The rising production of natural gas from hydraulically fractured wells in Appalachia generates along with it contaminated produced water that must be carefully disposed of. Researchers at Pennsylvania State University say that producers would be wise to consider the environmental risks associated with the most commonly used disposal practice of underground injection, and instead adopt more environmentally friendly and sustainable innovations in water filtration.
The study, Sustainability in Marcellus Shale Development, published by Penn State’s College of Engineering in conjunction with Chevron, notes that produced and flowback water from the prolific Marcellus Shale in Pennsylvania is most commonly disposed of through injection into saltwater injection wells drilled far below the deepest known aquifer.
But although this method is the cheapest available and most frequently used, it brings with it the potential for surface spills and casing leaks that can contaminate freshwater, as well as the risk of activating dormant faults and causing earthquakes.
Disposing Fracked Water
“During the hydraulic fracturing process, water and chemicals are used to stimulate the fissures in the rock in order to extract the natural gas. Water is mixed with sand and other chemicals and then injected into the well. After creating cracks in the Marcellus Shale, flowback water, a brine solution with heavy metals and chemicals, quickly comes back. Typically, this flowback water is stored in tanks or pits before treatment, recycling, or disposal,” according to the report, co-written by Kyle Bambu, Mike Spero, and Harry Polychronopoulos.
The most common way to dispose of this produced water is by pumping it into saltwater disposal wells that are drilled hundreds below the deepest known aquifers. But Pennsylvania’s unique geology is not well suited for such wells. At the time the study was published in Fall 2016, there were 144,000 Class II injection wells in the US and only eight of them were Class II salt water disposal wells in Pennsylvania. These eight wells combined accepted 8,667 barrels per day of brine, while similar wells operated in Texas can each dispose of more than 26,000 b/d of brine.
According to the report, the average cost to dispose of one bbl of fluid can range from as low as 25¢/bbl if the oil company operates its own disposal well, to anywhere from 50¢/bbl to $2.50/bbl if a commercial saltwater disposal well is used. The cost of using disposal is further increased by the cost of transportation.
“In northern Pennsylvania, where commercial disposal wells aren’t plentiful, the brine water may have to be transported to Ohio or West Virginia. This can increase costs by $4.00 to $6.00 a barrel, bringing the net cost of disposal in the Marcellus Shale region to $4.50/bbl to $8.50/bbl,” the study said.
The use of underground disposal wells is not without risk, and frequent concerns include the potential for groundwater contamination and induced seismic activity. In Youngstown, Ohio, the researchers noted that a Class II disposal well for fracking wastewater was linked to seismic activity after it activated a previously unknown fault line. That well was blamed for 10 minor earthquakes, the largest of which is a magnitude of 3.9. A spate of earthquakes in Oklahoma in recent years has likewise been linked to the increased injection of water into disposal wells.
The need to dispose of produced water in Pennsylvania has become more pressing in recent years as natural gas production from the prolific Marcellus and neighboring Utica shales has taken off. Data from the federal Energy Information (EIA) Administration show that output from the shale formations more than tripled Appalachian gas production from 7.8 billion cubic feet per day in 2012 to 23.8 Bcf/d in 2017 (EIA). These plays are credited for driving growth in US natural gas production since 2012 and have played a critical role in enabling low domestic prices and increasing exports.
The Water Filtration Alternative
Researchers note that a number of alternatives to disposal wells are emerging at varying levels of cost. These largely involve treating the produced water to remove its various contaminants, which can include radioactive substances, heavy metals, and high concentrations of salt. Traditional wastewater treatment plants cannot be used because they lack the sufficient processes needed to clean this water.
The most cost competitive alternative to underground injection highlighted by researchers is the option of using a membrane to clean the brine produced water. The company Oasys Water offers a system that drives the brine solution through a series of semi-permeable membranes at a cost of nearly $2/bbl of water. The water that emerges from this process is clean enough to be discharged into streams or drainage systems.
Other potential treatments on the horizon that require further research include the option of boiling the water. However, researchers note that the cost of using this process can run upwards of $17/bbl and the heavy salt causes extreme wear and tear to the requisite industrial boilers, resulting in massive equipment replacement costs.
