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OOGA 2015 Summer Meeting Roundup

Posted By Lyndsey Kleven, Communications Coordinator, Wednesday, August 5, 2015

The 2015 OOGA Summer Meeting held on Monday July 27 and Tuesday July 28 at the Zanesville County Club drew a large crowd with more than 310 people in attendance. The event opened with a breakfast business session spotlighting the current state of the industry provided by OOGA Executive Vice President Shawn Bennett and OOGA Director of Government Affairs Brian Hickman. 

Following the business session, 80 golfers teed off at Zanesville Country Club in tournament style competition. As has been the ongoing tradition since 2006, the 2015 Oilfield Patriot Award event, sponsored by Producers Services Corporation took place Monday evening. Jerry Olds was the recipient of the 2015 Oilfield Patriot Award. The festivities included a reception, dinner, award ceremony, and, as always, a video presentation honoring the recipient. It was an honor to present this distinguished award to an oilfield veteran such as Jerry Olds. 

The next day kicked off at 8:30 with 136 golfers participating in a relaxed recreational golf scramble at Zanesville Country Club while 50 golfers participated at Longaberger Golf Club in more competitive play. Meanwhile, 46 shooters met at Dillion Sportsman Center for the Ken Miller Supply Clay Shoot. In addition to the golf flights and shooting, afternoon activities at the Zanesville Country Club included a corn hole competition, putting contest, and tennis matches with eight individuals playing for top doubles and singles honors. 

As the event drew to a close, Shawn Bennett presented the sporting competitions awards to the winners. Following the sporting recognitions, door prize packages were presented to ten individuals. Packages included golf items and electronics. Jim Rose was the big winner, leaving with a 55-inch Samsung Smart HDTV. 

The Association would like to thank everyone whose attendance and participation in the 2015 Summer Meeting contributed to its success. Finally, a big thank you to ALL of our sponsors including our premier sponsors: Ergon Oil Purchasing, Inc. and Ergon Trucking, Inc.; and our platinum sponsors: American Refining Group, Inc., Ariel Corporation, and Eclipse Resources. We look forward to seeing you at our next OOGA event- the Technical Conference and Oilfield Expo, being held on November 4-5, 2015 at the Pritchard Laughlin Civic Center in Cambridge, Ohio.

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Five Facts to Know About a New Pennsylvania Fracking and Health Study

Posted By Nicole Jacobs, Energy In Depth, nicole@energyindepth.org Hughesville, Pa., Monday, July 20, 2015

This week, researchers from the University of Pennsylvania and Columbia University released a study, which asserts a correlation between natural gas development and an increase in hospitalizations in three Pennsylvania counties: Bradford, Susquehanna, and Wayne. However, in the study’s press release, the authors are clear that, “the study does not prove that hydraulic fracturing actually causes these health problems.” In the actual study the researchers also admit,

The precise cause for the increase in inpatient prevalence rates within specific medical categories remains unknown.” (Page 14)

Of course, one wouldn’t know that from the media’s response to the findings, which suggests a causal link between fracking and hospital visits. Here are the top five things to keep in mind when reading this report.

Fact #1: The county with the highest number of wells (Bradford) actually had the lowest overall inpatient occurrences

Using the data in the chart below, the ranking of the counties with the highest number of incidents by population is as follows: Susquehanna (1.92), Wayne (1.69) and Bradford (1.57).

Table2-CountyDemographics

If we are to follow the researchers’ logic and assume a link between well density and hospitalizations, shouldn’t Bradford County, which had the highest well density, have the highest number of incidents? One would think so, but actually the authors note that the zip code with the highest incidences of hospitalizations was found in Wayne County, where no natural gas development occurred due to a moratorium put in place by the Delaware River Basin Commission (DRBC). From the report:

“In our analysis, one particular zip code had extremely high inpatient prevalence rates compared to other zip codes. Thus, a sensitivity analysis was performed (data not shown). This zip code is located within Wayne County and had no active wells from 2007 to 2011.” (Page 12)

Interestingly, that zip code was removed from the analyses with no explanation as to why. What’s more baffling is that the authors also removed a zip code from Bradford County that had “extremely high wells/km2 in 2010 and 2011.” From the report:

“In our analysis, one particular zip code had extremely high inpatient prevalence rates compared to other zip codes. Thus, a sensitivity analysis was performed (data not shown). This zip code is located within Wayne County and had no active wells from 2007 to 2011. Removal of this zip code from the analysis had little effect on either the number of wells or the quantile analyses, and there was no change in inference and the estimated risk ratios. Next, a zip code in Bradford had extremely high wells/km2 in 2010 and 2011, 16.9 wells/km2 and 23.4 wells/km2, respectively. Consequently, we explored both sets of analyses without this zip code to determine whether removal of this zip code changed inference. Like the first sensitivity analysis, removal of the Bradford zip code had little effect on inference.” (Pages 12-13)

What the authors don’t make clear is what the incidence rates for hospitalization looked like in the zip code with “extremely high wells” or why it was removed. Could it be because the hospitalization rates were very low or stable?

