P.1 

RCRA Box 321 

Prepped by Ryan Dugan 

Document Number: 

243) OGRC-S0036 

Docket Number: 

F-93-OGRC-FFFFF 

Printed 5/8/2007 3:36:33 PM Sheet 243 of 259 
D. Ruddy Telecon Notes 

Communications Between 

Crude Oil Reclaimers 

and 

U.S. EPA 

Office of Solid Waste 

PJL 

0G4C- S0036 
P.3 

cS> 

Oct. 29, 1990 

A.A. Oilfield Service, Inc. Hobbs, NM 

Barry Peters 505-392-2577 

A.A. Oilfield sent a letter to WMD on 9/18/90; attached to the 

letter is a table of waste processed/generated and crude 

reclaimed for the years 1984 thru 1990 (y.t.d.). 

Primarily a trucking firm (hauling), then a tank cleaner, then a 

reclaimer. 

Normally only processes tank bottoms, but also produced water. 

Produced water: In by A.A. Oilfield truck, into a 1,000 bbl 

tank, oil settling and skimming in tank, oil to 250 bbl tank, 

heat & de-emulsifier in 250 bbl tank, truck or pipeline reclaimed 

oil. Oil sold at "posted or contract" price (not spot price). 

Produced water to onsite class II well. 

Tank bottoms: In by A.A. Oilfield truck, pump liquid tank 

bottoms into 500 bbl holding tanks, "lighter" tank bottoms into 

"treating" tanks, de-emulsifier & heat to separate, produced 

water used to treat reclaimed oil (oil is 'washed' with brine to 

remove iron/sulfide), wastes: brine, iron, heavy bottoms; heavy 

bottoms, brine and iron to 3rd party landfarm. Landfarm cost is 

$.60 to $2.00 per barrel. A.A. Oilfield had almost 10,000 bbl of 

such waste to landfarm in calendar 1989. 

A.A. Oilfield ceased accepting and processing tank bottoms as of 

9/24/90. They still accept and process produced water. Their 

reclaimer operation as a cost center was profitable. 

Tank bottoms charge rates: 

If oil content is 25% or greater, A.A. pays client a nominal 

amount (usually 1/2 or less of contract price per calculated bbl 

of recoverable crude). They remove it from client tanks, haul it 

to their facility, and process it. 

If oil content is 10% up to 25%, A.A. neither pays for material 

nor charges for material; they remove it from client tanks, haul 

it to their facility, and process it. 

If oil is 0% up to 9%, A.A. charges client a removal, hauling, 

and disposal fee of up to $4.00 per barrel; they remove it from 

client tanks, haul it to their facility, and process it. 

Produced water charge rates: A.A. charges its clients 20 cents 

per barrel to remove produced water from client tanks, haul it to 

its facility, and inject into onsite class II well. A.A. skims 

the produced water for recoverable crude oil; they get so little 

crude recovery from the produced water, that they lose track of 
P.4 

it in their accounting system (i.e., very small volume compared 

to that recoverable from tank bottoms). A.A. indicated that 

their competitors charge about the same (20 cents per barrel) for 

removal and disposal of produced water. 

Class II well expenses: 

No firm numbers readily available but - well operated on vacuum, 

so normal operating expenses are "not significant". Replaced 

well tubing 2 years ago at cost of $30,000, installed a brine 

storage tank for $200 (salvaged from elsewhere). Brine storage 

tanks are cleaned out (bottoms) every 3 to 4 months; about 150 

barrels of brine tank bottoms each cleaning. 

A.A.'s estimate of tank bottoms disposal today in a haz. waste 

facility is $550 per barrel. 

Tax treatment of reclaimers in New Mexico: No 'special' tax 

treatment (i.e., no preferential tax treatment). Pays 6 types of 

taxes to State (ad valorem, school, conservation, 1 mill college, 

etc.) 

Reclaimers do not get involved in any royalty arrangements. That 

is between the oil producer and mineral rights owner. 

Permits for reclaimers in New Mexico: No federal permitsi N.M 

Oil & Gas Cons. Comm. issues two - one for operating a class two 

well and one for operating a "crude treating plant". 

No known local or regional trade associations for crude 

reclaimers, and none that are conversant in oil reclamation 

issues . 
P.5 

October 30, 1990 

Midwestern Reclamation, Inc., Snyder, Texas 

Bob Kimmel 915-573-6385 

Operates a trucking company and crude oil reclamation facility. 

