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www.txwra.org
Water Recycling and Regulation:
Past, Present & Future
Brent Halldorson, Fountain Quail Water Management
Chairman, Texas Water Recycling Association
Texas Alliance of Energy Producers – Energy, Air & Water Conference
San Antonio Marriott Northwest - October 10, 2013
Discussion Points
① Hoover Dam led to the US becoming a
superpower.
② Shale development = our NEW HOOVER
DAM.
③ Water is the key to both (Hoover Dam and
Shale Development).
Hoover Dam
① Built during the Great Depression (1931-1936).
② Supplied the US with an abundance of low cost,
domestic power.
US Influence on the World Stage
1945. The US emerges
from WWII as the largest
power on the globe.
Superpower Status
Q:
1941. Japanese sneak
attach smashes US Pacific
Fleet.
A:
How did the US rocket to
world dominance in 4 years?
Low cost domestic energy
played a part…
WWII
US Joins in 1941
- 2010
- 2000
- 1990
- 1980
- 1970
- 1960
- 1950
- 1940
- 1930
- 1920
- 1910
- 1900
Thanks to Hoover Dam the US
could build more ships, airplanes
and tanks than anyone.
US Unconventional Oil and Gas
① US power is arguably in decline. China and
India are on the rise.
② US Shales are a GAME CHANGER.
③ Low cost domestic energy (Hoover Dam)
boosted the US in the past and will do it again.

Manufacturing, chemical plants, etc. are all drawn to
low cost, reliable power.
④ We cannot afford to screw this up – it is too
important.
Unconventional Shale Development
Pioneered in Texas.
• It all started with the Barnett Shale.
• Small independents unlocked the resource.
TEXAS OFFERS THE RIGHT CLIMATE
• Regulatory: Regulators that understand
Oil & Gas.
• Politically.
• Economically. The Texas economy is
linked to O&G.
Water Management – the Past…
•
•
Water was viewed as an afterthought.
Volumes increased over time – were simply a
cost of production.
UNCONVENTIONALS ARE DIFFERENT
•Water is needed BEFORE the resource
can be developed.
•Water treatment was viewed as a science
project – interesting but not integral.
Water Management – the Present…
•
•
•
America is waking up to the fact that it is
becoming energy independent.
Water is vital to the development.
Experience is becoming more important. Black
Boxes are going away.
RECYCLING IS BECOMING NORMAL
• Water is being recognized as essential.
• Supplies & disposal can be limited.
• The Texas drought has raised the
profile of water availability in areas like
West Texas.
© 2012 Select Energy Services. All materials contained in this document are confidential and proprietary to Select Energy Services, LLC and intended recipients.
Water Management – the Future…
•
•
•
Water must be used more effectively
to ensure continued development.
Industry wide codes and best
practices will emerge for water
recycling.
PW is becoming viewed as an asset.
RECYCLING WILL BE A NORMAL
PART OF SHALE PRODUCTION
• Recognized leaders in this space will
emerge.
• Water-related businesses will be
bundled (supply, transport, recycling,
disposal).
Water is a precious resource.
The TWRA is committed to developing positive, sustainable
solutions to Texas’ water challenges.
The TWRA seeks to:
① Encourage water reuse and recycling.
② Protect water without adversely impacting industry.
③ Maintain and advance Texas as a global economic leader.
The TWRA supports all viable water recycling technologies and
their vendors.
www.txwra.org
New RRC Recycling Rules
①
②
Very Positive. After discussion with industry and
TWRA, the RRC made some very reasonable
changes from earlier proposed rules.
The RRC made a statement we fully endorse (Ch
3, pg. 7):
“With the adoption of this rulemaking, the Commission sets
up a regulatory framework in which recycling is a viable
alternative to disposal, but allows the operators to make
their own water and waste management decisions.”
Permit by Rule
This is probably the biggest win.
a.If a producer re-uses their PW with no treatment
or adds their own treatment (i.e.: filter) this is fine
(within the oilfield).
b.Why then should a permit be needed if a 3rd
party performs treatment (filter or other)?
Now any operator that recycles for their own reuse is essentially “permit-by-rule”.
Multi-Lease, Multi-Operator
The “on-lease” vs. “off-lease” stipulation was
scrapped. The new definition is “non-commercial
fluid recycling.”
