Each new year brings with it a slew of anniversaries, some important, and some,

not so much. Here are a few of the more important ones in 2019, which continue

to have great effect our present world. Your own list may vary from mine.

400th anniversary of the arrival in North America of the first slaves from Africa

160th anniversary of Col. Drake’s discovery well at Titusville, PA

150th anniversary of the completion of the U.S. transcontinental railroad

100th anniversary of the Versailles Peace Treaty formally ending WWI, but whose

terms provided an ignition point for WWII

100th anniversary of the 19th Amendment granting women the right to vote

75th anniversary of D-Day and the Battle of the Bulge, both costly victories for the

Allies, but major defeats for Nazi Germany, which hastened the end of WWII

50th anniversary of the Moon landing by the crew of Apollo 11

Not forgotten is the 120th anniversary on July 1st of the first and last Bull vs Bear

fight in Custer City, south of Bradford. Both animals survived the fight, but Duke,

the bull, with a nearly six-to-one weight advantage, was reported to have had the

better of it. Which brings me to wonder, which will prevail in crude oil markets?

The bear market mauled oil producers in late 2018, largely because of market

oversupply worries. If the bear is strong in 2019, then conventional operators will

continue to do what they’ve demonstrated that they do best; adapt and survive.

In this issue

2019: Bull vs Bear P.1 2018 Conventional Permits P.2

In the Spotlight P.3 Logging Assists-Neutron Logs: p.4

About this Newsletter

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Cary Kuminecz CPG, PG is President/

Owner of StratResources Geologic

Consulting, PLLC which provides

prospect generation, geologic

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The Conventional Operator

Bi-Monthly Newsletter for Operators Exploring & Developing Conventional Oil & Gas Plays in Pennsylvania

ISSUE 24 Jan 2019

2019: Bull vs Bear

2

Conventional Well Permits - Pennsylvania (2017 & 2018)

The new and renewal conventional well permits for

2018 finished approximately 33% ahead of 2017

with 263 total permits of which 92% were for first

time permits.

263 permits is well short of the record, since this

newsletter has kept track, which was 1265 permits

in 2014. However, 2018 closed 61% higher than

the 163 permits recorded for 2016, which was the

poorest year recently. As has been the case all year,

the counties of the Northern Oil Region accounted

for most of the permits with 91.3% of the total. For

the entire state 2018 conventional well permit

types were as follows:

Oil ………………...81.0%

Oil & Gas……….13.3%

Gas………………….4.2 %

Other……………...1.6%

2018: Second Year of Increased Permit Activity

Year End 2018 Conventional Permits

County No. Permits % of Total

Warren 108 41.1

McKean 86 32.7

Forest 34 12.9

Venango 12 4.6

Lawrence 4 1.5

Armstrong 3 1.1

Butler 3 1.1

Elk 3 1.1

Mercer 3 1.1

Fayette 2 0.8

Washington 2 0.8

Clarion 1 0.4

Clearfield 1 0.4

Indiana 1 0.4

Total 263 100.0

3

Success Stories, News, Announcements

On December 13th, the PADEP’s Air Quality Technical Advisory Committee

(AQTAC) released a draft of a proposed rulemaking regarding the release of

volatile organic compounds (VOC), including methane, from oil and gas wells

(conventional and unconventional), equipment, and facilities. The impetus for controlling all VOC is the desire to control

the formation of ground level ozone, which is derived from VOC, as a component of smog. The US EPA, under President

Obama, ordered in 2016 that states address the control of VOC within the oil and gas industry using Reasonably Available

Control Technology (RACT) and the Wolf administration in PA is complying with this order based on their own December

release of proposed rules. However, the US EPA under the Trump administration has proposed removing this

requirement as it studies how best to address VOC emissions, but this newest proposal has yet to be finalized.

As part of the 2016 plan one of the EPA’s focuses was on “fugitive emissions from wells sites and gathering and

boosting stations.” According to the plan, well sites that would fall under these air control regulations must have an

average production greater than 15 BOED (barrels of oil equivalent, daily) for these wells. By this measure many (up to

80 percent according to PIOGA) conventional play oil and gas wells in Pennsylvania would fall below this minimum

required production volume. However, there is no recommended minimum volume limit on gathering facilities.

