Natural Gas Developmentand Hydraulic FracturingSheri SomervilleNatural Gas Advisor, CAPPKV Chamber of CommerceJune 5, 2013
Presented ByThe Canadian Associationof Petroleum Producers(CAPP)New Brunswick O&NGTask GroupThe New Brunswick Oil &Natural...
● Represents large and small producer member companies● Members explore for, develop and produce natural gas,natural gas l...
● In 2011 the NBONGA was formed to facilitate the effectiveexploration, development, production, transmission anddistribut...
Advancing the 3Es the 3Es● Generating Economic Benefits Jobs and revenues across North America● Providing Energy Security...
Global Primary Energy DemandIEA New Policies Scenario● Significant energy demandgrowth: Population, standards of living● ...
How will demand be met?Technological advances have unlocked vast unconventional gas resources.Resource assessments are ong...
North American Shale Gas Plays
Source: DNR NBNB Proven and Potential Resources
Natural Gas and OilIndustry in NewBrunswick:● First oil well drilled atDover in 1859● 300 oil and gas wells weredrilled in...
Geology of Natural Gas ResourcesSource: U.S. Energy Information Administration
Stages of Exploration and Production forUnconventional ResourcesNova Scotia Duvernay Horn River MarcellusNew Brunswick
Geophysical Exploration (Seismic):Vibroseis truck Seismic charge
Drilling Operations● Shale gas formations are deep inNB (1,500m to >2,000m)● Water aquifers are typically 100-250m deep● S...
Drilling & Well ConstructionWellbores:• Constructed to recover gas whileprotecting surroundingenvironment, particularlyund...
How does hydraulic fracturing stimulation work?● Approximately 4,000 cubicmetres (4 million litres) of waterused to fractu...
Fracture Fluid1.5 % AdditivesGelling AgentsCross LinkersClay ControlBreakersSurfactantsBiocidesEnergizerswww.fracfocus.ca9...
Fracture FluidsTYPE Source Purpose Common UseGelling Agent Guar GumPolyacrylamideIncrease viscosity, helpssupport and carr...
Multi-Well PadsVertical Well Pad Horizontal Well PadAdvantages of Multi-Well Pads:• Reduction of land use for the pad, acc...
● Jobs (Upstream from Western Canada Natural Gas)Natural Gas industry employment: 317,000 – jobs (direct, indirect and in...
Each Well:● Requires 420 individuals working in 150 different occupations to complete andproduce gas from one well● Create...
● Construction, manufacturing andtransportation● Drilling, completion and production● Geological and geophysical● Pipeline...
McCully Field, Sussex
Guiding Principles for Hydraulic Fracturing12345Safeguard the quality and quantity of regionalsurface and groundwater reso...
Operating Practices for Hydraulic Fracturing25
Who Regulates Oil & Natural GasSector● Federal & Provincial Departments Environment (Environment & Local Government) Ene...
The New Rules in NB Seismic testing procedures (e.g.,minimum setbacks 180 m) Well bore construction, casing,containment,...
Responsible Energy Development● New Brunswickers & Canadians want to knowthat shale gas can and will be developed safely● ...
For More informationCAPP.caFollow CAPP on Twitter:@OilGasCanadaLike CAPP on Facebook:facebook.com/OilGasCanadaCSUR.comMore...
THANK YOUQUESTIONS?Sheri SomervilleNatural Gas Advisor, NBSheri.somerville@capp.cawww.capp.ca
Upcoming SlideShare
Loading in …5
×

Natural Gas Development and Hydraulic Fracturing

481 views

Published on

Presentation given by Sheri Sommerville, CAPP Advisor, Natural Gas, on June 5, 2013 to the KV Chamber of Commerce.

Published in: Business
0 Comments
0 Likes
Statistics
Notes
  • Be the first to comment

  • Be the first to like this

No Downloads
Views
Total views
481
On SlideShare
0
From Embeds
0
Number of Embeds
1
Actions
Shares
0
Downloads
18
Comments
0
Likes
0
Embeds 0
No embeds

