Hydraulic Fracturing and Energy Production in California Western - - PowerPoint PPT Presentation

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Hydraulic Fracturing and Energy Production in California Western - - PowerPoint PPT Presentation

Dec 21, 2023 138 likes •349 views

WESTERN STATES PETROLEUM ASSOCIATION WESTERN STATES PETROLEUM ASSOCIATION Hydraulic Fracturing and Energy Production in California Western States Petroleum Association June 2013 WESTERN STATES PETROLEUM ASSOCIATION Shale Oil Resources in the

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WESTERN STATES PETROLEUM ASSOCIATION

Hydraulic Fracturing and Energy Production in California

Western States Petroleum Association June 2013

WESTERN STATES PETROLEUM ASSOCIATION

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WESTERN STATES PETROLEUM ASSOCIATION

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Monterey 15.4 Billion Barrels 63% of US Shale Oil Bakken 4 Billion Barrels 17% of US Shale Oil Eagle Ford 3 Billion Barrels 12% of US Shale Oil Avalon/Bone Springs 2 Billion Barrels 8% of US Shale Oil

Shale Oil Resources in the United States

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WESTERN STATES PETROLEUM ASSOCIATION

An Extraordinary Opportunity

  • “The fossil fuel deposits in

California are incredible. “ Governor Jerry Brown

  • “The potential is extraordinary,

but between now and their development lies a lot of questions that need to be answered.” Governor Jerry Brown.

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WESTERN STATES PETROLEUM ASSOCIATION

A San Joaquin Valley California Opportunity

  • According to the EIA, 15.4 billion

barrels of oil trapped in the pores

  • f shale rocks in the San Joaquin

Valley

  • Advanced-extraction oil

technology: potential in CA

  • 1750 square mile area

represents 2/3rds of U.S. shale resources

  • Hydraulic fracturing used

extensively in other states and in California for 60 years without harm to the environment

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WESTERN STATES PETROLEUM ASSOCIATION

The Monterey Shale & California’s Economic Future

  • 512,000 Jobs by 2015 and

2.8 million by 2020

  • 2.6% to 14.3% State GDP

Increase

  • $40.6 billion to $222.3 billion

personal income increase

  • $4.5 - $24.6 billion state and

local tax revenues increase

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WESTERN STATES PETROLEUM ASSOCIATION

Shale Oil Benefits in Texas and North Dakota

  • Eagle Ford Shale Play

(Texas)1

  • $61 billion economic

impact (2012)

  • 116,000 jobs supported

(2012)

  • $89 billion forecasted

economic impact (2022)

  • 127,000 forecasted jobs

supported (2022)

  • Bakken Shale Oil Exploration

(North Dakota)2

  • 60,000 Jobs created (2011)
  • $30.4 billion in economic

impact (2011)

  • $2.65 billion in government

revenues (2011)

1: Economic Impact of the Eagle Ford Shale, Center for Community and Business Research-The University of Texas at San Antonio 2: North Dakota State University’s Department of Agribusiness and Applied Economics 6

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WESTERN STATES PETROLEUM ASSOCIATION

What is Hydraulic Fracturing

Source: FracFocus, Courtesy of Texas Oil and Gas Association

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WESTERN STATES PETROLEUM ASSOCIATION WESTERN STATES PETROLEUM ASSOCIATION

Hydraulic Fracturing: How Much, Where

  • 568 wells fractured in 2012 according

to FracFocus

  • 2,705 well permits issued in 2012
  • 48,970 wells currently producing oil

and/or gas in CA

  • 97 percent of hydraulic fracturing
  • perations were in 2012 were in Kern

County

Source: WSPA survey of FracFocus website 2012 data 8

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WESTERN STATES PETROLEUM ASSOCIATION

A Well Completion Process

  • Permits are provided
  • Well is drilled
  • Well service company prepares well

for completion

  • Pump trucks deliver pressurized

water into well, 99.5 percent of which is water and sand

  • Fluid is collected and disposed of

pursuant to permits

  • Entire process takes 3 to 5 days
  • Shale oil gathered

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WESTERN STATES PETROLEUM ASSOCIATION

Hydraulic Fracturing and Water Use

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  • In 2012, the average amount of

water used during hydraulic fracturing operations was 116,000 gallons of water

  • The average golf course requires

312,000 gallons per day

  • The total amount of water used in

the 568 wells that were hydraulically fractured in 2012 was 202 acre feet

  • Farming in California 2012 uses

approximately 34 million acre feet of water annually

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WESTERN STATES PETROLEUM ASSOCIATION

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  • In October, 2012, an exhaustive year-

long study at Inglewood Oil Field in Los Angeles looked at 14 environmental issues, including public health, groundwater, air quality, seismic, noise, vibration

