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HomeMy WebLinkAboutGBA 2010-07-08 Minutes MINUTES OF THE MEETING OF THE GAS BOARD OF APPEALS OF THE CITY OF NORTH RICHLAND HILLS, TEXAS JULY 8, 2010 1. CALL TO ORDER The meeting was called to order by Chairman Tom Duer at 6:30 p.m. 2. ROLL CALL PRESENT Chairman Tom Duer Randy Shiflet Garry Cope Marty Kusmierski Kathy Luppy CITY STAFF Director of Planning & Dev. John Pitstick Asst Chief Mike Rawson Fire Marshal Lt. Greg Lindsey Recording Secretary Gina Pastre 3. Approval of May 13, 2010 Gas Board of Appeals Meeting Minutes. APPROVED Kathy Luppy, seconded by Garry Cope, motioned to approve the minutes from May 13, 2010. The motion carried unanimously (5 -0). 4. GB2010 -05 Public Hearing and consideration of a request from Chesapeake Energy Corporation for a deviation from distance requirements from existing structures to gas wellheads at the proposed C Station 1H and 2H gas wells located at 7300 Mid Cities Boulevard. Distance requirements are established in Section 104 -6 of the City of North Richland Hills Code of Ordinances. John Pitstick said that this a request for a deviation from the 600 foot community standard for drilling. If you recall we approved the Engler Mann 2H well a couple months ago. They already have approval for this site but they are adding two more wells the C Station 1H and 2H. There are three residential properties within 600 feet but only two houses structures within 600 feet. Janice Barrow at 7301 Luther Ct to the Page 1 of 7; 07/08/10 GBA minutes south who was notified previously and then there is a rent house at 6300 Buckingham Trail. Those are the only two that actually have structures within 600 feet of the two proposed wells. The proposed wells are 588 feet from the rent house at Buckingham Trail and 584 feet from 7301 Luther Ct. Chesapeake Energy is requesting that the Engler Mann site include a 2.58 acre gas drilling pad and a temporary frac pond to the west of that location. From what we understand there will be a total of 7 wells at this site. These are our 29 and 30 wells within the City of North Richland Hills within 6 citywide well locations. I will be happy to answer any questions that you may have and we also have Scott Castaneda here from Chesapeake who will be giving a presentation as well. Randy Shiflet asked if there were any issues with the flood plain? John Pitstick said no. We do allow drilling within the flood plain. They have to file with FEMA. It is a flood area and there is the bridge at the railroad tracks which is why this area has not developed. When we visited with the Engler's they will have the pad site towards the back and that would still allow for some office pad sites up towards Mid Cities after the fact. The 150 foot no build zone is established within that area but even with that they still could get some buildings up by Mid Cities. Marty Kusmierski asked if it had anything to do with the railroad tracks? Tom Duer asked if we had to get approval from the railroad? John Pitstick said the well has to be 150 feet from the railroad right of way. Public Hearing Opened at 6:34 pm Scott Castaneda came forward representing Chesapeake, 100 Energy Way, Fort Worth, TX 76102. I have planned to give you an overview of the Engler pad site of the C Station 1H and 2H. Included will be the Engler Site overview, the transportation route, community transportation and outreach and any questions that you may have. The Engler pad site is located on private property at 7300 Mid Cities Blvd with an entrance to the site from Iron Horse Blvd. We do plan to construct a pad site this month we have just waited for the rain to stop and give us a chance to get started. The first well the Engler Mann 2H is scheduled to be drilled in August of this year and we are seeking 2 well variances for the C Station 1H and 2H to produce the C Station unit. Drilling for these two wells is anticipated to begin in January 2011 which the wells will drilled consecutively and we do have a plan of up to 7 wells for this particular unit. The overall economic impact anticipated from the C Station unit is roughly around 93 million dollars with potential to produce minerals of more than 1,244 residents and businesses extending across approximately 574 acres, There is an estimated 11 million in royalties to mineral owners and an estimated 1.5 million in increased tax revenue for the City of North Richland Hills. Chesapeake is planning to use the previously approved transportation route which brings us from Loop 820 north on Rufe Snow onto Mid Cities and then south on Iron Horse Blvd. We have 3 structures within the 600 feet. We did reach out to the property owners for those structures and found no issues. We are also Page 2 of 7; 07/08/10 GBA minutes able to participate in communities and outreach. Letters were sent out about the drilling information and pad site activity in April of this year and again in June. We provide online updates at Chesapeake.com about each particular pad site within the city. We have been able to participate in community activities most recently the 4 of July celebration that was just held this past weekend. We do continue to maintain open lines of communication with our neighborhoods. Chesapeake respectfully asks North Richland Hills Gas Board of Appeals to approve the Gas Well variations for the C Station 1H and 2H. I would be happy to answer any questions that you may have. Randy Shiflet asked if they have determined what color they will doing the screening wall? Scott Castaneda said that during the permitting process they will be asking for comments from the staff and they will go with whatever they determine is acceptable. John Pitstick said that it needed to be compatible with the city complex across the street and the surrounding areas. John Pitstick said that the Engler Marin well that was previously approved was a little further south so there were 2 more property owners that were notified as part of that. They are not within 600 feet of these wells. Tom Duer said that there is really only 1 residential property owner that is affected by this one that wasn't affected before. John Pitstick said yes. Public Hearing Closed 6:41 pm APPROVED Randy Shiflet, seconded by Marty Kusmierski, motioned to approve GB 2010 -05. Motion was carried unanimously (4 -0) Garry Cope abstained. 