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2010-04-01 Meeting Report (Wright Gas Well)SPIN MEETING REPORT CASE NO. GAS10 -001 GAS10 -002 GAS10 -003 PROJECT NAME: XTO Joe Wright Unit Associated Pipeline SPIN DISTRICT: Citywide SPIN 8 MEETING DATE: March 30, April 1, and April 5, 2010 MEETING TIME: 6:30 PM 7:30 PM: Information Open House 7:30 PM 9 PM: Presentation Q &A Session MEETING LOCATION: 1400 MAIN STREET, SOUTHLAKE, TEXAS CITY COUNCIL CHAMBERS TOTAL ATTENDANCE: March 30, 2010 Forty -Seven (47) April 1, 2010 Twenty -One (2 1) April 5, 2010 Twenty -Two (22) SPIN REPRESENTATIVE(S) PRESENT: Patty Minder #8); Ronald Evans #10) APPLICANT(S) PRESENTING: Walter Dueease, Senior Regulatory Affairs Coordinator, XTO; Richard Smith, Director of Engineering, Energy Transfer; Anthony Welty, Operations Project Engineer, Energy Transfer STAFF PRESENT: Alison Ortowski, Assistant to the City Manager; Lorrie Fletcher, Planner I STAFF CONTACT: Lorrie Fletcher, (817)748 -8069; Ifletcher @ci.southlake.tx.us EXECUTIVE SUMMARY Property Situation The gas well site is generally located west of the intersection of Mustang Court and State Highway 26. The pipeline route consists of two segments: Segment 1 will generally run west from the proposed well site to Brumlow and then south to State Highway 26 where it will run generally west through the City of Grapevine. Segment 2 of the proposed pipeline will begin at the intersection of County Road 404 and Southlake Boulevard and run east along Southlake Boulevard until just west of Stonebridge Lane where it will turn north and then east eventually intersecting with Randol Mill Avenue where it will proceed north to the city limits. Introduction Patty Minder, SPIN 8 representative, introduced the items for discussion and the applicants. Walter Dueease, Senior Regulatory Affairs Coordinator, XTO Introduced himself and presented information regarding the gas well proposed. He gave history of XTO and talked about XTO currently. He discussed the different phases involved in the drilling process and horizontal drilling. Examples were shown of the drill rig and acoustical walls. The Barnett Shale was discussed showing the different gas drilling areas, explaining the core area. He stated there are currently 2500 wells in Tarrant County. He explained the wellbore and talked about completion activity. Fracture stimulation was explained stating this would be conducted during daytime hours only. He presented a typical facility and discussed security and safety measures. A list showing areas of concern and how they are addressed was presented. He showed the concept plan associated with this site and talked about who would benefit from this operation. Rick Smith, Director of Engineering, Energy Transfer Introduced himself and presented information regarding the pipeline route proposed. He gave an overview of Energy Transfer and talked about transportation needs associated with the drill site. He stated Energy Transfer operates over 250 miles of pipeline serving the Barnett Shale. He talked about the specific routes proposed in Southlake, discussing segments 1 2. Segment 1 is proposed to be approximately 1.31 miles of 12 inch pipe; Segment 2 is proposed to be approximately 1.96 miles of 16 inch pipe. He explained pressure, the construction process, HDD and open cut installation options. He discussed the importance of safety regarding the community at large, the pipeline and employees. He explained the information hotline that is available for questions or concerns. QUESTIONS CONCERNS March 30, 2010 The proposed site is 1000 feet from Southlake residents but is within 1000 feet of Grapevine High School. How does that work with Grapevine? Do you have to gain their permission? o WD I have sent letters to their City Manager and am open for discussion and questions. The activity occurs within the City of Southlake. Does Grapevine have the same restrictions? o Grapevine does have restrictions I believe it is 300 feet from protected structures. Is protected structure a school? o Yes... church, school and residence I've heard a lot of people talk about cancer. I am very concerned about this. o What specifically is your question? How will you protect us from emissions that cause cancer? o This is an area of concern... I think it is important to note that there are a number of studies being done that directly identify what the areas of concern are. TCEQ has stated that Ft. Worth did not show dangerous levels. Also important to know is that there are Benzene detectors in Ft. Worth and Dallas that actually show a decrease in levels; reason being the decrease in Benzene contained in gasoline being used by our automobiles. Benzene is found in many sources on a daily basis. We will do everything we possibly can in monitoring our well site. The core map shows that this area is a dry gas production area which does not have the high liquid carbons. 1 have a question about water... what do you do with the water and how is it treated? In fracing, where does the water come from and go? o We will use approximately 10,000 barrels of water during the drilling process. That water is turned into mud. We use clay and other materials to help stabilize the hole while we're drilling it. That mud can be reused on another wellbore, then transported to an approved disposal facility and not kept here in the City of Southlake. It is retained on site in above ground storage tanks. The water that is used during the fracturing process, in this particular case we would prefer to buy water from the City of Southlake or the nearest entity. And this would be treated or drinking water if at all possible for the fracturing process. The amount that is used could be 40 to 50 thousand barrels, so say 3 million gallons of water. That water is injected into the Barnett Shale formation with sand. We recover the majority of that during the flow -back period and the initial year or two of production and periodically as the production tanks on the site fill up with water. It would then be removed by a trucking contractor and hauled to a disposal facility some distance away from here. The City of Southlake does not allow for a disposal well and we're not planning to drill or dispose of any of these fluids within the City of Southlake. As tanks are filled, they are removed? o Yes Once you start this process, is there an end date to this or just continues forever? That's a good question, the first well would take approximately 15 days we would complete the well after a few months and the completion project would take about a week. If we found the reservoir to be productive, if we found that there were strong product prices to sell the gas, we would hopefully have a fairly active drilling program here to develop the minerals beneath this acreage to benefit the cities and the homeowners that we have leased property from. So if you find something, you would continue for the next 15 years? No... I'm sorry, I'm really not answering your question. We would not have a continuous activity with a drilling rig out there for the next 5 years. It's price driven; there's an economic decision that would have to be made. It's also one that's based on what we find in the Barnett; how good a well it's going to be and