the northeast ong marketplace - march 2014

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THE ONG SPOTLIGHT - Page 3A Message from Toby Z. Rice, President and COO, Rice Energy

WATER MANAGEMENT - Pages 6-7ClO2 - Baker Hughes Gives the Facts

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

The Northeast ONG Marketplace

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In collaboration, Shale Media Group andThe ONG Marketplace have worked hard tore-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 [email protected] or call 215-317-1177.

March 2014

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.

Th e Marcellus Shale and Utica Shale plays are generating jobs and economic prosperity to hundreds of thousands of residents in Pennsylvania, Ohio and West Virginia. Th e 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 fi ghts. We cannot assume that someone else will fi ght 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

benefi tted 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.

THE ONG SPOTLIGHT

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 Offi cer, rang the NYSE Opening Bell.

Toby Z. Rice will speak at theOhio Valley Regional Oil & Gas Expo

April 30 - May 1, 2014 • www.ohiovalleyoilgasexpo.com


ASSOCIATION MEETINGS

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

OGIS New York | April 7 - 9, 2014 New York, NY - www.ipaa.org

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

Shale Media Group Monthly Events

MARCH 2014

3/27Sweetening up the Shale

3/26 Elite Crew Change

To register or for more information on the events, go to shalemediagroup.com

3/28Elite Energy Event

ARTICLESTHE ONG SPOTLIGHT: A Message from Toby Z. Rice, President and COO, Rice Energy, Inc. ............ 3

WATER MANAGEMENT: Chlorine Dioxide (ClO2) Oil and Gas Applications: The Facts .................... 6-7

HEALTH & SAFETY: Focus on Personal Protective Equipment - Hearing Protection ..... 10-11

ENVIRONMENTAL MANAGEMENT: Thermal Oxidizers for Natural Gas Industries Compliance Issues Facing Midstream Production ............... 14-15

INDUSTRY INSIGHT: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

ADVERTISER INDEXALPINE ELECTRIC ........................................... 12

AMERICAN REFINING GROUP ..................... 12

BRI-CHEM ......................................................... 21

CPI SERVICE .................................................... 19

CHANCELLOR INSURANCE ............................ 5

CST INDUSTRIES ............................................ 13

D&S INDUSTRIAL PRODUCTS .................... 17

DR WELL SITE ................................................. 16

ERNST SEED .................................................... 23

ETC ....................................................................... 7

FAIRMONT SUPPLY ........................................ 11

FOSSIL ROCK SERVICES .............................. 12

GAS FIELD SERVICES, INC ............................ 1

GOODWIN PUMPS - XYLEM ........................ 12

JM MILLER .......................................................... 5

KEYSTONE CLEARWATER SOLUTIONS ..... 16

KUHNS BROTHERS .......................................... 5

LAYFIELD ............................................................ 2

LEE REGER BUILDS .......................................... 5

LEE SUPPLY ........................................................ 5

MACHINERY STREET ..................................... 17

MANSFIELD CRANE ......................................... 5

MID-ATLANTIC STORAGE ............................. 12

MIDSTREAM PHOTO.COM ........................... 11

MJ PAINTING CONTRACTORS ....................... 5

NORTH AMERICAN FIELD SERVICES ........ 12

PENNINGTON SEED ....................................... 15

PPC LUBRICANTS ........................................... 16

PSB ....................................................................... 5

QUALITY BRIDGE AND FABRICATION ....... 12

RIGMAIDS ......................................................... 16

SAMCO ENTERPRISES .................................. 12

SHALE MARKETS ............................................ 15

SHALE MEDIA GROUP ................................... 23

SHANNON SAFETY PRODUCTS .................. 12

SKYCASTERS ................................................... 23

STEEL NATION STEEL BUILDINGS ............. 19

ST!CK ................................................................. 16

SUNNY SIDE SUPPLY ....................................... 8

TECTONIC ......................................................... 11

THE SHALE ACADEMY.COM ........................... 5

UNIT LINER ........................................................ 9

V-F CONTROLS ................................................ 12

VEYANCE TECHNOLOGIES ........................... 21

WEAVERTOWN ENVIRONMENTAL ............. 16

CALENDARSASSOCIATION MEETINGS ............................... 4TRAINING & WORKSHOPS .......................... 16UPCOMING EVENTS ...................................... 20NETWORKING EVENTS ................................. 21