Lastly, the study says the process of electrodialysis could be used to separate water from contaminants. Researchers at the Massachusetts Institute of Technology have found that an electrical current can be used to separate fresh water from a salty solution. Salt is an effective conductor of electricity and successive stages of electrodialysis can remove most contaminates. But this process has not been tested in the oil and gas industry and there are not commercial treatment options available.
Researchers ultimately concluded that while the common practice of injecting produced water into disposal wells is relatively cheap, this practice comes with high environmental risks. These risks include the potential for groundwater contamination that is caused by surface spills or breaks in the tubing for saltwater disposal wells and even induced seismic activity.
At present, the impetus for improving produced water disposal practices is driven primarily by the sustainability practices of each producer and not government regulations. Researchers found that the oil and gas industry is exempt from some of the most stringent federal environmental regulations, like the Safe Drinking Water Act the Clean Water Act, but noted that states have been working to impose their own rules to address areas of concern. For instance, Pennsylvania in recent years adopted new guidelines intended to prevent spills and releases of harmful substances.
Today’s Best Option
The study ultimately recommends Oasys Water’s membrane filtration as the best option for disposing of produced water today. Researchers said that while using this method can result in slightly higher costs for water treatment and transportation, it appears to be the most sustainable solution until other technological advances are advanced in the future.
“This (membrane) system was recommended because of its relatively cheap cost yet adherence to sustainability and environmentally friendly concerns,” the study said.
To read a PDF of the Penn State study, click here.
Published on Feb 7, 2017
By Milana Vinn
Managing complicated repairs remotely saves oil companies time and money
Replacing parts of an outdated Baker Hughes turbine at a petrochemical plant in Johor Bahru, Malaysia, is about as fun as it sounds. The chore was supposed to halt operations at the facility for at least 10 days and cost $50,000 to fly a specialized U.S. work crew about 9,000 miles. Instead, once the equipment upgrade began last year, it took only five days and zero air travel—just an on-site technician wearing a dorky helmet camera and a few American engineers supervising remotely. They watched and coached the local crew through the helmet from a Baker Hughes site in Pomona, Calif.
Augmented-reality headsets, which overlay digital images on a real-world field of vision, are driving advances in industrial technology a few steps beyond FaceTime. While the likes of Apple, Amazon.com, Google, and Microsoft race to develop mainstream AR consumer gadgets in the next couple of years, they’ve been outpaced by oil companies looking for ways to cut costs. Some are simply buying the goggles and building custom software; others are investing directly in AR startups; still others are making the hardware as well. Baker Hughes, a General Electric Co. subsidiary, calls its rig a Smart Helmet. “Traditionally I would have to pay for two people’s travel, two people’s accommodations, and so forth to visit the customer’s site to do the mentoring,” says John McMillan, a regional repairs chief at the company whose team uses the helmet regularly. “It’s saved me a lot.”
Baker Hughes co-created its AR headset with Italian developer VRMedia S.r.l. and wrote its own software. BP Plc says it’s using AR glasses to bring remote expertise to sites across the U.S. Startup RealWear Inc.says it’s signed two dozen other energy companies, including Royal Dutch Shell Plc and Exxon Mobil Corp., to test its $2,000 headset. On March 6, AR software maker Upskill announced a fresh $17 million in venture funding from Boeing Co., Cisco Systems Inc., and other investors.
Remote gear can help experienced workers stay on the job even if they can no longer handle the travel or other physical demands of rig maintenance. “With these technologies, it’s more about the people than the hardware,” says Shell Executive Vice President Alisa Choong. Janette Marx, chief operating officer for industry recruiter Airswift, says remote work is also a good sales pitch to skilled technicians who might be lured by cushier gigs in Silicon Valley.
The bigger prize for oil companies is reduced downtime for equipment. Each day offline for a typical 200,000-barrel-a-day refinery can mean almost $12 million in lost revenue. Offshore oil and gas facilities often halt operations while waiting to fly specialists in by helicopter and, according to industry analyst Kimberlite International Oilfield Research, shut down 27 days a year on average. Little wonder, then, that analyst ABI Research estimates energy and utility companies’ annual spending on AR glasses and related technology will reach $18 billion in 2022, among the most of any industry.