if it's going to pay off. It's a business decision. It's possible that drilling could take place at this pad site for several years to come, on a periodic basis. My wife is concerned about environmental impact. There are articles I have read about leukemia. Having all that in mind, my wife told me we should fight to stop it. I said we can't... people that live here have signed leases. Honestly, can you tell me one thing we can use to stop this? o I'm not sure that I can... that's a very good question; no one has asked that question of me. I'm concerned about the water. Would it be safer to use a pipeline to dispose of it? o The Railroad Commission and the TCEQ have regulations that deal with the disposal of fluids that are produced associated with an oil and gas operation and the law basically tells us where we have to put the water that's produced out of these wells and at this moment I'm not sure I could tell you where the closest disposal facility is but it would likely be in Wise County 15 to 20 miles. I don't know that we could get there from here. One of the safest and most reliable methods of removing the produced fluids from a well to a disposal facility is through contract water haulers. There's quite a bit of traffic on SH 26 but I don't think that it's at a level that is deemed to be congested or full to a point that it cannot accommodate a few more added vehicles. Many pipeline easements may not necessarily allow for water to be piped through that same easement that is used for a gas line. Have you done any environmental impact studies for air and water or if you would consider doing them? o We have not done any environmental impact assessments for the air and water. We are working through the comments with the city staff regarding environmental considerations for this pad site and it may include some components as to what you are referring to as an environmental impact analysis. I'm concerned about the air that we breathe and the water tables and aquifers in the creek. o That is something that we take into consideration with the casing and cementing design and the daily monitoring of the well to ensure that we do not have any type of break through from the well bore or from the reservoir to any of the perched water supplies or the aquifer. There is an ambient noise survey that has been performed and is a part of the gas well application package that we submitted. We are looking into ambient air testing adjacent to this pad site. The EPA reports that I've seen said that the pollution from drilling and fracing will equal the pollution that we have from all the cars in the area. What are you doing to make sure that air pollution is not increased by this production? o We abide by the requirements of not only the TCEQ and the Railroad Commission but also the EPA. I think what you just quoted is a comment. I don't know that it is fact based. There have been some offsetting remarks regarding the contribution of emissions from oil and gas activity and that it did not exceed or equal the amount of VOC's from the cars and other vehicles in the Ft. Worth area. that study came from Dr. Armendariz at SMU who is now the Region 6 Director of the EPA. That was when Dr. Armendariz was with SMU and that was last Summer. I think there has been recent work about some of those findings and also some other studies that may not necessarily agree with that. I'd be glad to visit with you at some point later on if wanted to call me. What about the fracing? You say it's just sand and water.. no chemicals? Anything that we should be worried about? The constituents that we use in the drilling mud and the fracturing process have been supplied to the City of Southlake as part of the Materials Safety Data Sheets in the gas well application. Did you know that we don't really have water here? In the Summer we have to ration it... where is that going to come from? o That is something that we will have to solve. We would have to find another source of water someplace close by. It is not our intention to drill a water well. There are owners that are benefiting from the drilling... monetary benefit? o Yes, many individuals are under a lease What if you didn't sign a lease? o That is a contractual question. You will need to speak to a XTO land man. Part of the pipeline is going to be in my backyard on Randol Mill; I have concerns. Have you done property value studies? o RS with regard to you being a homeowner, I would like to talk with you regarding the plan. We will sit down with each land owner and use fair market pricing for negotiating easement. Study was done recently that concluded that there were no detrimental effects on property values. 1 would like to see a more comprehensive route map showing the entire route. o What we presented tonight were the portions in Southlake. Is the pipeline going to be on the east or west side of Randol Mill? o The west side What is the timeline from today to when you turn on the pipe? There are three cities involved, how do you plan to coordinate the pipelines? The pipeline will be installed after approval from the city for the well site. Construction will take about 6 months. We are working with cities and their applications are permit requirements. The process is driven by the producer. WD if the city grants XTO approval, we plan to drill by August and hope to finish by September. The pipeline installation would immediately follow. The city is doing future construction along Randol Mill. Do you anticipate traffic issues? o RS we are developing a traffic plan to minimize impact and working with the city. The areas on the map in white are a minimum of four feet deep; one of those areas is located in a creek way. What are you doing to constantly monitor those areas? o The route shown is preliminary. We will make adjustments as needed. We are required to submit plans that show pipeline under the creek deep enough to be safe. At what point will you have your corridor more definitive so people know what exactly is happening? Are you asking the city to approve this plan shown? o This is a corridor open for adjustments. We are working with the city now to establish corridor. Next, we will work with landowners in having a definitive route. This process will include Bear Creek; the purpose of those trees is to provide erosion control in addition to adding value to the homes. Will you then be disclosing what trees will be removed? o Our first thought is avoidance. If we can avoid cutting a resource, that is what we will do. We will take all consideration in recognizing the importance of trees. Should I tell my neighbors you will have more information in 30 to 60 days? o Please encourage your neighbors to call us. We will be happy to get their input in getting our route mapped out. The city's website says this is an unregulated pipeline. What does that mean? o The definition of unregulated is by virtue of the process with the City of Southlake. We are regulated pipeline through the Railroad Commission with the State of Texas and also installing the pipeline with respect to the federal code of regulations. That is just a designation that the city has deemed as part of their process. The diagram shows various horizontal drill lines when multiple drill sites