5. Discussion of proposed revisions to gas ordinance. John Pitstick said that he had received a letter from Chesapeake making a request to make a change to section 104 -6. Basically this is the section that deals with the requirement for the 150 foot no build zone. They are currently dealing with a site right now and they are having some issues and we have also had some issues with property owners. Our current ordinance requires 150 foot no build zone and it is required to be an easement and just like the city requires water easements. They have to grant that easement to the city and they are asking why should they give the land to the city. We don't want the land we just want to restrict it for no buildings. Our attorneys are fine with the change and they are recommending that we change some of this to state those sites are executed by the owner and affected property owner the benefit of the city prohibiting the construction of residences, religious institutions, retail and we have to provide a recordable instrument in the formal restrictive covenant rather than an Page 3 of 7, 07/08/10 GBA minutes easement. The attorneys have assured us that it is in favor of the city that we can enforce that and restrict future buildings of being built within 150 feet. We don't have a problem with this change as long as the attorneys are in favor of it. We have 2 sites, the Graham and the Morrow Stevens site were exempted from that because we did not create the 150 foot zone until after the fact so we are dealing with some issues with that. All the other sites and the city have the 150 foot no build zone. This site will will require the 150 foot no build zone but it would be in a restrictive covenant rather than a formal easement. Tom Duer asked if this is 150 foot from the perimeter of the outside wall. John Pitstick said yes. That is the first change and again you see a letter from Chesapeake and there is also a letter from Bryn Meredith the Assistant City Attorney. There is also a draft ordinance that talks about the changes to the section 104 -6. We are also recommending a second change. We don't have any revenues yet because we don't have pipelines to get the gas transferred. We have been working with Texas Midstream primarily and Enterprise Texas in regards to constructing pipelines. They will have to construct pipelines that will connect to all 6 well sites. In some cases they will have lines that would come together and merge and they will require above ground valve stations. One valve station is in Watauga on Rufe Snow and there is another valve station over by the old mall property next to the Medical Office building. It has a nice 8 foot masonry wall screening it. It was not clear in our ordinance so we are requesting a new section 104 -39 that talks about the requirements for screening above ground appurtenances including gas valve stations. Usually they are not as obtrusive even as a gas well and they are much smaller but we are recommending masonry screening for all above ground valves. Tom Duer said that one on Rufe Snow has a chain link fence. John Pitstick said yes. We are recommending that it would be a masonary wall and landscaping similar to what we are using around our gas well sites. We understand that there may be 2 -3 valve stations when they connect. They haven't shared all of that information with us yet. As they come through the city connecting those lines and as they bring them together they have to bring valves above ground. They may only be 5- 7 feet tall but they would have to build a masonry wall above for it to be fully screened from any public view and place landscaping around it. This is just a clarification and one issue that has been discussed is the compressor stations. Right now we don't allow compressor stations within the city unless they come forward with an appeal to the gas board. I don't know if you have read some of the requirements that other cities are requiring. Some of the other cities are requiring enclosures on the compressor stations because they can be noisy. Some of the other issues with the compressor stations related with the leakage and air pollution. Right now we have not addressed those because it isn't allowed unless they appeal to the gas board. You would have total control and if you found that in favor of a compressor station we could put whatever specific stipulations on individual requests. We know that we will have 2 -3 valve stations added over the next year and we wanted to add the language that would allow us to properly screen that. Page 4 of 7, 07/08/10 GBA minutes Tom Duer asked if the Gas Board is the governing body that decides if the compressor station would be allowed in North Richland Hills as well as location and stipulations? John Pitstick said yes. It is considered an appeal. Tom Duer said that it would be appealing something that doesn't even exist in the city yet? John Pitstick said yes. Our concern was that if we addressed screening around compressor stations then we are making an assumption that we would allow them. So that we are saying that