EVENTS

OHIO VALLEY OIL & GAS EXPO ................. 13DUG EAST ......................................................... 26EGCR .................................................................. 15ELITE ENERGY EVENT ................................... 15PIOGA’S CONFERENCE ................................. 25NAPE EAST ....................................................... 28OIL AND GAS AWARDS ................................... 8UTICA-MARCELLUS INFRASTRUCTURE ... 15

CONTACT US FOR ADVERTISING,INFORMATION OR MAILING LIST CHANGES:


P. O. Box 1441 • Oak Hill, WV 25901855-269-1188

Fax: 304-465-5065E-mail: [email protected]

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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INTERESTED IN ADVERTISING? SEE PAGE 27 FOR SIZES AND CONTACT INFO


WATERMANAGEMENT

By: Charles Kozora, Account Manager, Baker HughesMorgan McCutchan, Technical Manager, Baker HughesSteve Monroe, Product Line Manager, Baker Hughes

IntroductionChlorine dioxide (ClO2) has been used in oil and gas applications and in refi neries for decades with overwhelming success. It has been shown to be an eff ective 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. Th e application of an aqueous solution of ClO2 effi ciently neutralizes APB and SRB bacteria, hydrogen sulfi de, iron sulfi de, phenols, and mercaptans in source, fl owback, 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. Th is 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 fi eld 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 safeMuch of the safety concerns with ClO2 center upon the perception that it is fl ammable. While ClO2 gas at concentrations above 10% in air is mildly volatile (i.e. it ”puff s”), 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 fl ow. When no water fl ows, no chemicals fl ow and no ClO2 is created. When water fl ows, chemicals fl ow and a ClO2 solution in water is created. Th is process ensures safe and effi cient generation of the ClO2.

Fact #2: ClO2 does not aff ect pH or performance of hydraulic fracturing fl uidsWhile a 3000ppm ClO2 solution is slightly acidic, the dosage levels used have a negligible eff ect 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 fl uid system.

A much more in-depth evaluation on the non-eff ect of ClO2 on the performance of the slick water friction reducers is discussed in a white paper by Baker Hughes. Th is paper is available upon request.

Fact #3: ClO2 is not corrosiveFor the application concentrations used in the fi eld, ClO2 is less corrosive than

CHLORINE DIOXIDE (ClO2) OIL AND GAS APPLICATIONS: THE FACTS

March 2014

almost any acid used in hydraulic fracturing. To better understand the concerns, however, Baker Hughes examined 12 common oilfi eld 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. Specifi cally, a 0.03 index (lbs/ft 2) was observed, which is well below an industry accepted standard of 0.05.

Fact #4: ClO2 does not create THMs in waterTrihalomethanes (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. Th erefore, ClO2 has no eff ect on the formation of THMs.

Fact #5: ClO2 does not chlorinate waterChlorine 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 effi cient and introduce less NaCl into the water than two precursor systems.

Fact #6: ClO2 is environmentally preferredClO2 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

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.

ConclusionLocally, 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, eff ective, and economic solution for treating any water source for use in hydraulic fracturing. Knowing the facts will help everyone in capitalizing on its numerous benefi ts.

For more information, contact:Chuck KozoraAccount Manager – Northeast

Baker Hughes | Water Management 400 Technology Drive, Canonsburg, PA 15317 [email protected] ce: 724-514-5235 Mobile: 412-496-4069


WWW.ONGMARKETPLACE.COM

March 2014

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PRESS RELEASE


HEALTH& SAFETY

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 diff erent 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 fi eld.