are produced. Will land men initiate leases with all of these people? o WD this diagram is just conceptual. Just a couple of steps into a lengthy process. We hope we pass through P &Z and City Council. Once things fall into place, conceptual could become reality. Nothing is etched in stone at this point. Multiple units could be formed from this pad site. This is what we would like to see and yes, additional leases would be required. Is this un- odorized gas? How will we know when there's a leak? o RS we have a gas control system that monitors the pressures in the pipeline so they can tell any variations to the pipeline where there may be an issue with it. These valves we have installed are remote operated so they can open and close the valves from the gas control area in San Antonio, TX; so they monitor the pipeline very closely to the extent that they're may be any issues with it. There's never a problem with valves sticking? o No, we are required to have certain maintenance on the valves where our operation folks are required to go out and stroke the valves, operate the valves, lubricate the valves and make sure they are kept in fully operational condition. We take safety very seriously in design, construction, and operation. The pipeline goes out to Pleasant Run and connects to another place there, is there going to be a compression station? No, there is no compression planned at all with respect to the pipeline. How do you get it moved through the line if it's low pressure? By virtue of the well heads, it's able to push it through the pipeline in terms of having a low deferential through the pipeline. The pipelines are monitored from San Antonio... are they monitored 24 hours a day, once a week, how often? o It's 24/7 The gas pipeline explosion in Palo Pinto County about three years ago that created a hole as tall as this building... once in a million chance for that to happen but what if that happens to your pipeline? What is there to prevent it from happening? Can you prevent it? I don't know specifically about the pipeline instance you are talking about but we take safety very seriously and some of the things I went over earlier in terms of the horizontal directional drill to make the pipeline a lower depth. Statistically, one of the greatest impacts to a pipeline result from third party damage where people sometimes don't do the one call or the follow up and they get into the pipeline so we've mitigated that from the standpoint to where we've lowered the pipeline in populated areas such as Southlake and also where we've tied the pipeline in with the drill, we'll put in what's called safety tape to the extent so if someone starts digging, they will hit the tape first before they get to the pipeline in addition, the pipeline will have markers periodically so people will know there is a natural gas pipeline there as well. So low pressure doesn't have any bearing on an accident like an explosion, it's more penetrating the line than anything? Statistically, for gas pipelines attributed to those things are third party damage. We've mitigated that with the high strength carbon steel, lowering the pipeline, putting safety tape and markers, 24/7 on the gas control, our operations folks we have in the area will be staffed and monitoring the pipeline as well. In addition, the city requires us to have yearly briefings with the community at large and our operations folks will be working with the local emergency response and planning folks as well in terms of interaction of pipeline safety. Who allows this kind of project to go forward when the health of all residents is affected and we already have bad air quality and we are going to endanger it further? o WD Let me understand what you believe to be the water and air quality impacts as a result from these activities. I've heard that the fracturing destroys the ground water; the leakage from it contaminating ground water. And the Benzene is one chemical that has been mentioned but I'm convinced that there are others. o The well bore is not just a hole in the ground that is left open to any other formations that are above the zone of interest or down below it. It's cased with steel just like Rick was talking about with the pipeline. It's also coated and has cement on the outside of it. We design it with the intention so it doesn't fail and with safety factors similar to the pipeline. We don't want failure and we don't want to impact ground water. The ground water is no deeper than 1500 feet in the Trinity and Paluxy aquifer. We take every measure possible to protect it. I have kids that go to school here, I live here, I sleep here... we have a great deal at stake. I'm not sure that I agree with you that our fracturing process impacts the ground water; during drilling or disposal operations. Regarding the air quality, we would have to agree that the Fort Worth Dallas area is in a situation with air quality. They were in a situation before the last 200,000 people moved here or prior to the Barnett Shale drilling activity. Regardless of that, it is very important for us to use lean emission engines during the drilling and fracing process that cut down on the emissions in this area and that we monitor our tank batteries and our facilities to ensure that we have the lowest possible emissions rate. We are so below the level set by the TCEQ that we can easily meet the thresholds. We find air quality important and intend to abide by all regulations set. You're comfortable with these rules in protecting your own family? o Yes maam QUESTIONS/ CONCERNS —April 1, 2010 1 have a question about the compressors. You said there were no compressors, why don't we need compressors? o RS The best layman's analogy I can put to a compressor, not withstanding the pressures you use at home, is a compressor is like your heart. The purpose of your heart is to take blood and pump it throughout your body. In a pipeline system as you are trying to transport natural gas, you have to have a heart in order to get the gas along the pipeline system. What a compressor does is it imparts energy into the system to get it from point A to point B and get it on down the system. The system is designed at this point given the contractual requirements of XTO and for what they need, from a system design standpoint, do not require compression. So you don't foresee ever needing it? o No, not for what we know at this time. You talked about open cuts and HDD... my concern is with the proposed section of open cut at Timarron. Before you go to P &Z, will you have made that determination? We would like to know the final decision before the process starts. What we would like to do is after the SPIN meetings are over is take that next step. The reason why we have not been in the field to date is because there was some concern that if we got out in the field and held discussions that we didn't want to usurp the SPIN process. Once we complete those activities Monday night, we would like to meet with you, take a look and get on the ground and start assessing the route. So that will be done prior to P &Z Yes, we will endeavor to get that evaluation done. The objective is to save the trees and go under them. This looks like a really good plan. In the areas where you have to