Fact #2: Hospitalization rates by zip code remained stable or declined

The researchers state,

“Fig. 3 also shows that, within each zip code, the contribution by year was comparable, suggesting that within each zip code, the inpatient rates are relatively stable from 2007–2011. Indeed, the average overall inpatient prevalence rates for 2007–2011 are, respectively, 15.18, 15.30, 14.86, 14.00, 14.25. This indicates that on average, zip code overall inpatient prevalence rates were relatively stable or possibly declining from 2007 to 2011, which mirrors national trends.” (Page 9)

What’s more is these occurrences remained stable or even at times decreased, despite significant growth in the numbers of wells in each county, as Figure 2 from the report demonstrates.

Fig2-Wells

If the wells being placed near residences occurred at this high a rate and a link did exist between this and hospitalizations, shouldn’t the incidences of those hospitalizations also have risen? One would think so, and yet they didn’t.

Fact #3: Researchers don’t account for the fact that cardiovascular and neurologic disorders from outside exposures take decades to develop – or any other causes of health problems for that matter

Although the authors’ data show that overall incidents weren’t impacted by well density, they proceed to apply obscure modeling exercises, breaking health incidents down into 25 categories – and from that, they claim cardiologic and neurologic incidences increased more in zip codes with higher well densities.

But, of course, making such a correlation isn’t that simple. The researchers never address the specific diseases within these categories or if the patients suffered from a history of heart disease, heart attacks, stroke, diabetes, artery obstruction, or neurologic disorders. Were these new incidences? Did these individuals smoke? Were they overweight?

Further, age and sex (i.e. being male) increases the risk of some heart conditions such as heart attacks according to the American Heart Association. Did the male population increase? Were these conditions occurring in younger individuals or the elderly who are more prone to heart problems?

In a recent radio interview, Dr. Theodore Them, the Chief of Occupational and Environmental Medicine for Guthrie Health Systems in Bradford Count,y noted that studies on shale development often leave out the very crucial element of “confounders.” As Dr. Them put it,

“And there can be confounders such as smoking habits, drinking habits, drug use that never get accounted for in these studies and cause people to come to the wrong conclusions.”  (28:36-30:09)

And this is confounded by the fact that the study focuses on two health categories (heart conditions and neurological problems) that are well-known to take decades to develop, rather than occur instantaneously from short-term exposures. The authors acknowledge this limitation in the study, noting,

“We recognize that a five-year observation period may limit our ability to discern a direct impact on health in the surrounding community but may offer an opportunity to assess hospital utilization rates over time.” (Page 13)

What can occur from short term effects, however, are pulmonary conditions (lung problems), but the researchers did not see any increase in these. As the Philadelphia Inquirer reported, quoting Reynold A. Panettieri Jr., a “senior author” in the study,

“Panettieri said that he had expected the analysis to find an increase in pulmonary admissions – it did not.”

Fact #4: Previous health studies by medical professionals in these counties contradict the researchers’ findings

This study is also not in line with previous studies conducted in the state, or with the experiences of medical professionals in these counties. The Center for Rural Pennsylvania recently conducted a study that looked at inpatient hospitalizations in Lycoming and Bradford Counties in northwestern Pa., and Green and Washington Counties in the southwestern part of the state. These are some of the most heavily drilled counties in the Marcellus. It found:

“Inpatient hospitalizations in the four counties and the two regions increased slightly in the northern tier and decreased slightly in the southwest, but it is not possible to directly connect this to Marcellus Shale drilling.”

It continued:

There are no overall trends for injuries in the four study counties or across the two regions; however, there are noticeable increases in injuries associated with falls, motor vehicle accidents, and accidents involving motorcycles. These types of injuries could be related to any type of large-scale construction activity and not necessarily to Marcellus Shale drilling.

In the radio interview mentioned before, Dr. Them provides a different view altogether on what the health system has seen in the years since natural gas development took off in the county. From that interview (emphasis added):

As far as the remainder of the population, in the six or eight years that we’ve been having drilling ongoing around us, I’ve had two people come to me or were referred to me. Two total. One was a gentleman who lived between a limestone quarry and a well and had his water quality tested and found there were relatively high levels of barium… This gentleman’s problem was not from the gas wells. It was from the limestone underlying his home through which his water well went and through which the groundwater flowed. And the solution was to put a reverse osmosis unit on his drinking water supply. And he went away. I never heard from him again.”

“The other one was a case of a middle aged woman who came to me and her demand was, “I want compensation.” And when asked why she wanted compensation, it was “for the chemical exposure” which she was alleging she experienced from hydrofracturing water tankers that went passed her house on a daily basis. Now this is a woman with 30 years of allergies to environmental materials such as dust, trees, mold spores, pollen, grasses and so on. And her complaints were nosebleeds and congestion. And her complaint was that the trucks were causing her nosebleeds and congestion because they were going by her house and carrying chemicals, when in fact they were carrying water… She wanted money from the gas companies from her alleged suffering from nosebleeds and congestion from which she had suffered the prior 30 years without any change.

