pennsylvania-based Rice Energy visited the NYSE, where Toby Z. Rice (center), President and Chief Operating Officer, rang the NYSE Opening Bell.
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The Northeast ONG Marketplace
ASSOCIATION MEETINGS
Shale Media Group Monthly Events
MARCH 2014
3/28
Elite Energy Event
2014 OOGA Winter Meeting | March 5 – 7, 2014 Columbus, OH - www.ooga.org
OVOGA General Membership Meeting | March 18, 2014 St. Clairsville, OH - www.ovoga.org
3/27
Sweetening up the Shale
OGIS New York | April 7 - 9, 2014 New York, NY - www.ipaa.org To register or for more information on the events, go to shalemediagroup.com
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
3/26
Elite Crew Change
ARTICLES
ADVERTISER INDEX
THE ONG SPOTLIGHT: A Message from Toby Z. Rice, President and COO, Rice Energy, Inc. ............ 3
ALPINE ELECTRIC ........................................... 12
RIGMAIDS ......................................................... 16
AMERICAN REFINING GROUP..................... 12
SAMCO ENTERPRISES .................................. 12
WATER MANAGEMENT: Chlorine Dioxide (ClO2)
BRI-CHEM ......................................................... 21
SHALE MARKETS ............................................ 15
Oil and Gas Applications: The Facts .................... 6-7
CPI SERVICE .................................................... 19
SHALE MEDIA GROUP................................... 23
HEALTH & SAFETY: Focus on Personal Protective Equipment - Hearing Protection ..... 10-11
CHANCELLOR INSURANCE ............................ 5
SHANNON SAFETY PRODUCTS .................. 12
CST INDUSTRIES ............................................ 13
SKYCASTERS ................................................... 23
ENVIRONMENTAL MANAGEMENT: Thermal Oxidizers for Natural Gas Industries Compliance Issues Facing Midstream Production ............... 14-15
D&S INDUSTRIAL PRODUCTS .................... 17
STEEL NATION STEEL BUILDINGS............. 19
DR WELL SITE ................................................. 16
ST!CK ................................................................. 16
ERNST SEED .................................................... 23
SUNNY SIDE SUPPLY....................................... 8
INDUSTRY INSIGHT:
ETC ....................................................................... 7
TECTONIC ......................................................... 11
FAIRMONT SUPPLY ........................................ 11
THE SHALE ACADEMY.COM........................... 5
FOSSIL ROCK SERVICES .............................. 12
UNIT LINER ........................................................ 9
GAS FIELD SERVICES, INC ............................ 1
V-F CONTROLS ................................................ 12
GOODWIN PUMPS - XYLEM ........................ 12
VEYANCE TECHNOLOGIES ........................... 21
JM MILLER .......................................................... 5
WEAVERTOWN ENVIRONMENTAL ............. 16
The $100,000 Hammer ................................... 18-19
NEW TECHNOLOGY:
Economics of Electronic Gas Measurement..... 22-23
LEGAL & REGULATORY:
The Red Tape of Water Hauling ....................... 24-25
CALENDARS
KEYSTONE CLEARWATER SOLUTIONS..... 16
ASSOCIATION MEETINGS............................... 4 TRAINING & WORKSHOPS .......................... 16 UPCOMING EVENTS ...................................... 20 NETWORKING EVENTS ................................. 21
LAYFIELD ............................................................ 2
EVENTS
MANSFIELD CRANE ......................................... 5
OHIO VALLEY OIL & GAS EXPO ................. 13 DUG EAST ......................................................... 26 EGCR .................................................................. 15 ELITE ENERGY EVENT ................................... 15 PIOGA’S CONFERENCE ................................. 25 NAPE EAST ....................................................... 28 OIL AND GAS AWARDS ................................... 8 UTICA-MARCELLUS INFRASTRUCTURE ... 15
MIDSTREAM PHOTO.COM ........................... 11
KUHNS BROTHERS .......................................... 5 LEE REGER BUILDS.......................................... 5 LEE SUPPLY........................................................ 5 MACHINERY STREET ..................................... 17 MID-ATLANTIC STORAGE ............................. 12 MJ PAINTING CONTRACTORS ....................... 5 NORTH AMERICAN FIELD SERVICES ........ 12 PENNINGTON SEED ....................................... 15 PPC LUBRICANTS ........................................... 16 PSB ....................................................................... 5 QUALITY BRIDGE AND FABRICATION ....... 12
CONTACT US FOR ADVERTISING, INFORMATION OR MAILING LIST CHANGES:
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.
March 2014
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WATER MANAGEMENT
CHLORINE DIOXIDE (ClO2) OIL AND GAS APPLICATIONS: THE FACTS By: Charles Kozora, Account Manager, Baker Hughes Morgan McCutchan, Technical Manager, Baker Hughes Steve Monroe, Product Line Manager, Baker Hughes
Introduction Chlorine dioxide (ClO2) has been used in oil and gas applications and in refineries for decades with overwhelming success. It has been shown to be an effective environmentally preferred method to treat water in tanks, reserve pits, impoundments, and ponds, while consuming less energy and reducing manpower needs compared to alternative solutions. The application of an aqueous solution of ClO2 efficiently neutralizes APB and SRB bacteria, hydrogen sulfide, iron sulfide, phenols, and mercaptans in source, flowback, and produced waters. As an example, Baker Hughes’ H2prO™ HD water management units are mobile self-sustaining ClO2 treatment units. In 2013 these units successfully treated more than 500 wells across most major shale plays in the U.S. This success equates to more than 50 mm bbls of water treated in the last 18 months for use and reuse. Locally, these units have been mobilized in both the Marcellus and Utica shale formations for multiple clients with continual water treatment success. Even with extensive field success and a demonstrated safety record, there is still confusion about using ClO2 for oil and gas applications. With that in mind, here are a few facts to clarify key information about this technology.
