1. HYDRAULIC FRACTURING and Smart Water Management
Eli Gruber, President & CEO
Ecologix Environmental Systems

2. ABOUT ECOLOGIX About Ecologix
Ecologix designs and integrates water & wastewater treatment solutions
for industries and municipalities
SERVICES PROVIDED TO OUR CLIENTS:
Treatability studies
Engineering
Design
Fabrication
Installation
Start-Up & Training
System Operation

3. WHO WE SERVE About Ecologix INDUSTRIES Oil & Gas Automotive
Food & Beverage
Mining
Municipalities
Pulp & Paper
Petrochemical
Utilities

4. a little about
HYDRAULIC FRACTURING

5. U.S. DOMESTIC ENERGY BOOM
The Industry
US is #1 natural gas producer in the world
US oil production 9 million bbl/day, (almost 50% of daily domestic consumption)

6. WATER USAGE IN FRACKING
The Industry
Avg. 60,000 – 120,000 bbl/well
Water sourced from aquifers, rivers, lakes
30,000bbl flows back
90% of water ends up in disposal wells

7. HOW FRACKING WORKS
The Industry

8. HOW FRACKING WORKS
The Industry

9. HOW FRACKING WORKS The Industry
A mix of water, sand and chemicals including crosslinkers, breakers, friction reducers is injected under high pressure to fracture the rock
Thousands of vertical joints in rock strata connect, allowing drilling fluids to seep toward the surface

10. HOW FRACKING WORKS
The Industry

11. DIRECT REUSE FOR FRACKING
TWO SIDES OF THE ISSUE
Top Concerns
SURFACE DISCHARGE
Treat to municipal standards
DIRECT REUSE FOR FRACKING
Treated water used solely for drilling, fracturing operations
This presentation is about this side of the fence

12. TOP THREE ENVIRONMENTAL CONCERNS with fracking

13. 1: FRESH WATER RESOURCES
Top Concerns
FACTS
One well requires between 3 – 5 million gallons of water
Water sourced from rivers, lakes, aquifers
IMPLICATIONS
Over-withdrawal threatens longevity of water sources
Arid regions face water shortages

14. 2: ROAD WEAR, NOISE, TRAFFIC
Top Concerns
FACTS
One truck carries 130bbl
Approx. 600 one-way truck trips per well for fresh water delivery
Additional 175 one-way trips to dispose of flowback water
400+ trips for produced water disposal
IMPLICATIONS
Noise, pollution, road wear
2012, Pennsylvania estimated $265 million on road repairs in the Marcellus

15. 3: WASTEWATER DISPOSAL Top Concerns FACTS
144,000 Class II wells in United States
Disposing of 730 billion gallons of brine per year
IMPLICATIONS
Environmentalist concern with ground tremors

16. managing water to
RESOLVE THE CONCERNS

17. SURVEY SAYS
Water Management
72% OF INDUSTRY EXPERTS SAY WATER & WASTEWATER MANAGEMENT IS THEIR TOP CONCERN WITH FRACKING
It seems like solving this issue is a good place to start

18. A COMMON MISCONCEPTION
Water Management
A COMMON MISCONCEPTION IS THAT SALTY WATER DOESN’T MIX WELL WITH FRAC CHEMICALS

19. MISCONCEPTIONS DEBUNKED
Water Management
Society of Petroleum Engineers study (SPE , February 2013) shows:
TDS up to 285,000 mg/L can be used to make frac fluid
Fluid consisted of:
CMHPG Gum (Guar Gum)
Zirconium-based Crosslinker
Sodium Chlorite Breaker
Breaker Catalyst
Non-emulsified Surfactant

20. HALLIBURTON STUDY
In 2012, Halliburton experimented using produced water with TDS levels of up to 285,000ppm, here are the results:
100% success rate over 59 wells and 260 stages
No production decrease vs. fresh water
Avg. savings per well $70K-$100K, mostly due to reduced truck movements
The Bottom Line:
TDS Removal – why pay to remove TDS when you can adjust fluid composition at a fraction of the cost?
TSS Removal – Proppant permeability increases by 20% when TSS is removed

