Gastem USA Environmental Concerns, Mitigating Actions & Best Practices Otsego County, NY. 1
Gastem USA: Introducing an Industry WHO: Orville Cole-Gastem USA,, Rich Nyahay-Senior Geologist Gastem USA, Meghan Leaver-Gastem Inc., Environmental Affairs, Aaron Sulkey- Environmental Scientist Gastem USA, Tiffany McGivern-Hydrology Intern Gastem USA, Kelly Wright-Construction Supervisor. Independent - Thomas Byrnes, Hydrogeologist, Strategic Environmental WHAT: Natural Gas Exploration in New York State WHERE: Otsego, Delaware Counties, New York State WHEN: On-Going Exploration
Pro Environment and Pro Growth Water Use; volume of water use, drainage issues (sediment load), aquifer baseline, chemical introduction and frac flowback disposal. Impact to Community; Open dialogue, economic implications and education. Terrestrial Change; landscape ecology, logging, wildlife, access improvement, land use changes Protection Policies and Procedures; Federal, Regional, State and Industry Best Practises
Accountability Structure Federal: EPA Regional: SRBC State: NYSDEC County: Department of Soil & Water Conservation & Emergency Services Industry Standards: Gastem USA Best Practises
Regulatory Jurisdiction The Environmental Protection Agency (EPA) Regulates the operations of all effluent from Waste Treatment Facilities to Rivers & Streams. The Susquehanna River Basin Commission (SRBC) controls the use of all fresh water surface and sub-surface in the basin which encompasses much of south central New York State, Pennsylvania and Delaware. The New York Department of Environmental Conservation (NYSDEC) oversees the drill permitting, water management and site constructions and remediation Gastem develops a preferred practice to work closely with County Representatives for the awareness sharing of local expertise for both groups.
Baseline Water Quality Study Tested all wells within a 1 mile radius of the immediate site Tiffany s poster, pre drilling and post frac tests evaluated water quality on 19 wells and 10 surface ponds and streams. Results indicate that slight changes have occurred from seasonal conditions and natural unrelated condition changes. 6
Residential Well Sampling Analysis List Dissolved methane, propane and ethane Volatile Organic Compounds (EPA Method 524 or 8260) Glycols ph Conductivity Chloride Alkalinity Sulfate Total Dissolved Solids Total Suspended Solids Calcium Magnesium Sodium Potassium Iron Manganese Arsenic Barium Chromium Lead Lithium Strontium 7
Baseline Testing for Surface Water and Sub-surface Aquifers
Natural Gas Drilling: Fact Sheet Conductor was set through the glacial till to a solid rock seat. 16 inch to 126 and 10 inch to 138 7 inch Surface Casing was set at 780 and cemented to surface. This is 95 below the deepest water well found within 2 miles. 4.5 inch casing to 4950 cemented to surface.
H2O Management and Mitigation All fluid hauling was monitored to ensure that the same volumes delivered to site were accounted including the 80,000 gallon frac job and subsequent disposal of 38,160 gals. of frac flowback fluid and 21,000 gals. of freshwater Chemicals were finger printed and water analysis is scrutinizing local aquifers SWPPP to mitigate potential sediment erosion
Drilling Fluids NYSDEC permit reads «All drilling fluids, fluids displaced out of the well during cementing, and well water (collectively the fluid) must be contained in a water-tight tank or container and disposed of properly.»
Water and Disposal of Fluids Disposal of 38,160 gallons of frac flowback fluid to Watertown facility in January 2010. Full battery of tests and lab analysis from third party certified labs including testing for TDS, TSS, heavy metals and radioactivity testing Baseline testing on all wells within 2 miles of the drill site (current government qualification is 2000 ft.)