we don't really want to allow those unless there is a specific requirement for an appeal. Garry Cope asked if this would make them change the screening on existing sites for valve stations? John Pitstick said that the only existing site is already properly screened. It is across the creek from the hospital and you would hardly know it is there because it just fits in with everything over there. We are just saying that all above ground appurtenances would have to be properly screened. Those are our only 2 changes. The only two major issues that we see in the future would be potential air quality depending on what TCEQ does or EPA. We are testing each active well with a water test and we have seen trace amounts of any type of distillates or anything. We haven't seen a problem and in our minds the big issues have primarily been around compressor stations and we just want to keep up with air quality issues and if other cities or EPA comes out with guidelines we would certainly adopt those for our community. We don't want to be below the standard. Fort Worth is going through a lot of issues and they have a committee looking into TCEQ. We have 30 wells, Fort Worth has 1000 wells, Mansfield has 400 or 500 so we just want to wait on these. The other one would be future considerations because we think that would help would be green completions. Once they drill a well they have to tie directly into the pipeline. Most of our wells don't have pipelines to them yet. Hopefully once the pipelines get connected we would come forward with changes that would require them to complete the well they would have to tie it directly in to the pipeline. There are a couple days of flaring that we have had and we haven't had a much trouble with that. Those are a few things that we might see changes in the future on. Right now a draft is being presented to you and if you don't have any problems with that it will go to city council. You guys don't have to vote on it but just give us your comments and based upon that we take it to council with your recommendations on this change. Torn Duer asked what prevents a company like Chesapeake of making a larger perimeter? John Pitstick said that it is 150 feet from the outside boundary wall of the pad site. Tom Duer asked what regulates the perimeter? What keeps them from making a much larger pad site that what is needed? Page 5 of 7; 07/08/10 GBA minutes John Pitstick said nothing but they would have to pay for that property. They would have to acquire that easement or property. There is no requirements on the actual pad site. We have heard the upwards of 15 -20 wells per site. Greg Lindsey said that it depends a lot of whether it is a rectangular or more square site. They are just limited to the way they can move the drilling equipment around within the site size. Some of our pads could get up to as many as 20 wells. John Pitstick said that we have 6 well sites right now and we might have 8 or 9 sites total. We could have 20 wells at each site and that might be a pretty substantial number of wells but for the number of well sites I see only 2 or 3 more. Tom Duer asked if once they have determined the outside wall are they pretty much bound to that size. Greg Lindsey said that Graham was expanded. If there was a house at 151 feet from that outside perimeter in that particular direction then they are locked into the location. They couldn't expand their perimeter and have a negative impact on a building once it is permitted. Tom Duer said that it just has to be permitted not even build yet. Randy Shiflet said that one of the things he looks at for the future is technology changes that have gone on since they have started drilling. With the current technology we are looking at 8 or 9 sites with the updates in technology there may be twice as many as that. John Pitstick said yes. Greg Lindsey said that he doesn't know what Chesapeake's figures are but the percentage of product they are getting out of the formation while significant it is relevantly low. It is nowhere near 100% of the gas that is available in the formation. I think that technology is also going to allow them at some point to come in and rework the wells and capture more of the product. John Pitstick said that we have good gas inspectors and things work very well with the Gas Board. We have a good efficient system with very high standards to protect our citizens. Randy Shiflet said that he looks at the fact that we have in house Gas Inspectors which is not common. The fact that our pace has been slow enough that it isn't like going through a growth spell where we had to go through a whole lot of things and then have to go back and fix it. We have been able to migrate along with the changes and had a few bumps and bruises in the beginning. My perspective is that for the past couple years things have been really smooth and these are the folks that are handling the citizens. Page 6 of 7; 07/08/10 GBA minutes John Pitstick said that what he appreciates is that if we get a complaint we are able to forward it on to the Fire Department and they are out there right away and they are able to get things resolved quickly. The gas companies are very responsive and most of the issues we get are noise issues and sometimes you get complaints from '/2 mile away and no complaints from someone real close. Most of the time we have had a good relationship. APPROVED Kathy Luppy, seconded by Garry Copy, motioned to approve the recommended provisions to the changes in the Gas Ordinance. Motion was carried unanimously (5 -0). 6. Adjournment There being no further business, the meeting was adjourned at 6:58 p.m. Chairman Secretary 4 Tom Duer Kathy Luppy Page 7 of 7; 07/08/10 GBA minutes