Fowler Oil and Gas (fka FWOG)

[humboldt111502]

Borouogh approves methane well

http://www.adn.com/news/alaska/matsu/story/9348664p-9263165c.html


By ZAZ HOLLANDER
[e-mail]

Published: October 2, 2007
Last Modified: October 3, 2007 at 03:05 AM


WASILLA - On Monday night, Matanuska-Susitna Borough officials gave Fowler Oil and Gas Corp. historic permission to drill for coal bed methane in a hay field along Trunk Road.

Only a few dozen people looked on as four members of the borough Planning Commission - three missed the vote - unanimously approved a requisite conditional-use permit for the well, the first granted under a three-year-old borough law. The company still needs approval from the Alaska Oil and Gas Conservation Commission. Planning Commission chairwoman Helga Larson asked members to say their votes aloud “because it is a very important issue.”

Commissioners Dick Zobel, Ken Klunder, and David Webster all voted yes.

“And I vote yes also,” Larson said. “So this motion … passes with all in favor.”

Bob Fowler, a Palmer native and company CEO, pumped his fist in celebration of a major step in his mission to bring a major new resource industry to Cook Inlet. Fowler also became the first to do something his predecessor, Colorado-based Evergreen Resources Inc., could not: The straight-talking local boy made major gains on the public relations front.

“I’d have no problem with him drilling a well right next to my house,” said John Nolan, who owns 100 acres in the borough, along with the mineral rights. “How many people are on natural gas in this room? I know I am. It’s a clean, effective way to heat.”

A firestorm of controversy erupted in 2003 over Evergreen’s proposal to drill for methane on state-owned mineral leases scattered across the Valley. Landowners without mineral rights feared the prospect of drinking water pollution and industrial development in their backyards. Evergreen abandoned the project without drilling a successful well.

In 2004, the borough enacted one of the strictest coal bed methane laws in the country.

Fowler Oil and Gas promises hundreds of underground, horizontal drilling arms rather than numerous surface wells. Fowler pledges to protect the water table down to 1,000 feet and to not use dangerous chemicals to fracture coal seams.

In one of his biggest selling points, Fowler also tries to put wells on property where surface landowners also hold mineral rights. But that could change soon. Several other wells are in the works, including one at the Alaska State Fairgrounds, and others in the area of Farm Loop and Edgerton Parks roads. Not all of those wells involve landowners with mineral rights.

The majority of 15 people testifying Monday night gave mixed support, if not total approval, for Fowler’s proposed pilot well on 840 acres owned by four farm families. Five spoke against the well, largely based on concerns about drinking water safety. “I applaud the borough for developing that ordinance,” testified Mike Chmielewski, president of the board of Friends of Mat-Su, a pro-planning group that came out strongly against Evergreen’s plans in 2003. “I also applaud Mr. Fowler for being willing to spend whatever time it took for working very slowly through that process to ensure any questions would be answered.”

FEARS FOR AQUIFERS Several people urged the borough to protect their drinking water from contamination and also make sure Fowler’s efforts don’t drain local aquifers.

Plumbing coal seams for methane, the chief component in natural gas, requires first separating the methane from millions of gallons of water in the coal. Fowler plans to separate the water underground and then inject it into deep sandstone layers. “What do we do when we keep sucking our groundwater on out?” asked Greg Hall, who lives next to the well property. “I’d love to see all kinds of alternative energy on that property … but don’t take our water.”

Chris Whittington-Evans, a former Friends of Mat-Su board president, said he was particularly concerned about the apparent lack of information regarding Fowler’s water disposal plans.

“Just knowing precisely what you’re re-injecting into, the permeability of that formation, just how much it will take for how long, those questions are key to making this proposal a viable one,” Whittington-Evans said.

Planning commissioners quizzed Fowler on water concerns. He said the state is working with the federal government on new injection standards, and that the practice is already performed at oil wells.

“There is no migration of groundwater, no extraction of groundwater,” Fowler said. The issue is not settled. The state’s Oil and Gas Conservation Commission would also need to sign off on any water injection, in addition to the actual well-drilling. The commission had not received an application as of Monday, said commissioner Cathy Foerster. Fowler said his company was still working on specific information on blowout prevention equipment. Fowler said he expects the state permit to take 30-45 days once he applies.

PERMIT NO FREE RIDE The permit comes with conditions, including monthly water testing and a $50,000 bond to pay for reclamation and well-capping in case Fowler abandons the project. The borough ordinance limits well density, requires setbacks from homes and schools, and sets forth rules for notifying the public.

In an earlier interview, Fowler said he hopes to have both permits in hand within 45 days, and start drilling then. The company could know within a month of drilling whether the well will produce. Fowler told planning commissioners Monday he will not apply for another borough drilling permit until the pilot well pans out. “We want to come before you and say it’s doing what we expected it to do,” he said.