SWPPP: Stormwater Pollution Prevention Plan A plan required for major construction projects under the U.S. Environmental Protection Agency National Pollutant Discharge and Elimination System The SWPPP is required to address measures to prevent erosion, sedimentation, and other potential discharges of pollutants to water bodies and wetlands Department of Transportation, 2008. http://www.1395-rt9- study.com/glossary.html
Community and Public Disclosure Publicly available lab results Town hall sessions, including Town of Maryland official representatives, County Soil and Water Management and Emergency Response team / 911 first responders Media, Environmental lobby groups and any number of Elected Officials have had access to our site
SWPPP: Ross #1 Minimise effluent and sediment run-off to the water ecosystem Constructed by a certified hydrogeologist in adherence with stipulated guidelines
Utica Flowback Results Summary of Significant Detections TDS 6,460 mg/l Chloride 5,070 mg/l Barium 15.3 mg/l Iron - 38.1 mg/l Sodium 2,600 mg/l Strontium 34.1 mg/l Organic Compounds: Toluene 0.074 mg/l
Residential Well Sampling Results Summary Well A Well A Well A Well A Groundwater or Drinking Water 3/26/10 Analysis Standard or Guidance Value 8/20/08 12/17/09 Calcium No standard 26 mg/l 27 mg/l 27 mg/l Magnesium No standard 6.1 mg/l 5.9 mg/l 5.6 mg/l Sodium 20 mg/l 37 mg/l 39 mg/l 40 mg/l Potassium No standard 0.93 mg/l 0.57 mg/l 0.84 mg/l Iron 300 µg/l Not Detected Not Detected Not Detected Arsenic 25 µg/l Not Detected 1.9 µg/l Not Detected Barium 1000 µg/l 64 µg/l 62 µg/l 60 µg/l Chromium 50 µg/l Not Detected 6.6 µg/l Not Detected Lead 15 µg/l Not Detected Not Detected Not Detected Mercury 0.7 µg/l Not Detected Not Detected Not Detected Strontium No Standard 570 ug/l 580 µg/l 540 µg/l Chloride 250 mg/l 1.6 mg/l 1.1 mg/l 1.5 mg/l Total Dissolved Solids 500 mg/l 230 mg/l 210 mg/l 190 mg/l Standards vary by compound Not Detected Not Detected Not Detected Volatile Organic Compounds Dissolved Methane 10 mg/l Not Detected Not Detected Not Detected
Residential Well Sampling Results Summary Well B Groundwater or Well B Drinking Water Well B 9/30/09 Well B 1/13/10 Well B 4/20/10 Standard or 8/6/09 Laboratory Analysis Guidance Value Calcium No standard 32 mg/l 31 mg/l 32 mg/l 33 mg/l Magnesium No standard 8 mg/l 7.8 mg/l 8.0 mg/l 8.2 mg/l Sodium 20 mg/l 26 mg/l 24 mg/l 25 mg/l 26 mg/l Potassium No standard 0.68 mg/l 0.59 mg/l 0.73 mg/l 0.73 mg/l Chloride 250 mg/l 2 mg/l 2 mg/l 2.5 mg/l 2.6 mg/l Iron 300 µg/l 55 ug/l 64 ug/l 50 ug/l 59 ug/l Lithium No standard 10 ug/l 8.4 ug/l 11 ug/l Not Analyzed Manganese 300 µg/l 210 ug/l 230 ug/l Not Analyzed Not Analyzed Arsenic 25 µg/l Not Detected Not Detected 1.6 ug/l Not Analyzed Barium 1000 µg/l 1.9 µg/l 38 ug/l 40 ug/l 38 ug/l Chromium 50 µg/l 11 µg/l Not Detected 3.9 ug/l Not Detected Lead 25 µg/l Not Detected Not Analyzed Not Analyzed Not Detected Strontium No standard 170 µg/l 170 ug/l 180 ug/l 170 ug/l Sulfate 250 mg/l 6.6 mg/l Not Detected 5.7 mg/l 11 mg/l Alkalinity No standard 160 mg/l 160 mg/l 170 mg/l 160 mg/l Total Dissolved Solids 500 mg/l 220 mg/l 190 mg/l 162 mg/l 190 mg/l Total Suspended Solids No standard Not Detected Not Detected Not Detected Not Detected Dissolved Methane 10 mg/l Not Detected Not Detected Not Detected Not Detected
GASTEM BEST PRACTISES The result of New York Regulation, specific conditions and local opportunities and global experience has allowed us to develop specific practices that will be applied on all future operations. 19
Recommended Best Practices Gastem has experience across North America and has proposed operations formulas that align with the exploratory nature of our work in NYS. We have used a minimum of 1 mile radius for baseline test water analysis of surface stream, ponds and private water wells. Our water analysis procedures will end in the immediate area of our work sites after a one year clean bill of health which is currently the situation in the area of the Ross well site.
