From The Grand Junction Daily Sentinel (Dennis Webb):
The Colorado Oil and Gas Conservation Commission plans to expand statewide a policy aimed at preventing horizontal wells from causing leaks involving existing wells, due to a leak southwest of De Beque where such a possible link is being investigated.
The Bureau of Land Management also is looking at what it can do to try to help head off such problems.
The agencies’ actions follow the Dec. 14 discovery of natural gas and fluids bubbling up around a Maralex Resources well on Jaw Ridge, which is BLM-managed land about seven miles from De Beque. The leak’s cause continues to be investigated, and one possibility the COGCC is considering is that it resulted from hydraulic fracturing of a Black Hills Exploration & Production well that was drilled from a surface site about a mile away, but made a 90-degree turn underground and passed within about 400 feet of the Maralex well.
The Maralex well was drilled in 1981 but was shut in shortly after its drilling. It stopped leaking Jan. 17, as work continued on permanently plugging it, an effort completed a week later. Fluids initially escaped from the well pad after the leak’s start. Maralex then opened the well and directed the flow into a pit for removal by truck. That flow fluctuated widely but averaged about 6,300 gallons a day during the month before it ceased. Authorities have found no indication of contamination of surface water or groundwater. Testing continues to try to determine exactly how far the fluids spread beyond the pad within what the BLM considers to be a known maximum spill parameter.
The COGCC currently has a policy aimed at preventing what it calls the potential for “communication” between horizontal wells and existing wells in 11 counties in eastern Colorado’s Denver-Julesburg Basin. That area is seeing a boom in horizontal drilling aimed at producing oil and other liquids, in an area with numerous existing vertical wells that in some cases may not have been constructed to withstand modern-day, high-pressure fracture operations nearby.
“It is apparent that that policy needs to be pushed out statewide. It needs to be pushed out statewide very quickly,” COGCC director Matt Lepore told the commission at its last meeting.
The policy requires the COGCC engineer to evaluate all wells within 1,500 feet of a proposed horizontal wellbore to determine whether the existing wells have adequate cement sealing around them to isolate the geological formation to be fractured, as well as all groundwater zones. Also to be evaluated is whether an existing well’s wellhead and master valve are rated to 5,000 pounds per square inch of pressure, or alternatively that there is adequate mechanical isolation down the well.
If concerns exist regarding an existing well, the company proposing the horizontal well must take measures that can range from doing remedial cement work in the existing well to isolate all formations, to properly plugging it, to replugging it if needed or proposing alternative mitigation. An existing well’s owner cannot refuse to let mitigation work occur.
The COGCC initially implemented the policy for horizontal wells coming within 300 feet of existing wells. It eventually expanded the distance after pressure readings and other data collected at existing wells during fracking of new ones indicated a need to do so.
Lepore told the commission one concern companies have is the lack of data that would justify the 1,500-foot-distance standard in the case of wells outside the DJ Basin. He also noted that there are currently few plans to drill horizontal wells elsewhere in the state. Companies have been drilling a small number of such wells for exploratory purposes in the Piceance Basin.
LEAK THEORY INVESTIGATED
The Maralex well was drilled into the Dakota sandstone formation, while the Black Hills well targeted the Niobrara shale, part of the shallower Mancos formation. The COGCC says the Maralex well wasn’t cemented to isolate the Niobrara zone because that zone wasn’t considered a producing formation when the well was drilled. It’s looking at whether gas liberated from fracking the Black Hills well reached the Maralex well, pushing gas and water to the surface.
Bruce Baizel, energy program director with the Earthworks conservation group, has said another concern in horizontal drilling is that it may occur around older existing wells that may have corroded pipes or cement sealing that has weakened over time and can’t stand up to fracking pressures.
Maralex plugged its well in stages after the discovery of the leak. When it finished plugging the Dakota sandstone formation, the leak slowed but continued. The leak stopped once plugging was completed at the top of the Mancos formation. But that in itself hasn’t been enough to convince officials that the Black Hills well fracking caused or contributed to the problem.
Test results of fluid that flowed back from the Black Hills well are still being awaited. Samples of flowback fluid from another Black Hills horizontal well farther from the Maralex well proved to differ significantly from the fluid that came up the Maralex well.
THE BLM’S ROLE
Agency spokesman Steven Hall called the Maralex situation a rare one for the BLM, which he believes has seen few instances where fracking has occurred close to shut-in wells on lands it administers in Colorado. While noting that the leak’s cause hasn’t been determined, he said the BLM wants to do what it can to prevent problems between horizontal and existing wells. He said the BLM is reviewing how it manages horizontal drilling and fracking on federal land in the state. The agency has no rules or policies addressing potential communication between horizontal and existing wells. But Hall said it has a lot of leeway during the process of reviewing drilling permit applications to impose conditions to try to avoid such situations. In addition, it is working to deal with the situation of wells that are shut in for a long time, to make sure they are permanently plugged, put into production, or tested to ensure their integrity.
“We’re going to try to be very aggressive in addressing those,” Hall said.
The agency previously has said that of 110 wells Maralex owns that involve federal lands or minerals in western Colorado, 86 are shut-in — in nearly half those cases for more than 20 years. It has met with Maralex about coming up with a strategy for addressing its shut-in wells.