We can now recycle from multiple leases and
multiple operators as long as the facility is under
the jurisdiction of an oilfield operator.
For example, PW from a SWD can be recycled and sold to
another producer as frac supply water.
Recycle to Fresh Water Standard
Other jurisdictions (i.e.: Pennsylvania) were making
rules to “de-waste” recycled water (WGMR-123).
The TWRA viewed this as flawed logic.
• The PW itself is already RCRA exempt waste.
• As long as treated water meets a freshwater standard
(we recommended EPA secondary drinking water
standards), it should not require de-wasting as long as it
remains within the oilfield.
The RRC agreed.
In fact, they singled out distilled
water: “If the treatment of the fluids results in
distilled water, the Commission authorizes any
reuse other than discharge to water of the state.”
Recycle to Clean Saltwater
Any level of recycling in which the end product
remains saltwater used to be referred to as “partial”
treatment.
The rules are simple. Clean saltwater is handled
the same way as PW.
 H-11 pits necessary.
 Cannot use fast-line or other transfer designed for
freshwater.
The Big Question
Saltwater or Freshwater?
•
•
Saltwater
Lower cost (minimal
treatment).
Difficult logistics (storage
+ transport)
Freshwater
•Higher cost (thermal
distillation).
•Lower risk – store and
transport freshwater.
Charting a Logical Path
•
•
Saltwater
Lower cost (minimal
treatment).
Difficult logistics
(storage + transport)
Freshwater
•Higher cost (thermal
distillation).
•Lower risk – store and
transport freshwater.
1
SALTWATER
(BASIC)
TSS/POLYMER
REMOVAL ONLY
RE-USE
(CUSTOM) REDUCE
HARDNESS, SCALING
INDEX, ETC.
2
FRESHWATER
IS THE COST
WARRANTED?
LOGISTICS.
ZLD
Devon NOMAD Installation – Freshwater
Mobility Key to Logistics
Devon’s recent water recycling locations
Devon has two units operating at
one strategic location:
Denton
Wise
 Lateral “C” (S Wise Co.)
Past locations:
 Johnson Ranch (E Wise Co.)
Parker
 Godley (W Johnson Co.)
 Circle R (W Johnson Co.)
Tarrant
 Dove Hill (SW Denton Co.)
 McCurdy (SW Denton Co.)
 Spain (SE Wise Co.)
 Casto (SW Denton Co.)
NYSE: DVN
www.devonenergy.com
Hood
Johnson
14 Sites total (since 2004)
Recycling Center – Hub for Water
PAST: Disposal OR Recycling
FUTURE: Disposal AND Recycling
Maximize Recovery of
Value-Add Products
Oil ($$$)
Flowback
Recycling
Produced
Water
Other Treatable
Water Streams
Facility
Segregate, skim
oil, remove
solids, treat
water.
Distilled Water
(re-use for
fracs)
Clean Heavy
Brine (re-use for
drilling)
Solids + any untreatable water
for disposal.
Optimize & Protect
SWD Capacity
ROVER Permian Project – Clean Saltwater
•
•
•
Customer using PW as
source water.
High H2S (~200ppm)
FQWM and Select put
together a package deal
for customer
(containment, transfer
and recycling).
Before / After ROVER
Treatment
ROVER Solids Control
1
Direct re-use or “floc-ndrop” into containment.
 Solids build up & reduce
effective volume of
containment.
 Bacteria blooms.
 Lower cost initially.
 Expensive clean-up.
2
Remove solids prior to
containment.
 Keep solids out of recycled water
containment. 100% volume
available for HF supply.
 Clean brine can be stored longer.
 Dry solids can be buried on
location.
ROVER Permian Project – Clean Saltwater
 Keep solids out of recycled water containment
 Prevents bacteria blooms & messy cleanup
 PW is now a resource
New Trends
Pit covers (prevent evaporation).
② Combine Recycling & Disposal (not Recycling
OR Disposal).
③ More use of brackish water and saltwater – be
careful about hydrogeology.
④ Have a common sense discussion with parties
involved:
①

⑤
Landowners are often writing leases stating that E+Ps
must buy groundwater from them.
Incentivize, not mandate recycling (i.e.: TWRA).
www.txwra.org