  • All fractures separated from fresh water

by at least 7,700 feet (1.5 miles) or more

  • No impacts to any of the 14 areas

studies

October 10, 2012

Addressing Hydraulic Fracturing Concerns

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WESTERN STATES PETROLEUM ASSOCIATION

Current Oversight

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  • California Division of Oil, Gas & Geothermal Resources (DOGGR)

proposed regulations

  • Draft regulations require:

Advance notice to DOGGR before a well is fractured Enhanced testing and monitoring of fractured wells Safe storage and handling requirements of fracturing fluids Disclosure of chemicals

  • Provides protection of trade secrets
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WESTERN STATES PETROLEUM ASSOCIATION

Additional State and Local Oversight

“The Water Boards’ existing statutory authorities and regulations are sufficient to minimize potential risks to water quality related to hydraulic fracturing activities.”

February 6, 2013 letter from the State Water Resources Control Board to Senators Pavley and Rubio on regulating hydraulic fracturing.

“While we are not aware of any hydraulic fracturing used in natural gas production well development in the San Joaquin valley, fracturing has been used for at least thirty years in

  • il production operations, without

creating known air issues, beyond those associated with other production methods.”

February 1, 2013 letter from the San Joaquin Valley Air Pollution Control District to Senators Pavley and Rubio on regulating hydraulic fracturing.

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WESTERN STATES PETROLEUM ASSOCIATION

U.S. on Hydraulic Fracturing

  • “In no case have we made a definitive determination that the fracking

process has caused chemicals to enter groundwater.”

U.S. Environmental Protection Agency Administrator Lisa Jackson, April 30, 2012

  • “I’m not aware of any proven case where the fracking process itself

has affected water.”

U.S. Environmental Protection Agency Administrator Lisa Jackson, May 24, 2011

  • “There’s a lot of hysteria that takes place now with respect to hydraulic

fracking, and you see that happening in many of the states. … My point of view, based on my own study of hydraulic fracking, is that it can be done safely and has been done safely hundreds of thousands

  • f times.”

Former Secretary of the Interior Ken Salazar, February 15, 2012

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WESTERN STATES PETROLEUM ASSOCIATION

Legislation

Defeated

  • AB 1323 (Mitchell) required moratorium while hydraulic fracturing was studies
  • AB 288 (Levine) altered the state policy with regard to oil and gas wells
  • AB 669 (Stone) contained a piece-meal approach on regulating hydraulic fracturing

activities

  • SB 395 (Jackson) required produced water to be handled as hazardous material,

potentially impact all oil production in California

  • AB 982 (Williams) required extensive ground water monitoring
  • AB 649 (Nazarian) imposed immediate moratorium on hydraulic fracturing on any well

located within a certain distance from an aquifer

  • AB 1301 (Bloom) imposed immediate moratorium on hydraulic fracturing until future

regulations are enacted

  • SB 241 (Evans) imposed a 9.9% severance tax on all oil produced in California

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WESTERN STATES PETROLEUM ASSOCIATION

Legislation

Adopted, Sent to Assembly

  • SB 4 (Pavley) requires the state’s Natural Resources Agency to conduct a

study of hydraulic fracturing and mandates regulation of that practice. Sen. Pavley removed moratorium language and indicated she would work with the

  • il industry to develop comprehensive regulation of hydraulic fracturing

activities. Pending, Awaiting Committee Action

  • AB 7 (Wieckowski) provides a comprehensive regulatory structure for

hydraulic fracturing, including full disclosure, pre-notification, water testing and produced water disposal provisions go beyond what DOGGR is proposing

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WESTERN STATES PETROLEUM ASSOCIATION

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Public Support for Regulated Hydraulic Fracturing

  • USC Dornsife/LA Times poll, June 7, 2013
  • Californians support hydraulic fracturing if

properly regulated  41% of poll respondents said they supported hydraulic fracturing with additional regulations  19% said hydraulic fracturing was already regulated enough  30 percent opposed hydraulic fracturing under any circumstance

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WESTERN STATES PETROLEUM ASSOCIATION

  • Legislature took a measured and responsible approach to hydraulic

fracturing

  • All parties have a responsibility to acknowledge that:

 There are legitimate issues related to hydraulic fracturing that must be addressed by regulators and the Legislature  Production of petroleum energy is a vital and necessary part of the California economy

  • A comprehensive regulatory package will sufficiently ensure that our

state’s environmental health and natural resources are protected while safely using hydraulic fracturing technologies for energy production in California

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Message: We Support Comprehensive, Fair Regulation

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WESTERN STATES PETROLEUM ASSOCIATION WESTERN STATES PETROLEUM ASSOCIATION

THANK YOU!

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www.wspa.org