That’s the extent of the people that I have either had referred to me or I have seen in my practice in occupational medicine since 2006-2007-2008. I’m not seeing a flurry of people coming to see us along these lines, despite the fact that the 275 other physicians in my group know that, I and my core colleagues, are the experts in these matters and that such patients should be sent to us. We’re not seeing them.” (18:30-22:18)

Dr. Them went on to say:

I have yet to see any conclusive study, any absolutely conclusive study, on confirmed adverse human health impacts from drilling, particularly in the Marcellus Shale. The Barnett Shale in Texas has been produced for 20 years—Dr. Zucker referred to that—no confirmable documented adverse human health effects there, despite the fact that the Barnett Shale formation is very similar structurally, geologically to the Marcellus Shale.” (29:32-30:06)

Fact #5: At least one of the researchers “aims to stop fracking”

At least one of the authors, Poune Saberi, has been openly opposed to shale development, as is evident from her blog posts on the website Protecting Our Waters, a group whose mission is:

“To protect our water, air, health, biodiversity, climate and communities, we aim to stop fracking.”

And while we’d like to give her the benefit of the doubt to be able to be unbiased in her research, it’s a little difficult to do when she has made her agenda to stop fracking very clear on multipleoccasions, such as following video:

 

“And I will say that until we have credible science that will help us answer these individuals and their communities, there must be a moratorium on all steps that are involved in the high volume and extreme methods of natural gas extraction, processing and transport.” (1:53)

Her mission extends to a wider anti-fossil fuel agenda. As she puts it in one of her blog posts,

There is a Dakota saying that goes like this: ‘When you find yourself riding a dead horse, dismount.’

My name is Dr. Poune Saberi and I am a physician in Occupational and Environmental Medicine and a faculty member at the Hospital of the University of Pennsylvania. I am here to say: fossil fuels are dead and we must dismount.

Conclusion

The bottom line is that the researchers’ data show hospitalization rates remaining stable, with high oil and gas developing counties having the lowest hospitalization rates, while the county with no wells had the zip code with one of the highest hospitalization rates.

Health studies are important and should add to the growing dialogue and to improve best management practices for multiple industries. But this report appears to be yet another spearheaded by anti-fracking activists that resorts to claims of “needing more study” because it fails to find the scientific evidence to malign the development that’s bringing economic, and indeed, environmental and health benefits to Pennsylvanians and families across the country.

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State Budget Bill Finalized with Impacts on Oil and Gas Operations

Posted By Brian Hickman, Director of Government Affairs, Operations Managing Director, Wednesday, July 15, 2015

Now that the final version of House Bill 64 (Fiscal Year 2016-2017 State Budget Bill) has been passed and enacted, several new provisions have been placed into Ohio oil and gas law. While the focus of this year’s budget bill seemed to be the implementation of a higher severance tax on oil and gas interests, other regulatory changes were implemented into Ohio law.

A higher severance tax rate was not enacted in the final version of the budget bill. What was enacted was a special study committee on the issue as a part of the 2020 Tax Study Commission. The Commission will be comprised of seven members: three from the Ohio House, three from the Ohio Senate, and one appointment by the Governor. These members will analyze the issue and present their findings to the Ohio legislature by October 1, 2015.

Another issue that was inserted into the budget bill during conference committee deliberations was unitization. As you recall, a substantive overhaul of Ohio’s unitization statute (Ohio Revised Code Section 1509.28) was included in the Governor’s executive budget proposal. While this language was removed, language was inserted into the bill that would permit ODNR to issue unitization orders for properties that are wholly owned or partially owned by the Ohio Department of Transportation (ODOT).

The largest regulatory undertaking during the budget bill was a discussion on providing the Ohio Department of Natural Resources (ODNR) with notification during select emergency situations. The measure was originally proposed in the Governor’s executive budget proposal. After holding several negotiations with the ODNR, language was amended in the “As Passed By The House” version of the budget. This was the final language that was approved by the Conference Committee on the matter.

However, in all state budget bills, the Governor has the ability to line-item veto provisions. Governor John Kasich issued a line-item veto of this emergency notification provisions. He noted that the final language was “ambiguous and could result in unnecessary disputes regarding compliance”. The Governor went on to note that he intends to issue an Executive Order in the near future that would institute this notification for the ODNR.

Language that would streamline EPCRA reporting remained in House Bill 64 after conference committee deliberations. With this language now part of Ohio law, the ODNR will work on upgrading their current online system for reporting chemicals used on a well site. It is the hope, with this legislation now streamlined, that paper reporting for EPCRA will not need to be done for 2016.

These four topics are only a glimpse of the changes to Ohio law as it pertains to the oil and gas industry. For more information on all the changes, be on the lookout for the August edition of the OOGA Bulletin. If you have specific questions, feel free to contact the Association. 

