Water for Onshore Oil & Gas

Transcription

1 TABLE OF CONTENTS Water for Onshore Oil & Gas Publication information ii Executive summary Global oil and gas water management market, 2014 Services US water management services, Global drivers Regions Capital expenditure on produced water treatment by region, Treatment technologies Capital expenditure on produced water treatment systems, Introduction 1 Figure 1.1 Oil prices, Figure 1.2 Gas prices, Produced water Produced water treatment Produced water treatment trains 3 Figure 1.3 Oil-water separation and suspended solids removal 3 Figure 1.4 Oil-water separation treatment technologies Treatment of produced water with TDS removal technologies 4 Figure 1.5 Treatment trains for TDS removal 4 Figure 1.6 Comparison of produced water treatment technologies 5 Figure 1.8 Cost of different produced water treatment options Trends in the produced water treatment market 5 Figure 1.9 Selected produced water treatment technologies Channels to the market 7 Figure 1.10 Supply chain matrix 7 Figure 1.11 Route to the market (evaporator/crystalliser system) in North America Investment in water technologies 8 Figure 1.12 Selected venture/growth equity investments in water technologies for O&G 8 2. General trends Oil production 11 Figure 2.1 Historical and forecasted oil production by region, Figure 2.2 Onshore and offshore oil production, Figure 2.3 Onshore oil production by region, Oil reserves 13 Figure 2.4 Proven oil reserves by region, Figure 2.5 Proven oil reserves by resource type, Gas production 14 Figure 2.6 Historical and forecasted gas production by region, Figure 2.7 Onshore and offshore gas production, Figure 2.8 Onshore gas production by region, Gas reserves 16 Figure 2.9 Proven gas reserves by region, Figure 2.10 Technically recoverable gas reserves by resource type, Global E&P companies Market forecast 19 Figure 2.11 Global oil and gas water management market, Figure 2.12 Global oil and gas water management market by region, Produced water volumes 20 Figure 2.13 Global produced water volumes by resource type, Figure 2.14 Global produced water volumes by region, Produced water treatment equipment 23 iii iii iv iv iv v v vi vi vii

2 WATER FOR ONSHORE OIL & GAS Figure 2.15 Global capital expenditure on produced water treatment by system, Figure 2.16 Global capital expenditure on produced water treatment by region, Figure 2.17 Global capital expenditure on produced water treatment by resource type, Produced water management 25 Figure 2.18 Global oil and gas water management services expenditure, Figure 2.19 Global oil and gas water management services expenditure by region, Figure 2.20 Global expenditure on water hauling services by region, Figure 2.21 Global expenditure on water disposal services by region, Figure 2.22 Global expenditure on produced water treatment operations by region, Figure 2.23 US oil and gas water management services expenditure, Figure 2.24 US oil and gas water treatment operations expenditure, Alternative scenarios 30 Figure 2.25 Global produced water treatment market: Reference and low oil price scenarios 30 Figure 2.26 Shale gas and tight oil produced water treatment market: Reference and high gas price scenarios Shale gas/tight oil Extraction by hydraulic fracturing 33 Figure 3.1 Permeability of formations containing oil and gas 33 Figure 3.2 Changes in flowback water volumes and TDS levels over time 34 Figure 3.3 Change in water and oil production from tight oil wells in the Bakken Shale, US Water management in the unconventional oil and gas industry 35 Figure 3.4 Water management in the unconventional oil and gas industry Global shale gas and tight oil resources 35 Figure 3.5 Total global in-place and technically recoverable shale gas and shale oil resources 35 Figure 3.6 Map of assessed shale plays worldwide 36 Figure 3.7 Top 10 countries with technically recoverable shale gas and shale oil resources 36 Figure 3.8 Projections of tight oil production worldwide 37 Figure 3.9 Projections of shale gas production worldwide United States Overview of shale play production 38 Figure 3.10 Major shale plays in the US 38 Figure 3.11 Major tight oil producing shale plays in the US 39 Figure 3.12 Major shale gas producing shale plays in the US 39 Figure 3.13 Projected tight oil production in the US, Figure 3.14 Projected shale gas production in the US, Market drivers Regulatory overview Federal regulatory overview 41 Direct and indirect produced water discharge 41 Deep well injection 42 Current developments in federal regulatory oversight State regulatory overview 42 Figure 3.15 List of regulatory agencies in major shale gas and tight oil producing states 43 Water sourcing regulations 44 Figure 3.16 Groundwater and surface water law overview 44 Water reuse regulations 45 Figure 3.17 Permitted water recycling companies in Texas Water sourcing Water usage in hydraulic fracturing 46 Figure 3.18 Average water usage for fracturing an oil and gas well Alternative sources of water for hydraulic fracturing 46 Figure 3.19 Proportion of water sources used for hydraulic fracturing in Texas Water for fracturing Fracturing fluids trends 47 Figure 3.20 Fracturing fluids water treatment matrix Water management practices 48 Figure 3.21 Cost indicators for drilling and completion of horizontal wells 48 Figure 3.22 Water management economics 49 Figure 3.23 Overview of water management practices in major unconventional plays in the US 50 viii

