Texas’ State of Produced Water: House Committee Urged To Re-Think “Waste”
Cynthia and George Mitchell Foundation
February 7, 2019
With some experts saying Texas water will be a continually-more precious resource in the future, the joint House committees of Energy Resources and Natural Resources heard from companies and individuals on Wednesday about efforts to recycle water, a resource that’s now being used in the billions of gallons by Texas oil and gas industries.
Perhaps the most comprehensive effort to recycle used water comes from privately-owned West Texas Fasken Oil and Ranch Ltd., which has advantages over many of the larger oil producers, particularly in its large contiguous parcels of land and indigenous water supplies.
Facilities and Resource Manager Bo Farris said the Midland company’s management as early as 2013 called for ending the use of fresh water in the many wells the company operates, spurring experimentation in filtering and treating the water contaminated in the drilling process, called “produced water.”
Fasken’s company tried treating brackish water that no one wanted for other purposes, then tried “stand-alone oxydation” methods using peroxide, none of which was cost-effective, and tried using filters that Farris said were “high maintenance” and “not very efficient.”
In the search for a cost-efficient method of treating produced water, the company began using chlorine dioxide to remove iron, Ferris told commissioners, and is now able to recycle its oil and gas vertical well drilling water, treating 10,000 barrels per day at a cheap 75-cents per barrel.
The process does produce some byproduct that must be disposed of, but the company continues to ramp up and should be treating and recycling 50,000 barrels a day sometime soon, with two-thirds of its more than 3 million fracking-related barrels of water under treatment as well.
And Farris noted the company has been winning environmental awards along the way.
Cimarex Experimented With Different Methods Too
At Denver-based Cimarex Energy, efforts were a little slower, but then few companies have the ability to treat produced water using large nearby resources as the acreage-rich West Texas Fasken Oil and Ranch Ltd. has done.
Cimarex Water Resources Manager Robert Huizinga told commissioners on Wednesday that it pushed through the process of removing suspended solids and then dissolved solids in produced water to mixed results.
Suspended solids are, put too simply, the stuff you can see floating in water, dissolved solids are the stuff you can’t see.
The results weren’t cost-effective, Huizinga said, producing solid waste that had to go to landfills and using natural gas that was an added cost.
After years of trial and error that began in 2013, the company settled on removing only suspended solids from the produced water, then adjusting the chemical balance in its drilling methods to utilize the treated water, and putting the water through filters.
Unlike the previous methods that called for holding tanks and expensive water transportation, filters allowed the processing efforts to be mobile and treat the water faster for quicker recycling, creating an “on the fly” system.
Huizinga said Cimarex in 2016 pumped 3.7 million barrels of produced water, 23% of it recycled, with the rest brackish or fresh, upping that number to up 61% recycled in 2017 — upping that to 67% last year.
Marathon, Unlike Some Others, Has Wells All Over — A Challenge
For companies that have parcels of land here and there, even large ones, it can be a lot trickier recycling backflow or produced water, as Marathon‘s Water Management Technical Advisor Kerry Harpole told commissioners.
The Houston-headquartered company has assets in Oklahoma, the Permian Basin, the Bakken play and the Delaware in New Mexico, and they tried treating water in South Texas and recycling water in the Permian, but at hundreds of dollars per truckload using brackish water from near or far sources was not feasible for large fracking jobs, so recycling efforts continued.
Harpole said there is satisfying progress so far — Marathon’s only been in the Permian Basin for a year and a-half but has gone from half a million barrels of its water recycled a year ago to a full million recycled as of late.
The Economics
More than other factors, the economics of recycling produced water has been a major factor.
Like the slow elimination of coal from power production in America, the slow effort to recycle water in Texas signifies market forces at work.
Even when it’s cheaper to put used fracking water down a hole, companies have large concerns about the environment, about “seismic potential” (the possibility of earthquakes) and the economics of trucking in water from far away — which is a special concern in the dry and expensive Permian.
Recycling can potentially save a company money in the production process, which in the case of fracking, is staggeringly costly.
And then there’s what to do with the water once it’s recycled, which calls for intensified water management.
“When you make a lot of water, its a lot of money,” Harpole observed.
Industries are trying hard to work together as part of the recycling effort, Harpole also observed, and “if I have a bunch of water and another company needs it” they can talk about terms.
Some companies are making creative arrangements to procure cleaned water.
Pioneer Natural Resources even made a deal with the city of Midland in 2016 to make improvements to the city’s wastewater treatment plant, with the company getting reclaimed water from the plant in return.
That averted an increase in Midland taxes to improve the plant, reduced oil truck traffic as the water is piped out of the city and gave the city extra spending money.