Accepts only tank bottoms for processing; no produced water other 

than that in the incoming tank bottoms. About 1/2 of the time, 

his trucking company delivers the incoming tank bottoms; the rest 

of the time 3rd parties deliver to the reclamation facility. 

The reclamation facility practices heat treating, emulsion 

breaking, and settling water and iron sulfide form the tank 

bottoms. Benzene typically runs about 240 ppm in incoming tank 

bottoms (virgin crude typically around 1200 ppm benzene, gasoline 

from pump about 19,000 ppm benzene). 

Manifests are summarized on a monthly basis on "R2" forms for the 

Texas Railroad Commission. 

1990 

month 

Sep 

Aug 

Jul 

Jun 

May 

Note: 

volume of 

incoming 

tank bottoms 

bbl 

5,37 9 

2,08 2 

2,72 7 

3,63 9 

4,43 5 

tf l^ % 

crude recovered 

bbl 

1,59 3 

1,77 2 

1,37 8 

1,14 2 

2,01 3 

•M 

/ 

h 

0 

V 

*? 

i 

cost to truck 

wastes to landfill, $ 

1,372 

1,564 

721 

1,255 

1,575 

col. 2 minus col. 3 above is total volume of wastes to 

be disposed. This includes some amount of "free" water 

that is sent to class II disposal well (not owned by 

Midwestern); no breakout of free water v. residual 

bottoms available for column 4. Landfill cost for 

residual bottoms is $1.50 per bbl delivered to 

landfill; col. 4 above represents Midwestern's costs to 

truck wastes to landfill. "Free water" disposal costs 

are 25 cents per barrel delivered to a "public" class 

II disposal well. No transport costs to disposal well 

available. 
P.6 

This facility produces "low gravity" crude which gets $3 to $4 

under posting price for e.g., "Texas intermediate". 

Kimmel considers heat treating, etc. as a production cost. Heat 

treaters are fired by diesel (used to be nat. gas but unsteady 

supple). Heat treater and trucking to disposal are the two main 

cost items in this operation according to Kimmel. 

The reclamation facility is currently shut down due to the new TC 

rule. Producers are generally going to landfills now with tank 

bottoms or else disposing on site in pits, etc. 

Ft. Worth is closest hazardous waste disposal site. Kimmel 

estimates hauling cost for 130 bbl to Ft. Worth facility is about 

$1200 (excluding disposal cost). 

Midwestern is "licensed" by RR Commission and Texas Air Quality 

Control Board. 

Midwestern pays its clients for tank bottoms on the following 

schedule (when Midwestern does the trucking/hauling): 

% oil 

85 

70 

60 

55 

50 

45 

40 

$ per bbl 

19.50 

12.25 

11.50 

10.50 

9.50 

8.50 

6.50 

The oil cut in the bottoms is based on an oil and grease analysis 

by solvent extraction (this "shakeout" method seems to be the 

norm for testing oil content in this industry). 

Kimmel does not know the number of his competitors in the State 

but mentioned that 6 competitors in his county have gone out of 

business in last 3 years; thinks mainly due to. RR Commission 

oversight, and also because oil majors insisting that waste 

treatment, safety, etc. practices are appropriate before they 

will use a particular reclaimer. 

Rex King is RR Commission contact in Austin. 
P.7 

October 31, 1990 

Amal Oil Company, Austin, TX (90 mi. south of Austin) 

Gilbert Prudhomme, Pres. 

512-476-0864 

Salt water hauling, oil & gas production, oil reclamation are 

practiced by this company. Very little oil reclamation in the 

past 6 months due to: new R.R. Commission bonding requirement 

($100K) for reclaimers, and new TC rule. 

3 types of wastes accepted for crude reclamation: 

1. skim oil from class 2 wells. This is known as "P18" oil 

because of the R.R. Commission form P18 that the operator of 

the wells uses to log sources of p.w. Amal Oil transports 

the P18 oil to its facility in its own trucks. P18 oil is 

about 75% of Amal's incoming materials. (The operator of 

the injection well does the p.w. skimming and stores the 

skimmed oil on site in tanks; Amal trucks the skimmed oil 

away.) 

2. Crude stock tank bottoms are about 20% of Amal's incoming 

materials. Amal transports this in its own trucks to its 

facility. 

3. About 5% is from miscellaneous sources, including leftover 

crude from fracing operations, etc. 