3 TABLE OF CONTENTS Produced water management in Pennsylvania 50 Figure 3.24 Produced water management practices in Pennsylvania, Challenges to produced water reuse 51 Figure 3.25 WORs in major unconventional plays in the US, Figure 3.26 WGRs for major unconventional plays in the US, Produced water treatment technologies 52 Figure 3.27 Produced water treatment and reuse diagram 53 Figure 3.28 Selection of current water reuse solutions in the US Water treatment delivery systems Overview Future opportunities 56 Figure 3.29 Centralised produced water treatment facilities in the US Dynamics in the unconventional market Procurement of water treatment technologies 58 Figure 3.30 Overview of procurement routes in the unconventional O&G industry in the US Water treatment technology drivers Market entry strategies 59 Partnering with water service providers 59 Partnering with OSCs New technology entrants to the market Supply chain Exploration and production companies 62 Figure 3.31 Major exploration and production companies Oilfield service companies 63 Figure 3.32 Major oilfield service companies in the US Water service providers 64 Figure 3.33 Major water service providers in the US 64 Figure 3.34 Estimated market share of major water hauling service providers in the US, Market forecast: United States 66 Figure 3.35 Produced water volumes in shale gas and tight oil production, Figure 3.36 Capital expenditure on produced water treatment for shale gas and tight oil, Canada Resources 67 Figure 3.37 Shale gas and shale oil resources in Canada Exploitation 68 Figure 3.38 E&P companies active in the Horn River basin, Figure 3.39 The main E&P companies active in tight oil production in Canada Market forecast: Canada 70 Figure 3.40 Produced water volumes in shale gas and tight oil production, Figure 3.41 Capital expenditure on produced water treatment for shale gas and tight oil, China Resources and production 71 Figure 3.42 Basins and formations in China with assessed shale gas and shale oil resources Institutional support International E&P companies in China s shale gas development Challenges in E&P of shale gas in China Market forecast: China 74 Figure 3.43 Produced water volumes in shale gas and tight oil production, Figure 3.44 Capital expenditure on produced water treatment for shale gas and tight oil, Argentina Shale resources and activity 75 Figure 3.45 Size of shale resources in Argentina, by basin and formation Challenges International participation Market forecast: Argentina 77 Figure 3.46 Produced water volumes in shale gas and tight oil production, Figure 3.47 Capital expenditure on produced water treatment for shale gas and tight oil, Mexico Shale resources 78 ix