Th e 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.

Th ere 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. Th e sound waves passing into the outer ear are not able to make it to the cochlea. Th is 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. Th is 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 eff ects. Th e 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 suff er 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 in 9 recordable illnesses. Th e most disturbing aspect of this statistic is that in order to be OSHA recordable, the hearing loss must be determined to be work related and must be severe enough that the worker is considered hearing impaired.

Th e 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. Th is 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. Th e 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. Th e third component is to have all of the workers receive an audiometric evaluation, or hearing test to establish baseline hearing ability.

Th e fourth and fi ft h components of a successful hearing conservation program go hand in hand. Th e fourth component is to use hearing protection and the fi ft h component is to keep the worker educated and motivated to use hearing protection. Th ese 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 muff s, if the employee doesn’t understand how to properly use the PPE or the importance of using it, successful protection will not be achieved.

Th e fi nal three components are all administrative. Th e sixth component involves good record keeping of everything from noise levels in the work environments to all of the employee’s annual hearing exams. Th e seventh component is to continually evaluate your hearing conservation program to make sure it is as eff ective as possible. Th e fi nal component is to make sure

FOCUS ON PERSONAL PROTECTIVE EQUIPMENT – HEARING PROTECTION

“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). ”

March 2014

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.

Th e fi nal 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 aff ect 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 aff ected at levels as low as 80 to 85 dB (A).

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. Th ese negative eff ects can also occur aft er the noise has stopped, oft en resulting in a reduced tolerance for frustration. Th ese 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 eff ects on job performance. Th ere is also systematic evidence that employees who use hearing protection, when properly fi tted 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

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.

Once again, I would like to thank you for reading these articles.

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

Th anks Chris!

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March 2014

April 30 - May 1, 2014Belmont County Carnes Center, St. Clairsville, Ohio

BELMONT COUNTY SUPPORTS AMERICA’S ENERGY INDEPENDENCE

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Join us in Belmont County for the 3rd Annual Ohio Valley Regional Oil & Gas Expo to explore and understand new possibilities in the Utica Shale play. Limited sponsorships & exhibitor opportunities are availiable.

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FRACT OR FICTION? Marcellus producers have invested more than $411 million to build and repair Pennsylvania roads since 2008. Answer on Page 21


ENVIRONMENTALMANAGEMENT

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. Th e 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 aff ordable and less impactful on the landscape. Th is is good news for the country and our environment.

Th e Midstream ProcessMidstream gas processing plants are complicated production facilities. Th ese plants process large quantities of natural gas and hydrocarbons. Safety comes fi rst at every site and high quality standards drive every decision.

Th e 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. Th e 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. Th e 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.

Th e ProblemTh e 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 sulfi de (H2S). Given the complications the vent

gas presents, many operators have opted to use fl ares as the abatement device. However, fl ares have several drawbacks that prevent effi cient operation and under recently proposed EPA changes to the rules, fl ares will surely be discontinued in many future plant designs. (See, for example, 40 CFR, Part 63.11b for fl are design criteria that will apply to fl are installations in the future). As a replacement

technology for fl ares, thermal VOC abatement can provide substantial benefi ts. Th ermal 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. Th ermal Oxidation provides very high destruction effi ciency and is considered a safer method than fl aring.

Gas processors are now focused on effi cient operations of their plants. Th e 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 effi cient to help lower processing costs, provide more product for sale, and limit GHG emissions

Th e SolutionTh e fi rst 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, off ers 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, diff erent natural gas regions have diff erent varieties of gas, and thus diff erent vent gases can be expected. Once the vent gas has been defi ned the fi nal choice of abatement technology can be considered.

