Global Plastics Issue: Rocky Mountain revolution

By: 
December 18, 2013

Firestone, Colorado once again finds itself at the forefront of a fossil fuel revolution. The town of 11,000, which sits 30 miles north of Denver, grew out of a coal mine started there in 1872. Called the McKissick after the brothers who opened it, the site was the first coal-production mine in the state. Eventually it was sold to a group led by Jacob Firestone, for whom the town of Firestone, incorporated in 1908, was named.

Fast forward 140 years to April 2012. The coal mine is now a golf course, and that's where Firestone's mayor is hosting a delegation of Chinese government and energy industry representatives. They're not talking coal, or golf for that matter. They're talking shale, or more accurately, shale oil and shale gas.

From Denver suburb to oil-and- gas hub

Up until 1947, five coal mines operated in Firestone, with Colorado a top-10 coal-producing state. The town would shed those industrial roots, however, as it emerged as one of the fastest growing communities in the U.S., rising from a population of 1100 in 2000 to 11,000 just a decade later as it became a com- muter suburb of metro Denver.

As the population rose, however, Fire- stone reverted to its resource extraction roots. Advances in hydraulic fracturing and horizontal drilling allowed companies like Anadarko, which has 61 active directionally drilled wells in Firestone and 5000 active wells in Weld Country where Firestone resides, to pull fossil fuels from the state in a way they hadn't in decades, according to spokesperson Robin Olsen.

It's a new gold rush in Colorado, a state whose original capitol, Golden, takes its name from the state's resource rich mountains that drew miners in
the mid-to-late 19th century. It was in Golden, where the Colorado School of Mines (CSM) was founded in 1873, just one year after the McKissicks began their coal operation in Weld County.

Today the School of Mines is a research leader in the field of shale oil and gas, and like Firestone, it is getting visitors from all around the world. They are government and industry officials who want to make their city the next Firestone or province the next Colorado.

Jeremy Boak is an associate research professor at CSM's Department of Geology and Geological Engineering and is the director of the Center for Oil Shale Technology and Research (COSTAR). What is happening in Colorado, and elsewhere in the U.S. and Canada, where horizontal drilling and fracking are releasing oil, gas, and natural gas liquids from previously untappable rock formations, has captured the attention of the world.

Eager to learn

Delegations from Bulgaria, Ukraine, China and more have made treks to Golden to meet with Boak and other COSTAR representatives. Visitors from these countries have a keen interest in exploiting their own shale resources and are actively reaching out to communities that already have so they can better understand the technological requirements as well as environmental and eco- nomic impacts.

"Judging by the extent foreign companies are buying into North American plays, they're looking to learn," Boak said, "the Chinese particularly."

Thinking globally

In April 2012 at the McKissick mine- cum-Saddleback-Golf-Course, it was Chauto Chan, president of Huaxin Energy and the China Energy Fund Commit- tee (CEFC), along with five other CEFC delegates who were hosted by Mayor Chad Auer. Auer told PlasticsToday that although the visit drew some criticism in a community with at times insular rural roots, he felt outreach is a necessity.

"There's just no other way to put it," Auer said, "we have to reach out global- ly. We can't just think about our region,

or our state, or our nation. Somebody might say, 'Oh, it's just this little town in Colorado.' That's true, but we're not going to survive, certainly not going to thrive, if we're not thinking globally."

Firestone sits atop the Niobrara Shale. That formation and the Codell Shale are part of the Wattenberg basin in north- eastern Colorado-a "play" that could achieve production of 400,000 barrels/ day by 2020 by some estimates.

"Firestone sits on top of some of the biggest oil and gas reserves in the world," Auer said, "and therefore, we have to reach out to folks the CEFC, Canada, and others, and be a part of that conversation on what's next."

According to a release issued by the town, Huaxin and the CEFC were interested in meeting with U.S. technology partners to help them extract Chinese shale gas, which is estimated to measure more than 885 trillion cubic feet, back home in addition to a desire to purchase gas from the U.S. for Chinese consumption.

Who's next?

Market watchers believe China could be the next country to try to exploit shale resources on a commercial scale. For some time, however, it looked like the U.S. would be succeeded by Europe.

In that region, it has been countries in the east that have expressed the most interest, particularly Poland, which had leased prospective shale plays and drilled 43 test wells as of April 2013. Boak sits on the board of a small company that had acquired land in Poland, with the intent to drill, but activity has since slowed. If a shale play is made, he thinks it will still happen in Eastern Europe.

