Water Treatment Technologies in Production Sites of Oil and Gas Producing Countries

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1 JOGMEC Techno Forum 2013 PEMEX Exploración y Producción Subdirección de Distribución y Comercialización Gerencia De Operaciones Water Treatment Technologies in Production Sites of Oil and Gas Producing Countries Mr. Carlos Lechuga May 7-8, Tokyo, Japan

2 PEMEX, Mexico s National Oil Company PEMEX is the largest enterprise in Latin America Canada Mexico USA Brazil By Constitutional mandate, it is the only producer of hydrocarbons and refined products in Mexico Pemex is a fully integrated National Oil Company Objective: Maximize hydrocarbons economic value to contribute to the sustainable development of the country America

3 PEMEX includes complete value chain in the petroleum industry Exploration & Production Refining Gas and Basic Petrochemical Petrochemicals Exploration Crude oil Natural gas First transformation of natural gas, methane, ethane, propane and naphtha Drilling, development & production Crude oil Gasoline Jet fuel Diesel Fuel oil Asphalts LPG Lubricants Natural gas LPG Ethane Natural gasolines Sulphur Polyethylene Ethylene Oxide Glycol Vinyl Chloride Ethylene Ammonia Methanol Export Customers (domestic market)

4 PEMEX, regulatory framework Mexican Constitution (Art. 25, 27 and 28) and its Regulatory Law of Article 27 regarding oil matters, establish the basis of PEMEX regulatory framework The purpose of PEMEX Law is to regulate the organization, operation, control and accounting of PEMEX and its Subsidiary Entities. Mexican Political Constitution Regulatory Law PEMEX Law The Regulatory Law of Constitutional Article 27 regarding oil matters establishes: The State shall carry out the activities exclusively entrusted to it in the strategic areas of petroleum, hydrocarbons and basic petrochemicals, through PEMEX and its Subsidiary Entities The objective of the National Hydrocarbons Commission is to regulate and supervise the exploration and extraction of hydrocarbons National Hydrocarbons Commission Board of Directors Chairman (Ministry of Energy) PEMEX The Board of Directors of PEMEX determines the organizational and operating structure of PEMEX for the best fulfillment of objectives and activities within its technical, commercial and industrial scope PEMEX is a decentralized entity with the mandate of production, legal capacity and its own property with the purpose to carry out exploration, exploitation, petroleum products and petrochemicals Pemex Exploration and Production Pemex Refining Pemex Gas and Basic Petrochemicals Pemex Petrochemicals

5 Mexico s oil production is around 2.5 millions barrels per day Thousand barrels per day 3,500 3,000 2,500 2,000 1,500 1,000 Other offshore fields (shallow waters) Ku-Maloob-Zaap Cantarell South eastern basins Tertiary-age fields and other ones (mainly Mesozoic Tampico-Misantla Chiapas-Tabasco basin) +Tertiary and other fields Year In the late 70's and early 80's PEMEX initiated the development and exploitation of the offshore fields Akal, Nohoch, Ku and Abkatun (shallow waters) In 2004, Cantarell one of the biggest field in the world, started its production declining Since 2009, oil production in Mexico has stabilized around 2.5 million barrels per day

6 Conditionating Infrastructure and producing areas, Oil Distribution and transport Cadereyta [MBBLS] % Domestic Consumption 1, Exports 1, Refinería Exportación OIL FIELD Cayo Arcas STORAGE Salamanca Madero TMM FPSO Ku- Maloob- Zaap FSO Other Offshore Field s (CLM) Cantarell Tula Minatitlan TMP TMDB Salina Cruz CAET Chiapas - Tabasco

7 Contribution of Cantarell in Mexico s production, Impact of depletion stage Oil production MBD Incremental water production MBD 3,500 1,800 3,000 2,500 2,000 Cantarell 1,600 1,400 1,200 1,000 1, Water Production [2013=160] 1, Other fields Oil Production Cantarell, one of the world largest offshore oil field has provided Mexico with a significant production base. In 2003, this field reached the highest peak production around 2.2 MMBD. As Cantarell entered into a depletion stage, water production has increased 160 MBD. 7

8 Treatment of heavy oil on shore is considered in actual PEMEX strategies in order to accomplish water and salt specifications Cantarell s heavy oil, Ku Maloob Zaap and other fields production are transported toward TMDB to adequate water and salt contained until required specifications (contractual limits). Ku-Malob- Zaap Cantarell TMDB Qt (Mbd) Qo (Mbd) Qw (Mbd) %W API ,342 1, ,667 1, ,457 1, ,531 1, ,571 1, ,541 1, TMDB 8

9 Increase Capability Treatment Water Project STAGE CAPACITY [MMBD] STATE END DATE First 100 Complete March, 2011 Second 50 Engineering March, 2015 Third 100 Project September, 2015 Total 250

10 Demonstration Plant 150 b/d Objetives 1. Apply and calibrate JOGMEC technology in order to adequate in TMDB (Terminal Marítima Dos Bocas) PEP s produced water. Produced water: Raw sump B water Treated water: Oil and Grease <=15 ppm (mexican norm: 15 ppm) Floating solids <= 25 ppm (mexican norm: 50 ppm) High speed: Hold time<= 5 minutes 2. Obtain data for pilot plant design of 10,000 b/d.