Th ermal Oxidation can be segmented into three primary technologies for the natural gas processor:

• Regenerative Th ermal Oxidation – uses ceramic media and switching valves• Recuperative Th ermal Oxidation – uses traditional shell and tube heat exchanger• Non-recuperative Th ermal Oxidation – commonly called an aft erburner 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

THERMAL OXIDIZERS FOR NATURAL GAS INDUSTRIES COMPLIANCE ISSUES FACING MIDSTREAM PRODUCTION

March 2014

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 off ers all technologies. Th e right equipment provider can work with the gas processor to identify all considerations in equipment design and fi nally off er 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, [email protected]

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• 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 15%

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TRAINING & WORKSHOPS

APRIL

6 PEC Basic Orientation – SafeLand USAWashington, PAwww.rjrsafety.com

6 Pre-Drill Water Sampling WorkshopMonroeville, PAmarcelluscoalition.org/get-involved

7 Pre-Drill Water Sampling WorkshopMonroeville, PA marcelluscoalition.org/get-involved

10 - 12 Wild Well Control Training – DrillingCanonsburg, PA www.wildwell.com

11PEC Basic Orientation – SafeLand USASt. Clairsville, OH www.rjrsafety.com

12 PEC Basic Orientation Hughesville, PA [email protected]

13 PEC Basic Orientation Washington, PA www.eastcoastriskmanagement.com

13 - 15 Wild Well Control Training – DrillingCanonsburg, PAwww.wildwell.com

17 - 19Wild Well Control Training – DrillingCanonsburg, PA www.wildwell.com

17 - 20 Wild Well Control Training – Drilling & Work OverCanonsburg, PAwww.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 [email protected]

20 PEC Basic Orientation - SafeLand USAWashington, PA www.rjrsafety.com

24 - 26 Wild Well Control Training – Drilling Williamsport, PAwww.wildwell.com

24 - 26Wild Well Control Training – WorkOver 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 OrientationHughesville, PA [email protected]

31 to April 2 Wild Well Control Training – DrillingBuckhannon, WV www.wildwell.com

31 to April 3 Wild Well Control Training – Drilling & Work Over Buckhannon, WV www.wildwell.com

3 Transportation Safety Day and Flagger TrainingState College, PA marcelluscoalition.org/get-involved

7 PEC Basic Orientation – SafeLand USA New Philadelphia, [email protected]

9 Energy Industry Training Series Washington, PA ypepittsburgh.org

MARCH

March 2014

WWW.ONGMARKETPLACE.COM FOR LINKS TO UPCOMING INDUSTRY EVENTS


INDUSTRYINSIGHT

By: Jim Garner, Ground Scouts

Working at NASA for almost a decade, I saw some pretty bizarre behavior. Th is oft en happens in a large-scale 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 fi nd 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. Th eir 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 signifi cantly 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. Th e complacency of waiting until the State Inspector comes to see you, is no longer viable.

It turns out both views are connected! Now let me explain the $100,000 hammer…

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 fi eld position of wells, pipelines and access. Th ey 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 band-aid on a costly wound.

Knowing about a NASA invention for fi nding things under the surface of Mars, I put a plan together that would allow the client to accurately fi nd their pipeline systems, at a more aff ordable 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. Th e 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! Th e Operations Manager quickly remembered my company had started work and grabbed one of our fi rst maps. Penalties mitigated! (190.225 (5))

3. Th e $100,000 Hammer: Th e states were starting to enforce CFR 49 Part 192.5 compliance for gathering lines. Th us, 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)). Th e only up-side would be limit of $1M.

What we found was this:Every producer who has legacy gathering lines is conscious of safety. Th ey also can work out the math that a few bucks spent now will save them three in the near future. But the simple side-eff ect 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.

THE $100,000 HAMMER

March 2014

Th e process works! Once the Ops Manager was able to show the state our services were already under contract, (to fi nd, map and do a sliding-mile analysis on their systems,) all penalties were mitigated as per the same code!