Fact #1: ClO2 is safe Much of the safety concerns with ClO2 center upon the perception that it is flammable. While ClO2 gas at concentrations above 10% in air is mildly volatile (i.e. it ”puffs”), today’s modern equipment generates ClO2 in an aqueous solution (liquid) at a maximum concentration level of 3000ppm (0.3%), eliminating the hazard. As an additional safety feature, Baker Hughes’ H2prO HD unit uses a 3-precursor vacuum-based eductor system that generates ClO2 in-situ with any water source. Water passing through an eductor creates a vacuum that causes the precursors to flow. When no water flows, no chemicals flow and no ClO2 is created. When water flows, chemicals flow and a ClO2 solution in water is created. This process ensures safe and efficient generation of the ClO2. Fact #2: ClO2 does not affect pH or performance of hydraulic fracturing fluids While a 3000ppm ClO2 solution is slightly acidic, the dosage levels used have a negligible effect on water pH. As an example, more than 228 stages have been completed in the Eagle Ford with an average pH of 8.0. With more than 500 wells completed to-date (with many Marcellus and Utica wells) using the H2prO HD units, no problems have been exhibited with any hydraulic fracturing fluid system. A much more in-depth evaluation on the non-effect of ClO2 on the performance of the slick water friction reducers is discussed in a white paper by Baker Hughes. This paper is available upon request. Fact #3: ClO2 is not corrosive For the application concentrations used in the field, ClO2 is less corrosive than
March 2014 almost any acid used in hydraulic fracturing. To better understand the concerns, however, Baker Hughes examined 12 common oilfield metals in our laboratory and exposed them to 3000 ppm ClO2 solution for 24 hours at 150 F and measured the corrosion index. Results were well within acceptable standards for corrosion. Specifically, a 0.03 index (lbs/ft2) was observed, which is well below an industry accepted standard of 0.05. Fact #4: ClO2 does not create THMs in water Trihalomethanes (THMs) are carcinogenic and thus the avoidance of their formation is essential. THMs are formed in the presence of an active halogen. However, in the case of ClO2, it is oxygen, and not the chlorine halogen, which is the reactive species. Therefore, ClO2 has no effect on the formation of THMs. Fact #5: ClO2 does not chlorinate water Chlorine is not introduced into the water by ClO2 creation. As dictated by the chemical reaction, the only by-product of the ClO2 generation is sodium chloride (NaCl). Note that three precursor systems are more efficient and introduce less NaCl into the water than two precursor systems. Fact #6: ClO2 is environmentally preferred ClO2 is used widely in the U.S. food preparation industry; in Europe for drinking water treatment; and is gaining use in the United States for drinking water
Page 7 treatment. It is approved by both the EPA and FDA. ClO2 could be considered one of the most environmentally preferred products available for the industry for bacterial control. Conclusion Locally, adoption of this technology and process has enabled local clients to successfully treat 4.1 MM bbls of water in the Marcellus and 4.2 MM bbls of water in the Utica for use and reuse in their operations. In summary, ClO2 is a safe, effective, and economic solution for treating any water source for use in hydraulic fracturing. Knowing the facts will help everyone in capitalizing on its numerous benefits. For more information, contact: Chuck Kozora Account Manager – Northeast Baker Hughes | Water Management 400 Technology Drive, Canonsburg, PA 15317 charles.kozora@bakerhughes.com Office: 724-514-5235 Mobile: 412-496-4069
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The Northeast ONG Marketplace
WWW.ONGMARKETPLACE.COM
March 2014
Page 9
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The Northeast ONG Marketplace
HEALTH & SAFETY
FOCUS ON PERSONAL PROTECTIVE EQUIPMENT – HEARING PROTECTION By: Chris Chadwick, Safety Products Coordinator, SunnySide Supply, Inc
For this installment of my series on PPE, I will outline the dangers associated with high noise environments, as well as the different types of hearing loss that you and your works may be susceptible to. I would also like to note that this will be my fi nal installment on PPE, and my fi nal article for ONG Marketplace. Over the last 2 years or so, I have enjoyed the opportunity to share with you some points and ideas on safety in the workplace. I can only hope that my articles have shed some light on important safety issues, and have led to increased awareness in the field. The middle ear contains a chain of three tiny bones which link the ear drum to the inner ear. As a whole, this chain of bones are referred to as ossicles, individually the bones are the Malleus, Incus and Stapes. Also referred to as the hammer, anvil and stirrup, these bones are the smallest in the human body, and also some of the most important. As a whole, the ear works as a chain reaction of sorts. Sound waves are received by the outer ear and funneled to the ear drum. As the ear drum vibrates with the sound waves, the ossicles conduct these vibrations to the cochlea. Once the vibrations of the sound waves reach the cochlea, they travel through the perilymph and activate the inner ear nerves, or hair cells, triggering an electronic impulse for the brain. There are three types of hearing loss, Conductive, Sensorineural and Mixed. Conductive hearing loss is usually associated with malformation in the ear canal, scar tissue or injury. The sound waves passing into the outer ear are not able to make it to the cochlea. This type of hearing loss is usually treatable with surgery or letting enough time pass for an injury to heal. Sensorineural hearing loss is a result of damage to the inner ear, and the type of hearing loss associated with exposure to high noise. This could include damage to the cochlea, auditory nerves or brain. A Sensorineural hearing loss can’t be treated and there is no medical intervention that can reverse the effects. The sound waves passing into the outer ear are being relayed by the middle ear into the cochlea, but damage to the auditory nerves does not allow the signal to be interpreted by the brain. One of the biggest causes of this type of hearing loss is damage to the hair cells as a result of loud noises. Once these tiny hair cells are damaged by overexposure to loud noises, there is nothing that can be done to repair them. A Mixed hearing loss is a combination of a Conductive and Sensorineural loss. An example of a mixed hearing loss would be someone with a slight noise induced
hearing loss sustaining an injury to the eardrum resulting in a complete hearing loss. While the Conductive aspect of the hearing loss would likely be reversible, the noise induced hearing loss would always remain. Work related hearing loss is almost always a result of exposure to high noise, it is permanent and it is 100% avoidable. No matter how loud the work environment, if the correct measures are implemented, there is no reason for any employee to have to suffer with hearing loss. According to the Bureau of Labor Statistics, occupational hearing loss is the most commonly reported occupational illness in manufacturing, accounting for 1 “Step one is to monitor in 9 recordable illnesses. The most noise exposure and disturbing aspect of this statistic to know what noises is that in order to be OSHA recordable, the hearing loss must can cause damage. be determined to be work related Damaging noises are and must be severe enough that the worker is considered hearing any noises that are at, impaired.
