Fracking technology coming to Michigan

Fracking technology coming to Michigan by Lee Smith, September 13, 2012, Midland Daily News
Editor’ note: This is the first of four articles on fracking in Michigan.
Where is Michigan in the fracking revolution that has transformed gas and oil production in the United States? More than $400 million has been spent in Michigan in the past three years to explore the use of new fracking technology. The possibilities of recovering natural gas, natural gas liquids, and oil from the Collingwood-Utica Shale (Colllngwood) and the A-1 Carbonate (A-1) rock formations that underlie a significant portion of Michigan’s lower peninsula have brought this modern fracking technology here. But what exactly is modern fracking? The term fracking refers to applying pressure to hydraulically fracture the subsurface rock strata and injecting proppants (sand or ceramic material) into the cracks to keep them open. This fracturing increases the extraction rates, thus enhancing the recovery of gas and oil. Modern fracking technology is usually applied to shale reservoirs, but in some cases it can work in reservoirs that consist of other rock types, such as limestone and dolomite (carbonate rocks).

Is Michigan about to reach the take-off point where, rather than being used on fewer than a dozen wells a year, modern fracking will be applied to 100s of wells a year? If you are looking for signs of what a drilling boom would mean, consider that the Kalkaska County Planning Commission just gave approval for a temporary worker camp that can house up to 40 drill workers in Kalkaska’s Excelsior Township. Two companies, Encana and Devon Corp., have made substantial investments to appraise the potential of using modern drilling and fracking techniques on Michigan rocks. Although Devon and Encana are not necessarily household names in Michigan, both are substantial companies listed on the New York Stock Exchange. … Besides Encana and Devon, Chevron, operating in Michigan as Chevron Michigan LLC, holds Michigan drilling permits for five Collingwood tests — four in Kalkaska County and one in Antrim County. Chevron acquired 100,000 net acres of oil and gas leases in the Collingwood along with Antrim Shale gas production when they purchased Atlas Energy in early 2011. … The presence of well-financed companies in the hunt for profitable fracking opportunities in Michigan is important since the cost per well of the type being drilled in Michigan can be over $7 million. Present information indicates that in 2012, Encana, Devon, Chevron, and Rosetta could account for as many as a dozen wells in Michigan that will utilize modern horizontal drilling and fracking.

Anti-fracking advocates such as LuAnne Kozma, the campaign director of the Committee to Ban Fracking in Michigan, sees fracking as fracturing the forest and changing Michigan forever in the way that logging did over a century ago. The Committee to Ban Fracking is collecting signatures to amend the Michigan state Constitution to ban horizontal hydraulic fracking. Activity in the Collingwood in Michigan is progressing. Leading the pack in modern fracking in Michigan is Encana, which started production from two Collingwood wells in Kalkaska County in early 2012 and plans to drill five additional Collingwood wells in 2012. In response to my request in August of 2012 for information on their Collingwood drilling in Michigan, Encana provided a presentation by Jeff Wojahn, executive vice-president & president of Encana’s USA Division. This presentation represents that Encana believes that its Collingwood wells each have an estimated recovery of 5.3 billion cubic feet of gas equivalent. Encana’s presentation states that they have 1,700 potential net well locations in the Collingwood in Michigan. It also states that Encana presently holds oil and gas leases on 430,000 net acres in Michigan.

It is significant though that in spite of present low natural gas and natural gas liquid prices, companies are continuing to drill and frack in Michigan. Encana or Devon or Chevron or Rosetta or some other company, with their continued drilling programs, could bring in a well in the Collingwood or the A-1 Carbonate in Michigan that does yield significant quantities of natural gas liquids or oil. Should this key liquids-rich well be drilled, companies could proceed to drill and frack even more than those 1,700 wells that Encana says they have identified. The drilling of more than 1,700 wells would have to take place at an accelerated pace to beat the expiration date of oil and gas leases that companies now hold. Is Michigan ready for 100s of wells to be drilled each year using modern fracking practices?

This entry was posted in Global Frac News. Bookmark the permalink.