In short, if your company is faithfully trying to fi nd and eliminate compliance issues, the code dictates that penalties will not be levied. But it needs to be a documented eff ort! Th ankfully we were able to understand and fi nd 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 offi ce. 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 [email protected]

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UPCOMING EVENTS

MARCH17-19

SPE International Conference on HSELong Beach, CA | www.spe.org/events

25-26SPE Coiled Tubing and Well InterventionThe Woodlands, TX | www.spe.org/events

26-27Produced Water Disposal and Reuse InitiativeCanonsburg, PA | www.produced-water-utica-marcellus-2014.com

APRIL (continued)

APRIL1-3

SPE Unconventional Resources ConferenceThe Woodlands, TX | www.spe.org/events

7-9ShaleSafe Conference & ExpoWheeling, WV | www.shalesafe.info

9-11NAPE EastPittsburgh, PA | www.napeexpo.com

14-16VOGA Regional Natural Gas Vehicle ConferenceRichmond, VA | www.vaoilandgas.com

16-17AIPG 5th Annual SymposiumColumbus, OH | www.aipg.org

1712th Annual Michigan Petroleum ConferenceAcme, MI | www.michiganoilandgas.org

22-24Utica-Marcellus InfrastructurePittsburgh, PA | www.infocastinc.com/events/utica

Denotes National EventVisit our website for links to these events

WWW.ONGMARKETPLACE.COM/EVENTS

29-30Utica & Marcellus NGL & Natural Gas Markets Congress Columbus, OH | www,american-business-conferences.com

29-30LNG Export USA 2014: Global Buyers CongressHouston, TX | www,american-business-conferences.com

30-May 1Ohio Valley Oil and Gas ExpoSt. Clairsville, OH | http://www.ohiovalleyoilgasexpo.com/

5-8Offshore Technology ConferenceHouston, TX | www.otcnet.org/2014

12-135th Annual National Shale ConferenceFarmington, PA | www.neienergy.org

13-14Oil & Gas Environmental ComplianceConference - Appalachian BasinWashington, PA | http://oilandgas.awma.org

13-14PIOGA’s Eastern Oil & Gas Conferenceand Trade ShowPittsburgh, PA | www.pioga.org

13-15Eastern Gas Compression RoundtableMoon Township, PA | www.egcr.org

15Drilling Onshore Conference & ExhibitionHouston, TX | www.iadc.org

MAY

March 2014

$411 Million

Marcellus producers have invested more than $411 million to build and repair Pennsylvania roads since 2008.

FRACTMany Marcellus producers have made commitments to help the communitiesthey work in.

marcelluscoalition.org #fractorfiction

March 5YPE Pittsburgh Crew Change Bridgeville, PA | www.ypepittsburgh.org

March 19Energy Group MixerWilkes-Barre, PA | [email protected]

March 26Elite Crew ChangePittsburgh, PA | www.ypepittsburgh.org

March 27Sweetening Up the ShaleWashington, PA | www.shalemediagroup.com

March 28Elite Energy EventMonroeville, PA | www.shalemediagroup.com

April 22OVOGA Boomtown Panel Wheeling, WV | www.boomtownpanel.com

NETWORKING EVENTS

FOR MORE EVENTS VISIT WWW.ONGMARKETPLACE.COM/EVENTS

WWW.ONGMARKETPLACE.COM


NEWTECHNOLOGY

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.

Th e purpose of incorporating automation whether wired or wireless remains the same, to deliver effi ciencies that are not achievable without it.Th e 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

Th ese increasing justifi cations help build an economic case for wireless versus wired automation.

Increased ProductivityConventional wired installations can require multiple crews with electricians running wire and conduit, technicians calibrating instruments, and roustabouts digging trenches. Th e 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 oft en the producer fi nds himself on multiple waiting lists because the diff erent contractors cannot be on location on the same day. Many producers have come to accept one to two weeks as a normal timeline aft er completion to get all of the automation installed and reporting.

Contrast that, with a wireless installation.

