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Oil and Gas Development in West Virginia

West Virginia is a state located in the Appalachian region of the Southern United States It is bordered by Virginia to the southeast, Kentucky to the southwest, Ohio to the northwest, Pennsylvania to the north (and, slightly, east), and Maryland to the northeast. West Virginia is the 41st largest by area and the 38th most populous of the 50 United States. The capital and largest city is Charleston.West Virginia is located in the heart of the Marcellus Shale Natural Gas Bed, which stretches from Tennessee north to New York in the middle of Appalachia.


West Virginia is considered a national energy hub, leading the nation in net interstate electricity exports and underground coal mine production, while experiencing a growing natural gas industry as a result of the rapid growth in unconventional shale gas extraction. Overall, it produces 15% of the nation's fossil fuel energy.[1] The state's underground natural gas storage represents 6% of the nation's total, and overall it has 5.1 billion cubic feet of natural gas reserves through 2008 estimates.[2] West Virginia was one of the first states to engage in drilling for oil. Small to medium oil and natural gas fields still exist and are scattered mostly in the Allegheny Plateau and the Cumberland Plateau in an arc throughout the western part of state. The state produces around 180,000 barrels of oil per month, with 23 million barrels of reserves through 2008 estimates.[3]

History

The development and use of Oil and natural gas resources has a long history in West Virginia.[4] Prior to the arrival of European settlers Native Americans recognized and may have used natural gas vents and outflows of petroleum on the Little Kanawha, Kanawha, and Big Sandy rivers as a fuel source.[5] Early European settlers were also aware of the natural gas vents. The oil and gas industry in West Virginia began as an outgrowth of the salt industry. In the early 1800s, oil and gas was viewed as a waste product of salt drilling. during this period oil was typicaly diverted to the Kanawha River by salt manufactures. Once the value of oil and gas was realized, the Great Kanawha Valley region became a pioneer in the discovery of petroleum by boring and in the use of oil and gas on a commercial scale. Since that time the oil industry in West Virginia grew significantly yielding a peak 16 million barrels in 1900. subsequently, the oil production waned while the natural gas industry continued to grow. From 1906 to 1917 West Virginia was the leader in gas production in the United States. From 1917 to 1934 the State's production waned significantly before increasing again between 1934 and 1970. In recent years the introduction of unconventional drilling techniques has lead to a surge in natural gas production in the previously untapped Marcelus Shale. [6][7]

1815-1876: Early History of West Virginia Oil and Natural Gas Development

Natural gas has been a persistent and significant component of West Virginia economy. Early settlers initially discovered natural gas in 1815 in “burning springs” north of Charleston, West Virginia near the on the Kanawha River.[8]The natural gas reserves were developed commercially as a result of the state’s salt industry. Attempts to drill for salt would frequently hit oil or natural gas and in 1841, William Tompkins became the first salt driller to use natural gas found while drilling for salt as a fuel in the salt manufacturing process.[9] these initial demonstrations of the utility of natural gas encouraged drillers to began to drill deeper into the earth and utilize the natural gas in West Virginia. By the 1860’s, natural gas extraction had been developed into an industry and towns sprung up near drilling operations in the state extracting natural gas for home and street lighting. Subsequently, West Virginia became the leader in natural gas exploration and development in the United States between 1906 to 1917. [10]


Similar to the development of Natural gas resources in West Virginia Oil resources were initially discovered inadvertently as a result of attempts to develop salt resources.The state’s oil resources were initially developed by the West Virginia based salt drillers the Rathbone brothers near the Burning springs stream. Rather than salt, they hit petroleum and by drilling deeper eventually achieving a peak yield of 200 barrels per day in 1859. encouraged by their find the Rathbourne’s developed a second well which produced 1,200 barrels of oil per day. The success of these initial wells induced further development in the area. By 1861, a town with several thousand inhabitants grew around the development.[11] The area became known as the “Burning Springs oil field” and was one of only two oil fields in America prior to the Civil War. However, by 1876 there were 292 wells in the State.[12]


In addition to the burning springs oil field, West Virginia was also home to the Volcano oil field, which was discovered in 1860. from 1865 to 1870 drilling was very active, producing from the Salt sand at a depth of about 360 feet. The heavy lubricants produced led to the development of West Virginia's first oil pipeline, from Volcano to the oil distribution Hub of Parkersburg.[13]

2005 - 2015: Development of the Marcellus Shale

The Marcellus natural gas trend is a large and prolific area of shale gas extraction from the Marcellus Formation of Devonian age in the eastern United States. The trend encompasses 104,000 square miles and stretches across Pennsylvania and West Virginia, and into southeast Ohio and upstate New York. It is the largest source of natural gas in the United States, and production was still growing rapidly in 2013. The natural gas is trapped in low-permeability shale, and requires the well completion method of hydraulic fracturing to allow the gas to flow to the well bore. In 2012, it was estimated to have 141 trillion cubic feet of technically recoverable gas by the US Energy Information Administration, and 88 trillion cubic feet by the US Geological Survey[14]