dig, is the plan to return it as it was so if you have to take a tree away, will we get an established tree back? o We will have a mitigation plan in order to return the land equal or better than it was. From a pipeline stand point, you do not want to plant trees directly over the top of the pipeline because the roots would grow and get down to the pipeline. We will do the best we can to restore that. That is why we go way below the trees but to the extent that we have to do an open cut and be closer to the surface, we'll take a look at that. Generally, we don't allow deep rooted plants over the pipeline. The media has done stories on Methane gas release associated with some of the safety equipment I think over in the Keller area. Are we going to have issues with Methane gas release associated with this drilling? Are there things we need to talk about or understand to address this potential issue? o WD I'm not familiar with particular issues in Keller. I don't believe we will have issues with them. I think there have been a number of studies published and reviewed and there have been a great deal of information and disinformation. I think that perhaps the concern could be not so much Methane but Benzene. And so we are in the business of selling what we make and it's very critical to us to find the gas and get it up to surface and contain it and get it into sales line so perhaps we can get it into people's houses so it can warm their homes and provide power. Certainly there are byproducts in production of hydrocarbons but in this particular area of Southlake and this particular part of the Barnett formation, we are very comfortable with the gas analysis of the wells that are nearby that have no detectable Benzene in the gas stream. The core area is designated as an area that produces dry gas. It's the condensate that is the source of Benzene. What if that is not true? Will there be testing and monitoring? o Yes, the sample for quality is taken to an independent laboratory to analyze and identify the constituents in the gas. The nearest wet gas is many miles west of here into Wise and Parker County. I can be comfortable in saying what we anticipate is very likely what we will get but nonetheless it will be tested to be sure. There are methods we can take to mitigate any issues. Fracing has been described as using only sand and water. I have read countless studies and reports, even from the TCEQ and EPA noting that this material is not only sand and water but it is also a proprietary blend of toxic fluids. Can you address that? o The approximate percentage is 97% fresh water and frac sand. The remaining 3% consists of friction reducers, gelling or vascasifiers and some other agents. As you said is there proprietary? I can't tell you what's in a proprietary solution or constituent that is put in there. I think that perhaps some companies that perform this service here and elsewhere in the country have agreed to make their products known. We do provide to the city the Material Safety Data Sheets that describe the properties of all the products we introduce to the well bore as well as at the surface. Does the output of sand and water and other materials have to be transported on a noted hazardous waste truck? o No sir. That part of our business is similar to other vehicular traffic that transports fluid in that they have to meet department of transportation standards. However, the disposal of the fluid must meet the regulations of the Texas Railroad Commission and the TCEQ and to some extent the EPA. There is no "warning" sign required on these trucks. I am concerned about the chemicals that are in our water and air from the fracing. Who and how often are tests done on the air quality and the ground water safety in the area? o How often is daily, from the standpoint that the well site is visited by an XTO employee. We have automated measuring equipment that is checked on every day. I'm not aware that the fracturing process has contaminated any ground water aquifers. The EPA late last year produced a study that claimed there is no evidence of that occurring. So nobody is monitoring that except for your company? There's no government agency that comes around and tests? In some cities, I'm not sure Southlake will do this but they have identified the need for a gas well inspector, but in other cities a contract gas well inspector will come out and do periodic gas well inspections on our equipment. Also, the Texas Railroad Commission has inspectors that perform inspections and tests on our equipment. We can tell if there is a failure of down -hole equipment by an increase in pressure on the outside casing string at 1200 feet. We can see in a pressure gauge that is placed on the well head. So there's not a set time when someone from the railroad commission comes out and inspects? No maam. I'm not aware of a specific inspection schedule by the railroad commission. You say that someone from XTO will come out to your facility. Are they doing any air testing? Taking any canister samples? Any scientific testing at all? There have been numerous studies recently that have shown excess of Benzene, Carbon Disulphides, all kinds of things we don't want to be breathing. Who's checking on this? We are going to see Benzene where there is a condensate production. And we can see where there is condensate production in the green tanks. We gauge them, we measure the volume in them daily so we know what's coming out of the wells. We have a very clear idea if there is a need to take that next step forward. The gas analysis tells us all of the constituents in the gas and it's going to say if there is Benzene, Ethane, Butane, or anything else. We know what the production is in the well. If there is condensate in the tank then there is going to be potential for Benzene; then you have to look at the levels that may impact life and health. I disagree with you regarding some of the studies that you have mentioned. This year there has been a rebuttal to a number of the studies by the TCEQ and a peer review by Rice University. No immediate health concerns exist. The TCEQ's office of compliance and enforcement did a study of 126 sites in Ft. Worth; no carcinogens and no dangerous ambient conditions existed. In reviewing the study and its disclaimers, I believe that study was flawed. They did it on the coldest days of the year. What is the freezing temperature of Benzene... 