1. Forecasting Significant Incidents in Gas Fields Test Case: Barnett Shale, Fort Worth, Texas by Jerry Lobdill, physicist and Ch. E. (ret.)

2. One Picture is Worth...

3. Significant Incidents (SI) A US DOT term meaning an incident involving any of: $50,000 in damage or more Fire Explosion Injury Death The RRC collects mandatory reports of SIs for the US DOT

4. Purpose of Study Use Significant Incident historical data to quantify the risk associated with urban gas drilling and production. Apply findings to the City of Fort Worth (Barnett Shale)

5. Barnett Shale Gas Well Density 2007

6. Proposed Statistic Average Significant Incident Rate per 1000 gas wells per unit time. This is scalable to a field of any size.

7. History of Barnett Shale Play Play covers about 15 counties First wells drilled in the northern rural region in the 1990s By June 2008 there were 7766 wells First wells in Fort Worth area drilled in 2001 As of last week 2008 a total of 1376 well permits had been issued in FW

8. Factors Affecting SI Rate No. producing wells Miles of gathering pipeline Population density Regulation Maintenance/Inspection Age of Field

9. Population Density vs SI Rate Certain kinds of human activity increase the SI Rate above that experienced in rural settings. The historical SI data available are mostly for non-urban areas. Fort Worth has 2333 people/sq. mi. Our forecasts will be conservative.

10. The Effect of Regulation on SI Rate Regulations do not imply safety. They are the result of a tug of war between profit and safety. Profit interests are strongest. Regulations are only as good as the enforcement budget. Use modern TX RRC Regulation/enforcement in this study.

11. Effect of Maintenance/Inspection, Age Regular inspection should minimize SIs. Inspection without corrective maintenance will not prevent SIs. As gas field ages maintenance and inspection receive short shrift. Our forecasts will be conservative.

12. Wells and Pipelines in and Near Tarrant County, 2007

13. Analysis Summary There were 9 SIs from 2004-2007 in the Barnett Shale. Statistical analysis shows Fort Worth will have (conservatively) a significant incident about every 6 months on average when full production is achieved (3000 wells).

14. The Barnett Shale Data

15. Number of Incidents vs Number of Wells

16. Mathematically Assuming only that the SIs are independent events... The probability that there are exactly k SIs in a period of t months when the average rate is SIs per month is given by the Poisson distribution. The equation is

17. Simulated Timeline, 3000 WellsOne Replication Maximum time between Significant Incidents for this replication is about 17.6 months.

18. SI Rate Implications for Fort Worth Property insurance against gas damage will be mandatory. Home values will go down (for sales, but not for taxes) PITI will escalate. Population will decrease. Taxes will go up. Bond ratings will decline.

19. In Fort Worth Today... High Impact drilling is routinely permitted. For-profit gas companies are given eminent domain power to seize private property for pipeline ROW. City, State claim impotence.

20. Conclusions Drillers and their allies in local government ignore the public safety aspects of shale bed gas drilling today. The public cannot afford to accept this rosy view of life in an urban gas field. As new shale bed field projects begin, citizens should use this analytical tool to forecast the SI rate and demand restriction of pipeline and drilling site locations to industrial zones.