Aquifer Protections Gastem recognizes the NYSDEC requirement for a bond log and maintains a company ploicy to cement all casing to surface unless there is a clear reason for alternative actions. Useable aquifer has been detected within a few feet of hydrocarbon sources in Otsego County 21
Shallow Water & Gas Intervals
Bond Log 23
Terrestrial NYSDEC permit reads «If any archeological or structural remains are encountered during site construction operations, the permittee must immediately cease, or cause to cease, all work and notify the Albany Mineral Resources office. Work shall not resume until written permission to do so has been received from the Department.»
Innovation in Land Use Beneficial Use Determination (BUD) study in conjunction with local academic institutions Currently sponsoring a $20,000 study at Colgate University to evaluate drill cuttings to replace liming agent for agriculture. We will develop well sites with reusable matting materials to reduce surface disturbances. 25
Industry Employment Potential *The gas industry-funded report issued last year by Penn State's College of Earth and Mineral Sciences concluded that the natural gas industry created more than 29,000 jobs in Pennsylvania in 2008 and 48,000 jobs in 2009. Next year, the study estimates 111,000 new jobs will be created as a result of Marcellus Shale-related industry. A new industry will require at least a two year training cycle with continuous activity to develop the industry in a safe manner for new workers. Development of education programs with BOCES and local training is starting. *Reference June 30, 2010 Scranton Times-Tribune - DAVID FALCHEK 26
Current Employment & Local Initiatives Gastem USA employs a Geologist from Cobbleskill We recently hired a Environmental Scientist graduate from SUNY Oneonta and continue to have a Hydrology Student interning with us from Little Falls, New York. We currently have a contract worth $90,000 to a local supplies for Hemlock matting that will fill 40% of our projected needs for 2010 pending drilling approvals. Colgate University is analyzing drill cuttings for chemical content prior to a planned field test with SUNY Morrisville to test high ph drill cuttings as a replacement for liming on local agriculture land. 27
Our Local Contractor Report A few of the Contractors and Suppliers from the area; Ken Ross Construction Barber & Deline Bruce Hall True Value Lawson Surveying Seward Construction Town of Worcester (Water Supply) Town or Maryland (Road Access) Swatling Lumber Riccelli Trucking MOSA 28
Development requires Evolution The opportunity to develop a strong new Industry in New York State currently exists. The local Banks, education institutions including BOCES, SUNY Oneonta,Hartwick, Colgate, SUNY Morrisville and the STEM Education Coalition have all visited our well site or we are participating with them in focused projects. We are currently working with County staff and hope to expect to continue with initiatives that will develop a water well registry and standards on road use and road bonds. 29
We Understand the Geology
NYSDEC has Standards for Safe Drilling and Fracturing Operations
Gastem USA has Protected the Aquifer
Natural Gas Leases in Otsego County Gastem USA 150 Leases Atlas Energy 50+ Leases Whitmar & Lenape -? Worcester Land Association 240 Families on 26,000 acres (1000 acres in Delaware County) Tri-Cities Land Coalition in Town of Maryland -16,000 acres = 134 Families Unadilla - Otego -