Remote AR work doesn’t always go smoothly. Oil rigs often lack reliable wireless networks, and many headsets don’t yet meet the strict standards for areas near hazardous materials or high-risk jobs. Under certain conditions, for example, the headsets might emit dangerous sparks. That’s one reason many of the oil companies’ pilot programs remain just that for now.
Baker Hughes hasn’t had to worry about those issues yet, says John Westerheide, director of emerging technologies. In Malaysia, engineers were able to view equipment, send images to the headset screen, and talk directly to the on-site workers with few hiccups. “The way that we currently go to work,” Westerheide says, “that’s going to become much more virtual, interactive, and collaborative.” —With David Wethe
Increased awareness of methane’s impact on the environment is leading to increased monitoring for methane leaks. In order to reduce the amount of methane emitted into the atmosphere, we need better detection technologies. Last summer, EDF collaborated with the world’s largest oilfield service company – Schlumberger – to test a variety of stationary and hand-held technologies to detect methane leaks from equipment in the upstream oil and gas sector. To learn more about how technology and innovation can help solve the methane problem visit business.edf.org.
Published on Mar 29, 2018
The MOTIVE™ Bit Guidance System is a decision automation tool that has proven to significantly improve drilling performance. This automated system works in real-time to balance different objectives when making steering decisions. The system takes into account each decision’s impact on drilling speed, tortuosity, and future production potential. The patented system considers rotary tendencies, motor yield, motor potential, the skill of the driller, geosteering adjustments, nearby wells, lease lines, geology, and directional drilling limits set by each operator.
Chevron’s San Ardo oil field in Southern California recovers more than 10,000 barrels of heavy oil each day. The oil extraction process generates large volumes of produced water that require treatment and management, typically disposed of by deep well injection. Chevron engaged Veolia’s water treatment technology, engineering and operations experts to provide a new solution for sustainably treating the produced water. This would allow Chevron to minimize its water impact, while maximizing efficiency and significantly expanding production.
Southern California Refinery Case Study
PDF – 2.12 MB
To achieve this, Veolia provided Engineer-Procure (EP) services and operates a produced water management facility at this oil field that features the first-ever installation of Veolia’s OPUS® (Optimized Pretreatment and Unique Separation) technology. In this case, Chevron San Ardo’s treated water is used in two ways – reused for steam generation, and released into aquifer recharge basins that replenish local water resources and allow Chevron to recover more oil. The reliable operations & maintenance of the plant is backed by a Veolia performance guarantee.
The process of extracting oil from the ground generates a volume of water that can range from 10 to 20 times the oil production rate. Historically, a portion of this water had been recycled and softened for reuse in steam generation, with the remainder going to local EPA class II injection wells for disposal. However the injection zone capacity is limited, which constrains full field development and daily production levels.
The raw produced water for this oil field is 200°F, and contains about 25 ppm free oil, 80 ppm TOC, 240 ppm silica, 26 ppm boron, 240 ppm hardness and 6,500 ppm Total Dissolved Solids (TDS). The project goal was to reduce the feed water TDS to less than 510 ppm and boron to less than 0.64 ppm for discharge, while achieving 75% water recovery across the treatment system and minimizing the volume of produced water requiring re-injection. For steam generation, the project goal was to reduce the feed water hardness to less than 2 ppm total hardness as CaCO3.
Veolia provided Chevron with the first produced water facility in the world to use its OPUS® technology, a multiple-treatment process that removes contaminants sufficiently to meet the established requirements for discharge. The technology and services provided by Veolia enables the plant’s entire water cycle to be managed in a truly sustainable way, while simultaneously expanding oil production capacity.
Since the plant was commissioned in 2008, Veolia has operated and maintained (O&M) the facility for Chevron. Under its O&M contract, Veolia provides operations for the plant, which treats a combined 150,000 barrels of produced water daily, and oversees the facility’s maintenance according to an established performance guarantee. Additionally, Veolia provides Chevron with on-site and off-site technical and engineering support to troubleshoot issues, maintain optimal operations, prevent failures and implement processes to help maximize oil production.