or above 85 dB (A). ”
The CDC categorizes dangerously high noise levels as those at or above 85 decibels (dB (A)). OSHA’s Occupational Noise Exposure Regulation 29 CFR-1910.95 states that any person working in an environment with sound levels at or above 85 dB (A) must wear hearing protection. This regulation also states that if this noise level is present for 8 or more hours, a hearing conservation program must be put into place while MSHA Standard Section 62.120 states that the permissible exposure level is no more than 90 dB (A) for a maximum of 8 hours. Instituting a hearing conservation program is the most important step in keeping worker’s hearing protected. The National Institute for Occupational Safety and Health (NIOSH) website shows 8 simple components to instituting and maintaining a successful hearing conservation, or hearing loss prevention program. Step one is to monitor noise exposure and to know what noises can cause damage. Damaging noises are any noises that are at, or above 85 dB (A). Step two would be to put engineering and administrative controls into place. Engineering controls might include sound abatement walls or putting more distance between the worker and the noise source, administrative controls would include setting standards that the employees would be required to abide by. The third component is to have all of the workers receive an audiometric evaluation, or hearing test to establish baseline hearing ability. The fourth and fift h components of a successful hearing conservation program go hand in hand. The fourth component is to use hearing protection and the fift h component is to keep the worker educated and motivated to use hearing protection. These 2 components go hand in hand because it doesn’t matter if the provided hearing protection is a simple set of foam plugs or a sophisticated pair of muffs, if the employee doesn’t understand how to properly use the PPE or the importance of using it, successful protection will not be achieved. The fi nal three components are all administrative. The sixth component involves good record keeping of everything from noise levels in the work environments to all of the employee’s annual hearing exams. The seventh component is to continually evaluate your hearing conservation program to make sure it is as effective as possible. The fi nal component is to make sure
March 2014
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to audit your program annually. Making sure that your engineering controls are properly placed and in good repair and making sure that your employees are properly trained in using their hearing protection will ensure that you hearing conservation program is doing what it was designed to do, keeping your worker’s hearing protected.
found at the National Institute for Occupational Safety and Health website at www. CDC.gov/NIOSH, the National Institute on Deafness and Other Communication Disorders website at www.NIDCD.NIH.gov, the Occupational Safety and Health Administration website at www.OSHA.gov, or the U.S. Bureau of Labor Statistics website at www.BLS.gov.
The final piece of the puzzle is understanding that not only will work related hearing loss have a negative impact on an employee’s quality of life, but studies also show that workplace noise can have adversely affect the employee’s job performance and overall health. According to the U.S. Department of Health and Human Services, complex tasks, especially those involving simultaneous performance can be disrupted with sound levels of 95 dB (A) and above, with particularly sensitive tasks being affected at levels as low as 80 to 85 dB (A).
Once again, I would like to thank you for reading these articles.
Studies have also shown that this negative impact on job performance is more likely to happen when noise bursts are unpredictable and when the employee has no control over the noise. These negative effects can also occur after the noise has stopped, often resulting in a reduced tolerance for frustration. These studies have also shown that even fairly moderate levels of noise can raise anxiety and increase the risk of antisocial behavior, while decreasing the likelihood of helpful behavior. Although not yet clinically proven, some of these studies mapped the use of hearing protection and it appeared that, when used correctly, hearing protection showed a reduction in the adverse effects on job performance. There is also systematic evidence that employees who use hearing protection, when properly fitted and worn, have fewer accidents and absences. As you have just read, work related hearing loss is major problem in several industrial settings, but with awareness on the rise, HS&E professionals can take control of the issue. Taking the time to assess your work environments and implement the necessary precautions to protect the hearing of your workers, and educating workers on the importance of protecting their hearing, will lead to higher productivity and a healthier, happier workforce. For more information regarding work related hearing loss, hearing conservation programs and types of hearing protection, please visit the Centers for Disease Control and Prevention website at www.CDC.gov. More information can also be
By Chris Chadwick, Safety Products Coordinator at SunnySide Supply, Inc. www.SunnySideSupply.com
References: “Occupational Safety and Health Administration, U.S. Department of Labor.” (8 June 2011). General Requirements for Personal protective Equipment. 29CFR 1910.95. Web. 12 February 2014. http://www.osha.gov/pls/oshaweb/owadisp.show_document?p_ table=standards&p_id=9735 “Occupational Noise Exposure.” Occupational Safety and Health Administration. OSHA. (n.d.). Web. 12 February 2013. http://www.osha.gov/SLTC/noisehearingconservation/index.html “Workplace Noise Can Cause hearing Loss.” 3M Education 2000 Resource Guide. 3M. (n.d.). Web. 13 February 2014. http://www.newark.com/pdfs/techarticles/O91868.pdf “National Bureau of Labor and Statistics.” (n.d.). Web. 13 February 2014. http://www.BLS.gov “Centers for Disease Control and Prevention.” (n.d.). Web. 13 February 2014. http://www.CDC.gov “National Institute for Occupational Safety and Health.” (n.d.). Web. 13 February 2014. www.CDC.gov/NIOSH Thanks Chris!
