A new breed of service companies seeks to combine efficiency and environment.
The word “green” can mean different things to different people these days. To the accounting department it means money. To the public, including investors, it can mean environmentally friendly.
Often those two meanings are at odds.
One such effort is in the surfactant sector. Cleveland, Ohio-based Locus Bioenergy Solutions CEO Jonathan Rogers says his company began developing a bio-surfactant about four years ago, based on vegetable oil and sugar. The plan was to use it as a drilling fluid additive, but it quickly showed added benefits in well stimulation also, due to its ability to break down paraffin.
Rogers said biosurfactants have been on the radar for about 20 years, but they were never economical to produce other than in small quantities in a lab. The Locus breakthrough came in developing a way to produce them economically. “This is what the parent company of Locus does,” said Rogers. “We manufacture biosurfactants, basically in like a microbrewery type environment.”
Not only is the manufacturing cost lower, so is the dosage. Over the company’s first two years, in which they focused 100 percent of their efforts on research, they looked at the amounts of traditional soap-based surfactants required for effective treatments as opposed to the amount of bio-surfactants needed. “What we found was, to reduce the surface tension of a liquid, we needed 1,000 ppm of a traditional surfactant. We can do it at 20 ppm, so it’s a fraction of the dosage.”
The interest, or the “So what?” as Rogers terms it, is in the “make more from what you’ve got” mindset of most investors today. He cited a technical paper presented at the Offshore Technology Conference in Houston in 2018, stating that primary recovery factors in unconventional plays range from just 2-8 percent of oil in place, leaving 46 billion barrels of oil behind. Rogers says the biosurfactant, branded AssurEOR FLOW™, can increase recovery rates dramatically.
Any EOR method in an unconventional well revolves around breaking oil loose from a tight formation, and many companies are experimenting with traditional surfactants in this model. “You judge a surfactant based on its ability to reduce surface tension or to break down what we call interfacial tension,” Rogers explained. “In a reservoir you’ve got the oil stuck to the rock, [and] you basically want to wash that oil off and let it move. So the efficiency of a surfactant is key.
“We’ve already shown, in tight sands and conventional wells, that we can increase oil production by 45 percent. This is probably something for which there wasn’t a market six months ago, 12 months ago, because then people just drilled for more production.” Now, instead of spending millions for drilling, the focus is on boosting existing production.
And while few have looked at any EOR methods for tight shale, Rogers sees his product as being poised for trial.
For Rogers, the timing of Locus is exactly right. “Come at the moment, come with the product. Now is the time for these operators to look at, how do you get that performance, how do you get more production? Wall Street’s telling people, ‘Live within your cash flow.’”
With patents both on the product itself and on the manufacturing process, the company is growing its presence in the Permian Basin and elsewhere. They have manufacturing “microbreweries” in the home office at Cleveland as well as one in Midland, and they plan to add two fermentation units in Houston, with the capacity to make “thousands and thousands of gallons per month.”
Rogers stresses that the product is sterile, containing neither live organisms nor food, and that it’s similar to the kind of thing that comes out of a beer brewery.
Their presence in the Permian began in 2017 with field trials, in which they treated more than 500 wells, and Rogers said there is now great interest from some of the largest producers in the area.
For him and everyone in the company, the fact that the product is natural and sustainable is important. “Normally, ‘green’ means ‘not quite as good,’” he said. “We make these products from vegetable oil and sugar. It’s 100 percent sustainable, they’re non-toxic, they’re fully biodegradable—almost sounds too good to be true.”
If processing vegetable oil and sugar to dissolve paraffin and release trapped oil is an off-label idea, Encore Green Environmental’s plan to turn produced water into electricity and irrigation water may be even further down that road. Founder and CEO Marvin Nash says his Cheyenne, Wyo., company has a Memorandum of Understanding with Midkiff native Cody Wilson of Wilson Farms. Wilson is a fourth generation cotton farmer and a former banker with finance degree from Texas A&M and an MBA from Texas Tech. His wife, Dr. Stephanie Wilson, is an optometrist in Midland. He left banking to return to the farm fulltime in 2015. Their land is at the four corners conjunction of Midland, Upton, Reagan, and Glasscock counties.
Once told during his banking days that ranchers don’t raise cattle, they grow grass, Wilson realized that farmers like his family don’t grow cotton, they mine for water—and in that kernel was the seed of today’s ideas for reusing produced water.
For his family and others farming in the area, “Basically, you pump all the water out from under one piece of ground and you move over, you clear off another piece of ground, drill more wells and grow more cotton. It’s a very thirsty industry.”
And not just for agriculture. During boom times Wilson and others sold water for frac’ing, the profits from which “allowed us to keep farming.” During those years he did not grow cotton because doing both would have strained the aquifer.
Herein lies an idea for reversing that flow, using produced water, sufficiently treated, to reduce the use of well water for agriculture of all sorts. “My idea… instead of poking holes in the ground for more irrigation water, if we had the right equipment—and that equipment’s out there—to just mine our neighbors’ waste stream for water. Then all of a sudden you’ve got something that people are paying to throw away” instead being used to reduce the strain on the water table.
Wilson has done this sort of thing before. Years ago he found a use for the waste material produced by cotton gins—which is now being sought after as cattle feed and mulch.
The technology to clean water to this degree, as he said, does exist, but the cost per barrel is prohibitively expensive for a farmer needing to make a profit on cotton. He realized that there needed to be another ingredient in the mix, another step in the process, for the idea to be affordable.
In addition to produced water, the other thing there’s plenty of in West Texas is sunshine. That, combined with solar energy tax credits, gave Wilson the crux of his idea: to use a concentrated solar array to heat the produced water to steam, use that steam to produce electricity, then condense the steam back to a liquid. This product would basically be distilled water, which would be plenty clean for ag use.
An Australian enterprise uses this concentrated solar power, or CSP, as the intermediate step in distilling seawater for use in a hydroponics plant. Salt left behind is returned to the ocean. Wilson said the plant grows a large percentage of the country’s tomatoes.
Transferring that idea to Midkiff would require some teamwork. “If we could come up with concentrated solar power between two, if not three, big [produced water] midstream companies, and be another source for them—they don’t have to go out and drill more wells because they’re going to push to us all this saltwater” that would otherwise have to go to an SWD. “We’re going to take as much as we can through CSP, sell electricity to subsidize that whole process, take the solar tax credits to help pay off the mirrors (for the CSP), and then, when you have this concentrated brine that you can’t do anything else with, you push that down the hole,” Wilson said.
Nash said, “We’re calling it a total ecological solution.”
Because the water coming from the project would be used to grow plant life—cotton for sale, grass for cattle or something else—Nash and Wilson see this as a form of carbon sequestration that would move companies toward carbon neutrality.
They see this as an opportunity to boost multiple industries: oil and gas, power generation, and agriculture, for starters.
Nash and Encore Green Environmental were already using solar energy to treat produced water for ag use, so he saw Wilson’s ideas as natural next steps.
Water shortages are not confined to agriculture, and Wilson is thinking of that step. “I can imagine a day when we are pumping these saltwater disposals—all this water that got put down a hole in years past, that may be the only way that we can farm [someday]. Who knows, even to water our lawns in Midland and Odessa.”
Like never before, the oil and gas industry is pushing technology to its limits and beyond, seeking to keep the doors open for business and investment. Moore’s Law, which indicates that technological capabilities double every 18 months, is now feeling like life in the slow lane. The ride is going to be fun.
By Paul Wiseman