Source: U. S. Department of Energy, Energy Information Agency, - PowerPoint PPT Presentation

Hydraulic Fracturing in Nevada J. Berton Fisher, Ph. D., CPG, RPG (TX #0201) University of Tulsa & Lithochimeia, LLC λχ

Source: U. S. Department of Energy, Energy Information Agency, Crude Oil Proved Reserves, Reserves Changes, and Production, available at http:/ / www.eia.gov/ dnav/ pet/ pet_ crd_ pres_ dcu_ NUS_ a.htm U. S . Crude Oil Reserves Increasing U. S. Crude Reserves (MMBbl) 198 1-20 11 35,000 30,000 25,000 20,000 Crude Reserves (MMBbl) 15,000 10,000 5,000 0 1981 1986 1991 1996 2001 2006 2011

Source: U. S. Department of Energy, Energy Information Agency, Crude Oil and Other Liquids, U. S. Imports of Crude Oil, available at http://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=pet&s=mcrimus1&f=m U. S. Department of Energy, Energy Information Agency, Crude Oil and Other Liquids, Crude Oil Proved Reserves, Reserves Changes, and Production, available at http://www.eia.gov/dnav/pet/pet_crd_pres_dcu_NUS_a.htm U. S . Crude Oil Production Closes Gap on Imports U. S. Crude Production and Im ports (MMBbl) 198 1-20 13 4,000 3,500 3,000 2,500 2,000 Crude Production (MMBbl) Crude Imports (MMBbl) 1,500 1,000 500 0 1981 1986 1991 1996 2001 2006 2011

U. S. Oil Turnaround! Key Technologies • Horizontal Drilling • Hydraulic Fracturing

Goodbye and Hello Energy S ecurity means minimizing vulnerability to energy supply disruptions and the resulting volatile and disruptive energy pricing.

Nevada Oil and Gas Y esterday & Today

Sources: compiled from Hess, R.H., Henson, M.A., Davis, D.A., Limerick, S.H., Siewe, S.S., and Niles, M., 2011, Oil and gas well information for Nevada - 2011 update: Nevada Bureau of Mines and Geology Open-File Report 11-6, portable hard drive, 105 GB.

Sources: compiled from Hess, R.H., Henson, M.A., Davis, D.A., Limerick, S.H., Siewe, S.S., and Niles, M., 2011, Oil and gas well information for Nevada - 2011 update: Nevada Bureau of Mines and Geology Open-File Report 11-6, portable hard drive, 105 GB. Nevada Produces Oil and Gas TODAY • Wells ▫ ~ 740 drilled ▫ ~100 producing ▫ 11 water injection • Recent Oil Production ▫ July-Aug 2013: 57,225 bbl ▫ July-Aug 2012: 61,371 bbl ▫ Water : Oil ~ 17:1 • Cumulative Production ▫ Oil 39,998 ,90 2 bbl ▫ Water 135,561,8 0 9 bbl ▫ Water : Oil ~ 3.4:1

Source: U. S. Department of Energy, Energy Information Administration, State Energy Data System (SEDS): 1960-2011 (Complete), Released : June 28, 2013, Available at: http://www.eia.gov/state/seds/seds-data-complete.cfm?sid=NV#CompleteDataFile and Nevada Commission of Mineral Resources, Division of Minerals, Nevada Oil Patch - bi- monthly production reports, Nov/Dec 2013; Nov/Dec 201212, available at http://minerals.state.nv.us/formspubs_ogg.htm#Nevada_Oil_Patch Nevada Oil Production 1960-2013 4,500 4,000 3,500 BBLs – 1,0 0 0 s 3,000 2,500 2,000 1,500 1,000 500 0

Nevada Commission of Mineral Resources, Division of Minerals, Nevada Oil Patch - bi- monthly production reports, Nov/Dec 2013; Sep/Oct 2013; Jul/Aug 2013; May/Jun 2013; Mar/Apr 2013; Jan/Feb 2013; Nov/Dec 2012; Sep/Oct 2012, available at http://minerals.state.nv.us/formspubs_ogg.htm#Nevada_Oil_Patch Recent Nevada Production Nevada Oil Production (bbls/ m onth) 32,000 27,000 22,000 17,000 12,000 7,000 2,000

Sources: Nevada Bureau of Mines and Geology, University of Nevada at Reno, Production and Injection Data for Oil, Gas, and Geothermal Wells in Nevada, Oil and Gas Production Data by Field, available at http://www.nbmg.unr.edu/lists/Production/Oil/oil_production/dead_man_creek/ and http://www.nbmg.unr.edu/lists/Production/Oil/oil_production/toana_draw/ Elko County Oil and Gas Wells 2001 • ~70 drilled; oil and gas shows • No current producers • Two historic fields ▫ Deadman Creek  (May 1997 – 387 bbl / 0 bbl H 2 O) ▫ Toano Draw  (Jan 2007 – 1,964 bbl / 29,121 bbl H 2 O)

Helman, C. 2013. Far-Flung Noble Energy Believes In Oil And Gas 'Diversification‘. Forbes 12/18/2013 http://www.forbes.com/sites/christopherhelman/2013/12/18/far-flung-noble-energy-believes-in-oil-and-gas-diversification/ Personal communication, Lee Hinman, Noble Energy, 2014 Nevada and Oil and Gas TOMORROW • Nobel Energy, Inc (Wilson Play/Tabor Flats) ▫ Vertical exploration wells ▫ Elko Formation (Eocene-Oligocene) ▫ 350,000 acres (66% private land) ▫ Oil found ▫ Flow test planned 2014 ▫ Project ~50,000 bbls/day by year end 2014  Current Nevada production ~30,000 bbls/month ▫ $130,000,000 invested over next four years ▫ Acreage might hold 1 billion barrels or more.