42 degrees? Benzene does not freeze at 42 degrees. There were also in the 3 -phase study... the first month of testing was done in August. What is the ambient temperature in August? You would have to agree that it is significantly greater than December. That study was very limited... we need to wait until long term studies have been done and we know for sure that these toxins are not going to affect our family and our environment. o I respect your position on that and I can tell you are concerned. I have kids that live here too. My experience in my profession has me confident in what we do and what I am telling you. 1 am very concerned about unodorized gas coming through our community. I know you say you have your safety measures in place and that you're monitoring it in San Antonio. It is not acceptable to me that unodorized gas is going through our community and we won't know that it's leaking until there is a problem. Now maybe you will catch it or maybe somebody will turn their BBQ on. It has to be odorized... it's dangerous. o RS most of the pipeline companies in the United States, in terms of the interstate transportation, are not odorized. Having said that, we have certain safety measures in place, we have operation staff in the area, we do aerial patrols and annual leak detection surveys. We have the measures and protocol in place. The key being that our gas control can measure the pressure in the pipeline and can take the necessary action in the event that there is a deviation from that and go and check the system. How long does it take to shut off the valve? They can push a valve instantaneously and shut it Somebody has to be watching to be able to do that. Right, our gas controllers and staff work 24/7 and they are watching the pipeline. In that event, our operations staff is sent out to check the system. WD one of the reasons that interstate pipelines and gathering lines don't odorize the gas is that the whole thing is designed to smell gas in an enclosed area or gas that is less refined. This gas is so well refined that you wouldn't smell it because it would go immediately liberated into the atmosphere. And if you think about the atmosphere that we're in, it has a specific gravity of one. So the specific gravity of the gas that's being transported might be 6.6 or 6.5 maybe.. it's almost like helium. How does it help to put an odorizer in the gas? Just six weeks ago I was driving by Central Market and smelled a very strong natural gas smell and called Atmos and yes they found that someone working along Carroll had hit a pipeline and caused a disruption. It was because of the smell that I called them. o RS Atmos is considered a local distribution company and they are required to odorize their gas because of where those lines run. 1 know you are considered interstate but right here in Timarron is local to us. o Most instances are caused by third party damage. This is why we propose the HDD process for 90% of our line. At points of tie -in we use safety tape and measures so someone who might be digging will get to the tape before they ever reach the pipeline. QUESTIONS CONCERNS April 5, 2010 Could not hear the speaker RS —In segment one the pipeline route is approximately 1.3 miles and segment two is approximately 1.96 miles. The horizontal direction drills will be anywhere in sections from 1000 to 1300 feet. We will try and get a 2000 foot drill as well. The depth that you go, is that a lesser depth than if we were tapping into geothermal energy or a deeper depth than geothermal energy? If we do an open cut, the pipeline would be about 4 to 5 feet deep. Horizontal drilling will place the pipe 10 to 15 feet or deeper. If we were to consider tapping geothermal energy, how deep would we be going? WD I'm not a geologist and don't know that I can answer your question about the depth at which geothermal energy could occur here. We know of no geothermal potential in this basin. Certainly we have rigs that have the ability to drill to 20 or 30 thousand feet today but I don't know of any geothermal potential in the Ft. Worth basin. Cannot understand the speaker... they try tapping geothermal energy in the name of greed and they had a little bit more frequent earthquakes than they had anticipated so they go deeper and not in this instance where we are just trying to tap gas instead of geothermal energy. We are going that deep but can't we get an earthquake? We already have some pipelines you folks just talked about in the surrounding areas including in Ft. Worth so we are drilling more and more and in the surrounding areas and by the loss of physics is the disintegration of the foundation of Mother Earth. It's just a matter of time... maybe in one year, maybe ten years, maybe 50 years before the ground collapses with all the houses and people on top of it. Have you folks talked about this? No sir we have not, we are the business of exploring for hydrocarbons and not for geothermal energy. 1 understand, what my point is, if this can happen with drilling for geothermal energy, it's much easier for this to happen with the process that you are doing. Our geologists and geophysicists have not given us any indication that our drilling has any relationship to any earthquakes as you have described. Have you asked them? o Yes What was their answer? o Their answer is that they believe that the drilling in the Barnett Shale and other gas and oil bearing formations in the Ft. Worth basin does not have a relationship to earthquakes. There were a few reports of earthquakes in the last couple of years in the DFW area attributed to drilling just south of Dallas about 20 miles or so. It is difficult to believe that destroying the underlying foundation of Mother Earth will have no impact on the things that are there on the surface. Maybe one hole won't make a difference but there are multiple holes around this area and in Ft. Worth. It's a matter of time before this area is encircled and the center gives way and the things on top of it collapse. Ft. Worth, nothing happened... Southlake, maybe nothing happens but every drill you do, it's like your shaking the solid foundation of Mother Earth. Regardless what you ask your geophysicists or anybody, the laws of physics say when the foundation is weak, the structure on top has to fall. I just want to get a clarification on from the first step in the process of starting the timelines involved, what is the timeline of starting the rig until getting into production? And how long does it take to build the 3+ miles of pipeline? And, I'm concerned from a first responders standpoint, they're not trained in oil and gas issues... what do you do regarding providing them training if something were to happen? o WD one of the exhibits we have provided to the city is the route for the first responders to the drill site. The first responders would be notified in the City of Southlake and also the City of Grapevine. Training is a good point... we have a program at XTO called Train the Trainer and it would be where our health and environmental safety professionals would be able to come to the city and spend time with their crews and explain our activity and visiting sites and show them where potential for injury exists and how to respond to those. That is something that is very critical to us. The timeline, if we were granted this permit in the next couple of months, it's possible we would start the location construction in September. A well could be drilled in October or November and completion would take place next Spring. At that time we would be ready to sell gas then the pipeline would begin transportation. o RS let me address the emergency response... the city has mandated under their ordinance to require us to train and interact with the local emergency response personnel and first responders and we are required to do that on an annual basis as well, and provide a debriefing with the landowners. ETC does that as a normal standpoint for safety. Construction takes approximately 6 months, and we will construct both segments concurrently. What is the responsibility for you to