Marathon’s well near Grayling: a ‘test’ or a ‘nightmare’?

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by Ellis Boal

Chance discovery

One day in August I drove to Crawford County to take a look at Marathon Oil’s recent activities along King Road in Beaver Creek Township, which is near Grayling.

State Beaver Creek 1-23 HD1, a horizontal frack well in the state forest, has been producing on a pad there, tapping the nearly-two-mile-deep Utica-Collingwood shale for some time.

State Beaver Creek 1-23 HD1, on August 15. Photo: Ellis Boal

In late July Marathon applied for a second horizontal frack well on the same pad, named State Beaver Creek 1-14 HD1, which would explore into the Detroit River formation, about a mile shallower than the Utica-Collingwood.

This is the first high-volume frack well to explore in this formation in Michigan.

Not much was happening that day on the pad. But previously I had noticed an unusual feature on the plat accompanying the application for the new well, a half-mile away. It was labeled “State Beaver Creek D4-11″. The nomenclature is not typical for Michigan wells and no operator name was given. I thought it might be a processing facility of some kind.

D4-11

D4-11, still a forest on August 15. Photo: Ellis Boal. Click for close-up.

I didn’t see a direct two-track through the forest between the wellpad and D4-11, so I drove around and found an old one leading to the spot where it was supposed to be. There was nothing but trees, and a few scattered stakes and flags. No permit was posted. Nothing indicated that something big was about to happen.

A week later, in a quick turnaround time DEQ issued the permit for State Beaver Creek 1-14 HD1.

In September I inquired of DEQ what was going on with D4-11. On September 18 DEQ tech Kelley Nelson wrote that it is a well, not a processing facility. It was regulated under part 625 of the Michigan environmental law. Therefore, she said, it was a totally confidential operation. I asked if that meant the permit number, and even the fact whether the well was permitted, were unavailable. She answered:

You are correct. Nothing is available for any part 625 test well. It is confidential for 10 years.

Well, “nothing” was not really the whole truth. Part 625 regulations required Marathon to send the first page of its application to Beaver Creek Township, “post the permit in a conspicuous place” at the surface location until drilling is completed, and post a “conspicuous” sign near the wellhead showing the permit number.

D4-11, a/k/a the “science well,” under construction on August 26. Photo: Gary Cooley.

Obtained publicly from the township, the first page of the application tells us: Marathon posted a conformance bond of $33,000, the well is vertical, sour gas is expected, the intended total depth is 4700 feet, and the target formation is the Amherstburg. This is a fossil-bearing non-shale formation in the Detroit River group, the same formation being explored by State Beaver Creek 1-14 HD1. Vertically, D4-11 is just 300 feet deeper.

Marathon refers to D4-11 informally as a “science well.”

I visited again on September 20. This time there was a nearly-200-foot drill rig there, operating with a loud hum. The rig name, Ensign 161, was prominent on the side.

I was wearing my letsbanfracking t-shirt. Three workers came out. I identified myself and we chatted. They were from out of state. I asked who was the supervisor. They didn’t know, they said.

Later toward midnight I drove by again, this time staying on King Road. Through 100+ yards of trees I could hear the hum. Over the tree line I could see lights on the rig.

D4-11, operating on September 22. Photo: Gary Cooley

Two days later Gary Cooley, who has a home a little over a mile from D4-11, visited and took pictures of the rig in operation.

FOIA request

On September 22, I sent DEQ a formal FOIA request asking for all its documents on the facility. DEQ denied it on October 1, citing section 8 and section 9 of part 625.

But section 9 only says that the application and permit are “confidential in the same manner as provided for logs and reports on these wells.” Section 8 says “Logs on brine and test wells shall be held confidential for 10 years after completion.” It adds that “logs” — but not “reports” — can be held confidential even longer, forever.

Marathon’s application, permit, and pre-drilling correspondence with DEQ are not “logs.” So according to these sections, they were not confidential until the well was “completed.” And according to part 625 rules, completion was not until the well reached its “permitted depth or the [DEQ] has determined drilling has ceased.” Obviously, D4-11 was not complete on September 20 or 22. Ensign 161 was still there, and working.

