God Bless the Fracktivists.. and of course the endangered Indiana Bat :^)
An executive at Bluescape Resources (BRC) confirms that work is under way on a 52-mile pipeline that would transport gas from the Marcellus shale fields of Nicholas County to a connection point near Frametown in Braxton County.
“We have acquired all of the right of way, the permits and the interconnect agreement with the transmission company we plan to connect our pipeline with,” says Tom Grace, Bluescape’s executive vvice president. “We initiated the construction operations earlier this year.”
The pipeline will cost over $100 million and cross the Gauley and Elk rivers on its way to the company’s wells near Richwood, says Grace. He says no specific timeline for completion of the project is set.
“We are in the very early stages of proving the economic viability of this resource. It is a multi-year project, but if successful, this will open up an entire region of the state that before now has little economic development in terms of oil and gas,” he says.
The Dallas-based company currently has at least eight horizontal well permits in Nicholas County, approved by the West Virginia Department of Environmental Protection (WVDEP). Cabot Oil and Gas Corp. and Triana Engineering are also drilling wells to tap Marcellus shale gas in the county.
Three of Bluescape’s Nicholas County wells have flared illegally since the end of August, from a single flare stack. The DEP issued a notice of violation in late October to the company for not obtaining a permit. Law states that temporary flares can only burn for 30 days per year.
A response to the WVDEP’s notice of violation says that Bluescape has no choice but to burn the gas, since “to date no natural gas pipelines have been installed on or in the vicinity of the site.” The letter also states that two WVDEP officials told the company no permits were needed for the flare.
Grace says Bluescape’s plans for drilling further in Nicholas County are still unknown.
“We’ve drilled a handful and hope to test more next year. If things are positive, we will continue to drill next year in hopes of initiating commercial production in the coming years,” he says.
Bluescape has taken a risky position by initiating the pipeline before the economic viability of the Nicholas County shale fields is proven, says Grace.
“Building a pipeline for 52 miles across the state of West Virginia requires massive amounts of resources, both across construction and engineering and regulatory aspects. We felt it in our and the state’s best interests to initiate those operations sooner rather than later, at our risk, versus the alternative, which is to prove the economic viability and then wait for several years for the pipeline to be built,” he says.
“It is a risk, but we are confident that this project will work after we have sufficient data to prove the economic viability of well performance. ... Early returns are positive but inconclusive at this point.”
Grace says the drilling would create jobs for skilled and semi-skilled workers, and have trickle-down effects in the local economy.
“Our drilling operations will lead to several hundreds of millions of dollars in investment over the next few years,” he says. “The secondary effects of that will be expanded economic growth in all sectors of the community. We will be providing an enormous tax base in addition to economic benefits of increased commerce and development in that area.”
The company is building the pipeline to meet the specifications required for transporting gas for multiple companies, says Grace.
A local group called STand Up Now (STUN) takes issue with the horizontal fracturing wells and is holding regular community meetings about the developments. STUN says they initially reported the illegal flare to the WVDEP.