No decision on commercial wastewater well

Sidney found itself in the middle of a fervent dispute between residents of northwest Nebraska and an oil and gas company from Colorado on Tuesday.

And after a six-hour public hearing, there is still no resolution. A decision will instead be handed down within 30 days.

The issue: a proposal to turn a non-producing oil well in Sioux County into a commercial disposal site for contaminated oil wastewater.

When oil is pumped from the ground, it contains some amount of brine that must be filtered out.

In the case of hydraulic fracturing – when a mixture of water, sand and a proprietary chemical mix is injected under high pressure in the ground to create fractures in shale fields that allow trapped oil to be released – the filtered wastewater also contains some amount of chemicals.

The amount of water-to-oil produced varies at each well, and over the lifetime of the well, but can reach 10-to-1 – or higher.

Because wastewater can wreck havoc on the environment above ground, it is injected under low pressure through dry wells back underground.

Terex Energy Corporation, based in Broomfield, Colo., submitted an application last fall to the Nebraska Oil and Gas Conservation Commission to do just that at a site 14 miles north of Mitchell, a town of about 1,700 residents.

When the application was submitted, the price of oil had yet to plummet. Terex said it expected to dispose of 10,000 barrels of wastewater each day, transported to the round-the-clock operation by an estimated 80 trucks daily.

The company indicated it planned to handle wastewater primarily produced in oil fields across the boarder in Wyoming and Colorado.

Although there are already 143 saltwater disposal wells in nine counties throughout Nebraska – including here in Cheyenne County – the scale and scope of the proposed project incited a tremendous reaction.

Counties, towns and a public health board; nearby landowners, residents and students; even state politicians, began a campaign against the wastewater well – and Terex – through public meetings, the media, official objections and even proposed legislation. More than 3,000 Nebraskans even signed a petition against the well.

That campaign reached a climax Tuesday at 922 Illinois St. in Sidney.

Public comment

hearing

Public hearings and meetings conducted by the Sidney-based state Oil and Gas Commission are held in its nondescript building next to Miller Office Supplies and across from the Silver Dollar Bar and Grill.

The public hearing regarding Terex's application was broken into two sections: a morning portion where anyone was able to offer comments on the project, limited to three minutes each, and an afternoon quasi-judicial session where only affected parties were able to speak.

Nearly 100 people turned out for the morning portion. In accordance with the buildings occupancy capacity, though, only 60 were allowed in at any one time.

Commenters were asked to exit the building after speaking to make room for those waiting in the sunny but brisk morning air outside the entrance.

By the end of the public comment period, no one remained outside.

No one spoke in favor of the wastewater well in the first hour of comments. During the nearly three-hour hearing, and out of 50 speakers, only three voiced support for the proposal.

Opponents spoke out about Nebraska serving as the dumping site for other states, the potential for spills, a lack of regulatory oversight, increased truck traffic through small towns and the damage and safety concerns it would entail.

James Osborn, from Ainsworth, was the first speaker.

He had first-hand experience in the oil and gas industry, he said, and had helped construct pipelines.

As he spoke, he filled three clear plastic cups with water, then added a brownish and gritty liquid he said was fracking fluid. He asked the commissioners if they would drink it.

"My answer would be 'no,'" he said, after being told they could not respond to comments, "I would not drink this."

State Sen. Ken Haar, representing District 21, spoke at the session – first to read a letter on behalf of District 48 Sen. John Stinner and then to register his own objections.

In his comments, Haar said the lifeblood of the Nebraska economy is agriculture, and it must be protected. He asked the commission to delay its decision until the Legislature and Gov. Pete Ricketts are able to provide input on the issue.

William Raney, a student from Scottsbluff High School, attended the hearing with his environmental science class.

He told the commissioners he had lived near an illegal benzene site in Texas before moving to Nebraska. Through research done in class and on his own, he said he learned the wastewater injected in Mitchell would contain dangerous substances that could leech into groundwater.

"We do not want to focus on the moment with quick fixes," he said. "But we want to focus on the future. Do you want the future to remember the people who helped pollute and destroy this little blue marble of a planet that we have, or do you want them to remember you as people who saved lives and the ecological system of animals that have no voices and no power?"

