Friday, January 20, 2012

Marcellus Shale and Jobs

Much has been reported recently about jobs in the Marcellus Shale and how they have been taken by out of state workers. Setting aside that people tend to go where the work is and where their skills are compensated best lets look at actual jobs and where there might be opportunities for job seekers, entrepreneurs or other contractors.
Lets start with the gas company who wants a piece of ground he can drill on. He employs a landman to seek out the property, research the owner or owners of the mineral rights, negotiate a lease agreement and consumate the agreement. Now we have a site to drill on. However...first we have to prepare the site. That means cutting trees, leveling the site, provide an access road and prepare the drill pad. The contractor involved has to have tree cutters and equipment operators to remove trees and brush and make a clear site. Now the bulldozer comes in to level the site and prepare for the heavy equipment including the drilling rig. That means multiple loads of stone to prevent equipment from sinking in to the mud and the means to spread the stone and level it. So far we have tree cutters, bulldozers and operators, truck drivers, stone yards, loader operators and landmen. Behind the scenes we have geologists and petroleum engineers who determined that this is a good place to drill, environmental engineers who developed the site plan to reduce or eliminate any environmental problems and specialists in permitting who will walk through the permitting process and get the appropriate permits and pay the pertinent fees. Now with a pad and a permit we can drill right? Not so fast. The pad is just solid enough to support the weight of the equipment but is porous so any spills of oil, lubricants, diesel fuel or gasoline will contaminate the environment. Therefore a containment system has to be built to contain and ameliorate any spills. Now we can drill right? Not so fast. Now we can begin to move equipment onto the site. We have a drilling rig, a mud pump, multiple sleds for drilling mud cuttings, drill pipe, drilling mud and supplies, a power plant, water tanks, fuel tanks, lights, rest rooms, trailers for drilling operators contols and housing. Ready to drill now? Nope. Now we have to set up the drill stack. This includes the blow out preventers BOP, cross-over valve (to allow mud to go down hole and cuttings to come back up). Once the stack is in place it has to be hydrostatically tested to make sure it was done right and will support the drilling. Each step has to be completed with people and equipment, some highly trained, some not. In any event we are just about to start drilling. Once the BOP stack is in place and tested the drilling crew can commence drilling. Drilling will proceed to a predetermined depth below the water table. Once this drilling is complete and well casing pipe is run then a cement crew comes in and pumps cement down the hole and out the outside of the casing and cements the entire hole to the surrounding rock. We now have a cased cemented pilot whole below the water table and drilling can begin. For one well we have employed a contractor for tree removal and site prep, a contractor for pad prep, a stone yard to provide the stone for the pad and access road, truck drivers to haul stone, truck drivers to haul all the heavy equipment drill pipe and casing, a contractor to build the BOP stack and test it and a contractor to build a containment system on the pad, a contractor to provide port-a-potty services, rental companies to provide portable lights and housing for the rig crew and operators. Once drilling starts, the drill bit vendor is on site, a company man to supervise the drilling crew and maintenance mechanics to keep all the equipment running.  Since drilling requires mud to lubricate the drill bit and take away cuttings there is a continuous supply of trucks bringing water to the site. Once drilling reaches a certain point the direction changes from vertical to horizontal and another expert in the horizontal drilling has to be used and a new computer controlled bit is involved. More contractors, more pipe, more mud, more water. Now the drilling is done and we have gas right? Not so fast. Once the drilling is done the drill bit is removed and then they have to case the well in pipe for eventual production. More pipe, more trucks, more drivers. Again the cement crew comes in to cement the casing to the rock, the BOP Stack is removed and the drilling rig can be removed.
I have given the readers a basic overview of the drilling process for a typical horizontal well in the Marcellus Shale. One well involves a multitude of people, contractors, equipment, expertise and lots of money. In my next post, I will complete the well and describe the many contractors involved in the next phase of the well.