21. PRODUCED WATER ANALYSIS
Parameter
Raw Sample
Treated Sample
% Change pH
4.83 8
+65.63
Conductivity
257
258
+0.39
Chloride
163,637
164,951
+0.80
Sulfate 40 38
+5.00
Boron
20.3
16.6
-18.28
Barium
5.69
6.03
+5.98
Calcium
29,222
28,845
+1.29
Potassium
1,660
1,689
+1.75
Magnesium
4,347
3,148
-27.58
Sodium
70,342
75,517
+7.36
Strontium
2,204
2,020
-8.39
Iron
34.6
0.26
-99.25
TDS
267,588
273,552
+2.23
Turbidity
182
15.4
-91.54
TSS
10,623 92
-99.13

22. Treated Produced Water
VISUAL COMPARISON
TDS still
273,000mg/L
Raw Produced Water
Treated Produced Water

23. FLUID COMPOSITION Water Management Data Source:

24. CARRIER CHEMICALS (0.49%) Total additives amount to 4,900ppm
Water Management
Total additives amount to 4,900ppm
Gelling agents, friction reducers, and crosslinkers amount to 735ppm
Even low levels of TSS (colloidal solids) will cause unwanted friction, fouling, and loss of well productivity

25. TSS REDUCES PERMEABILITY
Water Management
Fracture permeability suffers with presence of TSS
image source: Halliburton

26. TSS IMPEDES WELL PRODUCTIVITY
Water Management
Treated produced water maintains about 20% more permeability
data source: Halliburton

27. FRESH WATER CAUSES CLAY SWELLING
Water Management
Formations with smectite clays swell when fresh water is introduced
Swelling clay can result in a 2-40% reduction in well productivity
“In heavy oil recovery, incompatible fluids are often injected into hydrocarbon reservoirs, which cause clay swelling and thus impair the formation permeability”1
1. Krueger, R.F. (1986): An Overview of Formation Damage and Well Productivity in Oilfield Operation, Journal of Petroleum Technology, Vol. 38, pp. 131–152.

28. WELL PRODUCTIVITY Business Case
In a shale formation with some content of clay, assume a 2% reduction in productivity due to clay swelling
A well that produces $10 million a year would lose $200,000
How about a 10% or 25% reduction due to clay swelling? That’s millions of dollars stuck in the well!
Is the loss in revenues worth the risk?

29. TREATING WATER FOR REUSE

30. TREATMENT PROCESS Treat for Reuse Solids Screening Water Conditioning
Oil
Recovery
Chemical
Precipitation
Physical
Separation
Polishing/ Filtration
Disinfection/ Oxidation
Reduce
Surface Tension
Enhance
Stratification
Colloidal Solids
Dissolved Metals
Sulfates/Sulfides
Oxidation

31. CHEMICAL TREATMENT
Coagulation Neutralizes negatively charged particles causing them to agglomerate
Flocculation Forms bridges between the coagulated particles, generating large solids that can settle or float
Separation removing formed sludge from the water, through either settlement or flotation
Raw
Coagulated
Flocculated
Separated
Coagulated water turns orange when using
Iron-based chemistry

32. PHYSICAL SEPARATION DISSOLVED AIR FLOTATION (DAF)
Micro-bubbles attach to sludge and float
Skimmer removes sludge from water
Clean water flows out of system

33. INTEGRATED TREATMENT SYSTEM
ITS - 900
900gpm (31,000 bbl/day) processing capability
Set-up as centralized treatment plant

34. MOBILE CHEMICAL TREATMENT - MCT

35. MOBILE DISSOLVED AIR FLOTATION - MD

36. NEXT-GENERATION HYBRID ITS-500
500 gpm (17,000bbl/day)
Combines chemical and physical treatment units
Moves from well to well for on-the-fly treatment
Standardized on Honeywell Instrumentation

37. CHLORINE DIOXIDE (ClO2)
ClO2 is a powerful disinfectant that reacts rapidly via oxidation to provide effective micro-biocidal impact
It delivers broad spectrum performance against bacteria, fungi, algae, viruses, and parasitic microorganisms
In Oil & Gas, ClO2 reduces bio-fouling, oxidizes hydrogen sulfide and iron sulfide