Sources: Compiled from Hess, R.H., Henson, M.A., Davis, D.A., Limerick, S.H., Siewe, S.S., and Niles, M., 2011, Oil and gas well information for Nevada - 2011 update: Nevada Bureau of Mines and Geology Open-File Report 11-6, portable hard drive, 105 GB; Las Vegas Review Journal, January 8, 2013 Available at http://www.reviewjournal.com/busines s/energy/oilgas-search-fracking-comes- nevad

Las Vegas Review Journal, January 8, 2013 Available at http://www.reviewjournal.com/business/energy/oilgas-search-fracking-comes-nevada Nevada Oil and Gas Tomorrow

Elko Daily Free Press, January 23, 2013 Noble Energy plans extensive test drilling in Elko County Available at: http://elkodaily.com/news/local/noble-energy-plans-extensive-test-drilling-in-elko- county/article_04d1b8e0-6506-11e2-b38a-001a4bcf887a.html Noble’s Play

SOURCE: Anna, L. O., et al. 2007. Geologic Assessment of Undiscovered Oil and Gas Resources of the Eastern Great Basin Province, Nevada, Utah, Idaho, and Arizona. Chapter 2: Geologic Elko Fm. Assessment of Undiscovered Oil and Gas in the Paleozoic– Tertiary Composite Total Petroleum System of the Eastern Great Basin, Nevada and Utah . U.S. Geological Survey Digital Data Series DDS–69–L

Las Vegas Review Journal, January 8, 2013 Available at http://www.reviewjournal.com/business/energy/oilgas-search-fracking-comes-nevada Terms of Engagement • The author Henry Brean’s words ▫ “The Silver State is about to get fracked.” ▫ “… use of pressurized fluid to smash oil and gas from previously untapped shale deposits…” Las Vegas Review Journal, January 8, 2013

Las Vegas Review Journal, January 8, 2013 Available at http://www.reviewjournal.com/business/energy/oilgas-search-fracking-comes-nevada Terms of Engagement • Brean Quoting Ron Mrowka, Center for Biological Diversity: ▫ “poison groundwater, foul the air and lead to chemical spills and other contamination near drill sites” ▫ “would include wells 6,000 to 14,000 feet deep, putting them thousands of feet below the groundwater table” ▫ "Fracking is not a good thing," he said. "We don't feel there is a safe way to do it."

National Petroleum Council, 20 11. PRUDENT DEVELOPMENT: Realizing the Potential of North Am erica’s Abundant Natural Gas and Oil Resources, available at http://www.npc.org/reports/NARD-ExecSummVol.pdf The facts about fracturing • One Million Hydraulic Fractures: Hydraulic fracturing was first used in 1947 in an oil well in Grant County, Kansas, and by 2002, the practice had already been used approximately a million times in the United States. • Nearly all wells are hydraulically fractured: Up to 95% of wells drilled today are hydraulically fractured, accounting for more than 43% of total U.S. oil production and 67% of natural gas production.

Environmental Issues • Water Requirements • Surface Releases • Subsurface Releases • Chemicals Used • Induced Seismicity • Disposal of Flowback Water • Air Emissions

Environmental Concerns Related to Hydraulic Fracturing Fluid and Brine Potential Pathways for Exposure to Fluids: 3 • Upward from deep, hydraulically fractured target formation to shallow groundwater 2 • Migration of a surface spill to groundwater • Migration of a surface spill to a stream or river 1 Source: Gradient. 2013. National Human Health Risk Evaluation for Hydraulic Fracturing Additives . Report to Halliburton Energy Services, Inc. 169p., available at http:/ / www.energy.senat e.gov/ public/ index.cfm/ files/ serve? File_id=53a41a7 8-c06c-4695-a7be-84225aa7230f

Water Requirements • Water and sand 99.5 percent of fracturing fluid • Water is primary carrier fluid Play Drilling Fracturing Total Water Used -Millions of Gallons /well Barnett 0.3 3.8 4.1 Fayetteville 0.1 4.0 4.1 Haynesville 0.6 5.0 5.6 Marcellus 0.1 5.5 5.6 Source: Chesapeake Energy, (2010), “Chesapeake energy - shale gas information,” Oklahoma City, Oklahoma, cited by Mielke, E. et. al, 2010. Water Consumption of Energy Resource Extraction, Processing and Conversion Avaliable at: http://belfercenter.ksg.harvard.edu/files/ETIP-DP-2010-15-final-4.pdf Accessed 02/19/2014 http://www.chk.com/Media/CorpMediaKits/Water_Use_Fact_Sheet.pdf, http://www.chk.com/Media/MarcellusMediaKits/Marcellus_Water_Use_Fact_Sheet.pdf, http://www.chk.com/Media/BarnettMediaKits/Barnett_Water_Use_Fact_Sheet.pdf, http://www.chk.com/Media/HaynesvilleMediaKits/Haynesville_Water_Use_Fact_Sheet.pdf, http://www.chk.com/Media/FayettevilleMediaKits/Fayetteville_Water_Use_Fact_Sheet.pdf.