insights for shale gas water management in the cooper basin · 7 insights for shale gas water...

Insights for Shale Gas Water Management in the Cooper Basin

Alex Lane, Paul Wilkinson, Mark Favetta

OzWater15 – 14 May 2015

Water for Mining, Resources & Power

2 Insights for Shale Gas Water Management in the Cooper Basin OzWater15, 14 May 2015, Adelaide Convention Centre.

Overview

• What is shale gas and why

focus on the Cooper Basin?

• Why is water management

so important?

• What can we learn from

other projects?

• How can we ensure a

socially, economically and

environmentally sustainable

industry?

Source: USEIA 2013


What is Shale Gas?

• A sedimentary rock of low permeability -

gas, oil and water are held in interstitial

spaces

• One of three unconventional gases

• Extraction relies on hydraulic fracturing

• Resources in many regions of the world

Source: USEIA 2013

Source: USEIA 2013


State of the Industry

• Only the US has seen significant

production (1.6% of national gas

production in 2000 ~50% in 2014)

• Largely at E&A stage in other

countries – mixed results and

frequent public opposition

• In Australia, E&A underway in

several prospective basins (WA,

SA, QLD, NT)

CANNING BASIN

Source: USEIA 2015

Source: USEIA 2015

Source: IHS 2015

Natural Gas Production in 2014


State of the Industry - Oil Price

Responses: re-prioritising activities, deferring capex, reducing opex

Optimising efficiency is therefore a key source of competitive advantage

Source: Macrotrends 2015


The Cooper Basin

• Located in sparsely populated

region on SA-QLD border

• Extremely high variability in

rainfall and flow

• Important environmental assets

• Several JVs undertaking E&A

• SA and QLD governments both

supportive

Source: Rigzone 2011

Source: DNRM 2014

Source: Australian Government 2014


Why Manage Water?

• All stages of a shale gas project rely on effective water management

Water Demands

• Drilling 0.2 ML to 2.5 ML

• Hydraulic Fracturing 7 ML to 23 ML

• Site set-up, maintenance and rehab

Water Production

• 15% - 75% of fracturing fluid returns in first few days

• Lower rates sustained over life of well

Site Set-Up /

Rehabilitation

Drilling

Completions

Operation

Construction

WaterStormwater

Drilling

Fluids

Hydraulic

Fracturing Fluid

Produced

Water


Why Manage Water?

Source: Adapted from Krupnick 2013

Infrastructure Construction Stormwater Flows

Drilling, Casing and Cementing Aquifer Interaction

Use of Freshwater Freshwater Withdrawals

Storage of Fracturing Fluids Storage of Fracturing Fluids

Storage of Produced Water

Management by Injection

Surface Beneficial Uses

Waste Management

Storage of Produced Water

Treatment of Produced Water

Use of Produced Water

SITE PREPARATION

DRILLING

FRACTURING AND COMPLETION

PRODUCED WATER

MANAGEMENT

ACTIVITY MANAGEMENT ISSUE POTENTIAL RECEPTOR POTENTIAL IMPACT

SOCIAL

FINANCIAL

REPUTATIONAL

ENVIRONMENTAL


Alternative Approaches

• Water sources and fracturing fluids

• Produced water management - treatment?

• Centralised vs decentralised approaches

• Project-specific solutions vs company collaboration

Source Water

Surface Water

Groundwater

Municipal Water

Industrial Wastewater

Fracturing Fluid Produced Water

Flowback

Treatment

Disposal

Beneficial Use

Surface Water Release

Injection

Aquifer Injection

Agricultural Use

Industrial Use

Municipal Supply

Water-Based

Gel-Based

Gas-Based

Filtration

Desalination

Chemical Amendment


Five Success Factors for Shale Gas Water Management


1 - Strategic Planning

• Takes advantage of the decision curve

• Risk assessment tools to prioritise further study

• Scenario testing and water balance modelling to balance risk profile

• Consistent planning frameworks for transparent decision making


2 - Early Stakeholder Engagement

Source: Standing Council on Energy and Resources 2012


2 - Early Stakeholder Engagement

• Project will not succeed without

the support of stakeholders

(regulators, media, local

community, broader public)

• Must engage stakeholders early

on in the planning process

– CSSD in the Marcellus Basin

– Gas Shales in Europe

– CSG initiatives in Queensland

CLEARLY COMMUNICATE

PROJECT RATIONALE

DESCRIBE BENEFITS AND

RISKS

EXPLAIN HOW

STAKEHOLDERS CAN

ENGAGE

Source: Survey on support for shale gas by the Government of Western Australia 2014


3 - Baseline Data

• Internal - rates, timings and

qualities of water demanded and

produced

– Supplement limited field data

with modelling

• External - hydrology, stakeholder

perceptions and regulation and

how these may change

– Without an environmental

baseline, public opposition and

delays are much more likely

• Engage stakeholders in the data

collection process - builds

confidence

Source: DOW 2015

Source: ALL Consulting 2010


4 - Flexible Solutions

• Internal and external influences vary from

basin to basin and over the well lifecycle

• Flexible water management is therefore

key

– Mobile infrastructure - follow the drilling

schedule

– Modular infrastructure - easy to scale

– Water recycling and reuse - climate and

social independence

• Regular process simulation provides a

cost-effective means of optimising

infrastructure

Source: ALL Consulting 2015

Source: GE 2014

Source: Devon Energy 2011


5 - Logistics

Source: Accenture 2012


5 - Logistics

Integrated

Technologies

Process Optimisation

& Dynamic Simulation

IWS

Water

Information

Management

Export Information /

Data Interrogation

Decision

Logic

IWS

SMART Grid

Field & Operator Data

Lab Water Quality Data

Handheld

device

interface

Import

utility

IWS

Facility Automation

Reporting


Conclusions and Recommendations for the Cooper Basin


Conclusions & Recommendations

• Apply strategic planning frameworks

• Initiate data collection programs as

early as possible

• Proactively maintain a stakeholder

engagement program

• Use scenario testing to manage risk,

analytical systems to transform data

into useful information and logistical

systems to act efficiently

• Use process simulation to optimise

infrastructure

Is sharing of data, information and

infrastructure the pathway to success?

Source: South Australian Government 2014



Thank You

[email protected]

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