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The Northeast ONG Marketplace
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The Northeast ONG Marketplace
ENVIRONMENTAL MANAGEMENT
THERMAL OXIDIZERS FOR NATURAL GAS INDUSTRIES COMPLIANCE ISSUES FACING MIDSTREAM PRODUCTION By: Chris Heikkila, Environmental Systems Manager, Catalytic Products Incorporated
It’s in the news every day; the natural gas production industry is experiencing record growth. The gas reserves in the United States are thought to hold enough natural gas for hundreds of years and the gas and oil industry has improved extraction techniques that make gas production more affordable and less impactful on the landscape. This is good news for the country and our environment. The Midstream Process Midstream gas processing plants are complicated production facilities. These plants process large quantities of natural gas and hydrocarbons. Safety comes first at every site and high quality standards drive every decision. The process involves cleaning natural gas of harmful impurities and water. When natural gas is extracted from the ground it contains high amounts of CO2, water, and corrosive sulfur compounds. A common processing operation includes glycol dehydration and amine stripping. The amine system uses a re-boiler that boils off the CO2, water, other VOC’s, and H2S so the amine solution can be re-used. The vent gas from the re-boiler is then subject to EPA guidelines; 40 CFR, Part 63, Subpart HH. Under this rule, greater than 95 percent of the pollutants must be destroyed before release to atmosphere. The Problem The typical off gas from an amine treatment system is rich in CO2, contains substantial amounts of water, and varying concentrations of volatile organic compounds (VOC) and hydrogen sulfide (H2S). Given the complications the vent gas presents, many operators have opted to use flares as the abatement device. However, flares have several drawbacks that prevent efficient operation and under recently proposed EPA changes to the rules, flares will surely be discontinued in many future plant designs. (See, for example, 40 CFR, Part 63.11b for flare design criteria that will apply to flare installations in the future). As a replacement technology for flares, thermal VOC abatement can provide substantial benefits. Thermal Oxidation is a process by which the vent gas is raised to 1,400 F, held in a reaction chamber where the hydrocarbons are oxidized to CO2 and water vapor. Thermal Oxidation provides very high destruction efficiency and is considered a safer method than flaring. Gas processors are now focused on efficient operations of their plants. The modern gas processing facility understands the gas they use in their operations is less gas they can sell downstream. Plus, EPA considers Greenhouse Gas (GHG) emissions as a regulated air pollutant. Methane, the primary component in natural gas, is a
GHG with a Global Warming Potential 21 times that of carbon dioxide, according to the EPA. Midstream processors have multiple issues to think about when designing their plants: • Reliable VOC abatement systems • Long lasting designs that consider the corrosive nature of the vent gas • Safe designs that are capable of operating in hazardous areas • Fuel efficient to help lower processing costs, provide more product for sale, and limit GHG emissions The Solution The first step to developing a suitable action plan is choosing the right partner. For a successful project, the processor should work with a company that has a long history in the petro - industries, offers a complete product line, has the knowledge to integrate a safe system, and a support staff with a proven track record of success. Next, a thorough review of the expected vent gas must be conducted. As noted earlier, different natural gas regions have different varieties of gas, and thus different vent gases can be expected. Once the vent gas has been defined the final choice of abatement technology can be considered. Thermal Oxidation can be segmented into three primary technologies for the natural gas processor: • Regenerative Thermal Oxidation – uses ceramic media and switching valves • Recuperative Thermal Oxidation – uses traditional shell and tube heat exchanger • Non-recuperative Thermal Oxidation – commonly called an afterburner or combustor, this system does not employ heat recovery. All technologies may seem appropriate, but the final choice is usually based on the expected amount of VOC’s contained in the vent gas. If the vent gas
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contains low concentration of VOC (usually less than 10 BTU/SCF) then the Regenerative Thermal Oxidizer (RTO) is an appropriate device. However, if the vent gas contains higher concentrations or upset conditions that may exceed 20 BTU/SCF, then the Recuperative Thermal Oxidizer is a better choice. Certain circumstances may point to the use of the non-recuperative Thermal Oxidizer, but considering the high fuel use, these systems are being employed less.
It’s important to partner with a company that offers all technologies. The right equipment provider can work with the gas processor to identify all considerations in equipment design and finally offer the right solution, based on the gas processors unique needs. For more information contact Chris Heikkila, Environmental Systems Manager, Catalytic Products Incorporated, 847.550.4118, cheikkila@cpilink.com
April 22-24, 2014 | Fairmont Pittsburgh | Pittsburgh, PA
Helping companies do more business in the Oil & Gas industry shalemarkets.com
STAKE YOUR CLAIM: UTICA & MARCELLUS TAKEAWAY CAPACITY AND INFRASTRUCTURE BUILD-OUT IS RAMPING UP • Investors/Financiers: Establish relationships with potential partners looking for capital investments • Midstream/Pipeline Companies: Meet the E&Ps and refiners you’ll want to partner with to advance your infrastructure development plans • Transportation Companies: Get the latest on production and infrastructure build-out and meet customers who will most need your services • E&Ps and Field Service Providers: Hear an in-depth overview of current and planned infrastructure build-out and connect with the midstream and downstream companies that will help maximize your ROI
Phone: (818) 888-4444 | www.infocastinc.com/utica
15%
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Be Brilliant Be Connected Be Elite March 28, 2014 Friday morning, starting at 8:30 AM Breakfast & Lunch provided Holiday Inn, Monroeville, PA Register online at ShaleMediaGroup.com
ONG MARKETPLACE - COVERING ALL THE SHALE PLAYS IN THE NORTHEAST U.S.