So DEQ should have produced the application, permit, and all records other than logs.

Exploring for gas and oil

On October 2 I visited again. A different worker came out to say hello. He said his name was “Trace” and he was the Marathon safety man. Asked how long the rig would be there, he didn’t know and said they were hoping to find gas or oil. He gave the card of his boss in Houston, in case there were further questions.

A brief internet search showed that earlier this year Ensign 161 was active at Marathon wells in three different counties of western North Dakota. Fracking for oil there is big business.

Trace’s information, Ensign 161’s design and history in frack country, and D4-11’s exploration in the Detroit River group all mean there is a second reason the well information is not confidential. By its title, part 625 only regulates “mineral” wells. Mineral wells include so-called “test wells.” A test well determines the presence of a “mineral, mineral resource, ore, or rock unit,” or obtains data related to “mineral exploration or extraction.” Exploratory test wells look for “an orebody or mineable mineral resource.”

Oil and gas are not “minerals”

Part 625 does not define “mineral.” But in ordinary English minerals are understood to be hard, crystalline, and inorganic. They are extracted by mining.

Gas and oil are extracted by drilling. They are not in DEQ’s list of Michigan minerals. There are no minerals of any kind in Crawford County, according to the list. Anyway, the idea of looking for a mineral in a 4700-foot hole is ridiculous.

Cooley’s nightmare. Photo: LuAnne Kozma. Click for close-up.

Rules under part 625 say if a mineral well encounters oil or gas of any value, the operator has to stop and apply for a separate permit under part 615. This is the part of the law that covers exploration for gas and oil. Part 615 part makes no mention of targeting minerals. It specifically does not apply to “mine and quarry drill and blast holes.”

Part 615, not part 625, was the part under which DEQ granted the “exploratory” permit given for State Beaver Creek 1-14 HD1. As an exploration well for gas and oil, D4-11 should have been permitted if at all under part 615, not part 625.

Whats’ the difference? A big one is that confidentiality under part 615 is quite limited. Logs and other data are confidential only for 90 days after completion and then only if the operator requests confidentiality. All other documents, including applications, permits, and pre-drilling correspondence, are routinely made public to me or anyone else at any time. The same is true of logging and production data after the 90 days has passed, or even before 90 days if the operator did not request confidentiality.

Another difference is that part 625 has no rules prohibiting nuisance noise. Part 615 does.

What will D4-11 do to the countryside?

Part 625 rules allow for horizontal mineral wells, though fortunately this well is vertical. The rules also allow for acidizing, perforating, and fracturing.

As mentioned, so far only the first page of Marathon’s application for D4-11 has been made public. Applications typically run to 50 or 100 pages. The full application had to include an environmental impact assessment.

DEQ’s form for that required Marathon to identify distances to nearby water wells and other human-made features, and wetlands, surface waters, and endangered species. Marathon should have stated if high-volume fracking will be done in which case it should have specified the water volumes and a water assessment, and identified at least some of the chemicals. It should have explained how muds, cuttings, pit fluids, and brines would be disposed. It should have given details about any flowline or other facilities on the pad, and explained how it would deal with soil erosion and sedimentation.

Cooley and Ban Michigan Fracking are appealing DEQ’s refusal of D4-11 information except for the logs. Ninety days after completion the logs will be requested too. A monster operation like this is a matter of public concern. People birding, hunting, or snowmobiling in the forest are entitled to know what DEQ knows, including the environmental effects and everything else.

Separately, On October 8 I wrote the Marathon boss asking him to confirm Trace’s statement that D4-11 was looking for gas and oil, and provide a copy of the “application [and] permit.” A week later a PR flack wrote back confirming a permit was issued but refusing to send any documents.

D4-11, October 16. Photo: LuAnne Kozma.

Lighting the heavens

LuAnne Kozma (the director of Ban Michigan Fracking and the Committee to Ban Fracking in Michigan) and I visited the site again on October 6, at twilight. Ensign 161 was lit up. She recorded the sounds and pictures in the video above.

On October 16 we visited the last time. Drilling was complete. The pad was quiet and empty, a gash in the forest with a blowout preventer at the center. No sign displayed the permit number, “conspicuously” or at all.

