Produced Water| Session VI - Steve Tarallo
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Produced Water| Session VI - Steve Tarallo

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Sustainable Solutions for Oil & Gas Produced water

Sustainable Solutions for Oil & Gas Produced water

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Produced Water| Session VI - Steve Tarallo Produced Water| Session VI - Steve Tarallo Presentation Transcript

  • SUSTAINABLE WATER AND ENERGY SOLUTIONS BLACK & VEATCH CORP.STEVE TARALLO SUSTAINABLE SOLUTIONS FOR OIL & GAS PRODUCED WATER 24June2013
  • AGENDA • Dealing with Oil & Gas Produced Water: Now vs. Then • Fresh Look at Collaborative vs. Singular Wastewater Solutions • Earlier Barriers to Collaborative Wastewater Solutions are Starting to Ease • Recent Developments Offer a New Forward Look for Wastewater Handling 2
  • 1. Oil & gas development no longer is “remote” • Fields are being developed in more heavily populated areas • Need to mitigate tensions between economic growth and residential life DEALING WITH OIL & GAS PRODUCED WATER: NOW VS. THEN 3 24 June 2013 Produced water is not invisible to modern stakeholders - as it might have been 60 years ago Upper photo: Preparing well site on Daniel Mast's Newcomb Road farm in Parkman Township, Ohio, 2011. http://www.geaugamapleleaf.com/freestory/lack-of-gas-ol-well-driling-control- concerns-commissioners-12-8 Lower photo: Postcard of Amarillo, Texas, ca. 1930s. http://www.allacrosstexas.com/uncovered-texas-postcard- detail?image=OilWell.jpg&city=Amarillo Then … Now …
  • 2. Water no longer can be considered “cheap” • The natural supply of drinkable water is limited and is in demand by a growing population • Droughts are impacting sensitive regions, including shale oil & gas developments DEALING WITH OIL & GAS PRODUCED WATER: NOW VS. THEN 4 24 June 2013 Produced water must be considered in the context of overall water supply and economics for multiple users Upper image: Water auction prices before and after Eagle Ford shale oil & gas development, south Texas. http://fuelfix.com/blog/2013/06/16/fracking-fuels-water-fights-in-nations-dry- spots/ Lower image: Three shale oil & gas plays encountering drought conditions. http://www.droughtmonitor.unl.edu/
  • 3. Disposal of wastewater through underground injection no longer is a “given” • Geology is not supportive everywhere • Public concerns about environmental consequences • Questions about possibilities for re-use – why throw it away forever? DEALING WITH OIL & GAS PRODUCED WATER: NOW VS. THEN 5 24 June 2013 Underground injection of wastewater cannot be done everywhere and the issue now is … should it be done Upper image: Unusual earthquake activity surrounding oil & gas wastewater disposal wells in Ohio. http://thinkprogress.org/wp-content/uploads/2012/01/cnnaerialearthquake.jpg/ Lower image: Pictorial simulation of progressive treatment of oil & gas produced “graywater”. http://www.spe.org/industry/docs/reusingwater.pdf Produced Treated for Re-Use
  • • Traditional approach to handling produced water emphasized singular solutions • Each producer implemented an individual solution • Injection well (conventional oil & gas) • Water treatment modules delivered to the well pad (shale gas) • Water recycling within a single producer portfolio FRESH LOOK AT COLLABORATIVE VS. SINGULAR WASTEWATER SOLUTIONS 6 24 June 2013 Emphasis on fastest solution available to an individual portfolio – almost always a singular fix Producer A Injection Well 1 Producer B Injection Well 2 Producer C Modular Water Treatment at Wellpad 3
  • • Sustainable approach must consider collaborative solutions • Several producers in the same play cooperate in centralized solutions • Shared wastewater treatment facility connecting multiple wellpads • Efforts toward beneficial re-use of treated wastewater FRESH LOOK AT COLLABORATIVE VS. SINGULAR WASTEWATER SOLUTIONS 7 24 June 2013 Efficiencies of scale can offer advantages both in cost control and regulatory compliance Producer A Producer B Producer C Disposal | Re-Use
  • • Mergers & acquisitions provide operational streamlining • Some independent producers now are part of majors (XTO/ExxonMobil, Petrohawk/BHP Billiton) • Larger water infrastructure investments now are more feasible • State regulatory changes are encouraging recycling & re-use which favor collaboration • Lightening of liabilities formerly associated with “pooled” wastewater reduces risks of shared solutions • Ad hoc water markets in resource plays provide transparency needed for collaboration • Water auction bid/ask activity create benchmarks for “market value” of water operations EARLIER BARRIERS TO COLLABORATIVE WASTEWATER SOLUTIONS ARE STARTING TO EASE 8 24 June 2013 Collaborative solutions are more compelling in 2013 than they were in 2007-2008
  • • Pennsylvania • Beginning 2007, in absence of disposal wells, wastewater from Marcellus development was trucked to Ohio for underground injection • Since 2011, wastewater must be reused and recycled, or collected and treated at an authorized wastewater treatment facility • State approval is required before the receiving treatment facility can accept the wastewater for processing and/or disposal • Modular treatment at wellpads became popular as a way around insufficient capacity at fixed treatment facilities • State now an excellent candidate for more centralized treatment facilities designed to accommodate high-TDS wastewater from multiple oil & gas developers RECENT DEVELOPMENTS OFFER A NEW FORWARD LOOK FOR WASTEWATER HANDLING 9 24 June 2013 Regulatory requirement for recycling provides a motivation for collaborative solutions – economy of scale
  • • Texas • Since the 1900s, abundant disposal wells have been the default solution for wastewater – now including the Barnett, Eagle Ford and Permian Basin developments • Disposal wells operated by individual developers • Commercial disposal wells used by multiple developers • In March 2013, State rules for wastewater recycling were amended to make collaborative recycling solutions easier • Recycle defined as “To process and/or use or re-use oil and gas wastes as a product for which there is a legitimate commercial use and the actual use of the recyclable product.” • Waives recycling permit if operators are recycling fluid on their own leases or transferring their fluids to another operator’s lease for recycling • Centralized Commercial Solid Oil and Gas Waste Recycling is defined as a specific option RECENT DEVELOPMENTS OFFER A NEW FORWARD LOOK FOR WASTEWATER HANDLING 10 24 June 2013 Lowering of regulatory hurdles encourages developers to cooperate and move toward centralized solutions
  • • Summary • Sustainable solutions for oil & gas produced water are more important than ever • Disposal wells no longer can be considered the universal solution • Situationally useful but geologically not feasible everywhere • Permanently removes water from the hydrologic cycle • Some bothersome side effects (i.e., earthquakes) • Modular treatment at individual wellpads is not a long-term solution • Situationally useful but challenged with high volumes in large developments • Regulatory progress at the State level is recognizing the importance of recycling and the value of having centralized solutions RECENT DEVELOPMENTS OFFER A NEW FORWARD LOOK FOR WASTEWATER HANDLING 11 24 June 2013 The time is right to explore ways to facilitate collaborative wastewater solutions among multiple developers