4 WATER FOR ONSHORE OIL & GAS Figure 3.48 Size of shale resources in Mexico, by basin and formation Shale activity Private participation in oil and gas E&P Market forecast: Mexico 80 Figure 3.49 Produced water volumes in shale gas and tight oil production, Figure 3.50 Capital expenditure on produced water treatment for shale gas and tight oil, Global forecast 81 Figure 3.51 Shale gas and tight oil: Global produced water volumes, Figure 3.52 Shale gas and tight oil: Produced water capital expenditure by region, Figure 3.53 Shale gas and tight oil: Produced water capital expenditure by system, Regional forecast North America 83 Figure 3.54 Produced water volumes in shale gas and tight oil production, Figure 3.55 Capital expenditure on produced water treatment for shale gas and tight oil, Latin America-Caribbean 84 Figure 3.56 Produced water volumes in shale gas and tight oil production, Figure 3.57 Capital expenditure on produced water treatment for shale gas and tight oil, East Asia-Pacific 85 Figure 3.58 Produced water volumes in shale gas and tight oil production, Figure 3.59 Capital expenditure on produced water treatment for shale gas and tight oil, Coalbed methane 87 Figure 4.1 Coalbed methane resources worldwide 87 Figure 4.2 CBM production and future projections 87 Figure 4.3 CBM reserves and production by country Australia Market overview 89 Figure 4.4 Map of Australian CSG reserves 89 Figure 4.5 CSG production in Australia, CSG recovery Market drivers Regulations Regulatory bodies in Queensland and NSW 91 Figure 4.6 CSG industry regulatory bodies 91 Queensland water management legislation 91 NSW water management legislation 92 Regulatory bans in Queensland and NSW 92 Figure 4.7 Regulatory bans in Queensland and NSW Regional overview of the CSG market CSG production in Queensland 92 Figure 4.8 CSG reserves and production in Queensland, CSG production in New South Wales CSG produced water treatment Quality of CSG produced water Challenges of the CSG produced water market Treatment of CSG produced water 94 Figure 4.9 Treatment technologies used for treating CSG produced water Technology trends Management of CSG produced water 95 Figure 4.10 CSG well water production profile CSG produced water volumes 95 Figure 4.11 Annual water and gas production rates in Queensland, Figure 4.12 Annual water production volumes by basin in Queensland, Figure 4.13 Annual gas production volumes by basin in Queensland, CSG produced water management practices 96 Figure 4.14 Disposal and beneficial use of CSG produced water and brine/salts 97 Figure 4.15 Treatment levels based on disposal route Market dynamics Procurement 98 x

5 TABLE OF CONTENTS Procurement process 98 Business contracts 98 Success factors Accessing the market 99 Approaching the CSG produced water market 99 New market entrants 99 Market presence and success Opportunities in water treatment technologies Supply chain analysis E&P companies 101 Figure 4.16 CSG and water production by E&P companies in Queensland (January June 2013) Engineering EPC companies Leading water technology companies 102 Water technology companies entering the market Recent and upcoming CSG projects 102 Figure 4.17 Recent CSG produced water projects 103 Figure 4.18 Upcoming LNG projects Market forecast: Australia 104 Figure 4.19 Produced water volumes in coalbed methane production, Figure 4.20 Capital expenditure on produced water treatment for coalbed methane, United States Market overview 105 Figure 4.21 CBM production in the US, Regulations Regional overview 106 Figure 4.22 US CBM production by state, CBM water treatment and management CBM water quality and volumes 107 Figure 4.23 CBM produced water characteristics 107 Figure 4.24 Average WGR of CBM wells in Colorado CBM produced water treatment 107 Figure 4.25 CBM water treatment technologies CBM produced water management 108 Water management strategies 108 Figure 4.26 Discharge routes in San Juan and Powder River basins 109 Figure 4.27 Water management strategies in San Juan and Powder River basins Market forecast: United States 110 Figure 4.28 Produced water volumes in coalbed methane production, Figure 4.29 Capital expenditure on produced water treatment for coalbed methane, Canada 111 Figure 4.30 Main E&P companies active in CBM extraction Market forecast: Canada 112 Figure 4.31 Produced water volumes in coalbed methane production, Figure 4.32 Capital expenditure on produced water treatment for coalbed methane, China Exploration and production CBM produced water Market forecast: China 114 Figure 4.33 Produced water volumes in coalbed methane production, Figure 4.34 Capital expenditure on produced water treatment for coalbed methane, The Russian Federation Market forecast: Russian Federation 116 Figure 4.35 Produced water volumes in coalbed methane production, Figure 4.36 Capital expenditure on produced water treatment for coalbed methane, Global forecast 117 Figure 4.37 Coalbed methane: Global produced water volumes, Figure 4.38 Coalbed methane: Produced water capital expenditure by region, Figure 4.39 Coalbed methane: Produced water capital expenditure by system, xi