No notes for slide

Natural Gas Development and Hydraulic Fracturing

  1. 1. Natural Gas Developmentand Hydraulic FracturingSheri SomervilleNatural Gas Advisor, CAPPKV Chamber of CommerceJune 5, 2013
  2. 2. Presented ByThe Canadian Associationof Petroleum Producers(CAPP)New Brunswick O&NGTask GroupThe New Brunswick Oil &Natural Gas Association(NBONGA)
  3. 3. ● Represents large and small producer member companies● Members explore for, develop and produce natural gas,natural gas liquids, crude oil and oil sands throughoutCanada● Produce about 90 per cent of Canada’s natural gas andcrude oil● Part of a national industry with revenues of about $100billion per year● Associate members provide a wide range of services thatsupport the upstream crude oil and natural gas industryCanadian Association of Petroleum Producers
  4. 4. ● In 2011 the NBONGA was formed to facilitate the effectiveexploration, development, production, transmission anddistribution of New Brunswick’s hydrocarbon resources inan environmentally safe and responsible manner● In December, 2011 the NBONGA and CAPP joined to form aTask Group● The Task Groups objective is to engage with communities,business leaders, governments and people interested in anopen, fact-based dialogue about natural gas and oildevelopmentWhat is the NB Oil & Natural Gas Association?
  5. 5. Advancing the 3Es the 3Es● Generating Economic Benefits Jobs and revenues across North America● Providing Energy Security Safe, secure and reliable energy Large energy resource potential● Providing EnvironmentalStewardship Strong regulations Technology advances
  6. 6. Global Primary Energy DemandIEA New Policies Scenario● Significant energy demandgrowth: Population, standards of living● Need all forms of energy: Increasing role for renewables Continuing reliance onhydrocarbons Increasing role for non-conventional crude oil & naturalgas● Environmental challenges● Technology is a key lever forsustainable growthSource: International Energy Agency World Energy Outlook 2012
  7. 7. How will demand be met?Technological advances have unlocked vast unconventional gas resources.Resource assessments are ongoing (GSC, NEB and others) in many new areas, and new opportunitiescontinue to emerge (Eastern Canadian shale gas, etc.)*Estimated Recoverable Marketable Gas
  8. 8. North American Shale Gas Plays
  9. 9. Source: DNR NBNB Proven and Potential Resources
  10. 10. Natural Gas and OilIndustry in NewBrunswick:● First oil well drilled atDover in 1859● 300 oil and gas wells weredrilled in NB by 2010● Since 1990, 40 oil wellsdrilled and 40 Natural Gaswells● 29 natural gas and 18 oilwells are currentlyproducing● Since 1990, 49 wells havebeen hydraulicallyfractured for oil and gas inNB
  11. 11. Geology of Natural Gas ResourcesSource: U.S. Energy Information Administration
  12. 12. Stages of Exploration and Production forUnconventional ResourcesNova Scotia Duvernay Horn River MarcellusNew Brunswick
  13. 13. Geophysical Exploration (Seismic):Vibroseis truck Seismic charge
  14. 14. Drilling Operations● Shale gas formations are deep inNB (1,500m to >2,000m)● Water aquifers are typically 100-250m deep● Shale zone accessed throughvertical, then directional orhorizontal drilling● 3 layers of steel casing andcement: Surface casing Intermediate casing Production casing
  15. 15. Drilling & Well ConstructionWellbores:• Constructed to recover gas whileprotecting surroundingenvironment, particularlyunderground drinking water.• Narrow pipe sunk deep intoground, surrounded by cementin the bore hole to ensure bothpipe and underground area ittravels through are completelyseparated.At production site (reservoir), theproduction pipe is perforated toallow the natural gas to flow intothe pipe and rise to the surface.
  16. 16. How does hydraulic fracturing stimulation work?● Approximately 4,000 cubicmetres (4 million litres) of waterused to fracture each stage of awell Water amounts may varydepending on type and location ofreservoir. Total water used at the 4 majorshale plays in the USA is less than1% of total water usage in eachstate● Fracture stimulation fluidconsists of 98.5% water/sandand 1.5% chemical additives● All chemical additives aredisclosed by industry toregulators before hydraulicfracturing occurs
  17. 17. Fracture Fluid1.5 % AdditivesGelling AgentsCross LinkersClay ControlBreakersSurfactantsBiocidesEnergizerswww.fracfocus.ca98.5% Water & SandThe water, sand, and additives used to convey pressure from the surface to thereservoir to create fractures to be created
  18. 18. Fracture FluidsTYPE Source Purpose Common UseGelling Agent Guar GumPolyacrylamideIncrease viscosity, helpssupport and carryproppant better thanstraight waterFood grade productFound in disposable diapersClay Control Potassium Chloride Prevents clay fromswellingPotash, fertilizer, and table saltsubstituteSurfactants Naphthalene Lowers surface tensionand helps used fracturefluid return to the surfaceFound in moth ballsWindexBiocide Glutaraldehyde(can also be derivedfrom plants or bacteria)Eliminates bacteria fromwater that can producecorrosive by productsDisinfectants, sterilizer for medicaland dental equipmentEnergizers CO2NitrogenImproves stimulation orrecovery of fluidsOdorless, non toxic.