One man can install the entire system and have the project working in less than one day. Th is 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 effi ciency by providing accurate measurement data faster.

Increase Quality or Increase Predictability of QualityWith 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

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 CostsLabor 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. Th e cost of installation with conventional wired solution was $35,125, while the cost of the same job with wireless solution was $22,418. Th e diff erence becomes even more dramatic when additional equipment is required as trenching or conduit must be replicated. Th is one tank monitoring application saved the producer $12,707. Th erefore, if they have a program to drill 25 wells this year the diff erence in cost between wired and wireless would be $317,675 and will provide the same data.

Improve RobustnessTh e 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. Th ey had one man whose job was to repair lightning damage which was exceeding 30+ wells every month. Th ey 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 fi rst year.

Safety Th e 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. Th is 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 oft en wearing oxygen packs, the amount of time they are in the high risk area can be reduced from days to hours. Clearly,

ECONOMICS OF ELECTRONIC GAS MEASUREMENT

From OSHA 2010

Radio InternetEvents Publication Video

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March 2014

the less time we have people in a potentially dangerous environment the less the risk of accidents.

Profi tabilityTime and money are saved with wireless systems. Th e fl ow 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.

ConclusionGas 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.


LEGAL &REGULATORY

By: Kristie Kubovic, Director of Communications, Shale Media GroupEdited By: Chris Stroyne, Editor, Shale Media GroupPhotos Provided By: Mustang Oilfi eld Services

Every state is a little diff erent. A particular state’s legislature is made up of a group of unique individuals with diff erent views and ideas. Th ese diff erences eventually lead to laws that vary from state to state. Even the age that you can legally get behind the wheel to fi rst obtain your learner’s permit to the age when you fi nally can obtain your full driver’s license varies from state to state. Once you receive your license, then each state enforces diff erent speed limits to follow as well.

Naturally, the laws and red tape imposed on the shale oil and gas industry are no diff erent when it comes to water hauling and driving on a state’s roads. At a well site, water acts as the primary carrier fl uid 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 Oilfi eld Services LLC. Th is 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 oft en hire a company to truck in the required water.

Mustang Oilfi eld 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. Th is means they haul freshwater to a well site for the various phases of drilling and hydraulic fracturing. In addition, they also haul the fl owback water off the well site. Th e company is also able to fi nd freshwater sources, along with fi nding disposal locations for the fl owback 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.”

Th e pendulum swings the other direction when it comes to obtaining the water and the associated cost of it. Cook explained, “Th e timeframe to permit a

ground source is much faster in Ohio than Pennsylvania. Th e 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 fl ip side, Cook says, “Th e 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. Th is leads to water costing signifi cantly more in Pennsylvania, between $12 to $15 per 1000 gallons or $50 and $60 a truck load.”

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. Th e fact that a company is able to haul more water on fewer trucks

in Pennsylvania saves on both labor and fuel costs. Th is off sets the higher cost of collecting the water.” In the end, the costs end up evening out.

On a diff erent 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. “Th e 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 fl ow times can impact aquatic life and dewatering. As stewards of the

environment, this eff ect is not taken lightly. Th erefore Pennsylvania, Ohio and West Virginia all established season specifi c 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.”

THE RED TAPE OF WATER HAULING

March 2014

In addition, “there are no specifi c 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.

Th e red tape varies from state to state when it comes to the shale oil and gas industry. Th e regulatory diff erences 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: Th eMarcellusShale.com, Th e UticaShale.com, Th eShaleAcademy.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 fi nd more details at ShaleMediaGroup.com.

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May 13-14, 2014Heinz Field • Pittsburgh, PA

Don’t Miss It!

PIOGA’s Eastern Oil & GasConference and Trade Show

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Find out more: www.pioga.org

Th e 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-eff ective way to let the industry know that you, too, are operating here and ready to do business.

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Natural gas is “dirtier” than coal.Natural gas releases 45% fewer greenhouse gases than coal.

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FICTION


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