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Ohio Oil & Gas Safety Council

Posted By Brian Hickman, Director of Government Affairs, Operations Managing Director, Thursday, July 9, 2015

 

The Ohio Oil & Gas Safety Council (OOGSC) is a not-for-profit organization organized by the Ohio Oil & Gas Association (OOGA) in collaboration with the Ohio Oil & Gas Energy Education Program (OOGEEP) and the Ohio Bureau of Workers Compensation (BWC) Division of Safety & Hygiene (DSH).

The goal of the OOGSC is to provide quality occupational safety training opportunities and safety resources for these member companies. Our mission is to promote health and safety awareness and environmental stewardship within the oil and natural gas industry in an effort to reduce workplace injuries.

The OOGSC continues to delve into several relevant safety topics. Over the past year, we have discussed topics pertaining to exploration and production safety, truck driver safety, proper handling of condensate, pipeline safety, the importance of establishing a unified command procedure when dealing with an on-site incident, sleep deprivation and its impact on oil and gas workers, amongst others.

The OOGSC is also a great way to learn more about industry-related training opportunities. Organizations like the Ohio Oil & Gas Energy Education Program (OOGEEP) and the Ohio Bureau or Workers Compensation (Ohio BWC) provide several educational opportunities that are beneficial to the Ohio oil and gas industry. The OOGSC will update you on these opportunities in an effort to promote continued industry safety. 

Membership in the OOGSC is open to the public. Additionally with your membership, employers who pay premiums or administrative fees to the Ohio BWC may be eligible to earn a 2% to 4% rebate on their workers’ compensation premium. 

Membership in the safety council is open throughout the year to all companies. However, to realize any discount eligibility opportunities, companies must join or renew their membership prior to July 31st to qualify for the current year program. 

Additional information on the Ohio BWC Safety Council Program, including information on potential rebates and discounts, can be found via their website: https://www.bwc.ohio.gov/employer/programs/safety/SafetyCouncils.asp#

Membership in the OOGSC is $120.00 per company and reserves one seat (and meal) at each monthly meeting. Additional attendees from member companies are encouraged to attend. However, any additional members will be charged a nominal fee to cover the meal costs at the event.

The OOGSC currently meets on the second Wednesday of each month at the Cambridge Country Club, come by and see what the OOGSC has to offer. 

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Member Spotlight: Jeff Moore, Moore Well Services, Inc.

Posted By Lyndsey Kleven, Communications Coordinator, Tuesday, June 30, 2015

The member spotlight series features legacy OOGA members who have been a member of the Association for at least 10 years. If you would like to recommend someone to be highlighted, please contact Lyndsey Kleven lyndsey@ooga.org

Background information:

Jeff Moore and his brother Keith grew up in the oil and gas industry, taking the lead from their father Bob. Once the brothers reached adulthood, they already had an idea of what they wanted to do.

Moore says, “We were initiated into the oilfield by growing up with our dad and working from day one, our education is straight from the field.”

Although Jeff himself never considered going outside of the oil and gas industry, there have been opportunities where he could have gone in a different direction. All in all, he always felt it was best to stay loyal to the family business.

About Moore Well Services, Inc.:

Bob Moore started Moore Well Services, Inc. in 1996, following the closure of KST Oil and Gas Company, and set up shop just down the street in Stow, Ohio.

“We’re a conventional company trying to do conventional things,” Jeff said. “We’re looking for other options and avenues to increase our revenues in times like these, just like everyone else.”

The company has 10-15 employees and will basically do everything that involves oil and gas work. Moore Well Services has 240 of its own operating wells; does well service operations, all the way to oil spill clean ups, and has disposal wells, including a 7,000-foot well in Cuyahoga Falls. The staff is made up of full time pumpers, a service work team, full roustabout crew, full rig crew, mechanic, and water truck driver.

Working for his father since 1985, Jeff, along with his brother Keith, found themselves transitioning towards running the company in 2007 when their father and his business partner both became ill. Jeff said it was a nice transition to have his father around for the following two years to advise how to run things. In 2009 when their father passed away, Jeff and Keith took over the company.

“Our work load has definitely shifted to the service side right now. We are pushing really hard to get a bigger customer base, broaden our footprint, and get as many customers as we can. In the late 2000’s we were more focused on production operations and drilling as much as we could.”

Most of their producing wells span from Cleveland to East Liverpool, with the majority of the wells being in Summit County. Recently Moore Well Services branched out into the Ohio Department of Natural Resources (ODNR) orphan well program. In late December, Moore Well Services worked to plug a leaking natural gas well in the Admiral Ernest J. King Elementary School, known as the Admiral King Elementary project.

“We physically had to remove a part of the school, cut a hole in the gymnasium floor and mobilized operations inside the gym to plug the well. That was probably our most high profile plugging project, it was extreme, the school district shut down and evacuated the school for three months. We were able to set new surface pipe and eventually plug the well, along with another orphan well located in the same area.