And the number of permitted independent commercial produced water recyclers is growing pretty fast (see The Texas Energy Report article “RRC Permitting, Water Recycling and Earthquake Data Explained at Joint Texas House Commission Hearing” below).
Some Say Government Policy Isn’t Keep Up
There are of course other factors, speakers told commissioners on Wednesday, in getting produced water recycling up to speed.
Perhaps the most important is governmental policy.
While the Railroad Commission has made it easier for well operators to lay down some water delivery lines and eliminated in some cases the need for extensive permits in creating environmentally-friendly recycling pits (the specs for which are drawn by the RRC) recycling can be a bureaucratic challenge.
There are about 100 water conservaton districts in Texas, Marathon’s Harpole said, each with its own policies and procedures that can make permits and permissions take years.
More than one speaker to commissioners on Wednesday called for an entirely new outlook on water.
Streamlining the permit processes would help especially on a local basis, they said, but there are technologies already in place and growing that some government agencies aren’t even considering, such as desalination.
And there are other reasons beside economics that make recycling produced water a challenge, speakers noted, such as differences in geography (especially for companies with diversified land holdings), disparate water sources, local laws, private property concerns, physical risk and insurance risk.
The Push For Out-Of-State Tech Is On, Environmentalist Is Not So Sure
Luke Metzger from Environment Texas reminded commissioners that a Duke University study found water use in the Permian Basin had increased 737% between 2011 and 2016, and 100 billion gallons of water will be used in oil exploration and production next year statewide — more than the total used by the city of Austin in one year.
He entreated commissioners to “not leap before looking very, very closely” in making changes in the treatment of produced water.
Drillers need to use more brackish water, he said, and reduce the amount of fresh water still being used, citing an expert who told him no more than 10% of produced water is being recycled today in the Permian Basin.
From Pennsylvania — a state where site disposal of produced water is not feasible, it’s either recycle or dispose of that water in another state, often Ohio — Daniel Ertel of Eureka Resources called for a new view of water, not just as a resource but as a potential commodity.
The iron, calcium chloride, lithium and residual oil that can be filtered out of produced water can be harvested for use in American markets, reducing the amounts of such commodities that are imported.
Ertel is the CEO of Eureka, which joined with Houston’s Haddington Ventures LLC for funding nearly eight years ago.
In Pennsylvania, where the company is headquartered, it already recycles 15,000 barrels per day of produced water, Ertel said, recovering minerals and removing contaminants, and it can do the same thing here in Texas.
He said his water recycling product — which can be treated at about 50-cents per barrel — is clean enough that it’s earned permits to discharge the water into the Susquehanna River, clean enough that it can recharge aquifers, replenish natural habitats and even create jobs along the way, he told the commissions.
And Mark Ellison spoke for desalination.
His IDE Americas, an Israeli company that began removing the salt and contaminants from water back in the early 1960s because Israel is so arid, is also looking to move into Texas by recycling produced well water.
He echoed Ertel in telling commissioners on Wednesday to stop thinking of used water from oil and gas wells as “waste,” when it can be recycled and components reused.
Ertel referred to the iron and other particles in such water not as byproducts but co-products.
At IDE, Ellison said his company is ready to use desalination to clean up water near the wellhead and is even working on the ability to use flaring natural gas to power that recycling.
The concept for the future, as Ertel put it, is a “closed loop.”
“Incentivize the product, then utilize the co-products.”
Ellison, too, called for governments to rethink the use of water, with technological advances now moving faster than bureaucracies and leaders can keep up.
Tech has overcome policies that were developed years ago, and in this case the question, he said, is not can we do it, but in what large volumes?
And how can the product of recycling be sold, and how can it be put to good use?
Environment Texas’ Metzger offered a different view, though: Right now, disposal wells need to be eliminated.
They can fail, just as they did in the Midland area in 2005, contaminating areas around them.
And produced water contains a lot more contaminants than we’ve considered here, he added.
There are “1600 chemicals in produced water,” he said as he wrapped up testimony before the commissioners.
“The EPA can detect only 400 of them, the Safe Drinking Water Act covers only 89 of those chemicals.
“Don’t buy the claims that treated water is fresh and safe until independent research proves its safe.”
The Texas House Energy Resources Committee Chair Chris Paddie and Natural Resources Committee Chair Lyle Larson called the joint meeting to refresh the committees’ memories on the state of water in Texas oil and gas production, and to introduce new committee members to the state of Texas water.
And with “water is the new oil” spoken so often it’s becoming cliche, committee members now have at least a session’s worth of questions to consider — and try to answer.
— Mike Shiloh
