Hydraulic Fracturing
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www.anadarko.com | NYSE: APC The Equipment: From Rig to Producing Well Hydraulic Fracturing Producing Well: 20+ Years Drilling Rig Anadarko Petroleum Corporation 13 www.anadarko.com | NYSE: APC Horizontal Drilling . Commences with Common Rotary Vertical Drilling . Wellbore then Reaches a “Kickoff Kickoff Point Point” ~6,300 feet Entry Point . Drill Bit Angles Diaggyonally Until ~7,000 feet the “Entry Point” . Wellbore Becomes Fully Horizontal to Maximize Contact Lateral Length with Productive Zones Anadarko Petroleum Corporation 14 www.anadarko.com | NYSE: APC Horizontal Drilling – Significant Surface‐Space Reduction Traditional Vertical Wells Horizontal Drilling Anadarko Petroleum Corporation www.anadarko.com | NYSE: APC Hydraulic Fracturing . Essential Technology in Oil and Natural Gas Production from Tight Sands and Shales . Involves Injecting a Mixture of Water, Sand and a Relatively Small Multiple Layers of 1+ Mile Separates Aquifer Amount of Additives Protective from Fractured Formation Under Pressure into Steel and Cement Targeted Formations . Pressure Creates Pathways, Propped Open by Sand, for Oil or Natural Gas to Flow to the Wellbore Anadarko Petroleum Corporation 16 www.anadarko.com | NYSE: APC Hydraulic Fracturing Equipment Water tanks Blender Blender Frac Van ellheadW ellheadW SdtkSand tanks Pump trucks 17 Anadarko Petroleum Corporation 17 www.anadarko.com | NYSE: APC Hydraulic Fracturing Technology Equipment Water Tanks Pump Trucks Sand Movers Blenders Frac Design Primarily Water and Sand Additives Include: . Gel (ice cream) . Biocide (bleach) . Friction reducer (polymer used in make‐up, nail and skin products) Anadarko Publicly Shares the Ingredients of All Hydraulic Fracturing Operations at www.FracFocus.org Anadarko Petroleum Corporation 18 www.anadarko.com | NYSE: APC Hydraulic Fracturing is Transparent . Anadarko was Instrumental in Creating the Ground Water Protection Council’s Online Public Registry that Enhances Transparency by Publicl y Shhiaring the Ingredients Used i n Hydraulic Fracturing on a Per‐Well Basis. Fracfocus.org GWPC’s Online Public Regygistry Publicly Shares All Fracing Ingredients on a “Per‐Well” Basis Available to Anyone at Any Time Anadarko Petroleum Corporation 19 www.anadarko.com | NYSE: APC Protecting Water Quality in Colorado . Anadarko is a Participant in Colorado’s Water‐Quality Sampling Program . Independent Third‐Party Experts Collect Water Samples Prior to Drilling … . And Again After Drilling . To Ensure Water Quality is Protected All Water‐Quality Data is Maintained by the Colorado Oil and Gas Conservation Commission Anadarko Petroleum Corporation 20 www.anadarko.com | NYSE: APC Coexist with agricultural operations… llheadeW llheadeW llheadeW llheadeW llheadeW llheadeW koAnadar Petroleum Corporation 21 www.anadarko.com | NYSE: APC Existing COGCC Hydraulic Fracturing Rules Rule 317 ‐‐ Surface casing and cementing requirements and cement bond log Rule 317B ‐‐ Setbacks and precautions near surface water Rule 906 – Spill containment and reporting Rule 341 – Monitor pressures and reporting requirements Rule 907 – Management of produced water Injection –COGCC permit process Commercial Facilities –CDPHE permit process Land Treatment –COGCC permit process Centralized E&P Water Facility – COGCC permit process Reuse and Recycle –COGCC permit process Anadarko Petroleum Corporation 22 www.anadarko.com | NYSE: APC New COGCC Hydraulic Fracturing Rules Publicly share ALL fluid additives Publicly share both additives and ingredients Protection of proprietary information allowed with the submission of a certification signed under the “penalty of perjury” by service providers Emergency professionals have access to proprietary information Publicly share information via FracFocus within 60 days of hydraulic fracturing being completed SSfurface lldandowner iifnformati on sheet Provide 48‐hour notification to COGCC prior to commencing hydraulic fracturing applications COGCC will then notify LGD Anadarko Petroleum Corporation 23 www.anadarko.com | NYSE: APC How Much Is 5 Million Gallons Of Water? • A Typical Wattenberg HZ Well Uses 3 - 5MMGallons5 MM Gallons • The Same Amount Is Consumed By: 750 704 472 364 1,000 MWh 1,000 MWh Corn Field Avg. golf course 204 coal-fired nuclear over every 114 power plant power plant 370 DAYS 14 34 52 5 ACRES in in per 11 HOURS 6 HOURS SEASON Anadarko Petroleum Corporation www.anadarko.com | NYSE: APC Water Usage – Additional Information Anadarko Petroleum Corporation 25 www.anadarko.com | NYSE: APC Environmental Protections & Best Management Practices • Pad Drilling: Reduces Surface Space • Closed-Loop System: No Open Pits • Water Recycling: Conserves Water Usage • Green Completions: Reduces Emissions • FLIR Cameras: Identifies and Addresses Potential Leaks • Flowline Testing: Ensures System Integrity • Stuffing Box Shutoff: Enhances Safety • Drip Catch Pan: Protects the Surface • Oil Polishing Facility: Reduces Truck Traffic & Emissions • Automatation: Reduces Truck Traffic & Emissions • Observati on R epor ts: ECliEnsures Compliance • Emission-Control Devices: Reduces Emissions Anadarko Petroleum Corporation 26 www.anadarko.com | NYSE: APC Recognition for Environmental Protection . Awarded as 2011 Outstanding Operator in the State of Colorado for: Environmental Protection Water-Quality Protection Community Relations Anadarko Petroleum Corporation 27 www.anadarko.com | NYSE: APC Giving Back to the Community & Environment . Community Involvement Weld Food Bank Weld County Special Olympics Weld County Fair and Junior Auction Habitat for Humanity –4th home under way Greeley Stampede National Western Stock Show and Junior Auction American Cancer Society Cattle Baron’s Ball Dearfield Monument Weld Community Foundation Historic Ft. Lupton Support numerous Denver‐based charities and civic organizations . Additi onal EEinvironmental Awards IOGCC Chairman’s Stewardship Award Anadarko Petroleum Corporation 28.