repair the ground to its pre- existing state? In terms of HDD there is no impact to the surface. The only impact there will be is where we have to come up to do a tie -in and we have to restore that to a better condition than we found it. There are no valves along the pipeline... the tie -in location may be about 50 ft. by 50 ft. but that's the important thing about us getting on the ground and walking the route to get landowner's permission for access so we can look at specific technical parameters relative to how we can do the drill to get it in. If you have to do an open cut, what is involved in that section? In terms of an open cut, the pipeline would be buried to about 4 ft. to top of pipe and normally we would come in and have a work space somewhere around 75 ft. wide. And we have to restore the land to a better condition than found. I have a student in Grapevine /Colleyville and my question is... I couldn't really tell by your diagram how close that is to Grapevine High School, and I want to know what the impact is going to be, especially on the student athletes during the construction phase? o WD The distance is 841 ft. from the proposed well to the edge of Grapevine High School. Their ball fields are between the edge of the school and the south side of SH 26... what are the impacts? I don't know that there would be any impacts. I would think during drilling and the completion activity, there would be more machinery out there and some noise, there could be noise impacts but then the traffic flow on SH 26 is in excess of 35,000 vehicles a day that go by there. I would struggle to find that there would be some type of impact from this activity in this already established industrial area upon the campus at Grapevine High School. What about any air quality monitoring once the rig is in place? o Typically some air quality monitoring sampling can be done at any given site. At gasoline stations or any sites that operate under the regulations of the TCEQ so certain sampling can be done to determine the ambient air constituents. Since this is within the less than 1000 feet, do you have to get special permission from the City of Southlake or the City of Grapevine? There's a jurisdictional boundary between the City of Southlake and the City of Grapevine. The site is on the north side of SH 26. 1 don't know of any mechanism in place, whether I was putting in a Jack in the Box or a gas station or a car lot at this that would have to comply or have to fit in with the regulations of another city, however, that doesn't mean we don't involve that city with what we are doing. I have had conversations and correspondence with key personnel in the City of Grapevine about this project. So you don't need their approval, it's more Southlake since it's on their side? I do need the approval from the City of Southlake. There is not a mechanism in place for someone to have to go to the City of Grapevine for that type of approval. 1 just think that if it was within 1000 ft of one of the Southlake schools, I don't know that it would be allowed. If there happened to be an emergency involving the first responders, are they going to have something in place for the school? Different from the evacuation plan that they have in place? That would be something that we could certainly work with the Grapevine ISD. I think it's the school's primary responsibility to ensure the safety of the students on their campus. Would you not agree? 1 do but I believe this would be a special circumstance to have to deal with. o Perhaps there is a special circumstance but there is also an existing condition here with a great deal of traffic on this road and an existing petroleum storage facility across the street. I don't know if Grapevine ISD is prepared for an emergency event of something happening there, do you? We are prepared to work with them on any type of evacuation procedures. This is something I would like to talk to them about. I can't tell them how to evacuate their school but it is something that we feel they are professional in doing to protect their students. 1 just think it's a different situation that needs to be addressed. o RS with respect to the pipeline, we'll be working with any cities that are contiguous to the pipeline to make sure all first responders are involved in the process. I am a Colleyville resident and we are all neighbors, we shop and trade and share school districts. I've heard there's a green completion to the drill site. Can you say what that entails and whether these sites in Southlake would be completed in a green manner? WD I'm not sure. I have been involved with Ft. Worth in revisions of their gas well ordinance twice. Ft. Worth is fairly progressive and had addressed the green completion issue and I'm not sure we actually came up with a definition for green completions. There is not an industry definition for green completion. From when industry first started the completion process for these gas wells... they were vented to the atmosphere for many days at a time until a great deal of the water introduced during the frac process came back to the surface. What we realized is while you're doing that, you're also venting to the atmosphere and so we feel like we have identified a way to better complete the wells by minimizing the time in which the well is flowing back to the surface. I don't know of any equipment that is readily available to industry at this point to have this entirely enclosed system at the point which we start flowing back the well and that is the point after the well is fraced and the formation is energized and you have gas, water and sand coming back to the surface. The water, sand and gas are put into a frac tank and at that moment at which we can turn the gas into a sales line, we do it. So that doesn't have anything to do with the VOC's being released? Yes, I guess in a way it does. Methane is one of the VOC's, and one of the products that we sell. There are other VOC's people are feeling the effects of in Flower Mound. That is what I am speaking of. Can you speak to the risk of VOC's being released? o Yes, VOC's are regulated by the TCEQ and it is something that they have defined. Not only VOC's but some of the constituents in the VOC's that are specifically regulated and that are limited in their release into the atmosphere and at some point they must be stopped. Whose job is it to inspect for the release? 