Insights for Shale Gas Water Management in the Cooper Basin

Transcription

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

3 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 Source: USEIA 2013 Resources in many regions of the world Source: USEIA Insights for Shale Gas Water Management in the Cooper Basin OzWater15, 14 May 2015, Adelaide Convention Centre.

4 State of the Industry Natural Gas Production in 2014 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) Source: USEIA 2015 Source: USEIA 2015 CANNING BASIN Source: IHS Insights for Shale Gas Water Management in the Cooper Basin OzWater15, 14 May 2015, Adelaide Convention Centre.

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

6 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: DNRM 2014 Source: Rigzone 2011 Source: Australian Government Insights for Shale Gas Water Management in the Cooper Basin OzWater15, 14 May 2015, Adelaide Convention Centre.

7 Why Manage Water? Construction Water Stormwater All stages of a shale gas project rely on effective water management Water Demands Site Set-Up / Rehabilitation Drilling 0.2 ML to 2.5 ML Hydraulic Fracturing 7 ML to 23 ML Site set-up, maintenance and rehab Produced Water Operation Drilling Drilling Fluids Water Production 15% - 75% of fracturing fluid returns in first few days Completions Lower rates sustained over life of well Hydraulic Fracturing Fluid 7 Insights for Shale Gas Water Management in the Cooper Basin OzWater15, 14 May 2015, Adelaide Convention Centre.

8 Why Manage Water? ACTIVITY MANAGEMENT ISSUE POTENTIAL RECEPTOR POTENTIAL IMPACT SITE PREPARATION Infrastructure Construction Stormwater Flows DRILLING Drilling, Casing and Cementing Aquifer Interaction ENVIRONMENTAL FRACTURING AND COMPLETION Use of Freshwater Freshwater Withdrawals SOCIAL Storage of Fracturing Fluids PRODUCED WATER MANAGEMENT Storage of Fracturing Fluids FINANCIAL Storage of Produced Water Storage of Produced Water REPUTATIONAL Treatment of Produced Water Waste Management Use of Produced Water Surface Beneficial Uses Management by Injection Source: Adapted from Krupnick Insights for Shale Gas Water Management in the Cooper Basin OzWater15, 14 May 2015, Adelaide Convention Centre.

9 Alternative Approaches Water sources and fracturing fluids Produced water management - treatment? Centralised vs decentralised approaches Project-specific solutions vs company collaboration Treatment Beneficial Use Filtration Aquifer Injection Desalination Agricultural Use Chemical Amendment Industrial Use Flowback Municipal Supply Source Water Fracturing Fluid Produced Water Disposal Surface Water Water-Based Surface Water Release Groundwater Gel-Based Injection Municipal Water Gas-Based Industrial Wastewater 9 Insights for Shale Gas Water Management in the Cooper Basin OzWater15, 14 May 2015, Adelaide Convention Centre.

10 Five Success Factors for Shale Gas Water Management 10 Insights for Shale Gas Water Management in the Cooper Basin OzWater15, 14 May 2015, Adelaide Convention Centre.

11 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 11 Insights for Shale Gas Water Management in the Cooper Basin OzWater15, 14 May 2015, Adelaide Convention Centre.

12 2 - Early Stakeholder Engagement Source: Standing Council on Energy and Resources Insights for Shale Gas Water Management in the Cooper Basin OzWater15, 14 May 2015, Adelaide Convention Centre.

13 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 Source: Survey on support for shale gas by the Government of Western Australia 2014 CLEARLY COMMUNICATE PROJECT RATIONALE DESCRIBE BENEFITS AND RISKS EXPLAIN HOW STAKEHOLDERS CAN ENGAGE 13 Insights for Shale Gas Water Management in the Cooper Basin OzWater15, 14 May 2015, Adelaide Convention Centre.

14 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 Source: DOW 2015 Without an environmental baseline, public opposition and delays are much more likely Engage stakeholders in the data collection process - builds confidence Source: ALL Consulting Insights for Shale Gas Water Management in the Cooper Basin OzWater15, 14 May 2015, Adelaide Convention Centre.

15 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 Source: ALL Consulting 2015 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: GE 2014 Source: Devon Energy Insights for Shale Gas Water Management in the Cooper Basin OzWater15, 14 May 2015, Adelaide Convention Centre.

16 5 - Logistics Source: Accenture Insights for Shale Gas Water Management in the Cooper Basin OzWater15, 14 May 2015, Adelaide Convention Centre.

17 5 - Logistics Reporting Lab Water Quality Data Integrated Technologies Process Optimisation & Dynamic Simulation IWS Facility Automation Decision Logic Import utility Field & Operator Data IWS Water Information Management Handheld device interface IWS SMART Grid Export Information / Data Interrogation 17 Insights for Shale Gas Water Management in the Cooper Basin OzWater15, 14 May 2015, Adelaide Convention Centre.

18 Conclusions and Recommendations for the Cooper Basin 18 Insights for Shale Gas Water Management in the Cooper Basin OzWater15, 14 May 2015, Adelaide Convention Centre.

19 Conclusions & Recommendations Apply strategic planning frameworks Initiate data collection programs as early as possible Proactively maintain a stakeholder engagement program Source: South Australian Government 2014 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 Source: South Australian Government 2014 Is sharing of data, information and infrastructure the pathway to success? Source: South Australian Government Insights for Shale Gas Water Management in the Cooper Basin OzWater15, 14 May 2015, Adelaide Convention Centre.

20 Thank You