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
3 Insights for Shale Gas Water Management in the Cooper Basin OzWater15, 14 May 2015, Adelaide Convention Centre.
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
4 Insights for Shale Gas Water Management in the Cooper Basin OzWater15, 14 May 2015, Adelaide Convention Centre.
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
5 Insights for Shale Gas Water Management in the Cooper Basin OzWater15, 14 May 2015, Adelaide Convention Centre.
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
6 Insights for Shale Gas Water Management in the Cooper Basin OzWater15, 14 May 2015, Adelaide Convention Centre.
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
7 Insights for Shale Gas Water Management in the Cooper Basin OzWater15, 14 May 2015, Adelaide Convention Centre.
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
8 Insights for Shale Gas Water Management in the Cooper Basin OzWater15, 14 May 2015, Adelaide Convention Centre.
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
9 Insights for Shale Gas Water Management in the Cooper Basin OzWater15, 14 May 2015, Adelaide Convention Centre.
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
10 Insights for Shale Gas Water Management in the Cooper Basin OzWater15, 14 May 2015, Adelaide Convention Centre.
Five Success Factors for Shale Gas Water Management
11 Insights for Shale Gas Water Management in the Cooper Basin OzWater15, 14 May 2015, Adelaide Convention Centre.
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
12 Insights for Shale Gas Water Management in the Cooper Basin OzWater15, 14 May 2015, Adelaide Convention Centre.
2 - Early Stakeholder Engagement
Source: Standing Council on Energy and Resources 2012
13 Insights for Shale Gas Water Management in the Cooper Basin OzWater15, 14 May 2015, Adelaide Convention Centre.
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
14 Insights for Shale Gas Water Management in the Cooper Basin OzWater15, 14 May 2015, Adelaide Convention Centre.
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
15 Insights for Shale Gas Water Management in the Cooper Basin OzWater15, 14 May 2015, Adelaide Convention Centre.
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
16 Insights for Shale Gas Water Management in the Cooper Basin OzWater15, 14 May 2015, Adelaide Convention Centre.
5 - Logistics
Source: Accenture 2012
17 Insights for Shale Gas Water Management in the Cooper Basin OzWater15, 14 May 2015, Adelaide Convention Centre.
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
18 Insights for Shale Gas Water Management in the Cooper Basin OzWater15, 14 May 2015, Adelaide Convention Centre.
Conclusions and Recommendations for the Cooper Basin
19 Insights for Shale Gas Water Management in the Cooper Basin OzWater15, 14 May 2015, Adelaide Convention Centre.
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
Source: South Australian Government 2014
Source: South Australian Government 2014