11 Demonstration Plant 150 b/d Results Concept Units Inlet water Treated water NOM-001-SEMARNAT ph Temperature C Oil and grease mg/l Floating solids ml/l Settleable solids mg/l Cadmium mg/l Cupper mg/l Chromium mg/l <1.0 < Nickel mg/l Lead mg/l Zinc mg/l Arsenic mg/l <0.05 < Mercury mg/l <0.05 < Source: GTDH-MSO: Inlet water analysis (TMDB dam B ) and outlet water (JOGMEC plant) carried out by IMP Laboratories in Mexico City and Intratek.

12 Pilot Plant of 10,000 b/d Objetives 1. Apply JOGMEC technology in order to adequate in TMDB (Maritime Terminal Marítima) PEP s produced water. Produced water: 5007 Dehydrated tank water Agua tratada: Grease and oil<=15 ppm Suspenden solids<= 25 ppm Sulfide acid <= 20 ppm Decrease of heavy metals 2. Obtain data from Akal-G platform throughout 2012 for 10,000 b/d pilot plant test.

13 Technological test results in TMDB vs Norm NOM-001-SEMARNAT-1996 (JOGMEC HITACHI PWTS, Pilot plant of 10,000 b/d) Parameter Unit Inlet water Outlet water NOM-001-SEMARNAT ph Temperature C Oil & Grease mg/l Floating matter - Trace Absent Absent Settleable solids ml/l Total suspended solids mg/l Cadmium mg/l Copper mg/l Chromium mg/l Nickel mg/l Lead mg/l Zinc mg/l Source: GGPT, GTDH-MSO: Inlet water analysis (TV-5007 tank) and outlet water (JOGMEC plant) carried out by IMP in TMDB and IMP Laboratories in Mexico City

14 Technological test results in TMDB vs Norm NOM-001-SEMARNAT-1996 (JOGMEC PWTS, Pilot plant of 10,000 b/d) Parameter Unit Inlet water Outlet water NOM-143- SEMARNAT-2003 Total Hydrocarbons mg/l Total Dissolved Solids mg/l 77,858 76,806 32,000 Comments: 1. The Norm 1996 establishes that if the concentration of Total Dissolved Solids (TDS) is greater than the environment selected for discarding, as in the case of marine environment where average concentration of TDS is around 35,000 mg/l, water disposal has to be 2 km far away from the coast trough diffusers. 2. In the case of TMDB, water disposal is carry out 3 km far away from the shore through a diffuser; because of this TDS value obtained in treated water is not out of standard Source: GGPT, GTDH-MSO: Inlet water analysis (TV-5007 tank) and outlet water (JOGMEC plant) carried out by IMP in TMDB and IMP Laboratories in Mexico City

15 Cantarell pilot plant of 10,000 b/d. Objetives 1. Apply JOGMEC technology in order to adequate in platform Akal-G PEP s produced water. Produced water: Water from three-phase separator Treated water: Following mexican norms NOM-001-SEMARNAT-1996 and NOM- 143-SEMARNAT-2003 and International rules for out-shore disposal. 2. Facility to PEP authorities the making decision process focused to eventual acquisitions in produced water treatmeant technology from JOGMEC, following the current legislation strictly.

16 Mexican Norm vs International Drivers Water disposal to marine environment Environmental Protection NOM-001-SEMARNAT- Agency 1996 (EPA) a The World Bank Financial Corporation (IFC) b Parameter Unit - Gulf of Mexico, EUA - ph 5 to Temperature C 40 The increase in temperature should not exceed 3º C in an area of 100 m from the discharge Oil & Grease mg/l Floating material - Absent - - Settleable solids ml/l Total suspended solids ppm Cadmium mg/l Copper mg/l Chromium mg/l Nickel mg/l Lead mg/l Zinc mg/l Arsenic mg/l Mercury mg/l a. Effluent limitations guidelines (Environmental Protection Agency Effluent limitations guidelines, EGLs). b. Environmental, Health and Safety Guidelines Offshore Oil and Gas Development (The World Bank, International Financial Corporation, Environmental, Health and Safety Guidelines Offshore Oil and Gas Development)

17 Pilot plant 10,000 b/d NOM-001- SEMARNAT-1996 Results of JOGMEC system Mexican norm vs international Environmental Protection Agency (EPA) a The World Bank Financial Corporation (IFC) b Parameter Unit Outlet water - Gulf of Mexico, EUA - ph a Temperature C The increase in temperature should not exceed 3º C in an area of 100 m from the discharge Oil & Grease ppm Floating material - Absent Absent - - Settleable solids ml/l Total suspended solids ppm Cadmium mg/l Copper mg/l Chromium mg/l Nickel mg/l Lead mg/l Zinc mg/l Arsenic mg/l Mercury mg/l a. Effluent limitations guidelines (Environmental Protection Agency Effluent limitations guidelines, EGLs). b. Environmental, Health and Safety Guidelines Offshore Oil and Gas Development (The World Bank, International Financial Corporation, Environmental, Health and Safety Guidelines Offshore Oil and Gas Development)

18 Final remarks Produced Water Treatment System of JOMEC/HITACHI could be a technological option to treat produced water in TMDB and dispose it to the open sea 3 km far away from the shore trough a diffuser without damage environmental. In order to take a final decision related to the possibility to acquire this technology under current legislation in PEMEX, PEP and JOGMEC will carry out a final technological test in TMDB with a pilot plant of 10,000 b/d including the Magnetite Recycling Unit (MRU).