Scott Melvin, from Bridgeport, said any spill from the site could make the land sterile for a long time.

"I would encourage the commission to reject this application," he said.

Randy Sutton, a third generation farmer living in Cheyenne County – nine miles west of Sidney – was one of few speakers to support the project.

He said he has had both oil wells and disposal wells on his farm.

"I've experienced the expertise of this commission that has taught me how to do it properly," he said.

He likened the outcry against the Terex application to when Interstate 80 was constructed across the state.

"I think that highway is no different than this injection well," he said. "Just a step in the future."

At 12:40, after everyone had an opportunity to voice their comments, the commission closed the public comment portion of the meeting.

Affected parties

hearing

When the hearing reconvened in the afternoon, the crowd had thinned and the room was reconfigured. Two tables were set perpendicular to the ends of the table were the commissioners sat, creating a 'U.' Facing each other, at one table was perched Terex's lawyer and representatives, at the other was seated a lawyer and the "affected parties" he represented who had officially protested the project.

Affected parties were defined as those who owned property within a half-mile radius of the proposed well.

Commissioner Thomas Oliver said the hearing would be conducted similar to a court proceeding: each side would be able to present expert witnesses and exhibits, and the other would be able to cross exam.

Oliver explained commissioner Robert Goodwin had recused himself from the proceedings due to a conflict of interest. Since commissioner James Gohl was present, the three-member commission maintained a quorum, he added.

During expert witness testimony presented on behalf of Terex, the company said the proposed site was 20 miles from the Ogallala Aquifer. Earlier in the day, numerous commenters said they were concerned about the potential of the wastewater to contaminate the aquifer.

Terex geologist Marty Gottlob said despite the distance from the Ogallala, there were still other fresh water zones nearer the well, and they would be protected.

The distance between where the wastewater would be injected and the lowest freshwater source would be nearly 6,000 feet vertically, he added.

He said Terex had no current contracts with companies to dispose of wastewater, and the 10,000-barrels-per-day figure cited in the application likely wouldn't – if at all – be a reality until oil prices rebounded.

"Once we're up and running, I think people will decide to bring it to us," he said.

Andy Peterson testified in support of the project as a petroleum engineering expert witness.

He said he had reviewed the engineering preparations for the well, and the injection tube would be surrounded by three layers of steel and two layers of cement.

Allen Heim, of Kimball, a principle founder of Terex, said there would be systems in place to shut down operations if a leak was detected. He added, while his company is foremost an oil and gas firm, it made the request for a wastewater site because it saw a need and an opportunity.

The project could help encourage oil production in Sioux County by offering producers a convenient site to dispose of wastewater, he said.

Sidney lawyer Thomas Sonntag represented the property owners opposed to the well. Throughout cross examinations of Terex's witnesses, he asked for specifics and details.

In response to one of his questions, Heim said at least initially, Terex did not expect to dispose of any water produced in Sioux County.

He reaffirmed Gottlob's statement that wastewater injected at the site would be less than initially thought.

"We're not talking about 10,000 barrels from anyone right now," he said. "We were hoping someday, but that's not a reality now."

Before the produced water is pumped into the ground, he said, it would be filtered to remove dissolved solids. The solid waste would then be transported to a landfill.

When Sonntag asked if a landfill where the waste would be trucked had been identified, Heim responded no.

Sonntag also challenged the argument that a wastewater disposal site would lead to oil exploration in Sioux County.

"You're telling me if a person is looking for oil, the first thing they want to know is if there is somewhere to put the water?" he asked.

In his closing arguments, Sonntag questioned whether Nebraska state statues allowed the commission to authorize a permit for the disposal of waste not produced in the state and if the commission had the resources to monitor the commercial site.

He also asked to commissioners to consider the letters of protest sent by nearby counties, cities and villages.

"Let Sioux County decide whether they want to have Colorado dump their water in Sioux County," he said. "Let the Legislature of the State of Nebraska decide whether Nebraska should be the dumping ground for Wyoming and Colorado's water."

Following arguments from both sides, the hearing was swiftly called to an end. Oliver said a final decision would be forthcoming.

"The law says we have to make a decision in 30 days," he said.