Monday, 16 August 2010

Water Treatment Key to Hydraulic Fracturing's Future -Points to BioLargo Technology Opportunity


Water Treatment Key to Hydraulic Fracturing's Future
Rigzone Staff|Tuesday, August 10, 2010

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The Marcellus shale gas exploration rush that has washed over Pennsylvania has created concerns over how hydraulic fracturing impacts local water supplies.

A single well hydrofracture in the Marcellus may require two million to five million gallons of fracturing fluid, of which an average of 25 percent may be returned to the surface as "flowback" or "produced water." Historically, flowback and produced water has traditionally gone to metals-precipitation plants, where metals and items are removed. The fluid that leaves the plant is clean salt brine, which has gone to sewage treatment plants where the salt is not removed, but diluted with treated sewage and discharged to the rivers.

In the past, this was never an environmental concern as the salt levels were very low and did not harm the environment. However, the sharp rise in Marcellus shale drilling in recent years means that the amount of water from shale gas operations being released into state waters would grow from a trickle to a tidal wave.

To address the issue of TDS levels in recycled water, the Pennsylvania Independent Regulatory Review Commission on June 17 passed new stringent treatment regulations for the recycling of flowback and produced water in the Marcellus shale. The ruling, which takes effect in January 2011, mandate a maximum of 500 parts per million (ppm) TDS and 250 ppm chlorides in water discharged into the state's water supply.

The amount of produced water generated by drilling will likely increase as oil and gas companies continue drilling the Marcellus shale play, which contains an estimated 489 Tcf of gas.

Recycling solution
Fountain Quail Water Management, a Fort Worth, Texas-based subsidiary of Calgary-based Aqua-Pure Ventures Inc., recently partnered with Eureka Resources of Williamsport, Pa., to offer wastewater recycling to shale gas drillers in Pennsylvania.

Last month, Eureka opened its expanded 60,000-square foot water treatment facility in Williamsport, which will be capable of recycling up to 200,000 gallons of wastewater every day. Eureka plans to add additional capacity at the facility later this summer. Customers include Range Resources, XTO Energy and Chesapeake Energy.

Brent Halldorson, chief operating officer of Fountain Quail, said Fountain Quail's technology, originally developed by Aqua-Pure for use in northern Alberta's oil sands, offers a cost-effective solution for recycling wastewater in the Marcellus.

Fountain Quail said it is currently recovering an average of 75-80 percent of pure distilled water from the Marcellus shale wastewater it receives, with total dissolved solids (TDS) measuring well below 150 ppm and only trace chlorides. Under current treatment processes, most of the TDS present in flowback water are not removed during conventional water and wastewater treatment at municipal facilities and flowback will contaminate waterways.

"Our recycling technology is achieving results that many people in the industry thought were impossible," said Brent Halldorson, Fountain Quail's chief operating officer. "Our evaporators are capable of producing pure distilled water, regardless of the feed composition. The only difference is in our recovery rates."

Fountain Quail's NOMAD evaporator, which utilizes the Mechanical Vapor Recompression Evaporation Process, can create 2,000 b/d of distilled water. In this process, the feed water is boiled to produce steam, leaving behind all dissolved solid contaminants. The steam is then condensed into pure distilled water. The process is far more efficient than running a boiler, taking only 1/40 of the energy a boiler requires.

The explosion in shale drilling and lack of treatment/disposal facilities means many operators in Pennsylvania have had to transport wastewater from shale drilling up to 10 hours away to Ohio injection facilities for disposal. Wastewater also is being stored in large pits in Pennsylvania, but this has raised concerns among local residents about odors and effects of chemicals emitted from these pits. The Eureka facility will eliminate the risk associated with trucking wastewater long distances, which increases the risk of leaks and spills.

The great challenge with treating flowback wastewater from shale wells is the variability of contaminants in the water. Current methods for treating wastewater, including membranes and ion exchanges, work when treating water with consistent levels of specific contaminants. The variability requires machinery to be constantly cleaned, recalibrated or for treatment to fail altogether. Water in the early stage flowback is likely very contaminated, while later flowback will typically have more salt it picks up from the ground.

Companies such as Range Resources report that they take 100 percent of flowback and produced water and recycle by diluting the water and using on other shale wells. Range is pre-treating all of its water either at a facility such as Eureka Resources' or others in Pennsylvania. Range spokesperson Matt Pitzarella said the company also believes operators will eventually employ onsite equipment that pre-treats the water for reuse. "It's not only a better environmental solution, but it also saves us money," the company said in a recent conference call.

Halldorson said the long-term solution may be a mix of onsite recycling and centralized treatment of wastewater, but the economics and decision of regulators in each state will determine that mix. In Pennsylvania, the company is releasing treated water back into rivers but also offering it to producers for use in fracturing wells.

Barnett, Fayetteville Shale
Fountain Quail in the last six years has recycled more than 500 million gallons of Devon Energy's wastewater associated with Devon's Barnett Shale activity in north Texas. The treated water, which would otherwise have been injected into disposal wells and permanently removed from the hydrological cycle, is instead re-used in Devon's drilling operations in the Barnett.

Shale drillers in the Texas Barnett shale have the advantage of very abundant disposal formations. Salt water is typically injected into a disposal well into the Ellenberger formation, which underlies the Barnett shale. The disposal wells provide a low-cost solution for flowback and produced water.

Fountail Quail's experience with Devon has allowed Fountain Quail to learn to treat wastewater from a company that pioneered shale gas drilling. This experience will enable Fountain Quail to treat flowback and produced water from other shale formations. Halldorson said its no-incident track record in Texas has earned it the trust of the Texas Railroad Commission and a long-term permit to treat wastewater in the state.

In two months, the company will begin operations in Arkansas, where land has been purchased for a facility site north of Conway near Little Rock, and permits have been obtained. Fountain Quail spent the past two years working with the Arkansas Department of Environmental Quality (ADEQ) to demonstrate its capability in treating wastewater from Fayetteville shale drilling in the state. "The ADEQ studied our distilled water in their own labs and came to the conclusion that it is cleaner than river water and will actually benefit rivers in Arkansas."

In Arkansas, wastewater from shale wells was being disposed of at land farms, or facilities that accepted water-based fluids and mud. At the land farms, which contain storage ponds, storage tanks, application fields, and monitoring wells, drilling solids and drilling mud were being spread on the ground to biodegrade.

However, ADEQ shut down 11 of the 13 land farms in the state in April 2009 following inspections of these facilities, noting that soil chloride concentrations exceeded permitted levels and that oil-based drilling fluids had been applied at some sites, which was not allowed under the permit issued. The sodium adsorption ratio found in some soil indicated that some farms would need to cease application on some fields and some fields may have been irreversibly damaged, ADEQ said in an April 2009 report.

Halldorson anticipates a higher recovery rate of 95 percent in Arkansas because the water is less salty compared to Marcellus water, which is saltier due to the formations. In the Barnett shale, Fountain Quail averages 80 percent to 85 percent recovery of distilled water from the saltwater.

The company is interested in the Eagle Ford shale in Texas and the Horn River shale play in northern British Columbia, and plans eventually to be in every shale play in North America. "We've operated on very thin margins in the Barnett, but that experience has prepared us well for our expansion into the Marcellus and Fayetteville shales," said Halldorson.

* Remember to read the earlier post by BioLargo describing our role in this industry segment.

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