0 It's a dual role with industry and TCEQ inspectors. I viewed the oil and gas 411 website that was provided by the city and there was a direct link to the CDC and it stated that Benzene is flammable and long -term exposure causes leukemia. I thought about what if we are having a BBQ and there is an explosion. It said if you're exposed and you're inside, go outside and if you're outside, move away. Well, since I live here, where will I go to? Where will our children go to? Why are we even considering this in such a densely populated area? Why are we not being good neighbors to Grapevine? o There would only be ignition if there was enough of any kind of gas in a concentration to where it could ignite and that would have to be something at a lower explosive limit that is in the neighborhood of 11 to 13% of the atmosphere. I think there's no possible way for that amount of gas to saturate the atmosphere to the point of explosion. Are you going to provide Benzene detectors throughout this site to make sure we don't run into any problems? o Someone asked that question earlier... air sampling is something that can give us a very clear idea of the potential for this site to produce any kind of VOC's or Benzene that would be of a concern to the safety of the neighbors. To clarify, exactly how much Benzene is released into the atmosphere relative to your work? o As I indicated earlier in what we are calling this core area of Denton, Wise and Tarrant County, and how that part of the Barnett is called a dry gas area. The reason it's a dry gas is because we monitor not only our wells but other operator's wells and the pipeline companies that buy gas have gas analysis from every well that they are buying gas from and they identify the properties of the gas from each one of those wells. The gas from the core area is dry. The primary source for Benzene is condensate or a liquid hydrocarbon. It's much lighter than crude oil. The amount of Benzene that is found in a typical Barnett Shale gas well in this area is around one part per million. Putting that in a frame of reference the gasoline that you put into your car has around 1 Benzene by volume which is about 10,000 parts per million. I believe that this should speak for itself. We are concerned and know what we are producing and it is assured by these well site analysis tests. Are you not required by state or federal standards to monitor air quality at the site of the well during construction and after construction? In effect, is that the responsibility of the EPA to come by every so often or the state environmental quality board to test it but it's not your responsibility to test it? o I'm not aware of a requirement to run ambient air testing before construction and after construction. But we must ensure that we do not exceed the thresholds set by TCEQ for the emissions from any of these facilities. Right now the TCEQ is revising all of their thresholds and reporting requirements and probably by late Summer or early Fall a new rule will be out on those requirements. Not only on the gas industry but for any industry to be required to follow. We would have to ensure that we do not exceed those thresholds and that's done with infrared cameras and other types of ambient air testing and monitoring equipment. And that would be done at point of certification of the well. In other words, you would have to certify that the well was complete and you would have to take those tests and then everybody would leave and then unless somebody comes back from state or federal, let's say a year later... so is there any other testing that goes on as a regular requirement? It's important because they need to know that the state and federal agencies have fallen asleep on the job in monitoring air quality so it's important that they feel comfortable in whether they are testing or not that you're holding your own self responsible to test it in being a good neighbor to them? o So the question is, after the well is completed, we identify what the potential for emission is and we would monitor the production of the well which would tell us what our emissions are going to be and at any point that we would get close to that threshold that we would exceed regulatory requirements, then we must do something for the emissions abatement. What do you do with the waste water since you aren't required the pits or whatever? You're taking it off site and dumping it somewhere. Can you explain to everyone where you are dumping it and how? The production facilities I have shown and the green tanks show how the water produced from these wells is contained in steel tanks. On a periodic basis, a contract water hauler is on a routine to come by these sites and take the water to an approved disposal facility. This is not water that is dumped on the ground or unfortunately at this time it is not recycled. It is disposed in a regulated disposal facility, similar to what is used in other oil and gas basins and other chemical industries as well. It may be helpful for you to provide at a later date, who you use so people can evaluate that. When you have the pipeline in the ground and it looks like it comes up, do you dig a hold and keep it going lateral horizontally? RS The way the profile will look is that we will do a drill, then do another section, and where they intersect, we will excavate down about 4 to 5 feet and do a tie -in right there. I'm a Grapevine parent and I am very concerned. My daughter is in band and she stays outside practicing in the Summer for a minimum of 4 hours a day and so I'm very concerned about air quality. Does XTO currently have any agreement in place with the City of Southlake for air quality monitoring at the pad site? And, any vapor recovery system? Also, when you do find something that is over the limit for air quality, is it self- monitoring by XTO or what exactly happens if you find something that exceeds the EPA standards for clean air? o WD the answer to your first question is that no, there is not a specific agreement in place with the City of Southlake for monitoring and as Ms. Minder pointed out, we are in the initial phases of providing the zoning case and application to the city. We had discussed with staff and other members of the city that yes, certain air monitoring can be done at different times during the phases of our operation. Can we request that it be done during the heat of the Summer? Yes, that could certainly be done. I think that timing on this needs to be considered with staff for either prior to or a certain operation has taken place. On vapor recovery units, I think that that also is something that is a supplement or another tool besides vapor suppression and that's something that gas stations use. Not all gas stations have vapor recovery units. Not all of them are next to high schools where people are practicing. A vapor recovery unit is most effective when there is a volume of rich gas that can be recovered and returned into the system. But you have to have the rich gas to help make the vapor recovery unit work. Who's keeping track of any gas that is released? It's us and any other regulatory agency that oversee our activity that may show up at any one given time and want to see what type or amount of emissions we have. It is our responsibility to ensure that we do not exceed those thresholds for VOC's. The City of Ft. Worth just completed their ordinance and they are requiring green completions to capture Methane and VOC's. During the well completions, is that something that will be discussed with Southlake? o That is certainly something I think that's actually a consideration the City of Southlake will have. I can't speak for them but it's also somewhat built into the ordinance and the operating requirements. I'm a resident of Colleyville, I will start by saying that I have worked for the TCEQ and have worked for one of the nation's largest petroleum marketers so am very familiar with this; as a parent of a student at Grapevine High School, I am concerned about the steps you are taking to protect and mitigate risks to human health and safety. A number