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Chesapeake Energy To Resume Pennsylvania Well Completions

 

Chesapeake Energy Corporation announced that its subsidiary, Chesapeake Appalachia, LLC, plans to immediately resume well-completion operations in Pennsylvania. The company had voluntarily suspended completion operations shortly after a well-control incident at the Atgas 2H well in Bradford County on April 19.

In a statement released by Chesapeake, Eastern Division vice-president of operations John K. Reinhart stated, “We regret this incident and the inconvenience it has caused to our neighbors and the community. We have engaged in a rigorous investigation of the cause of the incident, a thorough examination of our existing operations, and a comprehensive environmental evaluation of the area surrounding the location. We understand that operating in the Commonwealth of Pennsylvania is a privilege. We have learned from this and have taken steps to mitigate the risk of this type of event happening in the future. We are very confident that we will safely resume our completion operations.”

An edit of the remainder of the press release follows, with additional comentary at the end:

On April 29, the company provided a written incident response to the Pennsylvania Department of Environmental Protection (DEP). It is more than 700 pages in length and addresses the wellhead equipment failure experienced at the location, the additives used in the completion process and the water testing protocols used to conduct an environmental assessment of the impact of the area around the well location.

Below is a summary of key points from Chesapeake’s response to the DEP, provided by Brian Grove, Chesapeake’s Senior Director of Corporate Development, based in Towanda.

The Incident: The incident occurred around 11:45 p.m. on April 19, 2011, during completion operations when the well was being fracture stimulated. During the process, a failure occurred at a valve flange connection to the wellhead, causing fluid to be discharged from the wellhead at high pressure. An equipment failure of this type is extremely rare in the industry and is the first valve flange failure of this magnitude in more than 15,000 wells Chesapeake has completed since its founding in 1989.

Rapid Well Control Response: Personnel onsite immediately responded and promptly notified the appropriate authorities and first responders, including Chesapeake’s team of certified well-control specialists, who began arriving within 45 minutes. The authorities notified included the DEP, a contract well-control company and construction crews to bring equipment to the location to enhance the containment process. Chesapeake’s internal well-control team assessed the situation, secured the location, ensured the safety of neighbors and took appropriate and safe steps to begin limiting the flow of the fluid from the well by inserting loss control material (LCM) into the well to begin plugging it. These initial steps were successful in reducing the flow of the fluid from the well by approximately 50 percent by 10:00 a.m. on April 20 and approximately 70 percent by 12:30 p.m. that day, setting the stage for further actions to bring the well under full control. Additional contract well-control specialists arrived at the location early Wednesday afternoon, joining the Chesapeake well-control team. The strategy continued, as additional work utilizing LCM brought increasing levels of success. At 3:50 p.m. on April 21, the well was successfully brought under control. At 6:05 p.m. on April 25, the compromised wellhead was replaced with a fully competent and functional wellhead and the well remains shut-in and stable.

Fluid Containment Actions: In the early hours of the incident, a mixture of well fluid and rainwater accumulated in the containment area of our well location, and approximately 240 barrels flowed over the top of the containment berms onto nearby land, with an even more limited amount of fluid making its way into an unnamed tributary of Towanda Creek. Chesapeake estimates that the fluid that escaped initial containment included the equivalent of approximately one barrel of highly diluted chemical additives used in the hydraulic fracturing process. Chesapeake provided the list of these additives to the DEP within hours of the incident. Even though the well is only partially completed, the company has requested that this information be posted and made available to the public at www.fracfocus.org. Chesapeake began utilizing vacuum trucks from the beginning of the incident to maintain containment of the fluid. Additional trucks were quickly mobilized for on-going assistance. Water that began escaping containment at 2:30 a.m. on April 20 was stopped about four hours later. In addition to on-site containment measures that we typically employ and the design of our work locations, which are constructed as containment mechanisms themselves, construction crews worked successfully to create a diversion channel to pre-constructed sediment basins that contained the vast majority of the fluid, greatly minimizing the amount that left the site. All recovered fluid was stored in steel tanks and was properly treated and disposed. No fluid was disposed in systems that discharge to rivers or other surface waters.

Rapid Environmental Response and Assessment—Chesapeake began extensive surface and well-water sampling the day of the incident and continues daily testing today. The DEP has also taken extensive samples from both surface water and nearby water wells. To date, our testing results indicate minimal and localized impact to the environment immediately surrounding our location, and no impact to Towanda Creek or the Susquehanna River. The most significant impact occurred at a small farm pond near the location, which was drained in coordination with the DEP, and the pond water was trucked to a Chesapeake waste-water recycling facility. Area landowners' private water wells continue to be tested. Water quality sampling of the unnamed tributary and Towanda Creek shows results at or near the same water quality indicated by samples taken prior to drilling activity. Thus far, ecological assessments of both streams have shown no indication of any fish kills or other adverse impacts. Chesapeake and the DEP continue to sample a wide area for various constituents in an effort to properly and thoroughly analyze any environmental effect from this incident. Chesapeake will work closely with the DEP to formulate a plan for restoration of the site, which will likely require excavation of limited quantities of soil and also some soil remediation activities to return the affected area to its original condition.

Equipment Testing and Assessment: As a result of this incident, Chesapeake voluntarily suspended completion operations in its Eastern Division to perform a review of the integrity of comparable wellheads. Every wellhead in the review was disassembled, components were studied and pressure tested and reassembled. We are confident that this was an isolated incident and that all wellhead equipment and connections are fully functional and structurally sound.     For future operations, Chesapeake has implemented changes in its oversight of the contractors that assemble and test our wellheads. Certification of contract employees will be reviewed more thoroughly and more extensive documentation for all phases of pressure testing and equipment calibration will be required. In addition to these steps, we are instituting an independent auditing system to serve as an extra layer of oversight in wellhead assembly.

Assurances to the DEP: Chesapeake has committed to continue to test soil and water sources, submit a plan for future monitoring and provide frequent updates to the Department. And, while its internal, certified well-control specialists were on site quickly, the company has agreed to utilize local third-party well-control specialists should their services be required in the future. Chesapeake will share what it has learned from this experience with our industry partners to encourage Best Management Practices and the company will work with the Pennsylvania Department of Environmental Protection to ensure future operations meet and exceed the standards regulating natural gas development in the Commonwealth of Pennsylvania.

 

According to Chesapeake Energy media relations coordinator Rory Sweeney, during the self-imposed shut-down, “Many workers directly employed in our completion operations were simply idled.  That’s approximately 400 trucks and their drivers locally for each day of the three-week voluntary suspension of completion operations. The suspension further impacted workers employed by those trucking contractors or other companies that provide support for completions and Chesapeake’s overall operations. The total impact on the regional workforce was more than 1,000 workers.”

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