produced water| session vi - steve tarallo

Download Produced Water| Session VI - Steve Tarallo

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Sustainable Solutions for Oil & Gas Produced water



2. 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 3. 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. concerns-commissioners-12-8 Lower photo: Postcard of Amarillo, Texas, ca. 1930s. detail?image=OilWell.jpg&city=Amarillo Then Now 4. 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. spots/ Lower image: Three shale oil & gas plays encountering drought conditions. 5. 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. Lower image: Pictorial simulation of progressive treatment of oil & gas produced graywater. Produced Treated for Re-Use 6. 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 7. 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 8. 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 9. 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 10. 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 operators 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 11. 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


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