Fracking 101 for Investors: Profiting from the Water Problem

Photo credit: Flickr/Andrea

Fracking 101

The average shale well in the U.S. requires 3-5

million gallons of water to hydraulically fracture.

Fracking 101

Add up all the shale wells drilled across America

each year…

Fracking 101

…and we’re talking about billions of gallons of

water.

Fracking 101

…and we’re talking about billions of gallons of

water.

Photo credit: Flickr/Alex

Fracking 101

An added issue (and opportunity) arises from the fact that not all that

water stays underground.

Fracking 101

According to Halliburton 3-5 barrels of water are

produced for every 1 barrel of hydrocarbons.

Fracking 101

This costs the industry $51 billion per year to manage

this water.

Fracking 101

This costs the industry $51 billion per year to manage

this water. Photo credit: Flickr/zack Mccarthy

Fracking 101

That produced water problem, however, can

become a solution to the freshwater usage problem through water recycling.

Fracking 101

This is one reason why Halliburton’s goal for 2014

is to reduce freshwater usage by 25% by recycling

more produced water.

Fracking 101

To reach that goal it’s teaming up with Nuverra Environmental Solutions

in a recycling solution called H2O Froward.

Fracking 101

Let’s take a closer look at these two companies and the profit opportunities

offered to investors.

Profit Opportunity No. 1:

Nuverra Environmental Solutions (NYSE: NES) is a full-cycle environmental solutions provider.

Source: Nuverra Environmental Solutions website

Nuverra Environmental Solutions

Source: Nuverra Environmental Solutions Investor Presentation

Nuverra Environmental Solutions Leading positions in the Bakken,

Marcellus/Utica and Haynesville shales. Working with Halliburton on H2O Forward in the

Bakken as well as an environmental treatment center.

Appalachian Water Services wastewater treatment facility in the Marcellus Shale area.

Nuverra Environmental Solutions Growing positions in the Mid-Continent Region

as well as in the Eagle Ford Shale and the Permian Basin.

Looking to build its next waste treatment facility in the Eagle Ford Shale.

Plan is to replicate its Bakken assets across all major shale plays.

Profit Opportunity No. 2:

Halliburton (NYSE: HAL) is one of the world’s leading oil-field service companies.

Halliburton CleanStream System

Halliburton Pioneering the H2O Forward Service with

Nuverra. It will increase the amount of produced water

reused in frac fluids. Reduce volume of water sent down disposal

wells. Reduce truck volumes. Turns the waste stream of produced water into

the solution for providing water for fracking.

Investor takeaway Halliburton and Nuverra Environmental

Solutions offer investors a compelling combination to profit from the energy industry’s water problem.

Photo credit: Flickr/Andrew Magill

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