6 WATER FOR ONSHORE OIL & GAS 4.7 Regional forecast North America 119 Figure 4.40 Produced water volumes in coalbed methane production, Figure 4.41 Capital expenditure on produced water treatment for coalbed methane, Eastern Europe-Central Asia 120 Figure 4.42 Produced water volumes in coalbed methane production, Figure 4.43 Capital expenditure on produced water treatment for coalbed methane, East Asia-Pacific 121 Figure 4.44 Produced water volumes in coalbed methane production, Figure 4.45 Capital expenditure on produced water treatment for coalbed methane, Southern Asia 122 Figure 4.46 Produced water volumes in coalbed methane production, Figure 4.47 Capital expenditure on produced water treatment for coalbed methane, Heavy oil/bitumen Steam EOR 123 Figure 5.1 The SAGD process 123 Figure 5.2 Breakdown by country of current onshore oil production using steam EOR 124 Figure 5.3 Onshore oil production using steam EOR, including future projects in the Middle East Canada Market overview 125 Figure 5.4 Estimates of Canadian crude oil production, Figure 5.5 Main bitumen deposits in Alberta, Canada Bitumen extraction: in-situ and open-pit mining 126 Figure 5.6 Extraction of bitumen in the Canadian oil sands: in-situ vs. mining, Figure 5.7 Forecast of Canadian oil sands production by in-situ extraction and open-pit mining to Water requirements for in-situ and mining processes 126 Figure 5.8 Water requirements of bitumen extraction methods Water requirements of in-situ technologies 127 Figure 5.9 Water requirements of in-situ extraction methods Bitumen upgrading Market drivers Regulations Regulatory bodies Relevant regulations 129 Figure 5.10 Regulations affecting water management in the Canadian oil sands industry 129 Water licence approval process for mining or in-situ projects 129 In-situ production water uptake, recycling and disposal 130 Mining water uptake and tailings management Water treatment in SAGD operations 130 Figure 5.11 SAGD water treatment train: conventional and evaporative methods 131 Figure 5.12 Comparison of conventional and evaporative water treatment approaches 131 Figure 5.13 Production by technology in existing and planned SAGD projects Other technology approaches in SAGD 132 Process water treatment 132 Blowdown management Tailing ponds management Procurement process Characteristics 134 Procurement process stages 134 Recent trends in procurement 134 Figure 5.14 Procurement process for oil sands projects Entering the market 135 Key factors to consider Supply chain analysis E&P companies 136 Figure 5.15 Major E&P companies in the Canadian oil sands industry Engineering firms 137 Figure 5.16 The main engineering firms active in the Canadian oil sands industry 137 xii

