TPT July 2017

G LOBA L MARKE T P L AC E

G LOBA L MARKE T P L AC E

Oi l and gas A deadly explosion in western US calls renewed attention to the potential for leakage of older ver tical gas wells An investigation into a 17 April accident in Colorado, USA, centres on a natural gas and oil well just 178ft from a house that exploded in a fireball and killed two men working on a hot water heater. On 19 April, well owner Anadarko Petroleum, the state’s largest oil and gas producer, shut down 3,000 wells throughout northern Colorado, including seven near the blast site. The company said it was acting out of an abundance of caution. “Colorado residents must feel safe in their own homes,” Anadarko senior vice-president Brad Holly declared in a prepared statement. But according to David Kelly of the Los Angeles Times , to those living in the Oak Meadows subdivision, about 25 miles north of Denver, their proximity to old and potentially leaky gas wells has them feeling anything but safe. Despite assurances from the Colorado Oil and Gas Conservation Commission, the exploration regulator, one resident told Mr Kelly that she would not reactivate a pilot light for fear of an explosion. Others disclosed worries about turning on the gas stove or going into the basement. A common anxiety is that the soil of the neighbourhood is soaked in combustibles. Mr Kelly reported that the suspect well was drilled in 1993 and changed hands several times before acquisition by Anadarko in 2014. It primarily produces gas, with a little oil. Like all of the shut wells, it is of the older vertical construction, in contrast to newer horizontal wells that allow for exploration in various directions. Commission director Matthew Lepore said there are 54,000 active oil and gas wells in Colorado, of which 48,000 are vertical. (“Anadarko Petroleum Shuts Down 3,000 Wells After a Deadly House Explosion,” 28 April) Industry expert Mark McDonald of Boston-based NatGas Consulting has spent 25 years investigating gas explosions. He believes that the lines that move gas and oil from wellheads to processing plants are under-regulated. If not properly maintained, he told the LA Times , corrosion and leaks can occur. “Hopefully, it will dissipate through the soil into the air but sometimes it will travel along a previous trench or sideways or underground into someone’s home and then you have a time bomb,” Mr McDonald said.

› At this writing, Anadarko inspectors were focused on underground lines associated with each wellhead, especially those near housing and commercial developments. An apartment complex is going up just behind the house that exploded. The local fire protection district was also gathering and analysing evidence to determine the origin and cause of the fatal explosion. While the well in the vicinity was an aspect of its probe, the district said in a statement, “This is a complex investigation and the origin and cause of the fire have not been determined.” Corroded flowlines are identified as the source of the majority of production-related spills in Colorado In related news of Colorado, ten days before the accident described in the previous item (“A deadly explosion”) it was reported that an audit of oil and gas flowlines in the state found that about half of all spills from such lines can be traced to corrosion. According to Dennis Webb, who covers energy and natural resource issues for the Grand Junction (Colorado) Sentinel , that means that as much as a quarter of the spills reported to the Colorado Oil and Gas Conservation Commission involve flowline corrosion. Flowlines are pipelines running directly from wells, typically to the point of gas metering or where tanks collect produced oil. Flowlines also may carry water associated with oil and gas development. The flowline audit programme conducted by the commission’s Engineering Integrity Group has, since the start of 2016, carried out 30 audits, mostly focused on larger companies. The examiners have audited more than 2,800 wells, reviewed more than 3,800 pressure tests, and done more than 400 flowline-related inspections. Mark Schlagenhauf, engineering integrity supervisor for the commission, confirmed to Mr Webb that flowlines account for 40 to 50 per cent of all spills that energy companies report to the agency. (“Corrosion Causes Half of Oil, Gas Flowline Spills,” 7 April) Underlining the importance to Colorado of the findings, the US Energy Information Administration (EIA) has reported that, with oil production from the Niobrara Shale increasing, more pipelines are being built or repurposed to move Colorado crude oil to refineries out of state. Besides commanding the Wattenberg field, the nation’s fourth-largest oilfield ranked by proved reserves, Colorado is also among the major natural gas-producing states in the US. Mr Schlagenhauf said that the Engineering Integrity Group’s audit of spills reported from September 2016 to February

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JULY 2017