Veolia’s innovative application of its OPUS® technology – groundbreaking for produced water management – has delivered exceptional value back to Chevron San Ardo. By developing a sustainable solution that allows up to 50,000 barrels per day of produced water for surface discharge and another 75,000 barrels per day for steam generation, Chevron is minimizing its environmental impact on water-stressed California by returning water to the aquifer recharge basins. And by avoiding deep well injection, Chevron has a long-term solution for managing produced water that limits its regulatory risk and supports expanded production activities.
Thanks to Veolia’s expert operations & maintenance staff who run the facility for Chevron, the produced water is consistently treated to levels that allow for surface discharge to replenish local water resources – a critically important factor for oil field operations and their social license to operate in California. With plant operations handled by Veolia and backed by a performance guarantee, Chevron can focus on its core operation of oil production.
By partnering with Veolia, Chevron San Ardo accomplished its objective of achieving a more circular, sustainable and reliable business operation.
December 2016, McKinsey & Company, www.mckinsey.com. Copyright (c) 2018 McKinsey & Company. All rights reserved. Reprinted by permission.
Organizational choices made during a time of resource scarcity need reexamination when the cycle turns.
When business cycles turn, cyclical industries can struggle to retool their organizations for the new environment. For instance, today’s oil and gas companies were developed in a time of resource scarcity. To get at those hard-to-find, difficult-to-develop resources, companies greatly expanded the role of their central functions—mandating them to set common standards, make technical design decisions, track company-wide metrics, and disseminate best practices. This worked well during a decade of high growth and high prices but created complexity that added costs, stifled innovation, and slowed down decision making. As these central teams expanded, general and administrative costs grew fivefold, hitting nearly $5 per barrel in 2014 (exhibit), with the biggest increases coming from technical functions such as engineering, geosciences, and health and safety.
With prices now below $50 a barrel, that organizational blueprint is no longer sustainable. While companies have cut their support functions since 2014, the overall organizations supported by these functions are also smaller. This suggests further reductions in corporate functions will be needed, as well as new organizational models.
A more agile organization, with fluid teams and looser hierarchies, can lower costs and create greater responsiveness to today’s vastly different markets—ranging from megaprojects to less asset-heavy unconventional shale-oil and renewable-asset plays. Technologies such as networked sensors that generate and share data can help optimize production processes, while digitally enabled automation of routine manual activity can reduce human risk and spur productivity. Critically, the structures built to manage scarce talent and large-scale megaprojects will need to be fundamentally redesigned. We see two models arising: for lower-risk assets such as tight oil, a very lean corporate center with highly autonomous asset teams will suffice, while higher-risk, more capital-intensive assets will need a comparatively stronger center with deeper functional and risk-management capabilities.
For additional insights, see “The oil and gas organization of the future.”
- Builds on Global Climate and Energy Project’s 15 years of success
- Strong science and exploratory research to develop low-carbon energy solutions
- $20 million commitment in addition to ExxonMobil’s GCEP investment of more than $100 million
- Expands company’s collaborative work with academic and research institutions around the world
IRVING, Texas–(BUSINESS WIRE)–Exxon Mobil Corporation (NYSE:XOM) today announced that it will become the first founding member of the new Stanford Strategic Energy Alliance, an initiative that will examine ways to improve energy access, security and technology while reducing impacts on the environment. As part of its commitment, ExxonMobil will contribute $20 million in funding over five years to research and develop lower-carbon energy solutions.
The Stanford Strategic Energy Alliance builds on the success of the Global Climate and Energy Project (GCEP), also led by Stanford, which focused exclusively on low-emissions, high-efficiency energy technologies. ExxonMobil has sponsored GCEP since its inception in 2002 with a commitment of $100 million and additional contributions toward specific projects. In its 15 years of work, GCEP has evolved into a pioneering collaboration of scientists, engineers, researchers and students focused on identifying breakthrough low greenhouse gas emission energy technologies that could be developed and deployed on a large scale.