Ensign 161 had moved a half-mile to the pad of 1-14. It was drilling there in the same Detroit River formation.

The rig is expected back at D4-11 soon, after Marathon runs the numbers. It cost millions to cut the trees, excavate the pad, and bring in the rig. The company won’t want to walk away empty-handed. And next time the bore would not just be vertical. It could be aimed right at Cooley, his nightmare.


Pipeline secrecy: the poster child

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By Ellis Boal

On May 5, twelve members of the Michigan House introduced a pipeline secrecy bill, HB 4540. The bill would amend Michigan’s Freedom of Information Act, or FOIA law.

Before-and-after pictures of clearing for the pipeline along King Road, taken by neighbor Gary Cooley. Cooley found flattened Kirtland’s warblers in excavated dirt on the day and near the location of the third picture. Click and then click again to enlarge.

It would allow public agencies to withhold “critical energy infrastructure” information — defined as “engineering … or detailed design information” which “relates details about the production, generation, transportation, transmission, or distribution of fuel or energy” of “existing and proposed” infrastructure “relating to crude oil, petroleum, electricity, or natural gas.”

The definition is limited to information that is “more than the general location,” and that “could be useful to a person in planning an attack” on systems and assets, the incapacity of which “would negatively affect public security, economic security, health, safety….”

Both proponents and opponents have focused on oil and gas pipelines and high-powered electrical lines as the critical energy infrastructure which the bill targets. But in ordinary discourse the term also includes oil and gas production.

In the future as wind and solar begin to take hold in the state, central production and transmission facilities related to them would seem to be included too.

(The bill also has provisions related to cybersecurity generally, not limited to oil, gas and electricity. They have not sparked widespread controversy.)

If the bill were amended to exclude production, the primary agency affected by it would be the Michigan Public Service Commission (MPSC) which regulates transmission of oil, petroleum, electricity, and gas.

What follows is an object lesson, where secrecy of gas pipelines proved disastrous for Michigan forests and wildlife.

Secret pipelines

To build a gas line, a company has to give MPSC a plat showing the line’s dimensions, character, compression stations, control valves, and connections. Similar details are required for oil, petroleum, or electric lines.

In January 2013 deep-shale fracker Encana Oil & Gas (USA) applied for and MPSC permitted gathering lines for two horizontal wells. The lines were to connect the wells to a transmission line crossing southern Crawford and Kalkaska Counties.

This is Kirtland’s warbler territory. Kirtlands are federally endangered birds. If you kill one you pay a fine or go to jail or both.

Encana asked MPSC to process the applications “ex parte” — which means secretly. MPSC obliged. Neighbors near the lines had no chance to object. Twenty days later MPSC granted the applications in boilerplate decisions. Only then did the existence of the proposed lines became public.

Neighbors John Buggs, Dan Bonamie, and Gary Cooley live in inholdings of the state forest which the Crawford County line traverses. The line goes along King Road, what was once a stately woodland two-track. They and their neighbors walk, hunt, and bird throughout the area.

Encana had submitted environmental impact assessments (EIAs) to MPSC. But the EIAs were slopwork, supposedly authored by Encana’s surveyor but unsigned. His only enviro credential is a certificate to teach high school biology. The EIAs made no mention of the nearby Kirtland nesting sites, and did not even claim to investigate environmental impacts in the forest alongside the pipeline easements.

MPSC didn’t read the EIAs, saying that wasn’t its job. Buggs and Bonamie tried to intervene and ask for reconsideration, but the agency refused, holding they lacked standing.

In the court

The two appealed to the court of appeals, where Encana argued again they lacked standing.

Meanwhile the company spent $2 million and built the lines, flattening two Kirtland’s warblers in the process, according to witness Cooley’s affidavits. Cooley reported the find to two Encana contractor employees who refused to even look at the dead birds or report the incident to DNR as required.

Cooley also took before-and-after pictures of the one line which goes by his place. DNR had allowed easement widths of 35 feet, but the company used 53 feet including an 8-foot strip of roadside trees along King Road outside the easement boundary.