38. SULFATE REDUCING BACTERIA
Sulfate-reducing bacteria (SRB) produces hydrogen sulfide
Crude oil that contains hydrogen sulfide has reduced commercial value
Hydrogen sulfide makes the separation of water from oil less efficient, and ferrous sulfide precipitates can clog drilling and pumping equipment
SRB are the most potent contributors to the anaerobic corrosion of metal, which causes costly failures of equipment and pipelines
SRB
Sulfate
Sulfide

39. TRADITIONAL vs. SMART WATER MANAGEMENT

40. Traditional Water Management Strategy
Disposal Well
60,000bbl produced water is hauled away for disposal (460 truck loads)
Drilling Site
20,000bbl
Fresh water haulers truck 80,000bbl to the drilling site (615 truck loads)
Producing Well
Within the first few days of productivity 20,000bbl of flowback water is hauled to the disposal site (150 truck loads)
60,000bbl
80,000bbl
Overall, 160,000bbl of water is hauled over 1,200 truck trips for one well
Fresh Water

41. Smart Water Management Strategy
Disposal Well X
A mobile water recycling facility is introduced, eliminating the need for fresh water and disposal wells
20,000bbl
Recycling Facility
Drilling Site
80,000bbl
60,000bbl of produced water is hauled to the recycling facility
Producing Well
20,000bbl of flowback water is hauled from the new well pad to the recycling facility
60,000bbl
Water is treated and combined to make 80,000bbl of usable water X
Recycling eliminates fresh water use and reduces truck movements
Fresh Water

42. HYPOTHETICAL BUSINESS CASE
– FRESH WATER USE + DISPOSAL
Business Case
80,000bbl of fresh water required to frac a well
Fresh water cost per bbl = $ $1.60 (for hauling)
$2.05/bbl x 80,000bbl = $164,000
20,000bbl of flowback and 60,000bbl of produced water from nearby wells is hauled for disposal
Disposal cost per bbl = $ $1.60 (for hauling)
$2.50/bbl x 80,000bbl = $200,000
TOTAL WATER MANAGEMENT COST
$164,000 + $200,000 = $364,000/well

43. HYPOTHETICAL BUSINESS CASE
– BRINE WATER RECYCLING & REUSE
Business Case
Assuming treating and replenishing brine water costs $1.50/bbl and water hauling is cut by 50%
Frac a well with 60,000bbl produced water + 20,000bbl flowback
Treated water cost per bbl = $ $0.80 (for hauling)
$2.30/bbl x 80,000bbl = $184,000
TOTAL WATER MANAGEMENT COST
$184,000/well

44. RECYCLED BRINE WATER vs. FRESH WATER
Business Case
Fresh water cost per well: $364,000
Recycled water cost per well: $184,000
$364,000 - $184,000 =
$180,000 per well
Possible loss of productivity from use of fresh water: $200,000 per well
COMBINED BENEFITS OF USING TREATED BRINE WATER = $380,000 per well

45. RECAP
Conclusion
By recycling frac water, fresh water can be left for other purposes
TSS removal is the key to reuse
Brine water prevents clay from swelling, resulting in higher well productivity
Water reuse eliminates 100s of truck loads per well
Proper water management vs. purchasing/transporting fresh water can result in $100,000’s of savings per well + increase well productivity + reduced truck traffic + better stewardship of the environment + better community relationships

46. WHERE WE OPERATE

47. SOUTH TEXAS - EAGLE FORD
WHO: SM Energy (NYSE: SM)
WHAT: ITS-900 System
Processing 30,000bbl/day
WHERE: Carrizo Springs, Texas
WHEN: Summer 2013
WHY: Remove Oil, TSS, Iron and
Disinfect to prepare water for
reuse

48. BRITISH COLUMBIA – MONTNEY REGION
WHAT: ITS-900 System
Processing 30,000bbl/day
WHERE: Dawson Creek, BC
WHEN: Summer 2013
WHY: Remove Oil and TSS in shale
frac water to prepare water
for reuse

49. QUESTIONS OR COMMENTS? 888-326-2020 | 678-514-2100
@EcologixSystems