The ODNR orphan well program has kept Moore Well Services and other contractors very busy over the past year. With the downturn in oil and natural gas prices, it has been a good focus while business is slower. 

Another project Moore currently has an interest in has been the processing and marketing a new natural saltwater product call AquaSalina. The product is used as a pre-treatment for de-icing roads and dust suppressant, it is all-natural and has a low freeze point (-15° F), which is lower than man made salt brine.

Moore partnered with Dave Mansbery of Duck Creek Energy, Inc. the innovator and creator of AquaSalina. They repurpose conventional brine water from wells that have been in production for over a year and run it through a vigorous filter process developed by Mansbery. 

“The product is a pre-treatment for roadways, parking lots and driveways. It’s being produced, repurposed and sold to ODOT, municipalities, and landscapers statewide and across the US.” 

Repurposing brine water and channeling it into a practical product is both innovative for the industry and is helping to cut down on the need for other disposal methods. The product is currently being sold at multiple home improvement locations across Northeastern Ohio, an area that can greatly benefit from a product like this during its harsh winter months.

OOGA Involvement:

Joining the Ohio Oil and Gas Association (OOGA) in 1996, Moore has been a member of the OOGA for nearly two decades. Moore is currently involved on the Producers Committee and has previously been involved with the Environmental Committee. He is also active in the Regional Producers meetings and was elected Region 1 Producers Representative.

“You have to be a contributing member to the Association, it’s important for members to stay loyal and for the Association to stay loyal to all of its members, both conventional and shale. It’s constantly on-going in this industry, with all of the issues, and the committee meetings and Association help to keep everyone up-to-date.”

Moore cited the greatest value being in all of the work that goes on behind the scenes with the OOGA. Also that the Association does a good job of keeping its members informed of everything that is going on. He also highly regards the Ohio Oil and Gas Energy Education Program (OOGEEP) for getting out on the front lines to educate the general public, often times to unapologetic antis.

State of the Industry:

Moore cited the decline in current market prices as putting everyone in a tough position, as well as the increase of shale drilling being the source of increased regulations and awareness across the industry as a whole. 

“I think the biggest thing we need in our industry right now is stability, we need a stable market price, the current state is way too low. It’s very hard and puts everyone in a position where they are constantly having to reevaluate, cut back hours, cut back manpower, and still maintain operations”

The company recently relocated their office from Stow to Mogadore as other means of cost savings and to tighten their belt wherever the can. Moore sees the next 5 years as being a lot of the same for the conventional driller. Currently they’re feeling the repercussions of Marcellus gas, and he feels the Utica will keep coming following the Marcellus peak. 

“We’re in for a long hull, to obtain stabilized pricing. It is a cycle with a new twist, regarding the shale play in the area. Enforcement has increased along with some new regulations influenced by the recent shale activity. Whether you are a conventional producer or a shale producer we are all have a target on us with the media and anti-groups.”

Moore said fracing is constantly being accused as problematic. He noted more than 30 years ago wells all across northeastern Ohio have been hydraulically fractured. 

Shale-development’s impact on business: 

Moore Well Services works on conventional drilling, producing and servicing, when asked if they any interest in the Utica, at any capacity, Moore said, “I think you have to have interest.” The company’s current equipment isn’t capable of Utica work at the present time. Moore compared his current equipment to shale equipment that he’s seen in Carroll County, and described their (shale) work over machines as being bigger than Moore’s (conventional) drilling rigs.

“We’re conventional. We have not taken any shale water in our disposal water. We missed an opportunity, but it was a calculated risk keeping true with our conventional partners.

Moore feels he has missed some opportunities financially, but wanted to stick with its loyal customer base the company has developed relationships with over the years. Moore Well Services has been able to keep its rates low and is trying to stay steady in a rapidly changing world.

“Shale impacted conventional operators, dramatically, in a negative way. We’re still dealing with conventional wells, conventional productions and we’re getting a sub-conventional price, and everyone is in a tough position currently. Most of our gas is both produced and sold locally, and very few of us get into the main transmission lines at this point. Our gas comes in, turns around and goes right back into the local communities and I think there’s value in that.”

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America’s Unconventional Energy Opportunity

Posted By Lyndsey Kleven, Communications Coordinator, Thursday, June 18, 2015

A win-win plan for the economy, the environment, and the low-carbon, cleaner-energy future

In a joint effort last week, the Harvard Business School (HBS) and the Boston Consulting Group (BCG) released a new report America’s Unconventional Energy Opportunity. The report finds that U.S. shale drilling provides immense opportunity for both the economy and the environment. The report was an independent research effort with no outside funding support, with BCG providing in-kind pro-bono support to this complex topic.  

