CHAPTER 8 WHEN LIFE GIVES YOU COAL BED METHANE, MAKE LEMONADE AN ANALYSIS OF THE POTENTIAL TO APPLY WATER PRODUCED BY COAL BED METHANE DEVELOPMENT TO A BENEFICIAL USE
| Jurisdiction | United States |
(Jan 2002)
WHEN LIFE GIVES YOU COAL BED METHANE, MAKE LEMONADE AN ANALYSIS OF THE POTENTIAL TO APPLY WATER PRODUCED BY COAL BED METHANE DEVELOPMENT TO A BENEFICIAL USE
Holland & Hart
Cheyenne, Wyoming
This paper examines the problems and potential solutions associated with produced water from coal bed methane development in Wyoming's Powder River Basin. Although speed and extent of the coal bed methane development in the Powder River Basin have created a variety of complications, the production and disposal of water from coal bed methane wells gives; rise to the most severe practical and legal issues. Several options exist for disposing of water produced by coal bed methane activities, each with its own benefits and detriments. This paper summarizes those various options and the problems associated with each.
However, rather than analyze in detail each option for disposing of produced water, the paper proposes that the most effective means available to resolve the issues surrounding produced water may be to ensure that all involved parties receive some benefit from the water production. Consequently, this paper will analyze the potential for applying produced water to a beneficial use, as well as the problems and pitfalls associated with such an approach.
Coal Bed Methane Production
As the name indicates, coal bed methane is found trapped in the vast coal formations underlying much of the country, and particularly Wyoming. During the coalification process, wherein organic matter is progressively converted into coal, large quantities of methane gas are produced. Due to the porous nature of the coal, coal formations are able to hold much larger quantities of methane than exist in conventional gas reservoirs of equal volume.2 The coal's porous nature also allows it to hold large quantities of water in addition to methane gas.
In order to extract methane from coal formations, a developer must reduce the pressure that holds it in place. Where large quantities of water are also present in the
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formation, as is common in the Powder River Basin, it is the water that exerts the most pressure on the formation. Consequently, that water must be removed prior to accessing the methane. The quantity of water present in a coal formation generally decreases with the depth of the formation. However, as water quantity decreases with depth, so does water quality.
It's the Water, Stupid
Coal bed methane development, like any other form of natural resource extraction and development, suffers from a variety of controversies and problems. In the Powder River Basin, the surface and mineral estates are often severed, and developers who wish to access the large quantities of methane just a few hundred feet below the surface must consider the impacts to surface land owners and users. However, despite the controversies inherent in attempting to create a large scale industrial complex in one of the most empty and independent parts of the country, one issue stands out above all other: water. Mining and other mineral extraction practices often produce water together with the target mineral. In the Powder River Basin, coal bed methane activities produce water in impressive proportions.
Keeping track of the number of operating wells in the Powder River Basin, and the consequent water production, is akin to rounding up the proverbial cat herd. Each month, hundreds of new wells are completed or begin production. From December 2000 to December 2001, 9, 110 applications for permits to drill were submitted to the Wyoming Oil and Gas Conservation Commission.3 Currently, more than 10,000 coal bed methane wells operate in the basin, with the potential for up to 60,000 more wells in the next ten to fifteen years. Each coal bed methane well produces approximately 12 gallons per minute of water.4 In the Wyodak Drainage Coal Bed Methane Environmental Assessment ("Wyodak Drainage EA"), the Bureau of Land Management estimated that the approximately 4,093 wells in operation by November 2000 were producing 50,416 acre-feet of water per year.5 As coal bed methane development continues, the total amounts of water will continue to increase.