In their 2016 document the EPA defines fugitive emissions as “any component that has the potential to emit fugitive

emissions of VOC at a well site or gathering and boosting station, including but not limited to valves, connectors,

pressure relief devices, open-ended lines, flanges, covers and closed vent systems not already subject to equipment

and fugitive emissions monitoring, thief hatches or other openings on a controlled storage vessel, compressors,

instruments and meters.” Based on this definition VOC in high-producing conventional wells in their early years of

production could exceed the 15 BOED tripwire and would be subject to these regulations as well as all facilities and

stations that move or process hydrocarbons. What happens when a well’s average production falls below 15 BOED with

respect to regulatory liability is not mentioned in the EPA document, but according to PIOIGA, operator documentation

that the new rules do not apply may be required even for stripper wells. The EPA has proposed various methods to

measure fugitive VOC levels and document equipment that needs to be repaired or replaced at well sites and facilities.

The cost to do this with operator-owned equipment or using contractors varies with the size of the monitored area,

frequency of testing, and number of monitored sites, but EPA’s own estimates put the annual costs in the multiple

thousands of dollars range for even a modest number of wells and facilities. The link to the PIOGA, PADEP and the EPA

sites with the more information regarding this issue are:

https://www.pioga.org/publication_file/PIOGA_Press_105_January_2019.pdf

http://files.dep.state.pa.us/Air/AirQuality/AQPortalFiles/Advisory%20Committees/Air%20Quality%20Technical%

20Advisory%20Committee/2018/12-13-18/ONG_PRN_Annex_A_AQTAC_12-13-2018_for_posting.pdf

https://www.epa.gov/sites/production/files/2016-10/documents/2016-ctg-oil-and-gas.pdf

4

In a previous issue of “The Conventional Operator” (No. 22, Sep 2018) I introduced the topic of Neutron Porosity logs.

The neutron is one of the basic particles that, with the exception of normal hydrogen, make up each atom in the

universe. In this issue I will discuss the lithology or matrix correction needed for Neutron Porosity logs in the

conventional plays such as the Upper Devonian and Lower Silurian Medina/Whirlpool Sandstone Plays.

It is important to remember that the Neutron Porosity reading in most logs is a raw or apparent Neutron Porosity value

and should not be used without first making some corrections. The first thing to note on your well logs, or to ask your

logging engineer, is whether the Neutron Porosity curve is from an epithermal (also known as sidewall) or thermal

Neutron Porosity tool. The difference is in the energy level of the scattered neutrons that return from the radioactive

source to the tool’s detector(s). The higher energy or fast epithermal neutrons (or capture gamma rays (see Issue No.

22)) are captured by an epithermal or sidewall Neutron Porosity tool when logging in an air or gas-filled hole. Thermal

Neutron Porosity tools are used in liquid-filled holes and are designed to detect the slower, lower energy neutrons (or

capture gamma rays) in liquid-filled holes. Subsequent corrections to the raw or apparent Neutron Porosity values will

be different between epithermal and thermal tools.

The log curves for epithermal or sidewall Neutron Porosity tools and thermal Neutron Porosity tools vary with the

logging company and with the generation of the specific tool. Table 1 shows some of the more common Neutron

Porosity percentage or fractional porosity scale names or mnemonics used by logging companies in the northern

Appalachian basin. The list is by no means complete, but was compiled after surveying a large number of log images and

includes the most common scale names.

Topic 20: Neutron Porosity Logs:

Using Them In Appalachian Basin

Conventional Sandstone Plays

Logging Assists:

Table 1

(Continued on Page 5)

5

(Continued from Page 4) There are several borehole conditions that affect the apparent Neutron Porosity and most

modern logging company practices take these into account in their software. However, you the well log consumer and

analyst need to make the most important correction if you’re working a conventional sandstone play; and that is to

change the Neutron tool’s matrix measurement reference from limestone to sandstone. All Neutron Porosity tools are

calibrated to read zero porosity in a limestone matrix of zero porosity. Therefore, since you’ll be needing the Neutron

