williston basin petroleum conference north dakota may 22, 2012

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Williston Basin Petroleum Conference North Dakota May 22, 2012 Recycling of Drilling Waste: The Road to Sustainability Emerging Bakken Technologies

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Williston Basin Petroleum Conference North Dakota May 22, 2012 Recycling of Drilling Waste:  The Road to Sustainability Emerging Bakken Technologies. INTRODUCTION. Oil & Gas Industry Industry continues to expand in the Bakken Operator expectations for services are high - PowerPoint PPT Presentation

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Williston Basin Petroleum Conference North DakotaMay 22, 2012

Recycling of Drilling Waste:  The Road to SustainabilityEmerging Bakken Technologies

INTRODUCTION

Oil & Gas Industry

Industry continues to expand in the Bakken Operator expectations for services are high Service companies doing all they can to keep up Exploration & production waste continues to be high

profile And with the new reserve pit rule changes

Louisiana approx. 800,000 bbls of E&P waste are generated

monthly

(not including produced water)

Texas volumes of waste generated are unknown In 2011; 23,000 drilling permits, 2012; annualized

25,000+

ORDER OF WASTE RESPONSIBILITY

• Source Reduction• Recycling• Treatment• Disposal

North Dakota – Williston Basin

2012 2013

Rig count 230 250

# of wells 2750 3000+

Depths 19000’+ 19000’+

The Waste Segment of the O&G

Industry

is extremely vital &

more important than ever!

Waste Generated Per Well

WB 1094 bblsOB 1227 bblsBrine 1049 bblsTOTAL 3370 bbls

Bulking/Stabilization 1:1

BAKKEN SHALECRUSH THESE VOLUMES

R3 – REDUCE, REUSE, RECYCLE

Major oil and gas companies are taking the lead role in operations to protect the environment

The big push is on efforts to recycle as much as possible

Recycling of Drilling Waste

The Road to Sustainability

RECYCLING – WHY NOT?

E&P waste recycling is not new Oil - non renewable resource Solids - resource as well

Treated solid materials not reused – Why? FOCUS: Road Construction Products

Requires large volumes Requires strict engineering

specifications Requires strict environmental

specifications Recyclers have lacked experience Standardized recycling rules were

lacking Definition of recyclable product unclear

Reluctant Generators

LIABILITYLIABILITY

BAKKEN MARKET / CUSTOMERS

No matter how noble the intent of any No matter how noble the intent of any recycling effort, success cannot be recycling effort, success cannot be

achieved without a viable and continuing achieved without a viable and continuing market for the productmarket for the product

Market for Recycled Road Construction Materials Understand it Identify the needs Development the product Make the sale… Conceptual

Potential customers identified State – Dept. of Transportation Counties Cities O&G companies Farmer & Ranchers

Stipulations Location of product utilization Sustainable quantity availability Cost competitive

GOALS

R3 Road Base Product (Asphalt or Cement Stabilized)

safer and improved roads for the landowners, O&G operators

less dust than traditional scoria or gravel roads and pads a cleaner environment through waste minimization, recycling of spent E&P wastes and minimization and/or elimination of reserve pits

The most effective way to do this is to partner with the Operator to

manufacture a recycled road base product for their respective lease

roads, drill sites and/or public roads

PRODUCTS - FORMULATIONS

Understand the needs development of the recycled product replicate the process in the field full scale comply with regulatory criteria comply with the users directives - Asphalt / Cement Stabilized Base

Formulation E&P waste – oil, chloride & water content course aggregate using localized material emulsified asphalt cement water

Mix Design: OB Drill Cuttings / Scoria / EA / Cement / Water Compressive Strength 120 psi Hveem Stability 52 Compacted Weight 126 lbs/ft2

CONCEPT – MOBILE RECYCLING

The proposed facility: designed to be Mobile System and set up at/near the rig site may serve single or multiple operators the operator will be the generator and consumer the volumes will be limited to prevent speculative accumulation the footprint will be limited in size the equipment; mechanical separation or thermal desorption the facility and process will comply to stringent EMS

is SAFE

The recycled product: will comply with engineering and environmental standards will comply with Gov’t directives, rules & regulations will be as good or better than what is currently being used

does WORK

OPERATIONS

Equipment & Process

MOBILE FACILITY LAYOUT

LOGISTICS

Project Logistics 5-7 active rigs 1,200+ bbls oil base cuttings per well Operations:

24-hour waste receiving & product manufacturing

Expected Volumes 1,000 bbls (~208yds3/day of inbound waste; 1 yd3 = 4.8 bbls)

1,059 tons (~623 yds3/day of outbound R3 CSB product; 1yds3 = 1.7tons)

R360 Commitments Certificate of Recycling for volume of waste recycled Total regulatory & operational reporting disclosure

Customer Commitments Uses the product and/or provide to other potential users

EQUIPMENT & PERSONNEL

HS & E Site Specific Safety Plan Site Specific Environmental Management Plan

Aspects/Impacts Register

Processing Equipment Front end loader, backhoe, conveyors, pugmill, waste receiving system, tanks/roll-off bins, light plants, generator

Miscellaneous Equipment   Office & lab, living quarters, potable water tank, site truck w/ portable fuel tank, pumps, air compressor, critical spares inventory, fuel tank

R3 Team Members - 10 Operations manager, receiver, equipment operator, roustabout

RESULTS

Recycled Product

RESULTS

R3 Roadbase

R360 firmly believes that: E&P waste for recycling must be handled as a waste first Regulatory landscape must acknowledge that if a waste is properly recycled that the generator is no longer liable Genuine recycled products; judged on engineering and environmental merits

Keys to Success Ensure that the recycling is legitimate Ensure that recyclers possess the technical expertise Ensure that recyclers have substantial financial capacity Ensure a high level of environmental management systems

Recycling Projects Will not succeed without market Sustainability Based on applicable “Engineering and Environmental” standards

CONCLUSION

THE ROAD TO SUSTAINABILITY

THANK YOUAny Questions?