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The Northeast ONG Marketplace
TRAINING & WORKSHOPS MARCH 6
PEC Basic Orientation – SafeLand USA Washington, PA www.rjrsafety.com 6 Pre-Drill Water Sampling Workshop Monroeville, PA marcelluscoalition.org/get-involved 7 Pre-Drill Water Sampling Workshop Monroeville, PA marcelluscoalition.org/get-involved 10 - 12 Wild Well Control Training – Drilling Canonsburg, PA www.wildwell.com 11 PEC Basic Orientation – SafeLand USA St. Clairsville, OH www.rjrsafety.com 12 PEC Basic Orientation Hughesville, PA training@drwellsite.com 13 PEC Basic Orientation Washington, PA www.eastcoastriskmanagement.com 13 - 15 Wild Well Control Training – Drilling Canonsburg, PA www.wildwell.com 17 - 19 Wild Well Control Training – Drilling Canonsburg, PA www.wildwell.com 17 - 20 Wild Well Control Training – Drilling & Work Over Canonsburg, PA www.wildwell.com 18 - 21 OSHA 5810 – Hazards Recognition and Standards for On-Shore Oil and Gas Exploration & Production Pittsburgh, PA safetyandhealth.ext.wvu.edu 19 CPR Training Hughesville, PA training@drwellsite.com
20 PEC Basic Orientation - SafeLand USA Washington, PA www.rjrsafety.com 24 - 26 Wild Well Control Training – Drilling Williamsport, PA www.wildwell.com 24 - 26 Wild Well Control Training – Work Over Canonsburg, PA www.wildwell.com 24 - 27 Wild Well Control Training – Drilling & Work Over Williamsport, PA www.wildwell.com 24 - 28 Wild Well Control Training – Work Over & Well Service Canonsburg, PA www.wildwell.com 26 PEC Basic Orientation Hughesville, PA training@drwellsite.com 31 to April 2 Wild Well Control Training – Drilling Buckhannon, WV www.wildwell.com 31 to April 3 Wild Well Control Training – Drilling & Work Over Buckhannon, WV www.wildwell.com
APRIL 3 Transportation Safety Day and Flagger Training State College, PA marcelluscoalition.org/get-involved 7 PEC Basic Orientation – SafeLand USA New Philadelphia, Ohio evanfossen@buckeyecareercenter.org 9 Energy Industry Training Series Washington, PA ypepittsburgh.org
March 2014
WWW.ONGMARKETPLACE.COM FOR LINKS TO UPCOMING INDUSTRY EVENTS
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INDUSTRY INSIGHT
THE $100,000 HAMMER It turns out both views are connected! Now let me explain the $100,000 hammer… By: Jim Garner, Ground Scouts Working at NASA for almost a decade, I saw some pretty bizarre behavior. This often happens in a largescale government organization, but I want to share with you two views that can help our capitalistic industry. For NASA it is simple to claim safety as a reason to not change, but for our industry, change is necessary for us to survive. We find very reasonable ways to reduce costs and still maintain high levels of safety and production because we are pushed to do so to remain competitive. As silly as $500 government ashtrays and foolish budget decisions are, we tend to do similar things in our work. While at NASA I became aware of many neat technologies that came from massive budgets without corral. Being a technology kinda guy, I made note of many advances that I still use today. Their management of data, for instance, is similar for us because technology moves very fast and the amount of information we must manage to be successful is huge! We have typically used old run-sheets for research, colored-pencils for adverse lease-hold maps, and sometimes resort to paper napkins and magic markers to highlight locations of pipelines that have not been seen in 30 years! Although these approaches should not make sense to anyone in our industry, we continue the same practices, over and over, ad nauseum! Perhaps it is because other options are not obvious. Let’s get back to the views I wanted to share: View Number One: Technologies, (some developed by NASA,) can be successfully used to significantly reduce costs and improve productivity and safety. View Number Two: We need to avoid the $100,000 hammers that come in the form of Federal and State compliance penalties. The complacency of waiting until the State Inspector comes to see you, is no longer viable.