If the BLM's estimates are accurate, and average water produced per well has remained constant, current water production in the Powder River Basin could exceed 100,000 acre-feet per year. For those not familiar with the area, Wyoming is a dry state. Although somewhere in geologic history the Powder River Basin was covered by dense swamps and vegetation, that landscape has long since given way to miles of uninterrupted grasslands, dry winds, and inconsistent water sources. Precipitation in the Gillette, Wyoming area, in the center of the Powder River Basin, averages
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approximately fourteen inches each year. The 100,000 acre-feet of water potentially being produced by coal bed methane activities far exceeds the total existing groundwater consumption in the basin. The Wyodak Drainage EA indicates that 32,300 acre-feet of groundwater are consumed each year in the basin.6
According to the Wyoming State Engineer's Office, total annual surface water use for all industrial and municipal uses in the state amounts to 200,000 acre-feet of water. One acre-foot of water is sufficient to supply a family of four for one year. Consequently, at the estimated 100,000 acre-feet, the current amount of water produced by coal bed methane development in the Powder River Basin would be sufficient to supply domestic water to over 80% of Wyoming residents.
The large quantities of water produced by coal bed methane development in the Powder River Basin creates complexities not previously experienced in the mineral extraction industry. Although much of the water produced is of sufficient quality for stock watering and some domestic uses, attempts to use the water for irrigation can have severe consequences. Water produced by coal bed methane activities is often highly saline. The high salinity of the water, combined with the particular nature of the soils and vegetation in the Powder River Basin, can have dramatic impacts on the potential for the soil to support vegetation in the future. Consequently, without treatment, the produced water is often of a quality unusable as an irrigation resource.
Coal bed methane produced water also creates substantial problems with respect to water quantity. Many of the drainages into which water is discharged are ephemeral or intermittent, and would not typically experience water flow year round. The advent of coal bed methane development has changed many of these drainages into perennial streams, which can have substantial impacts on ranching operations. For ranchers in the area, the constant flow of water can impact long-used stream crossings and diversion structures. In addition, the infiltration of produced water into shallow aquifers may impact the water quality in existing domestic wells. Finally, increased surface water flows may substantially increase erosion.
Management Options and Problems
Despite the problems associated with disposing of produced water, coal bed methane development continues. To date, coal bed methane development has produced approximately 470,516,300 Mcf of methane in the Powder River Basin. This indicates, of course, that notwithstanding the various complexities, developers have found the means to dispose of water produced by that development. Several options exist for disposing of water produced by coal bed methane development activities, though a single method is most often employed in the Powder River Basin. This section will briefly discuss each of those options, and will outline the problems associated with each.
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Surface Discharge
Virtually all coal bed methane operations in the Powder River Basin discharge produced water into existing surface drainages. This strategy requires the developer to obtain a National Pollutant Discharge Elimination System ("NPDES") permit from the Wyoming Department of Environmental Quality ("DEQ"). While the DEQ is not currently issuing NPDES permits for discharge into the Tongue river and its tributaries, and the recent agreement between Montana and Wyoming limits the potential to discharge into the Powder and Little Powder rivers, surface discharge remains the most simple and cost effective means of disposing of produced water.
However, as development continues and the quantity of produced water increases, and as the opposition to coal bed methane development grows more aware of the issues, the potential to continue discharging into surface drainages will decrease.
Several factors could severely impact the ability to continue discharges into surface drainages. As noted above, Montana and Wyoming entered into a Memorandum of Cooperation in early September 2001.7 That agreement established salinity and sodium standards for the Powder and Little Powder Rivers at the Montana/Wyoming border. If the water quality exceeds these standards, Wyoming is required to determine the cause of the exceedance. Should the problem be traced to coal bed methane activities, Wyoming is required to "initiate steps through its regulatory mechanisms" to return the water to the standard required by the agreement. Although no specific steps are outlined, Wyoming might be required to severely restrict surface discharges, including perhaps existing discharges, should water quality exceed the agreements standards.
In addition, Wyoming's Water Quality Rules and Regulations establish an antidegradation policy that requires the state to maintain the water quality necessary to protect existing water uses.8 The Wyoming rules further require the state to ensure that all surface waters with the potential for agricultural use retain a quality sufficient for that use:
All Wyoming surface waters...
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