Monday, 27 September 2010

Halliburton Hunts New Bacteria Killer to Protect Shale-Gas Boom (March 2010) - Points to BioLargo Opportunity- (11-10 Clash with EPA Escalates)




Halliburton Hunts New Bacteria Killer to Protect Shale-Gas Boom
March 29, 2010, 12:38 AM EDT

Link Here

By David Wethe

March 29 (Bloomberg) -- Halliburton Co. and Schlumberger Ltd., trying to forestall a regulatory crackdown that would cut natural-gas drilling, are developing ways to eliminate the need for chemicals that may taint water supplies near wells.

At risk is hydraulic fracturing, or fracking, a process that unlocked gas deposits in shale formations and drove gains in U.S. production of the fuel. Proposed regulations might slow drilling and add $3 billion a year in costs, a government study found. As one solution, energy companies are researching ways to kill bacteria in fracturing fluids without using harmful chemicals called biocides.

“The most dangerous part in the shale frack is the biocide,” said Steve Mueller, chief executive officer at Southwestern Energy Co., the biggest producer in the Fayetteville Shale of Arkansas. “That’s the number-one thing the industry is trying to find a way around.”

U.S. House and Senate bills introduced in 2009 would force producers to get federal permits for each well. That and other proposed environmental measures would cut drilling by as much as half and add compliance costs of as much as $75 billion over 25 years, according to a study done for the U.S. Energy Department.

Biocides are employed because the watery fluids used to fracture rocks heat up when they’re pumped into the ground at high speed, causing bacteria and mold to multiply, Mueller said. The bacteria grow, inhibiting the flow of gas.

“You basically get a black slime in your lines,” he said in an interview. “It just becomes a black ooze of this bacteria that grew very quickly.”

Ultraviolet Rays

Halliburton and Schlumberger, the world’s largest oilfield contractors, are among companies seeking biocide substitutes. Houston-based Halliburton said March 9 that it’s testing a process using ultraviolet light to kill bacteria in fracking fluid.

About 80 percent of gas wells drilled in North America are stimulated or fractured in some way, Tim Probert, corporate- development chief at Halliburton, said in a telephone interview.

“It’s incumbent on the industry to continue to develop tools and technologies that are compatible with minimizing the environmental impact of the stimulation process,” Probert said.

Houston-based ConocoPhillips, the third-largest oil company, said March 9 that the world has centuries of gas supplies, largely in unconventional deposits such as shale.

Schlumberger, based in Houston and Paris, spoke with Southwestern about testing a biocide that would last only a few hours before becoming nontoxic, Mueller said. “We have not tested it,” he said. “We only know they’re working on it.”

Ultrasonic Fluid

Schlumberger spokeswoman Mary Jo Caliandro, who confirmed the company is testing new technology, declined to comment on any advance before it’s “commercial.”

Houston-based Southwestern has tested an ultrasonic technique that moves water faster than the speed of sound through a cone-shaped vortex to kill bacteria before the fluid is sent down the well, Mueller said.

“At high speeds, something will happen called cavitation,” he said. “You’re basically smacking the bugs upside the head and killing them.”

Chemicals, including biocides such as chlorine, make up less than 1 percent of fracking fluids. The rest is water and sand. Companies haven’t identified the chemicals they use, citing competitive reasons. Advocacy organizations such as the Environmental Working Group in Washington have called for lawmakers to require energy companies to disclose the chemicals.

Disclosure Issue

“I think the industry’s going to have to be more transparent,” Steven Farris, CEO at Houston-based Apache Corp., the biggest independent U.S. oil producer by market value, said March 22 at the Howard Weil Energy Conference in New Orleans. “‘You can’t say, ‘Trust me.’”

Gas producers are realizing they have to find ways to clean and recycle the water used in hydraulic fracturing, said George P. Mitchell, the Houston billionaire who pioneered development of shale gas in the Barnett formation of North Texas.

“I think a lot of action is going on to get that done,” Mitchell said in a telephone interview. “It’s not an insurmountable task.”

Environmental issues generally begin to be addressed after companies realize there will be a financial cost if they don’t act, said Geoff Kieburtz, an analyst at Weeden & Co. in Greenwich, Connecticut. “The oil industry is as good as any at recognizing those things change over time,” he said.

EPA Permits

House and Senate bills introduced in June would force producers to wait for the U.S. Environmental Protection Agency to develop a permitting process. They’d then have to get approval from the agency for each well. The EPA said March 18 it will spend $1.9 million to study risks associated with fracking.

Environmental concerns over gas production go beyond biocides. Two of 94 monitoring sites at the Barnett Shale, the most productive U.S. shale formation, had elevated levels of the carcinogen benzene in the air, the Texas Commission on Environmental Quality said in January.

“Now, when they have the possibility that something might stop the fracturing and stop the development of the shale, that’s what you have to worry about,” said Mitchell.

--With assistance from Edward Klump in Houston. Editors: Tony Cox, Susan Warren.

To contact the reporter on this story: David Wethe in Houston at dwethe@bloomberg.net.

To contact the editor responsible for this story: Susan Warren at susanwarren@bloomberg.net.

**** Link to Press Release- Former Halliburton CTO, Vik Rao- Joins BioLargo Management Team

1 comment:

  1. 11-10-10 (Clash Escalates)

    Agency Pushes Halliburton to Hand Over Drilling Data

    By STEPHEN POWER And SIOBHAN HUGHES

    WASHINGTON—The Environmental Protection Agency escalated a clash with Halliburton Co. on Tuesday, subpoenaing the oil-field-services giant for information about chemicals used in a controversial technique for extracting natural gas from underground rock formations.

    The agency said it issued a subpoena because Halliburton failed to turn over information necessary to move forward with a congressionally requested study of hydraulic fracturing, or "fracking," in which large amounts of water laden with sand and chemicals are pumped deep underground to release natural gas trapped inside rock.

    The EPA said Halliburton was the only company among nine contacted by the agency that never committed to providing everything the agency requested on a timely basis.

    In a written statement, Houston-based Halliburton said the EPA made "unreasonable demands" that would potentially require the company to prepare approximately 50,000 spreadsheets of data. The company said it had been working with the agency "in good faith" and has turned over nearly 5,000 pages of documents as recently as last Friday.

    "We are disappointed by the EPA's decision today," the company said. "Halliburton welcomes any federal court's examination of our good faith efforts with the EPA to date."

    The EPA inquiry into hydraulic fracturing is part of a broader conflict over efforts to tap huge stores of natural gas locked in large shale formations, including the Marcellus Shale. That tract stretches from the Ohio River Valley into upstate New York through economically depressed regions where new gas drilling could provide much-needed jobs and income for small farms.

    At a news conference the day after his party suffered major losses in the midterm congressional elections last week, President Obama expressed a desire to work more closely with Republicans on energy policy, citing natural-gas production as one area in which he thought cooperation was possible.

    "We've got, I think, broad agreement that we've got terrific natural-gas resources in this country," Mr. Obama said. "Are we doing everything we can to develop those?"

    But environmental groups and some landowners in potential gas-producing areas say hydraulic fracturing puts water supplies at risk. In response to concerns about the effects of hydraulic fracturing on water supplies, Congress directed the EPA to study the issue. EPA officials have since expanded their inquiry to evaluate the impact of the heavy volume of water the process requires. They said they also intended to study the way gas wells are constructed and the risks that wells could leak gas or chemicals into underground water.

    Write to Stephen Power at stephen.power@wsj.com and Siobhan Hughes at siobhan.hughes@dowjones.com

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