The report says the United States’ single largest source of competitive advantage and economic opportunity lies within its unconventional gas and oil reservoirs. Economically the benefits are profound, by 2030 these could be some of the results: 

· Support 3.8 million jobs with wages twice the national median—half of which would be accessible to middle-skilled workers

· Produce average annual energy savings of $1,070 per household from low-cost natural gas, up from nearly $800 today

· Contribute almost $600 billion in annual GDP and $160 billion in government tax revenue from production-related activities alone, with ripple effects in energy-intensive industries such as plastics, metals, and heavy manufacturing 

Additionally remarkable was the study highlighted the environmental triumphs that shale development brings. The environmental effects have been seen, and will continue to be seen in the progress the industry is making towards reducing greenhouse-gas emissions. This was no surprise to anyone working in the industry, when the report recognized that shale is speeding up our transition to a cleaner, low-carbon energy future. Natural gas is proving to be an inexpensive alternative in helping reduce air pollution and contributing to multiple new modes of transportation—natural gas powered vehicles, ships, and trains—which are cutting carbon.

Domestically the benefits we are reaping economically and environmentally are profound. But the study does not stop there; it goes on to accentuate how shale development will also bring geopolitical benefits. Having this resource and utilizing it for all of its returns will help to improve our energy security and cut back reliance on unstable regions. It also opens a new means for backing our trade deficit and building diplomacy abroad.

The primary risk would be failing to capitalize on this historical opportunity America has within its shale resources. The report observed how the U.S. is currently entangled in a misinformed and unproductive debate over hydraulic fracturing. A strong focus on “ban-fracking” campaigns across the U.S. with state and local oppositions is stalling progress. Instead of fully capitalizing on the opportunities, many areas stand in political gridlock. 

We have seen this in Ohio, and continue to see it among local control groups. Lack of awareness on: regulations, environmental impacts and climate concerns cause these groups to rally in attempts to ban or delay development. When this occurs no one is winning.

Headway is starting to happen and will continue to progress as more people are seeing the benefits and recognizing that the opposition groups are spouting ill-informed information. A new poll by Robert Morris University shows that support for fracking is growing with increased awareness. About 56% of people polled nationwide said they support hydraulic fracturing from shale; this is up from 42% in November of 2013.

The take away is that shale is providing the U.S. with resources unimaginable just a few years back. The benefits are driving the economy, and will continue to as we develop our natural resources in an environmentally responsible and beneficial way. More people are continuing to see this side of shale, as the development of unconventional energy will offer an unparalleled competitiveness and U.S. opportunity for many years to come.

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Long-Awaited EPA Study Finds Fracking Has Not Led to Widespread Water Contamination

Posted By Katie Brown, PhD, Energy In Depth, Thursday, June 11, 2015

The Environmental Protection Agency (EPA) has released its long awaited, five-year study, which finds “hydraulic fracturing activities have not led to widespread, systematic impacts to drinking water resources.”

As many have noted, this is the most important study on hydraulic fracturing to come out over the past five years – a fact that EPA’s Science Advisor and Deputy Assistant Administrator of EPA’s Office of Research and Development pointed to in a press release,

“It is the most complete compilation of scientific data to date, including over 950 sources of information, published papers, numerous technical reports, information from stakeholders and peer-reviewed EPA scientific reports.”

EPA today also released nine peer-reviewed scientific reports, which played a big role in contributing to EPA’s overall groundwater study.

EPA’s study actually builds upon a long list of studies that show the fracking process poses an exceedingly low risk of impacting underground sources of drinking water.  It corroborates a “landmark study” by the U.S. Department of Energy in which the researchers injected tracers into hydraulic fracturing fluid and found no groundwater contamination after twelve months of monitoring. It is also in line with reports by the U.S. Geological Survey, the Government Accountability Office, the Massachusetts Institute of Technology, and the Groundwater Protection Council, to name just a few.

The report contradicts the most prevalent claim from anti-fracking activists, which have made “water contamination” the very foundation of their campaign against hydraulic fracturing.  As EID reported in March, after heralding the report at its inception, anti-fracking organizations like the NRDC and InsideClimate News (ICN) later went into damage control, downplaying the forthcoming report, likely due to what it would conclude.

Hydraulic fracturing has brought cleaner air, significantly reduced greenhouse gas emissions, created millions of jobs, reduced energy prices, strengthened national security, and turned the American economy around.

With this new report, it couldn’t be clearer that shale development is occurring in conjunction with environmental protection — and the claims by anti-fracking activists have been thoroughly debunked.

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Member Spotlight: Mark D. Jordan, Knox Energy, Inc.

Posted By Lyndsey Kleven, Communications Coordinator, Monday, June 1, 2015

The member spotlight series features legacy OOGA members who have been a member of the Association for at least 10 years. If you would like to recommend someone to be highlighted, please contact Lyndsey Kleven lyndsey@ooga.org

Background information:

Mark Jordan’s family has a notable history of oilmen, preemptively leading Mark into the industry at a young age. His grandfather W.F. Jordan started in the industry in the 1920s as a roughneck working on rigs in Texas and Oklahoma. He became good at what he did, and gained ownership of two rotary rigs. W.F. later moved the rigs from Oklahoma to southern Illinois where he established himself over the next 40 years as a well-known drilling contractor.