Porosity in a sandstone you must correct the apparent limestone Neutron Porosity to that for a sandstone. How do you

know if the Neutron tool in your wellbore was calibrated in a limestone? In modern logs you can check the tail of the

well log, such as the one shown below from a 2007 Schlumberger well log from Allegany County, NY (Figure 1). The tail

should say that the calibration matrix or lithology was limestone, though in rare cases you may come across a log in

which the correction to a sandstone matrix was made by the logging company prior to putting the tool in the wellbore, as

shown in the well log scale bar in Figure 2 below from a 1983 Birdwell log from Chautauqua County, NY. Let me repeat,

the use of sandstone (ss) matrix on the Neutron Porosity percentage curve is not commonly seen in the Appalachian

basin and you must make the correction yourself to get a true Neutron Porosity for your sandstone reservoir.

In all cases check your well log’s tail or scale to determine with which matrix the Neutron Porosity curve was calculated.

In some older well logs there may not be any tail or scale bar with this information. In those cases you must assume the

Neutron Porosity reading was calibrated for limestone and then make the change to sandstone yourself if a sandstone

reservoir is your target for analysis.

Topic 20: Neutron Porosity Logs:

Using Them In Appalachian Basin

Conventional Sandstone Plays

Logging Assists:

Fig. 1

Fig. 2

(Continued on Page 6)

6

(Continued from Page 5) Schlumberger and other logging companies have published lithology correction charts for their

epithermal and thermal Neutron Porosity tools. Figure 3 shows an example for correcting epithermal Neutron logs from

Schlumberger ‘s 1998 Log Interpretation Chart Book. The dark solid lines running from the lower left to the upper right

represent three common major reservoir minerals, dolomite, calcite and quartz. To correct an apparent Neutron

limestone porosity as shown on a log or in an LAS file, you read upward from the X-axis to the solid calcite (limestone)

line. Then, you proceed vertically from that intersection point until you reach the solid and dark quartz (sandstone) line.

From that intersection you proceed left to the y-axis and read off the true Neutron Porosity for sandstone. That true

Neutron Porosity value is what you use for calculation of average and effective porosities for your reservoir, which then

plug into water saturation formulas. In the example in Figure 3 you can see that an apparent Neutron Porosity (in

limestone) of 25 percent is equivalent to a true Neutron Porosity (in sandstone) of about 28 percent. In fact above five

percent apparent Neutron Porosity in limestone, sandstones will generally have a true Neutron Porosity about three

porosity units (p.u.) higher. So for a sandstone reservoir you can mentally add three porosity units to your apparent

Neutron Porosity that was logged using a limestone matrix. There is a slightly different chart for correcting lithology for

thermal Neutron Porosity logs. If using an LAS file and a spreadsheet you can make the same approximate correction

mathematically using the formula for

epithermal logs:

PHINss[] = (-0.2804 * ENPH[] ^2) +

(1.1177 * ENPH[]) + 0.0215

Where PHINss is the true Neutron Porosity

value for sandstone and ENPH is the raw log

value. For thermal Neutron Porosity tools

the approximate mathematical correction for

sandstone is:

PHINss[] = (-0.3905 * NPHI[]^2) +

(1.2805 * NPHI[]) + 0.0214

Where NPHI is the raw log value. The true

Neutron Porosity can then be combined with

the computed Density Porosity to obtain

average and effective porosities for the

reservoir. More about this in future issues.

Topic 20: Neutron Porosity Logs:

Using Them In Appalachian Basin

Conventional Sandstone Plays

Logging Assists:

Fig. 3

7

Providing Geologic Consulting Services to the

Oil & Gas Industry and Landowners

Oil & Gas Prospect Generation

Evaluation of Properties for Water Injection or Disposal

Acreage Hydrocarbon Assessments/Property Risk Management Assessment

Quantitative Well Log Analysis

Core Descriptions

Analysis of Drillers’ Cuttings

Well Log Quality Control at the Wellsite

Volumetric Reserve Estimates

Oil & Gas Data Compilations and Reporting

Subsurface Geologic Reports/Interpretation of 3rd Party Reports

Conversion of Paper Well Logs into Raster Format (TIF) or Vector Format (LAS) Files

Training Classes in Stratigraphy of the Northern Appalachian Basin

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