  19. 19. Multi-Well PadsVertical Well Pad Horizontal Well PadAdvantages of Multi-Well Pads:• Reduction of land use for the pad, access roads & pipelines.• Easier monitoring of site and enforcement of regulations.• Conducive to establishing and enforce traffic/trucking corridors.• Optimization of location.• Establish and enforce noise, light, air emission and water plans.Source: ERCB 2011
  20. 20. ● Jobs (Upstream from Western Canada Natural Gas)Natural Gas industry employment: 317,000 – jobs (direct, indirect and induced) across Canada by 2035 9,693,000 – person years of employment between now and 2035 $339 billion – natural gas employees will earn over next 25 years● Revenue, Royalties, Taxes (To all Canada from Western Can. NG)Natural Gas industry will: contribute $1.5 trillion to Canadian GDP over next 25 years generate $199 billion in royalties generate $170 billion in federal taxes generate $130 billion in provincial taxesWhat does this mean for Canada?
  21. 21. Each Well:● Requires 420 individuals working in 150 different occupations to complete andproduce gas from one well● Creates approximately 13 Direct FTE’s per year● Creates 32 – 58 FTEs per well, if you include direct, indirect and induced jobs(varies by jurisdiction)Source: Marcellus Shale Education and Training CenterNatural Gas Workforce Information
  22. 22. ● Construction, manufacturing andtransportation● Drilling, completion and production● Geological and geophysical● Pipeline and associatedinfrastructure● Environmental & other consultingservices● Legal & land● Natural gas distribution● Service industries, logistics &distribution● Retail, food, health, education &financial servicesSupply Chain Opportunities● Work boots, uniforms & uniformcleaning● Well pad cleaning● Alternate housing – RVs, mini-homes● Fencing, landscaping & irrigation● Concrete● Security, EMTs, engineers, lawyers,accountants, surveyors, etc.● Home sales, hotels, restaurants,entertainment, retail, auto sales (e.g.,pickup trucks)● Catering
  23. 23. McCully Field, Sussex
  24. 24. Guiding Principles for Hydraulic Fracturing12345Safeguard the quality and quantity of regionalsurface and groundwater resources, through soundwellbore construction practices, sourcing fresh wateralternatives where appropriate, and recycling waterfor reuse as much as practical.Measure and disclose our water use with the goal ofcontinuing to reduce our effect on the environment.Support the development of fracturing fluid additiveswith the least environmental risks.Support the disclosure of fracturing fluid additives.Continue to advance, collaborate on andcommunicate technologies and best practices thatreduce the potential environmental risks of hydraulicfracturing.We will:
  25. 25. Operating Practices for Hydraulic Fracturing25
  26. 26. Who Regulates Oil & Natural GasSector● Federal & Provincial Departments Environment (Environment & Local Government) Energy (Energy & Mines) Natural Resources Transportation Fisheries and Oceans (Agriculture, Aquaculture &Fisheries) Finance Public Safety Others may be involved: Aboriginal Affairs,Economic Development● Federal & Provincial regulatory entities: National Energy Board (NEB) Energy and Utilities Board (EUB)● Federal Programs: Chemicals management program New Substances program
  27. 27. The New Rules in NB Seismic testing procedures (e.g.,minimum setbacks 180 m) Well bore construction, casing,containment, testing, etc. (e.g. doublewell casings) Managing wastes and potentialcontaminants (e.g., closed loopsystems for drill fluids) Monitoring to protect water quality(e.g. water well testing, surface watermonitoring) Sustainable use of water (e.g., watermanagement plan and reporting) Air Emissions and GHGs (e.g.,monitoring, emissions reduction plans) Public safety and Emergency Planning(e.g., CSA compliant-EmergencyManagement program) Communities and the environment (e.g.,traffic plans, noise, water supplies) Reducing financial risks and protectinglandowner rights (e.g., financial securityfor damage) Sharing information (e.g., disclosure offracture fluids)Responsible Environmental Management of Oil and Natural Gas Activities
  28. 28. Responsible Energy Development● New Brunswickers & Canadians want to knowthat shale gas can and will be developed safely● Strong regulation that has worked successfullyin Canada can provide framework for emergingprovinces● Companies are committed to:• Responsible energy development and abide bycodes of conduct that further supports strongregulation• Accountability and transparency• Strong regulatory frameworks, enforcement policies• Scientific research and continuous improvement● Natural gas is a significant opportunity withpositive effects on economy and energy supply.Support the Responsible Exploration andDevelopment of Natural Gas in NB
  29. 29. For More informationCAPP.caFollow CAPP on Twitter:@OilGasCanadaLike CAPP on Facebook:facebook.com/OilGasCanadaCSUR.comMorefactslessfriction.caCanadiannaturalgas.ca
  30. 30. THANK YOUQUESTIONS?Sheri SomervilleNatural Gas Advisor, NBSheri.somerville@capp.cawww.capp.ca

×