7 TABLE OF CONTENTS Water technology providers 137 Overview 137 Figure 5.17 The main water technology providers by type of equipment 137 Focus on evaporation technology Market forecast: Canada 139 Figure 5.18 Produced water volumes in steam EOR for heavy oil production, Figure 5.19 Capital expenditure on produced water treatment in steam EOR for heavy oil, Colombia Market drivers Water treatment technologies Enhanced oil recovery (EOR) Accessing the market Procurement Produced water reuse: initiatives in the Rubiales and Castilla oilfields Desalination plants at the Rubiales oilfield Conventional treatment in the Castilla oilfield Unconventional plays Market forecast: Colombia 146 Figure 5.20 Produced water volumes in steam EOR for heavy oil production, Figure 5.21 Capital expenditure on produced water treatment in steam EOR for heavy oil, Oman 147 Figure 5.22 Current and future steam EOR projects in Oman Market forecast: Oman 148 Figure 5.23 Produced water volumes in steam EOR for heavy oil production, Figure 5.24 Capital expenditure on produced water treatment in steam EOR for heavy oil, Kuwait 149 Figure 5.25 Current and future steam EOR projects in Kuwait Market forecast: Kuwait 150 Figure 5.26 Produced water volumes in steam EOR for heavy oil production, Figure 5.27 Capital expenditure on produced water treatment in steam EOR for heavy oil, Venezuela 151 Figure 5.28 Total oil reserves in Venezuela, Orinoco Oil Belt (FPO) Recovery methods for heavy oil in Venezuela International participation in heavy oil E&P Market forecast: Venezuela 153 Figure 5.29 Produced water volumes in steam EOR for heavy oil production, Figure 5.30 Capital expenditure on produced water treatment in steam EOR for heavy oil, United States Market overview 154 Figure 5.31 Heavy oil production from steam EOR in the US, Regional overview California 154 Figure 5.32 Heavy oil production in the four main Californian oil fields, Figure 5.33 Water to oil ratio for years following initial steam flood 155 Figure 5.34 Produced water disposal methods in fields using steam EOR in California, Market forecast: United States 157 Figure 5.35 Produced water volumes in steam EOR for heavy oil production, Figure 5.36 Capital expenditure on produced water treatment in steam EOR for heavy oil, Global forecast 158 Figure 5.37 Steam EOR in heavy oil: Global produced water volumes, Figure 5.38 Steam EOR in heavy oil: Produced water capital expenditure by region, Figure 5.39 Steam EOR in heavy oil: Produced water capital expenditure by system, Regional forecast North America 160 Figure 5.40 Produced water volumes in steam EOR for heavy oil production, Figure 5.41 Capital expenditure on produced water treatment in steam EOR for heavy oil, Latin America-Caribbean 161 Figure 5.42 Produced water volumes in steam EOR for heavy oil production, xiii

8 WATER FOR ONSHORE OIL & GAS Figure 5.43 Capital expenditure on produced water treatment in steam EOR for heavy oil, Western Europe 162 Figure 5.44 Produced water volumes in steam EOR for heavy oil production, Figure 5.45 Capital expenditure on produced water treatment in steam EOR for heavy oil, East Asia-Pacific 163 Figure 5.46 Produced water volumes in steam EOR for heavy oil production, Figure 5.47 Capital expenditure on produced water treatment in steam EOR for heavy oil, Middle East-North Africa 164 Figure 5.48 Produced water volumes in steam EOR for heavy oil production, Figure 5.49 Capital expenditure on produced water treatment in steam EOR for heavy oil, Conventional production Water requirements for enhanced oil recovery (EOR) 165 Figure 6.1 Breakdown by country of global onshore enhanced oil production using EOR methods 165 Figure 6.2 Breakdown of global onshore enhanced oil production by EOR method used 166 Figure 6.3 Forecast of oil production by EOR from different countries in 2015 and The Middle East Market overview Market drivers Produced water management and use 169 Figure 6.4 Estimated breakdown of management options for reinjection in the Middle East Treatment trains Procurement Greenfield projects Brownfield projects Challenges and issues in the procurement process Entering the market Market players E&P companies EPC companies 172 Figure 6.5 Selected EPC companies active in the Middle East Engineering consultants 173 Figure 6.6 Selected engineering companies active in the Middle East Oilfield service companies 173 Figure 6.7 Selected oil service companies active in the Middle East Water technology providers 174 Figure 6.8 Selected water technology companies active in the Middle East Iraq Oil and gas reserves and production 174 Figure 6.9 Proven oil and dry natural gas reserves in Iraq, Figure 6.10 Map showing the main oil and gas fields in Iraq 175 Figure 6.11 Oil and dry natural gas production in Iraq, Challenges in oil and gas industry development Unconventional resources Produced water management and use Oil recovery methods Treatment trains Produced water market Market forecast: Iraq 179 Figure 6.12 Produced water volumes in conventional oil and gas production, Figure 6.13 Capital expenditure on produced water treatment for conventional production, Kuwait Oil and gas reserves and production 180 Figure 6.14 Proven oil and natural gas reserves in Kuwait, Figure 6.15 Map showing the main oil fields in Kuwait 180 Figure 6.16 Oil and dry natural gas production in Kuwait, Unconventional resources Produced water management and use Enhanced oil recovery methods 182 xiv