Until recently, development of natural gas in the Marcellus shale had not been viewed as economically viable, given the difficulty of extracting natural gas from shale formations with conventional drilling techniques. However, the implementation of hydraulic fracturing and horizontal drilling techniques pioneered in the Barnett shale in Texas, have made development of the shale economically viable. The economic impact of the Marcellus Shale development in the state in 2009 was calculated to be $2.35 billion of business volume and accounted for the generation of 7,600 jobs. Marcellus Shale is believed to hold trillions of cubic feet of natural gas thus the development of the shale is expected to continue to have a significant economic impact on the state in the future. [15]

West Virginia Department of Environmental Protection

The Regulatory agency responsible for ensuring the safe and environmentally responsible development of the natural resources in West Virginia is the West Virginia Department of Environmental Protection (WVDEP). specifically the WVDEP is tasked with the protection of public health, the environment and natural resources through the regulation of industrial development and the protection and rehabilitation of areas of industrial and natural resource development, and through their role as a public educator. [16]


Within the WVDEP the Office of Oil and Gas (OOG) is mandated to monitor and regulate all activities related to the exploration, drilling, storage and production of oil and natural gas. the OOG maintains records on over 55,000 active and 12,000 inactive oil & gas wells, in addition to managing the decommissioning, plugging, and rehabilitation of abandonded welss. Furthurmore, the OOG works to ensures surface and groundwater is protected from oil and gas activities.

Geography and Geology

Located in the Appalachian Mountain range, West Virginia covers an area of 24,229.76 square miles (62,754.8 km2), with 24,077.73 square miles (62,361.0 km2) of land and 152.03 square miles (393.8 km2) of water, making it the 41st-largest state in the United States.[17] West Virginia borders Pennsylvania and Maryland in the northeast, Virginia in the southeast, Ohio in the northwest, and Kentucky in the southwest. Its longest border is with Virginia at 381 miles, followed by Ohio at 243 miles, Maryland at 174 miles, Pennsylvania at 118 miles, and Kentucky at 79 miles.


The underlying rock strata are sandstone, shale, bituminous coal beds, and limestone laid down in a near-shore environment from sediments derived from mountains to the east, in a shallow inland sea on the west. Some beds illustrate a coastal swamp environment, some river delta, some shallow water. Sea level rose and fell many times during the Mississippian and Pennsylvanian eras, giving a variety of rock strata. The Appalachian Mountains are some of the oldest on earth, having formed over 300 million years ago.

References

  1. "Advanced & Alternative Energy"
  2. "Fossil Energy", West Virginia Department of Commerce. Accessed December 11, 2010
  3. "Gas", West Virginia Department of Commerce. Accessed December 11, 2010
  4. "History of WV Mineral Industries - Oil and Gas", West Virginia Geological and Economic Survey . Accessed may 31, 2015
  5. "History of WV Mineral Industries - Oil and Gas", West Virginia Geological and Economic Survey . Accessed may 31, 2015
  6. "History of WV Mineral Industries - Oil and Gas", West Virginia Geological and Economic Survey . Accessed may 31, 2015
  7. "History of WV Mineral Industries - Oil and Gas", West Virginia Geological and Economic Survey . Accessed may 31, 2015
  8. "The Economic Impact of the Natural Gas Industry and the Marcellus Shale Development in West Virginia in 2009 ", Amy Higginbotham, Adam Pellillo, Tami Gurley-Calvez, and Tom S. Witt Bureau of Business and Economic Research College of Business and Economics West Virginia University. Accessed may 31, 2015
  9. "The Economic Impact of the Natural Gas Industry and the Marcellus Shale Development in West Virginia in 2009 ", Amy Higginbotham, Adam Pellillo, Tami Gurley-Calvez, and Tom S. Witt Bureau of Business and Economic Research College of Business and Economics West Virginia University. Accessed may 31, 2015
  10. "The Economic Impact of the Natural Gas Industry and the Marcellus Shale Development in West Virginia in 2009 ", Amy Higginbotham, Adam Pellillo, Tami Gurley-Calvez, and Tom S. Witt Bureau of Business and Economic Research College of Business and Economics West Virginia University. Accessed may 31, 2015
  11. "History of WV Mineral Industries - Oil and Gas", West Virginia Geological and Economic Survey . Accessed may 31, 2015
  12. "History of WV Mineral Industries - Oil and Gas", West Virginia Geological and Economic Survey . Accessed may 31, 2015
  13. "History of WV Mineral Industries - Oil and Gas", West Virginia Geological and Economic Survey. Accessed may 31, 2015
  14. US Energy Information Administration, Annual energy outlook 2012.
  15. Amy Higginbotham, Adam Pellillo, Tami Gurley-Calvez, and Tom S. Witt Bureau of Business and Economic Research College of Business and Economics West Virginia University, http://www.caimanenergy.com/sites/default/files/resources_wvueconomicimpactstudy.pdf The Economic Impact of the Natural Gas Industry and the Marcellus Shale Development in West Virginia in 2009].
  16. West Virginia Department of Environmental Protection, [1].
  17. "Land and Water Area of States, 2000". Information Please. 2000. Retrieved July 7, 2010.