Mark’s father Jerry was raised in Illinois and grew up working as a roughneck for W.F., Jerry went on to become a geologist and lawyer, leading a storied career as an attorney, oilman and association leader.

Mark started out working for companies his dad was involved with.

“The first summer I worked for American Exploration I worked in the office doing administrative things. The following summers I worked out in the field for American Exploration and The Clinton Oil Company.”

Mark spent a large part of his youth in Columbus, until he went to Mars Hill College in Ashville, North Carolina where he received a business degree. After that he earned his two-year Associates Degree in Petroleum Technology from Seminole State College in Oklahoma. Mark finished up his schooling in 1984, and was planning to work in Oklahoma—until the bottom fell out of the oil and gas industry that year, having the greatest initial impact in Oklahoma and Texas. The Clinton Oil Company was still doing well at the time, so Mark came back and took a field supervision job in North Eastern Ohio for the next 4 years.

“I was working with contractors and other company employees in getting wells and pipelines hooked up, and gas flowing. We were doing well at the time, drilling 70-100 wells a year and kept really busy.”

In 1986-87 the downturn started to hit Ohio too, and in 1988 things got so slow that Mark came back to work out of the Columbus office doing gas marketing. The subsidiary, Clinton Gas Marketing, was flourishing which is where he worked for the next 5 years.

“Gas marketing companies were new and could make a good margin, and it was a good field to be in. I was a gas buyer for local Ohio gas, which was neat because I was meeting producers all over the state.”

After that Mark moved over to plugging and ran the administrative effort of plugging a large number of wells for CGAS. From here, he moved onto Project Development focusing on Rose Run drilling projects.

“We needed to bring in a lot of capital/partners to drill these types of wells. Our geology department was one of the best in the state and that made my job easier.”

In the mid 1990s Mark became the Vice President of the land department. Mark greatly enjoyed this position and had a lot going on at the time. CGAS developed various held by production acreage, and had to fill in a lot of leases to make up the proper blocks for seismic surveys. This was Mark’s last job he held at CGAS as Enron bought out the company in 1996.

“Market conditions changed, causing them to move in a different direction and they started downsizing the company. I recognized this and made a deal to leave the company early. I was also able to acquire 120 marginal type wells that they had in Muskingum County, which helped me to start Knox Energy.”

It ending up being a great platform for Mark to leave the company, he had worked for CGAS for 14 years and gained a wealth of experience.

“I learned a lot because of all the different jobs I had and it really helped me to start my own company.”   

About Knox Energy, Inc.:

November of 1998 is when Mark left CGAS and started his own company, Knox Energy, Inc.

“My office was in the basement of my house, and I remember my Ping-Pong table was my filing cabinet. It was terrible market conditions; $9 oil and $2.50 gas.”

Mark’s father Jerry helped him get the company started, right around the time Jerry was becoming the chairman of the Independent Petroleum Association of America. Jerry had been watching the supply and demand of natural gas and encouraged Mark to start the company.  He said, “hang in there, Mark, there’s going to be a boom”. They soon bought another 260 wells from CGAS. 

“A year or two later one of our friends Harry Berry decided to retire and sell his service rig, so we decided to buy it because it fit well with all the older type wells we had.  After we acquired the existing production we be began drilling new wells as the price of gas began to rise.  To date we have drilled over 400 Clinton and Berea wells.”

Mark moved into an office on the east side of Columbus and began hiring a staff. Many of his staff were former employees of CGAS, which worked out well as it was being downsized and Knox Energy was growing.

“The people that helped me build Knox Energy are unbelievable and have such great industry knowledge.”

Currently Knox operates approximately 620 wells throughout Eastern Ohio, with the main concentration of those being in Knox and Licking Counties.  It also runs a service rig division named Berry Well Service which operates five service rigs and other equipment, and is located in Gratiot near Zanesville.    

OOGA Involvement:

Mark became a member of the Ohio Oil and Gas Association (OOGA) in the early 1990s.

“Being involved with the Association has really helped my company. One of the keys to business is networking with your industry peers. It’s so important that you do that and you want to stay as connected as you can. You have to give back to the industry because it gives so much to us.”

Mark first began getting more involved with the Association through its regional producers committees, he credits Tom Stewart for pulling him in to get more involved, as well as his father. He is presently on the Executive Committee and has learned even more being on the front line of all the decision-making, and holds serving in this role as an honor.

“The greatest value is what you can learn, and how you can help your own company. You can help your company by being involved with OOGA, because you know all the things that are affecting your industry, from new regulations, to what the predictions are for the future, to new technologies.”

Looking ahead:

Mark has been in the business since the late 1970s, and would never have believed the advances that are taking place. Specifically, where the industry is at today with the shale revolution. Mark noted that horizontal drilling has affected conventional producers in negative and positive ways.

