Shale Gas Overview. September 25, 2014

Transcription

1 Shale Gas Overview September 25, 2014

2 Anadarko is Among the World s Largest Independent Oil and Natural Gas E&P Companies Included in the S&P 100 Index with Employees Worldwide Headquartered in The Woodlands, TX with Operations in 15+ Countries Producing Enough Energy to Meet Daily Demands of ~25 Million Avg. American Homes. Production Exploration

3 Mission and Values Anadarko s mission is to provide a competitive and sustainable rate of return to shareholders by exploring for, acquiring and developing oil and natural gas resources vital to the world s health and welfare. Integrity and Trust Servant Leadership People and Passion Commercial Focus Open Communication 3

4 History of Shale Energy Development 4

5 Shale Gas Plays

6 Horizontal Drilling + Hydraulic Fracturing = Energy Reboot Horizontal Drilling Hydraulic Fracturing Multiple layers of Protective steel & cement 6

7 Hydraulic Fracturing Fracking Explained Fracking is a Temporary Process, Typically Lasting 3-5 Days per Well. Involves Injecting a Mixture of Water, Sand and a Relatively Small Amount of Additives Under Pressure into Targeted Formations. Pressure Creates Pathways, Propped Open by Sand, for Oil or Natural Gas to Flow to the Wellbore. Without Hydraulic Fracturing Tight Sands and Shale Formations are too Dense to be Economically Produced. 7

8 Hydraulic Fracturing Quick Facts 8

9 It Has Been Used For Years Myth: Fracking is a New Technology Truth: Fracking is a Proven Technology in Use Since the 1940s, while Constantly Being Improved and Enhanced. The world s first commercially fractured wells located in Duncan, Oklahoma. (March 17, 1949) 9

10 It Is A Long Ways Down Myth: Fracking Endangers Water Truth: Proper Well Construction Protects Groundwater Near the Surface. Truth: Mother Nature Protects Groundwater from Upward Migration of Fluids, as Thousands of Feet of Impervious Rock Separate Petroleum Zones from Groundwater Sources. In no case have we made a definitive determination that the fracking process has caused chemicals to enter groundwater. Lisa Jackson (2012), Former U.S. Environmental Protection Agency Administrator 10

11 Water Usage Comparison Myth: Hydraulic Fracturing Uses Too Much Water Truth: Fracking Conserves Water. (Gallons of Water per 1 Million BTU of Energy) Soy biodiesel: Corn ethanol: Natural gas: 44,500 gallons of water 23 gallons of water 3 gallons of water Truth: Drilling and Fracturing a Horizontal Well Requires about 3-5 Million Gallons of Water A Relatively Small Amount When Taken into Context with Other Uses 11

12 Induced Seismicity Myth: Hydraulic Fracturing Causes Earthquakes According to the National Research Council, the process of hydraulic fracturing a well presently implemented for shale gas recovery does not pose a high risk for inducing seismic events. 12

13 Low Carbon Footprint Myth: Hydraulic Fracturing Makes Air Quality & Climate Change Worse 13

14 Saves Space Myth: Fracking for Oil & Gas Takes Up Too Much Land Truth: Shale Gas Production Requires Drastically Smaller Land-Use than Conventional Natural Gas and Many Other Forms of Energy Production. Amount of Land Need to Fuel 1,000 Households for 1 Year Shale Gas: Coal: Wind: Solar: 0.40 Acres 0.75 Acres 6.00 Acres 8.40 Acres Source: IGU: Shale Gas, The Facts About the Environmental Concerns 14

15 Commitment to Transparency Myth: Companies Won t Say What Chemicals They Use Truth: We publicly share the ingredients used in every application of hydraulic fracturing through the Groundwater Protection Council s Online Public Registry: Anadarko s uploaded data for 5,000+ wells 15

16 Multiple Regulations Myth: Hydraulic Fracturing is Not Adequately Regulated Truth: Hydraulic fracturing is highly regulated at multiple levels of government. Key Federal Regulations Governing Shale Development Include: Clean Water Act Clean Air Act Safe Drinking Water Act National Environmental Policy Act Resource Conservation and Recovery Act Emergency Planning and Community Right to Know Act Endangered Species Act Occupational Safety and Health Act Key State Regulations Governing Shale Development Include: Review and Approval of Permits Well Design, Location and Spacing Drilling Operations Water Management and Disposal Air Emissions Wildlife Impacts Surface Disturbance Worker Health and Safety Inspection and Enforcement of Dayto-Day Oil and Gas Operations 16

17 Getting the Products to Market 17

18 Obama Administration Officials on Safety, Benefits of Shale President Barack Obama

19 Engaging Stakeholders Launched CRED Initiative in Colorado Anadarko employees host an Open House in Ft. Lupton, Colo. to address concerns and answer questions from stakeholders in the community.

20 Committed to Reducing Emissions Collaborative Air-Quality Rules in Colorado with Governor, Regulators and EDF University of Texas/EDF Emissions Study Utilizing Green and Reduced-Emission Completions Throughout U.S. Onshore Expanding CNG Fleet and Infrastructure Anadarko, EDF, Governor John Hickenlooper and 2 Other Operators Collaborate on New Air-Quality Rules in Colorado. Focus on Reducing Truck Traffic Anadarko is awarded a 2013 Environmental Protection Award by the COGCC for the third consecutive year.

21 Conserving More & Producing More in Colorado INNOVATION IN THE WATTENBERG* Innovation Innovation Innovation Innovation Innovation Centralized Stim Centers New Water on Demand System New Water on Demand System New Oil Gathering System New Oil Gathering System COMPLETIONS PHASE PRODUCTION PHASE Result Result Result Result 40% 88% 96% 82% 96% Fewer Frac Tanks Fewer Trucks on the Road Fewer Production Tanks Fewer Trucks on the Road Smaller Pads * Average per 4-well pad Result Increasing Production 2011-YE X MORE Production From the Field

22 What Oil & Natural Gas Means to You In 2013, America Exceeded Russia in Oil and Natural Gas Production In 2011, America Became a Net Exporter of Petroleum Products for the First Time Since 1949 In 2015, America is Projected to Surpass Russia and Saudi Arabia as the World s Top Oil Producer In 2013, U.S. Consumers Paid 33% Less than Europeans for Home Heating and Electricity 22

23 What Oil & Natural Gas Means to You 23

24 What Oil & Natural Gas Means to You 96% of All Products We Use on a Daily Basis are Either Derived From or Powered by Oil and Natural Gas 24

25 U.S. Energy Revival Technological Innovation Horizontal Drilling and Hydraulic Fracturing Transformational Benefits 100+ Years of Domestic Natural Gas Supply Lower Energy Costs for Consumers Industrial and Manufacturing Renaissance Strengthen Energy Security / Balance of Trade Growing U.S. Global Strategic Influence Improve Environmental Quality 25

26 Shale Gas Overview September 25, 2014