9 TABLE OF CONTENTS Figure 6.17 Current and future oil recovery projects in Kuwait Treatment trains Produced water market Oman Oil and gas reserves and production 183 Figure 6.18 Proven oil and natural gas reserves in Oman, Figure 6.19 Oil and dry natural gas production in Oman, Unconventional resources Produced water Produced water management and use Enhanced oil recovery methods 185 Figure 6.20 PDO s oil recovery methods 185 Figure 6.21 Current and future EOR projects in Oman Treatment trains Market forecast: Oman 187 Figure 6.22 Produced water volumes in conventional oil and gas production, Figure 6.23 Capital expenditure on produced water treatment for conventional production, Saudi Arabia Oil and gas reserves and production 188 Figure 6.24 Major onshore oil fields in Saudi Arabia 188 Figure 6.25 Map of major oil fields and reservoirs in Saudi Arabia 188 Figure 6.26 Proven oil and dry natural gas reserves in Saudi Arabia, Figure 6.27 Oil and dry natural gas production in Saudi Arabia, Unconventional resources Produced water management and use Oil recovery methods Treatment trains Produced water market Market forecast: Saudi Arabia 192 Figure 6.28 Produced water volumes in conventional oil and gas production, Figure 6.29 Capital expenditure on produced water treatment for conventional production, The United States Market overview Conventional oil production 193 Figure 6.30 US conventional oil production, Regional overview Conventional gas production 194 Figure 6.31 US conventional gas production, Regional overview 194 Figure 6.32 Leading US states for conventional gas production Market forecast: United States 196 Figure 6.33 Produced water volumes in conventional oil and gas production, Figure 6.34 Capital expenditure on produced water treatment for conventional production, The Russian Federation Major players Improved and enhanced oil recovery Produced water treatment Market forecast: Russian Federation 198 Figure 6.35 Produced water volumes in conventional oil and gas production, Figure 6.36 Capital expenditure on produced water treatment for conventional production, Global forecast 199 Figure 6.37 Conventional oil and gas: Global produced water volumes, Figure 6.38 Conventional oil and gas: Produced water capital expenditure by region, Figure 6.39 Conventional oil and gas: Produced water capital expenditure by system, Regional forecast North America 201 Figure 6.40 Produced water volumes in conventional oil and gas production, Figure 6.41 Capital expenditure on produced water treatment for conventional production, Latin America-Caribbean 202 xv

10 WATER FOR ONSHORE OIL & GAS Figure 6.42 Produced water volumes in conventional oil and gas production, Figure 6.43 Capital expenditure on produced water treatment for conventional production, Western Europe 203 Figure 6.44 Produced water volumes in conventional oil and gas production, Figure 6.45 Capital expenditure on produced water treatment for conventional production, Eastern Europe-Central Asia 204 Figure 6.46 Produced water volumes in conventional oil and gas production, Figure 6.47 Capital expenditure on produced water treatment for conventional production, East Asia-Pacific 205 Figure 6.48 Produced water volumes in conventional oil and gas production, Figure 6.49 Capital expenditure on produced water treatment for conventional production, Southern Asia 206 Figure 6.50 Produced water volumes in conventional oil and gas production, Figure 6.51 Capital expenditure on produced water treatment for conventional production, Middle East-North Africa 207 Figure 6.52 Produced water volumes in conventional oil and gas production, Figure 6.53 Capital expenditure on produced water treatment for conventional production, Sub-Saharan Africa 208 Figure 6.54 Produced water volumes in conventional oil and gas production, Figure 6.55 Capital expenditure on produced water treatment for conventional production, Interviewees 209 References 211 xvi