“We have to be involved with everything that can impact our industry. If you don’t stay very alert as to what all is being talked about, whether it be regulation, or new technologies, if you’re not staying on top of it all you can be affected badly. We’ve got to help our industry have the best environment possible.”

Mark emphasized the importance of being alert to what’s influencing the future, and being able to affect the future by planning. 

“The current market conditions are very tough but it will turn around at some point. What I’ve found is, the producer community in Ohio is really good at working together.  We all need to stay involved in the association in order to try and make our industry conditions as best as they can be.”

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OOGA 2015 Summer Meeting Preview

Posted By Lyndsey Kleven, Communications Coordinator, Wednesday, May 20, 2015

The 2015 OOGA Summer Meeting will be held at the Zanesville Country Club on July 27th – July 28th bringing together the membership and top industry leaders. The meeting will include a legislative update on issues impacting Ohio’s oil and gas industry followed by a schedule chockfull full of activities.

The Monday golf round will consist of competitive stroke play at Zanesville County Club. Tuesday golf rounds will include competitive stroke play at Longaberger Golf Club and scramble rounds being held at Zanesville Country Club and Eagle Sticks. A new venue will be hosting this year’s shooting activities due to scheduling conflicts.  Ken Miller Supply is sponsoring the shooting activities that will take place at Dillon Sportsman Center.  Shooting activities will include skeet and trap fields plus rifle and pistol ranges. Tennis, euchre, corn hole and other miscellaneous events will take place simultaneously at Zanesville Country Club.

As has been the tradition since 2006, the 2015 Oilfield Patriot Award event will take place on Monday evening, sponsored by Producer Service Corporation. Festivities will include a reception, dinner, award ceremony, and a video presentation honoring the recipient.

As many of you know the annual Summer Meeting has grown in size over the last few years to reflect the changes of Ohio’s oil and gas industry. Registration for this year’s event will take place through the new OOGA member services platform. Login and register early for the 2015 Summer Meeting at www.ooga.org

Click here to download the flyer

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Feds Authorize Dominion Cove Point Liquefied Natural Gas Exports

Posted By Lyndsey Kleven, Communications Coordinator, Thursday, May 14, 2015

On May 7, the U.S. Department of Energy issued a final authorization for Dominion to export domestically produced liquefied natural gas (LNG). Dominion’s LNG operation, Cove Point, located on the Chesapeake Bay in Maryland has been approved to export LNG up to 0.77 billion standard cubic feet per day (Bcf/d) of natural gas for a period of 20 years.

LNG is formed when natural gas is cooled to around -260 F, which becomes a clear, odorless, noncorrosive, nontoxic liquid. According to the American Petroleum Institute, the volume of natural gas shrinks by approximately 600 times when liquefied. LNG has been handled safely for decades, with more than 100,000 LNG vessels making trips without incident.

Highly regulated, the LNG industry is overseen by the Federal Energy Regulatory Commission, the Department of Transportation, the U.S. Coast Guard and the Department of Homeland Security, just to name a few. Under the Natural Gas Act, countries that do not have a free trade agreement (FTA) with the U.S. must be granted permission from the Department of Energy to allow export authorization. It has taken years to gain the federal support needed for the U.S. to export domestically produced LNG to countries that do not have a FTA with the U.S.

Approval of LNG exports is huge—positively impacting: the industry, Dominion and other LNG exporting companies alike, numerous states producing the resource, Calverty County (the home of the facility), and it will affect the entire nation. The Cove Point liquefaction project is estimated at $3.4-$3.8 billion, creating thousands of construction jobs, 75 permanent jobs and expected to create an additional $40 million in annual tax revenue for Calverty County.

In Ohio, Dominion operates Dominion East Ohio, one of its two local distribution companies and has additional gas processing infrastructure in the state. The Ohio transmission system and Ohio natural gas will now be part of the network used to send product to Cove Point for export.

In the U.S. Energy Information Administration’s Annual Energy Outlook for 2015 (AEO2015), it predicted natural gas becoming the dominant U.S. energy export, pending the enactment of additional policy changes. With its new federal approval, the Cove Point facility is projected to be operational in late 2017. On point with reality, the report found the U.S. becoming a net exporter of natural gas as early as 2017.

Also in the AEO2015 forecast, domestic natural gas production is expected to continue increase and in 2015 alone could continue to do so at a record average production rate of 72.4 Bcf/d. In Ohio, this resource is abundant in the Utica shale, and many other shale formations across the country contain the resource.

According to Dominion, once completed Cove Point will produce about 5.25 million metric tons of LNG annually, for it’s already contracted service agreements with two overseas companies. LNG transported from Cove Point can reduce global greenhouse emissions by millions of tons a year as a replacement for coal that is currently used in overseas electricity generation. Shipments from Cove Point are projected to reduce U.S. trade imbalance by at least $2.8 billion annually, to as much as $7.1 billion. 

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