I do a lot of data management in our industry. A little over a year ago I was doing some GIS mapping for a client and realized that they really didn’t know the accurate field position of wells, pipelines and access. They had some GIS maps; even some GPS points for some of them, but they had millions of feet of “legacy” gathering pipeline systems, hand-drawn from their Tenders and Managers. I started to gather information from the Tenders and began accurately mapping those changes into GIS, but it wasn’t long before I realized it was a terrible bandaid on a costly wound. Knowing about a NASA invention for finding things under the surface of Mars, I put a plan together that would allow the client to accurately find their pipeline systems, at a more affordable cost, using common devices, systems and computer programs that I could repurpose. In the process of research I found a few things of great value: 1. The accuracy of position and operation for their pipeline systems, which only resided with Tenders and Managers, was at constant risk due to the high rate of worker turn-over, resulting in a severe loss to the company. 2. In WV and OH, where HBP (Held By Production) leases held low-cost promise for Utica and Marcellus exploration, the companies were having a hard time getting full price for their assets because they couldn’t show accurately, WHERE their systems were on a GIS map. I was successful in showing I could locate and map their systems and solve these issues. However, as work began, the state showed up for a compliance visit. An inspection for 192.5 compliance; legacy gathering systems, revealed issues and penalties were to believed, reaching the cap of One Million Dollars! The Operations Manager quickly remembered my company had started work and grabbed one of our first maps. Penalties mitigated! (190.225 (5)) 3. The $100,000 Hammer: The states were starting to enforce CFR 49 Part 192.5 compliance for gathering lines. Thus, a single penalty for non-compliance, or ignoring compliance, could and was resulting in a penalty of $100,000 per day, per issue, repeating everyday it remained. (CFR 49 Part 190.223(a)). The only up-side would be limit of $1M. What we found was this: Every producer who has legacy gathering lines is conscious of safety. They also can work out the math that a few bucks spent now will save them three in the near future. But the simple side-effect of having beautiful color pictures, presentations and GPS-accurate maps of what they own, is money well spent once they realize they can do it for much less than the penalties associated with waiting. But most importantly, the $100,000 hammer is swinging hard! It is so simple to get pipeline systems mapped out now, that it is folly to just sit back and hope that those pipes and systems that have sometimes been in the ground for over 60 years won’t go “BOOM” in the night. Just consider, when One-Call/Miss Utility is told, “the pipeline is here”, rather than there, people can get hurt. It is happening even more frequently now due to age and housing encroachment. But this is a reason the codes exists and that the penalties are starting to show teeth.
March 2014 The process works! Once the Ops Manager was able to show the state our services were already under contract, (to find, map and do a sliding-mile analysis on their systems,) all penalties were mitigated as per the same code!
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THE WORLD’S SAFEST, COOLEST, MOST QUIET COMPRESSOR STATIONS
In short, if your company is faithfully trying to find and eliminate compliance issues, the code dictates that penalties will not be levied. But it needs to be a documented effort! Thankfully we were able to understand and find ways to correctly document and satisfy this part of the code. Since then, our company has added the ability to present pictures, video, interactive maps, and heat-maps that show not only compliance areas, but that also make it easy for managers to “see” and manage their systems from the office. We have added experts to our ranks that understand the codes and, more importantly, how to mitigate the penalties while making corrections to facility locations. As it turns out, the same code that has pushed our services into a need, also allows us to protect the clients as soon as they contract our services! Jim Garner, Owner, GroundScouts 304-933-9858 Jim@GroundScouts.com
Design • Manufacture • Erect Sound Mitigation & Air Handling ISNetworld Certified
WASHINGTON, PA | 724.225.2202 | steelnationbuildings.com
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The Northeast ONG Marketplace
UPCOMING EVENTS MARCH 17-19 SPE International Conference on HSE Long Beach, CA | www.spe.org/events
APRIL (continued) 29-30 Utica & Marcellus NGL & Natural Gas Markets Congress Columbus, OH | www,american-business-conferences.com
25-26 SPE Coiled Tubing and Well Intervention The Woodlands, TX | www.spe.org/events
29-30 LNG Export USA 2014: Global Buyers Congress Houston, TX | www,american-business-conferences.com
26-27 Produced Water Disposal and Reuse Initiative
30-May 1
Canonsburg, PA | www.produced-water-utica-marcellus-2014.com
Ohio Valley Oil and Gas Expo St. Clairsville, OH | http://www.ohiovalleyoilgasexpo.com/
APRIL 1-3 SPE Unconventional Resources Conference The Woodlands, TX | www.spe.org/events
MAY 5-8 Offshore Technology Conference
7-9
Houston, TX | www.otcnet.org/2014
ShaleSafe Conference & Expo Wheeling, WV | www.shalesafe.info
9-11 NAPE East
12-13 5th Annual National Shale Conference Farmington, PA | www.neienergy.org
Pittsburgh, PA | www.napeexpo.com
13-14
14-16
Oil & Gas Environmental Compliance Conference - Appalachian Basin
VOGA Regional Natural Gas Vehicle Conference
Washington, PA | http://oilandgas.awma.org
Richmond, VA | www.vaoilandgas.com
16-17
13-14
AIPG 5th Annual Symposium
PIOGA’s Eastern Oil & Gas Conference and Trade Show
Columbus, OH | www.aipg.org
Pittsburgh, PA | www.pioga.org
17
13-15
12th Annual Michigan Petroleum Conference
Eastern Gas Compression Roundtable
Acme, MI | www.michiganoilandgas.org
Moon Township, PA | www.egcr.org
22-24
15
Utica-Marcellus Infrastructure
Drilling Onshore Conference & Exhibition
Pittsburgh, PA | www.infocastinc.com/events/utica
Houston, TX | www.iadc.org
Denotes National Event
Visit our website for links to these events
WWW.ONGMARKETPLACE.COM/EVENTS
March 2014
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NETWORKING EVENTS March 5 YPE Pittsburgh Crew Change
March 27 Sweetening Up the Shale
Bridgeville, PA | www.ypepittsburgh.org
Washington, PA | www.shalemediagroup.com
March 19 Energy Group Mixer
March 28 Elite Energy Event
Wilkes-Barre, PA | stephanie.paluda@84lumber.biz
Monroeville, PA | www.shalemediagroup.com
March 26 Elite Crew Change
April 22 OVOGA Boomtown Panel
Pittsburgh, PA | www.ypepittsburgh.org
Wheeling, WV | www.boomtownpanel.com
FOR MORE EVENTS VISIT WWW.ONGMARKETPLACE.COM/EVENTS
$411 Million Marcellus producers have invested more than $411 million to build and repair Pennsylvania roads since 2008.