The court was shocked by Encana’s standing argument. It told the company that dismissing the appeal “may result in a miscarriage of justice.” It added environmental review is the job of every agency, under longstanding Michigan precedent. It reversed the MPSC permits as “unlawful,” and remanded to the agency.

Meanwhile Encana had sold the lines to DTE Michigan and the wells to Marathon Oil.

Back at MPSC

DTE then told MPSC it should now read the EIAs and re-affirm the permits summarily with no hearing.

Getting some backbone for a change, MPSC refused. The EIAs were “mere guesswork,” it ruled. Then it gave DTE till August to try to show the “efforts [it] made and resources [it] used” to produce the EIAs.

MPSC did not ask DTE to submit new EIAs by someone who does have credentials. Any new EIA — after Encana already gouged the forest — would be untimely by 2½ years and objectionable.

Recognizing the “interest” the case has generated, MPSC issued a press release and will allow public comment for 30 days after DTE’s submission in August.

Technical details

Pleadings and decisions in the case are at this link. The technical details provided by Encana when it applied for the lines is in items 1 and 2 of the link. The details include pipe specs and diameters, wall thickness, minimum yield, joint information, coating information, fitting information, maximum and normal pressures, max/min/expected operating temperatures, and other data.

In particular the details showed the line diameters would be 6.625 inches (commonly referred to as 6-inch).

This is the kind of detail which MPSC would be privileged to withhold under HB 4540. Are such details important to Buggs’s and Bonamie’s case?

This is where it gets interesting.

After the court decision, DTE did not remove the lines. It didn’t even stop operating them. Today it is making money off them. But the law provides for fines and a year of prison for corporate officers who have or operate a line without a permit. Here we have two lines and no permits.

Buggs and Bonamie began to question DNR about the 35-foot easements over which the lines run. The width of the easement determines how wide a forest swath can be excavated and cleared for a line. DNR procedure, in effect since 2005, recommends widths of 20 feet or 30 feet.

So why did DNR allow 35 feet for these lines?

And why did it allow taking of the 8-foot strip in violation of its 1994 policy that roadside trees make a “significant contribution to the natural beauty of the surrounding area”?

A DNR employee questions

DNR land use forester Jerry Grieve handled Encana’s application for one of the two lines. He questioned superiors about the width in the fall of 2012. Encana had requested 50 feet for that line. Grieve wrote:

Note: This requested easement is for 50′ not the normal 20′. This is because of the kind of pipeline being put down…. [D]iscussions about the width … are still on going in the Department. A final determination of width will be made by the time the easement is issued in Lansing.

FOIA information shows that in the case of this line, DNR did comply with the normal procedure — in writing — and allowed just 20 feet. But when Encana started excavating and clearing it went out 35 feet. DNR’s reaction: It just winked. In the case of the other line, the written permission stated 35 feet.

No FOIA notes of the DNR decisions show why it deviated from “normal” 20 feet.

But there are clues suggesting possible explanations. One is that the company overstated the line diameters. It told MPSC they would be 6 inches and DNR they would be 8 inches. Companies are supposed to be straight with public authorities. But neither MPSC or DNR have demanded an explanation of the contradiction. DNR fell for it and may have used the exaggerated diameters as an excuse for too-wide easements.

The second clue may be that something in the technical specs — perhaps the steel construction material or the expected pressure — motivated the deviation.

If this information caused DNR to violate its longstanding “normal” procedure, then the public is entitled to know. The width issue goes to the core of the DNR’s mission. Its job is to protect state forests from fragmentation, not violate rules secretly just because a powerful company wants it to.

But it is exactly the kind of data which MPSC and DNR could withhold under HB 4540, by simply declaring terrorists might use it.

In May, Buggs and Bonamie sued DNR in the court of claims to vacate the easements and restore the slashed forest. DNR has not yet responded.

Regardless how the new suit turns out, HB 4540 will allow MPSC and DNR to continue hiding information, and eating out of the hands of the frackers.

Adrian Today reported on May 10 that a search of campaign finance records shows that all the bill’s 12 sponsors received financial support from the energy industry in 2014.

 


 

The litigations are supported by Ban Michigan Fracking.