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Monday, August 8, 2011

SEISMIC TESTING: More Important Than You Thought!

SEISMIC TESTING: More Important Than You Thought!

Hundreds of thousands of AC are leased (and soon more will be leased) across our Marcellus/Utica region, but certainly not all will be drilled on. Well locations are determined by the results of seismic testing ... a technology similar to sonar used for mapping the ocean floor, but for our purpose it's done on land to map underground rock formations.

Some firms doing this testing are hired by energy companies holding signed leases, while others conduct the studies independently making their money by selling the findings to energy companies "considering" leasing. This information isn't made available to landowners (rights holders) for 2 reasons:

1. It would certainly affect lease negotiations!
2. It's written in technical jargon understood by highly-skilled geologists working for energy and investment companies.

Seismic testing falls into various categories, each one more detailed than the previous test.

Two dimensional (2D) shoots which are run from the roadways (oft called bumper-thumper trucks) mark the beginning of company interest in an area. Once these initial results are analyzed they determine the urgency of further testing and possible resource development.

3D "shoots" use sub-surface explosive charges then monitor the feedback using traditional methods plus computers and processors that provide detailed analysis.

A 4D shoot takes the process one step further adding "time dimension", i.e. how sub-surface characterics change over time. This may seem over the top to laymen, but remember unconventional shale development is a multi-generational endeavor. The term leases and single contracts we sign affect us now, as they will others belonging to future generations.

Companies have long been aware of the impact their legal agreements can have. Everything they do is with an eye on the future. The 3D and 4D seismic tests cost millions per square mile. However their results allow companies to place wells effectively, almost eliminating dry holes regardless what landmen have told the public. This cuts drilling costs, shortens exploration time, and seriously reduces negative economic and environmental impacts companies might be forced to correct at a later time.

In spite of all the positive indicators resulting from seismic testing, companies often find themselves waiting months for fracking services to begin on site. If their pockets aren't deep enough, the lease may expire. At that point it becomes time to re-negotiate and renew the lease if the owner is pleased with the new offerings.

Why does seismic testing matter to the public? It depends how the AC in question is being used. The contract usually offered is quite brief, and a one-shot deal for landowners whether they own the rights (OGM's) or not. The document needs to specify the type of testing the company wants to do, and how long it will take to complete the test(s). An all-inclusive contract for numerous tests over a few years' timespan is only a good deal for the company.

The disturbance to a landowner's current or future income deserves just compensation as it may include possible timber loss, a season's crop loss, pasture made unavailable, a portional loss of a sugarbush stand, etc.. The same holds true for environmental disturbances during the testing. Certainly concise reclamation clauses should be included in a seismic testing agreement, as well as having a timeframe established.

Monetarily this testing contract does not provide a windfall for the landowner, but if a fair, mutually-agreeable document is not entered into, who is the loser --- company or landowner? Making concessions as needed, both parties come out winners. Doing business smartly means there are no losers.


Janice L. Hancharick
4-County Leasing Group
Potter/McKean in PA, Cattaraugus/Allegany in NY
E-mail: jlhanch@nc.rr.com

9 comments :

Anonymous said...

if 3d testing by explosives can fracture stone and send methane into peoples houses because of fractures in the land, can't the same be true about a towns water supply. you know, causing cracks in the stone therefore rerouting water supplies or decreasing the amount available for a town.

Anonymous said...

You are getting close. Like the question. Curious about what kind of a crap answer you're going to get. Can't live without water.

Anonymous said...

Monday, August 8, 2011 8:40:00 PM EDT
I will try to answer your question.
I hope it isn't a "crap" answer.
There are many things that allow methane to migrate to the surface,aquifer and peoples homes.
Methane is lighter then air. It is a gas. It travels UP the path of least resistance.
Methane migrates UP pathways that are naturally occurring,UP existing well bores, such as un-plugged wells,UP fractures and voids caused by any industrial activity that cause fractures and voids. This includes seismic testing and Hydraulic Fracturing.

That is why it is recommended to have baseline water sampling done on water wells in advance.

The good thing is seismic testing MAY help to identify the location of orphan,abandon and unplugged well bores.
If only the seismic test results were made public.

Un-plugged,abandon wells provide(easy) pathways that allow methane to migrate to the surface,aquifers and into homes and have caused explosions.

Methane does not discriminate between the aquifers private and public water sources are drawn.

So yes,in theory it is possible for methane to migrate to homes via a public water source.

Some water supplies are monitored for methane (daily) frequently some not as frequently.

It is almost impossible for seismic testing to re-route or deplete an aquifer.That is what the industry's water withdrawals are for!

Anonymous said...

I would think most people would prefer seismic companies
to summerize their seismic results.
Requiring the companies to translate their "technical jargon" into "plain language" so potential leasers are made aware of
problems/issues/historic well bores in advance so landowners could make an informed decisions before they sign.
It seems to me just plain common sense.
Certainly if these companies if can pay millions per mile forseismic testing they could afford the cost to have the report translated and printed up!

Anonymous said...

Why is there no NEPA or other environment impact study done on "thumping" or underground explosions done for seismic testing? Especially in an area where there is so many natural tectonic cracks as we have around here?

That seems irresponsible to me.

And remember, that all the abandon, orphaned wells around here are proof that the industry in the past was not correctly or adequately regulated and is proof of how irresponsible they acted!

Anonymous said...

Does someone know the answer to this... Do leases provide for the cost to plug the Marcellus wells. I read somewhere the the cost is over one hundred thousand.
Is this true?
How much is plugging costs?
Is money set aside for when wells stop giving gas?
If everyone signs a group lease, but the well is on my property. Does the group pitch in to plug it...or is it mine if the company leaves it unplugged?

Anonymous said...

Tuesday, August 9, 2011 12:17:00 PM EDT
Seismic testing is voluntary.
You do not have to allow them to vibrate your property.

Anonymous said...

Plugging a Marcellus well is an unlikely occurance because millions to deveop it would not have been spent, had the company already known it was going to be unproductive. Accurate, expensive seismic testing provides this "info". In our region our relatively shallow Marcellus (50'-150' thick) sits atop Utica shale 250'-400'. When the drilling is completed and the well has gone dry, it should be plugged @ company expense. PUT that in the lease!
As for all the abandonned and unplugged wells across PA/NY and certainly other states, they exist for numerous reasons. Many were drilled by crews working 16 hr. days @ breakneck speed during the World Wars. Environmental and conservation efforts weren't on anyone's radar. Everything became a part of our country's war effort. Get that oil and gas UP. Build all manner of ships, planes, tanks, etc. and give them something to run on! Metal shortages? YES. Re-use metal as many ways as possible. This included pulling pipe to sink down another well. Whatever was done supported the war effort. and everyone felt good about it.
The future cannot be predicted, and to call all past actions as being irresponsible when it comes to developing our resources ... PHOEEY. What language would we be speaking now if we had waited for all possible regulations to be put on the books?

Anonymous said...

Providing for the cost to plug Marcellus wells when they become un-productive is something that should be worked into a lease.
DEP's list abandon well list is long enough.

People who think these wells are all 100+ year old wells drilled during war times have been mis-informed.

Many are old others are not.

I spoke to someone the other day about this. He told me this; anyone with a well that has not generated income within the past 5 years can fill out the request form to have a well put on the DEP's abandon well list to be plugged.