of the parents here have addressed the concerns they have so I won't dwell on that; I would like to address the emergency response, particularly the cross -city response teams and the local school district. I realize you are not responsible for the steps the school is taking but I would like to know what steps you are taking to work with the local first responders beyond the "train the trainer' training as well as working with the local school district in perhaps doing some scenario training, were there to be some spill but more specifically during the actual construction process were the rig to be approved. o We would make ourselves available to any of the concerns that school's public safety officers may have about our activities. Have you already worked pro actively with anyone from the school district? o Pro actively is probably not the best description at this point, however, we have had conversations with them and have had correspondence and I fully anticipate meetings in the future about this should we go forward here in Southlake. Yes, we are within a 1000 feet 841 feet as the survey goes but there are a number of other wells in the Ft. Worth basin that are much less than 600 feet to nearby schools and we have very good relationships with those schools and I would say that this has been a very successful relationship without any impact to the kids in those schools. RS once the pipeline route is finalized, we will be reviewing with the cities and any other appropriate key stakeholders as well actually where as built to the pipeline is to make sure they are aware of where it is located. Our operations group usually comes out and they will establish a process interactive where they will talk about the pipeline and what is expected in terms of an incident should there be one and how it should be handled. We wait and do that more towards the end of construction before the pipeline goes into service. We will have a list of key stakeholders put together that we will meet with to ensure there is one like -mind in terms of an event that first responders need to be called out so we will all be on the same page. This is done on an annual basis. With regard to notification, I know you've done quite a bit of notification to residents in the City of Southlake, have you notified anyone that is down stream of that location? I know that there are a number of lower socio- economic communities that are down stream of the facility. WD —Would you please define down stream? Adjacent to the Grapevine High School area, there is a mobile home park, some apartments, some very high density housing. Have you notified any of the residents in that particular proximity? No maam RS with respect to the pipeline, we are going in and out of the City of Southlake. We will have the same type venue here in Colleyville, Westlake and some other cities as well. We will have the same type of process with them when we submit our permit applications. WD I'm curious, what was your job function with the TCEQ? 1 worked particularly for the Commissioner's Office, heading their media and public affairs and I did the same thing for a large oil refiner and marketer and am actually very familiar with the tank farm facility having been involved with first response at those facilities. And when did you leave TCEQ? 1 have been gone for a number of years but I'm very familiar with that facility. 1 live on Randol Mill, right next to the pipeline. I remember seeing that there was a petroleum tank farm right next to the well site. Don't they store millions of gallons of gasoline there? o Yes sir So maybe Grapevine High School should have thought about that before they build that high school there. I would think that would be a lot more dangerous than a clean natural gas well. You said your geologists said that there is probably no chance of an earthquake in the DFW area... how long ago was that? I want to clarify what we were talking about and the discussion had to do strictly with the drilling of the Barnett Shale gas wells to approximately 7300 feet. It did not involve the disposal wells that go into a deeper formation... the Ellenberger. That means that the Barnett Shale is shallower than the Ellenberger in that they believe that there was not a relationship between the drilling into the Barnett Shale that had an impact or a cause and effect ratio with the earthquakes. How long ago was that opinion given? Just a matter of months ago. So it was after the quakes that occurred in DFW a year or two ago? It was after that, sir. 1 am president of the North Central Texas Communities Alliance and we are an organization of individuals and organizations and communities within the Barnett Shale area. As you know, in Ft. Worth we've been faced with some similar problems and I just want to know two things are you willing to do a baseline test before you get started to see what the air and water quality status is in the areas where you plan to lay the pipeline? o RS in terms of the pipeline, we will not be doing any baseline studies with regard to where the pipeline is located because the pipeline is self- contained and enclosed so there would not be any need to any air studies done. The transportation of the gas would be inside the pipeline. Pipelines are known to also have leak problems and vapor recovery problems. I am asking in general if in the area, would you be willing to do an air quality baseline study before you began any operations? Specific to this pipeline here, there wouldn't be a need for us to do that. How large is the pipeline that is going to run under the water source, the stream? What water source are you referring to? I believe you are going underneath the Bear Creek. That segment of the pipeline will be 12 inches in diameter. Once we have the opportunity to lay our drill profile, we could be anywhere from 10 to 15 foot deep up to as much as 30 foot deep. We won't know that until we have a chance to go out there and gather data and see how deep we need to go. Our objective is to be as deep as possible to get far below the trees and stream. Do you have an alternative route? Most pipelines are buried... an option would be to go above ground and that is not the way we want to go. Is there an alternative route besides going close to the school? Have you researched any options? We route the pipeline along road corridors and open spaces. This is the best route along SH26 that exits from the well pad and moves westerly. 1 was wondering how long the pipeline would be underground and how long it will be in use? o The pipeline will be there in perpetuity. It will be used as long as the well produces. Patty Minder gave conclusionary remarks... meeting adjourned. SPIN Meeting Reports are general observations of SPIN Meetings by City staff and SPIN Representatives. The report is neither verbatim nor official meeting minutes; rather it serves to inform elected and appointed officials, City staff, and the public of the issues and questions raised by residents and the general responses made. Responses as summarized in this report should not be taken as guarantees by the applicant. Interested parties are strongly encouraged to follow the case through the Planning and Zoning Commission and final action by City Council.