FRACT
Many Marcellus producers have made commitments to help the communities they work in. marcelluscoalition.org #fractorfiction
WWW.ONGMARKETPLACE.COM
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The Northeast ONG Marketplace
NEW TECHNOLOGY
ECONOMICS OF ELECTRONIC GAS MEASUREMENT By: Jim Gardner, Regional Vice President Sales, OleumTech Corporation “Civilization advances by extending the number of important operations which we can perform without thinking of them,” Alfred North Whitehead, co-author of Principia Mathematica. The purpose of incorporating automation whether wired or wireless remains the same, to deliver efficiencies that are not achievable without it. The main reasons for automation: • Increased productivity • Reduced installation costs • Improved quality or predictability of quality • Improved robustness of process • Reduced human labor costs and expenses • Safety These increasing justifications help build an economic case for wireless versus wired automation. Increased Productivity Conventional wired installations can require multiple crews with electricians running wire and conduit, technicians calibrating instruments, and roustabouts digging trenches. The logistics of this in an area where drilling activity is high can be a problem. All of the crews and contractors have a backlog of work and often the producer finds himself on multiple waiting lists because the different contractors cannot be on location on the same day. Many producers have come to accept one to two weeks as a normal timeline after completion to get all of the automation installed and reporting.
and battery voltage of the instrument. By eliminating corrosion and mechanical damage, the quality of the product is much improved and by providing feedback on signal strength and battery voltage the predictability greatly improves. Reduce Installation Costs Labor is the largest cost of the installation. An example of this is the installation of tank level sensors requiring both supply voltage and signal wire run from the RTU or EFM to the top of the tank. One major producer in the Bakken recently shared two bids for the automation of a well pad with 5 tanks and data coming back to an EFM. The cost of installation with conventional wired solution was $35,125, while the cost of the same job with wireless solution was $22,418. The difference becomes even more dramatic when additional equipment is required as trenching or conduit must be replicated. This one tank monitoring application saved the producer $12,707. Therefore, if they have a program to drill 25 wells this year the difference in cost between wired and wireless would be $317,675 and will provide the same data. Improve Robustness The single most destructive force we deal with in Oil & Gas automation is lightning. An excellent example of this is a major producer in East Texas that had 850 wells. They had one man whose job was to repair lightning damage which was exceeding 30+ wells every month. They made a decision to go wireless and were able to reduce the amount of lightning damage to zero, saving them over a million dollars the first year. Safety The common worker accident claims are in either transportation to a location (2% of all O&G accidents) or slip and fall accidents (16% of all O&G accidents). On a typical wired site, crews of several people climb the stairs or use bucket trucks to install the wire and conduit on every tank. This means more opportunities for accidents. Additionally, there is higher voltage equipment being installed. Many tank gauges require AC power rather than the DC voltage used in a wireless application. Although the greatest risk is still from exposure to H2S (3.3 % of all accidents). While wireless must still be installed by humans in this potentially deadly environment often wearing oxygen packs, the amount of time they are in the high risk area can be reduced from days to hours. Clearly,
Contrast that, with a wireless installation. One man can install the entire system and have the project working in less than one day. This allows company technicians to be more productive and engineers/ managers to have access to data more quickly and focus on other tasks. Decreasing the installation time saves money by reducing labor, and increasing efficiency by providing accurate measurement data faster. Increase Quality or Increase Predictability of Quality With a wired system, there is no way to monitor the condition of the wire. Wire is susceptible to corrosion and damage from other crews adding to or working on a location. And, there is no warning signals that can predict failure. Wireless is not susceptible to any of these potential failures and has the ability to provide feedback on the health of the instruments, including signal strength between the radio
From OSHA 2010
March 2014
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the less time we have people in a potentially dangerous environment the less the risk of accidents. Profitability Time and money are saved with wireless systems. The flow of information over communications systems improves the bottom line. Without an operational need for a technician or pumper on a site, they should not go there. Wireless systems are able to provide the key metrics for making decisions, such as routing away from unnecessary points while also supporting decisions to route resources where they are needed – even urgently. Conclusion Gas measurement and production optimization have been changing rapidly with creation of new technologies and electronic advancements. For as long as there are technology advances, there will always be changes in the Gas Measurement and production optimization industry. Wireless instrumentation technology is the latest technology shift for monitoring and controlling processes. It is a natural evolution of Oil & Gas industry powered by economics.
YOUR NEWS SOURCE FOR THE OIL & GAS INDUSTRY Radio Internet Events Publication Video shalemediagroup.com
150 W. Beau St., Washington, PA
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The Northeast ONG Marketplace
LEGAL & REGULATORY
THE RED TAPE OF WATER HAULING By: Kristie Kubovic, Director of Communications, Shale Media Group Edited By: Chris Stroyne, Editor, Shale Media Group Photos Provided By: Mustang Oilfield Services
ground source is much faster in Ohio than Pennsylvania. The ability to permit a private or public water source in a couple days opens up the door to drawing water from rivers and streams or a farmer’s private pond. Geography also plays a big part in the equation. Ohio is less mountainous, plus it was largely strip mined (versus underground mined). Both of these circumstances tend to lead to more ponds.” All of this means that in Ohio, water ends up costing about $6 to $9 per 1000 gallons or $25 to $35 a truck load (for reference, a truck load tends to be comprised of 4,200 to 4,600 gallons of water) and can come from almost anywhere. On the flip side, Cook says, “The Pennsylvania Department of Environmental Protection (DEP) has a longer permitting process to pull water from a ground source, so companies generally go through the municipal water system. When the water goes through a tap, more taxes are collected. This leads to water costing significantly more in Pennsylvania, between $12 to $15 per 1000 gallons or $50 and $60 a truck load.”