"It seems to me the Western European countries want [drilling] to hap- pen first in Eastern Europe to be sure it won't cause a problem," Boak said. "It's like that's their laboratory and they're just going to hold off until the more desperate Eastern Europeans do something."

That reluctance comes despite the fact that many Western European countries have potentially substantial shale gas plays of their own. France, Boak noted, has an "extremely good target" for a shale gas play that's actually produced in the past, but its government recently put a fracking ban in place.

Safety concerns

The shale boom has not been without controversy, especially as wells encroach on communities, leading governments
of all sizes to ban or restrict the practice. Two cities that neighbor Firestone, Longmont and Fort Collins, have imposed moratoriums on drilling, with others considering such a move. Industry watchers like Boak readily acknowledge the public's anxiety and its potential to snuff out a nascent energy renaissance.

"I think a lot of people are a bit worried about [fracking]," Boak said. "It would be a real shame if [bans] hap- pened, because I just don't think the problems are there. I think it would be far better to look again at regulations, figure out where the real problems are and go after those."

For Boak, those real problems come down to poorly completed wells where developers rush to encase the drilling they've already done, versus the drilling and hydraulic fracturing itself.

The documentary Gasland and its sequel have generated a lot of negative attention for the industry, but for Boak those films' most dramatic scenes, where homeowners set their tap water on fire, can be deceiving. In those instances, a myriad number of factors could be at play, including shallow coal beds near aquifers or unconstrained landfills seeping methane into the water table.

"When they show people lighting up the faucets," Boak said, "that has nothing to do with any fracking chemical. That's natural gas and there are a multitude of places it can come from."

Firestone's Auer said in his com- munity, which has more than 250 individual gas wells in operation in an area of a little over 5 square miles, the key to limiting public interaction with drilling has been for economic development to get out ahead of resource extraction.

"To be proactive, we wanted to be sure that oil and gas developers under- stood that there's a lot of growth going on and will continue to happen in Fire- stone. Therefore it's important for them to get in, establish, drill their wells, get the pad sites set up first, and then neighborhoods and commercial development can be built around them." Auer says there are still occasions of drilling crossing paths with community, but they're limited. "When you do it that way," Auer said, "oil and gas development isn't backing into residential surface use."

Anadarko, which has had operations in Firestone since 1971, has taken steps to bury oil and water infrastructure to lessen surface impact, including truck traffic, according to Olsen.

Olsen said that 98% of the water used for hydraulic fracturing at its Wattenberg horizontal wells is supplied by water pipelines installed, operated, and maintained by Anadarko. "Anadarko is committed to safely producing energy in a way that protects public health, land, air, and water," Olsen said. Over his six years in office, when 150 new wells have been drilled, Auer said companies like Anadarko have not given him reason for concern, although he can empathize.

"Of course everybody wants safe development," Auer said, noting anxiety over everything from contaminated water to toxic fumes. "We have those same concerns. I do; I'm the mayor, and as I've worked with the energy industry, I've learned the safety steps we have to take, all the monitoring. I feel really good about where Firestone is."

Old technologies, new fears

Neither hydraulic fracturing or horizontal drilling is actually new. The first horizontal well was completed in Texon, TX in 1929 but was not economically

viable in a market with falling oil pries, according to a study by Harvard Belfer Center researcher Leonardo Maugeri. Magueri said the technology wasn't accepted as commercially viable until the early 1980s, when the oil embargo and improved technology made it more feasible. Hydraulic fracturing was first used in 1947 in Grant Country Kansas. By 2002, according to the National Petroleum Council, fracking had already been used 1 million times in the U.S., with up to 95% of wells applying the technology.

So why is so much more oil and gas being extracted now via fracking and horizontal drilling?

"It's the combination of horizontal drilling and the complex tailoring of the frack fluid," Boak said. Initially a combination of oil and sand were all that were used, but now gels and other elements have been added to prop open the fractures created by the sand. "Frac fluid" contains 90.6% water, 8.96% proppant, and .44% of a mixture of 12 chemicals, including acids and surfactants.

"You get down to a relatively small amount of legitimately hazardous chemicals that are often relatively small pro- portions of what they're putting down the hole," Boak said, "and you're putting them into a hole 8000 ft deep, when 
all of the aquifers are less than 1000 
feet. There's not a reasonable way to get much of that up there, except through a failed bore hole."

Written by Tony Deligio 

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