Range Resources struck a blow for the entire oil industry January 19 – 20, 2011 at RRC hearings in Austin. Responding to an EPA Emergency Order dated December 7, 2010, Range presented extensive evidence as to the inaccuracy of the claims made in the Order. The order sited the EPA authority to act pursuant to Section 1431 of the Safe Drinking Water Act after receiving “information that indicated contaminants are present in or likely to enter an underground source of drinking water and may present an imminent and substantial endangerment to the health of persons, and EPA has determined that State and local authorities have not taken sufficient action to address the endangerment described herein and do not intend to take action at this time.” Curiously the claimant (EPA) was not in attendance nor was any representative of the Agency. David Poole, General Counsel for Range, provided an overview of the testimony to be provided by the expert witnesses for the hearing examiners. Mike Middlebrook, Range V.P. of Operations, testified as to the events that had taken place since late July 2010. Emphasis was placed on the communications and actions taken by Range in conjunction with the RRC staff in determining the sources of the problem with the Lipsky (owner of the water well in question) water well. In addition, a complete review was presented regarding the drilling of the Teal and Butler wells (Range’s Barnett Shale wells in the area). Lastly Exhibit 11 was introduced, being a large photograph of nearby water well drilled in 2005 flaring natural gas and flowing water without a pump! The photograph had been obtained from a local water well driller who was familiar with the history of gas contaminated well water in the area. Additionally, Range pointed out the significance of the well being drilled four (4) years before they drilled their first Barnett wells in 2009 (Strike 1).
Next up was Norm Warpinski, Ph.D, an expert on micro seismic and hydraulic fracturing, who explained the methods of drilling and fracturing the Barnett Shale formation at depths almost a mile below the water wells in question. From the evidence presented it was difficult to imagine how gas contaminated frac water could migrate from the Barnett Shale formation at approximately 5000 feet below the surface into an aquifer a couple of hundred feet from the surface.
Mike McCaffrey, Ph.D, followed as the expert regarding geochemical gas fingerprinting. He testified that the method of fingerprinting attempted by the EPA was fundamentally flawed and could not accurately match gas from the Lipsky water well to Range’s wells. The EPA only used an isotopic test to identify the gas in the Lipsky well and since the Barnett Shale is the source rock for all the gas containing strata above it the isotope reading would be the same for gas from the Barnett and any shallower formations. Using a more appropriate scientific methodology for geochemical gas fingerprinting utilizing isotopic and compositional testing he testified that the source of the gas in the Lipsky water well was the shallow Strawn formation. He pointed out that Strawn gas contains high levels of nitrogen not present in such amounts within Barnett Shale gas and therefore the samples taken from the Lipsky well which contained higher nitrogen concentrations must have been released from the Strawn formation (Strike 2). John McBeath, P.E. testified about the extensive history of gas in water wells in this part of Texas and that those occurrences are unrelated to Range’s oil and gas activities. He also reviewed cement bond logs of the Teal and Butler wells which revealed first rate well completion and well integrity by Range. The cavalcade continued with Charles Kreitler, Ph.D an expert hydrologist testifying that the gas found in the Lipsky well occurs as a result of a widespread naturally occurring geologic contact between the shallow gas bearing Strawn formation and the shallow Cretaceous fresh water-bearing formation which lies on top of the Strawn. Last but not least Keith Wheeler, P.G., C.P.G. and expert on hydrology reviewed the comprehensive water well and gas sampling project undertaken by Range in response to the RRC’s investigation of the Lipsky complaint. Mr. Wheeler testified that extensive sampling of the water wells in the area of the Lipsky well indicates that there is absolutely no public health risk or safety issue related to any of the water wells, including the Lipsky well. The coup de grace came with the taped deposition of citizen Lipsky admitting that he had temporarily moved out of his large house into guest quarters on the property while he was claiming his house was uninhabitable due to the well problem and receiving a substantial reduction from the Parker County Appraisal District in his property value and tax bill (Strike 3). One can only hope that the appraisal district receives the information from this investigation so that the school children of Parker County can receive their just due from citizen Lipsky. He has subsequently moved back in his house and presumably resides there today.
This sensationalized tale is becoming all too common in regards to unconventional shale gas drilling around the country. The EPA seems to be taking rash action without adequate investigation when citizen complaints arise and are publicized on local television stations. Their public grandstanding and then subsequent disappearance from proceedings only damages their credibility regarding environmental issues important to all parties. Unfortunately the deposition of their designee John Blevins before the Federal Court in New Orleans on Tuesday, January 25, 2011 did little to dispel this notion. Appearing with a small army of EPA and Justice Department lawyers and only after being subpoenaed, Mr. Blevins testimony revealed an administrator far more skilled at the art of the deposition than in seeking the facts. His testimony revealed an Agency with an astounding lack of transparency and a penchant for objecting and denying each question. This painful testimony should come with a warning label; WARNING: Reading this deposition may cause you to want to deport yourself to another country.
Kudos to Range Resources for standing up and defending their business at great expense but with commensurate benefit to their reputation and credibility. They offer the industry a primer on how to proactively approach a sensationalized assault on their company. The hard truth is that oil companies are going to have continuously pursue best business practices in all aspects of well drilling and completion so as to be able to defend themselves with the facts versus fiction. Failure to do so will be fatal.
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