Every state is a little different. A particular state’s legislature is made up of a group of unique individuals with different views and ideas. These differences eventually lead to laws that vary from state to state. Even the age that you can legally get behind the wheel to first obtain your learner’s permit to the age when you finally can obtain your full driver’s license varies from state to state. Once you receive your license, then each state enforces different speed limits to follow as well. Naturally, the laws and red tape imposed on the shale oil and gas industry are no different when it comes to water hauling and driving on a state’s roads. At a well site, water acts as the primary carrier fluid for the drilling and hydraulic fracturing processes. “One horizontal shale gas well can exhaust around six million gallons of water in the various stages from drilling to hydraulic fracturing,” informed Greg Cook, CEO, Mustang Oilfield Services LLC. This water is collected from various water sources such as lakes, rivers, municipal supplies and/or groundwater. If water is not readily available at a well site or not permitted, producers will often hire a company to truck in the required water. Mustang Oilfield Services, headquartered in Saint Clairsville, Ohio, provides service to Ohio and Pennsylvania and is primarily a water hauler for the shale oil and gas industry. This means they haul freshwater to a well site for the various phases of drilling and hydraulic fracturing. In addition, they also haul the flowback water off the well site. The company is also able to find freshwater sources, along with finding disposal locations for the flowback water. Most trucks that haul water to a well site hold around 100 to 130 barrels of water; however the amount that they are allowed to carry varies per state. For example in this match-up, Ohio is more stringent than Pennsylvania or West Virginia. Cook relayed, “Ohio’s hauling restrictions only allow for 100 barrels to be carried on a four-axle truck, while Pennsylvania and West Virginia permit 110 barrels of water on a three-axle truck.” Dave Caddies, Director of Road Operations, Shale Energy Institute, says, “By paying a fee and applying for another permit, additional barrels are sometimes allowed.” The pendulum swings the other direction when it comes to obtaining the water and the associated cost of it. Cook explained, “The timeframe to permit a
However, it isn’t as easy as pulling the water from an Ohio source and bringing it to Pennsylvania. Cook pointed out, “It isn’t economical to haul water from Ohio to Pennsylvania. The fact that a company is able to haul more water on fewer trucks in Pennsylvania saves on both labor and fuel costs. This offsets the higher cost of collecting the water.” In the end, the costs end up evening out. On a different note the multitude of sources in Ohio and the availability of water are allowing pipelines to be built to transport water from a source to a well site, therefore taking a large portion of trucking out of the equation. “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. Some producers are even using pipelines for water transfer for up to eight to ten miles,” explained Cook. When water is withdrawn from surface waters, timing is important. Withdrawals during low flow times can impact aquatic life and dewatering. As stewards of the environment, this effect is not taken lightly. Therefore Pennsylvania, Ohio and West Virginia all established season specific and drought withdraw regulations. Surface water taken directly from rivers and streams makes up over 80 percent of the water used in hydraulic fracturing in West Virginia. West Virginia passed the Water Resources Protection Act, a program that requires registration for surface water or groundwater withdrawals of 750,000 gallons over a period of one calendar month. Plus, Caddies pointed out, “West Virginia and Pennsylvania have laws that states shale oil and gas trucks must be off the roads when school children are being transported to and from school.”
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In addition, “there are no specific Department of Transportation (DOT) regulations that address water hauling, but all general rules apply, such as having a Class A or B Commercial Driver’s License (CDL) with Endorsement N (Tank Vehicle Endorsement), medical card, drug and alcohol testing, load securement, hours of service and bridge laws,” explained Caddies. The red tape varies from state to state when it comes to the shale oil and gas industry. The regulatory differences along with the availability of water have a huge impact on a water hauling company’s operations and bottom line. However, for the safety of the environment and a state’s citizens, it is important red tape to cut through.
Shale Media Group (SMG) is your 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, Shaleadvantage.com and ShaleEnergyNow.com. In addition, join us on March 27th for Sweetening Up the Shale at Chicco Baccello in Washington, PA from 5:00-7:00 pm and on March 28th for our next Elite Energy Event at the Holiday Inn in Monroeville, PA from 8:30am-1:00pm. Register or find more details at ShaleMediaGroup.com.
Natural gas is “dirtier” than coal. FICTION
855.269.1188 | info@ongmarketplace.com | P.O. Box 1441 • Oak Hill, WV 25901
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The Northeast ONG is the only publication read by almost everybody operating in the Appalachian oil and gas industry. No other monthly publication covers every northeast shale play - Marcellus, Utica, Antrim and New Albany. No other publication covers Pennsylvania, Ohio, West Virginia, Michigan and more than a dozen other Northeast states. With more than 10,500 subscribers, the Northeast ONG Marketplace is the most cost-effective way to let the industry know that you, too, are operating here and ready to do business.
Natural gas releases 45% fewer greenhouse gases than coal.
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➤ New Dates ➤ Exciting New Venue ➤ Same Great Program
May 13-14, 2014 Heinz Field • Pittsburgh, PA Find out more: www.pioga.org
www.pioga.org/resources/exhibitors
PIOGA’s Eastern Oil & Gas Conference and Trade Show
Great exhibit spaces available!
Don’t Miss It!
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The Northeast ONG Marketplace
June 3-5, 2014 David L. Lawrence Convention Center Pittsburgh, PA
NEAERLWIER
DATES
SAVE THE DATE MARK
DUG East is the premier conference focused on resource development in the Marcellus and Utica region. Join us to see for yourself why thousands of oil and gas professionals converge each year for this spectacular event.
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now and plan to attend, sponsor or exhibit at
DUG East 2014.
Register today at
DUGEast2014.com Hosted by
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Conference Statistics from 2013:
23 speakers 15 conference sessions 62 sponsors
329 exhibitors 3700+ attendees
March 2014
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The Northeast ONG Marketplace