“ExxonMobil has worked with Stanford to advance low-carbon technologies over the last 15 years, and we’re excited to be the first founding member of this new endeavor,” said Bruce March, president of the ExxonMobil Research and Engineering Company. “Identifying scalable solutions for addressing the dual challenge of supplying energy to meet global demand while minimizing the risk of climate change is one of our core missions. We are continuously looking for ways to improve existing supply options and manufacturing processes while managing carbon intensity.”
Since its creation, GCEP has sponsored more than 100 research programs in the United States, Europe, Australia, China and Japan, and has resulted in over 900 papers in leading journals and more than 1,200 presentations at conferences. Building on fundamental science, significant advances have been made in the areas of photovoltaic energy, renewable and lower carbon fossil fuels, batteries and fuel cells. More than 60 technologies have also been developed and 15 patents have been issued. Multiple companies have also started up as a direct result of or inspiration from GCEP research.
The new Stanford Strategic Energy Alliance will pair industry alliance members and Stanford professors who share common research objectives across the spectrum of energy topics from science and engineering to policy and business. Managed by the Stanford Precourt Institute for Energy, the alliance will also fund some early-stage research at the direction of its faculty leadership.
ExxonMobil’s support for the Stanford Strategic Energy Alliance expands the company’s collaborative efforts with other academic and research institutions that are focused on developing an array of new energy technologies, improving energy efficiency and reducing greenhouse gas emissions. The company currently works with about 80 universities in the United States, Europe and Asiato explore next-generation energy technologies, including founding members of MIT Energy Initiative, Princeton E-ffiliates Partnership and University of Texas at Austin Energy Institute.
Source: Exxon Mobil Corporation
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By Luis Gamboa, Oil & Gas Business Development Manager, Rockwell Automation
In late November, Nabors Drilling, the largest land drilling rig contractor in the world, invited a few members of Rockwell Automation staff and the media down to Houston, Texas, to see the latest innovations they’ve made in drilling automation to improve drill time, accuracy and efficiency while enhancing worker safety.
Our tour included a look at the services Nabors provides to support rig operation remotely, new software solutions Nabors is engineering to automate drilling navigation, and a visit to a rig build site to tour a SmartRig™.
The first stop on our tour was the Rigline 24/7™ operations center: a glass-walled area where expert technicians remotely monitor the status of hundreds of drilling rigs in operation all over the globe.
The technicians can view KPIs like rate of penetration, directional path, weight on the drill bit, torques, fluid flow rates and various other parameters throughout all phases of the well construction process.
We visited the largest land drilling rig contractor in the world to see how they are using the latest technology.
They watch for alerts of rig issues, answer phone calls from rig operators who have questions, and intervene if a “red-status” is created. The Rockwell Automation FactoryTalk® suite of information solutions is used to capture all the rig data in real time, and contextualize and display it as useful information.
The level of expertise the staff can provide from afar is impressive – some of the rigs are even equipped with video cameras in key places to provide visual insight in addition to the data coming in from the controllers on the rig. This allows experts to operate the rig remotely from Houston, if needed.
Next, we stopped down in the software simulation area to learn about the software Nabors has developed to automate navigation, including directional drilling. Nabors sought to fix an industry issue that was causing extra expense and downtime during the drilling process: the need to bring an experienced directional driller on-site when it was time to execute a slide, and the variability associated with relying on human operation.
In the software simulation area, Nabors has a full drilling operator station set up so engineers can test the constraints of this new software, and also to allow for operator training on how to use it. We got a peek at the ways Allen-Bradley PACs and motor control centers are powering the drilling equipment and feeding data to the software to help automate control of the rig equipment and enable this more efficient and accurate drilling.
Finally, it was time to drive 40 minutes over to Crosby, Texas, to see a Nabors SmartRig in person. The rig stood an impressive 90 feet tall, with the platform, operator cab, and e-house standing 45 feet in the air.
The rig we saw was a walking side-saddle design, with automated pipe racking capability: which means the pipe can be racked without any human intervention off on the side of the rig.
When drilling a multiwell pad, the entire rig can be walked in any direction to drill the next well without needing to disassemble or move the racking equipment out of the way.
We’re getting closer to seeing completely automated, remotely monitored drilling rigs – which opens up a ton of possibilities.