Amal trucks the P18 oil and tank bottoms to its plant and blends 

them into receiving/settling tanks. "Run" oil is pulled off the 

top of the tanks. Tank bottoms from the reclamation operations 

are sold to the nearby counties for road/asphalt materials. Run 

oil is sent to heater treater (diesel fueled, 180 deg. F.). Free 

water to settling tank. Hot oil to another insulated settling 

tank for 3 days settling, then free water bled off and oil 

marketed if oil contains less than 1% BS&W. 

Amal used to operate a centrifuge for oil recovery but very 

costly daily maintenance resulted in shutdown of centrifuge. 

However, the centrifuge did provide very efficient oil recovery 

when it worked. 

Amal Oil's processing capacity is about 160 bbl day maximum of 

incoming materials (any combination of P18 oil, tank bottoms, and 

misc. crude). 

Free water removed during the reclamation process is transported 

to a licensed class 2 well owned by another party. 
P.8 

Use of diesel oil instead of gas for heater treater makes 

economics of the process poorer (i.e., diesel more expensive than 

gas) . 

There was a trade association called the Texas Reclaimers Assoc, 

started up about 2 years ago but no recent activity. Officers 

and members are unknown to Prudhomme. 

The new R.R. Commission $100K bonding requirement is being 

considered currently by Amal. According to Prudhomme, because of 

this bonding requirement and the TC rule, Amal may not continue 

in the crude oil reclamation business. 
P.9 

October 31, 1990 

Dodson, Inc., San Antonio, TX 

Raoul Garza 1-800-322-5085 

Facility conducts two types of operations: (1) cleans and 

blends used oil and spend diesel/gasoline for sale as industrial 

fuel oil (Dodson pays 20 to 30 cents per gallon for used oil), 

and (2) processes crude tank bottoms, pit skimmings and produced 

water skimmings for salable product. 

Transports incoming materials in own trucks to facility. 

Transports solid wastes to landfill and some produced/free water 

to class II well in own trucks. 

Tank bottoms, pit skimmings and p.w. skimmings are put into tanks 

for heat treatment (180 deg. F, diesel fired) and gravity 

separation. Incoming materials are typically 20 to 30% BS&W. 

A class II well is operated on site for water disposal, but 3rd 

party licensed offsite class II wells are also used. Offsite 3rd 

party class II well disposal cost is 30 cents per barrel of water 

when delivered to the disposal well site. Solid wastes from 

operations are trucked by Dodson to the BFI landfarm; landfarm 

costs are $8.00 per barrel when delivered to the landfarm. 

Facility is on 3 acres, takes in typically 350,000 gallons/month 

of incoming bottoms and skimmings; for "good quality" bottoms and 

skimmings Dodson pays $6 to $7 per barrel less than the current 

posted rate. Dodson produces typically 240,000 to 250,000 

gallons/month net salable crude; crude is sold to a gatherer for 

about $3 less than current posted rate. 

Since TC rule went into effect: Dodson says it is investing more 

in analytical testing of incoming materials, either experimenting 

with or using air stripping on waters removed from waste crude, 

and is going to a TSD with wastes that don't meet TCLP criteria. 
P.10 

November 1, 1990 

Crude Processing, Inc. 

Williston, ND 

Jim Davenport, Owner 

701-572-4505 

Run by himself and his wife. Shuts down for 4 winter months each 

year. 

Trucks tank bottoms and crude/p.w. skimmings to his facility. 

Heater treater (propane), grav. separation, de-emulsification. 

Takes in an average of 800 bbl per month during operation. Pays 

client depending on oil content of crude wastes based on 

"shakeout" analysis. Says a maximum of 50 bbl per month of 

wastes. Incoming crude is high paraffin content. 

Free water is trucked to a commercial class II disposal well; 

pays 35 cents per bbl for disposal as delivered to well site. 

Waste solids are "stored" on his property; there is currently 

approximately 2000 bbl in storage. 

Has a state permit to operate and is bonded for $25,000 with the 

state. 
P.11 

November 5, 1990 

Atascosa, Jourdanton, TX 

Paul Bishop, owner 

P.O. Box 236 

Jourdanton, TX 78026 

512-769-2244 

Obtains about 90% of incoming materials from produced water 

skimmings at class II well sites. Uses own trucks and labor to 

haul incoming materials. 

example current payments for p.w. skimmed oil (based on oil 

content check with "shakeout" test): 

If 10% BS&W: pays about $18 per net bbl of oil 

If 5% BS&W: pays about $23 per not bbl of oil 

Incoming material is pumped to a feedstock tank; then to treating 

tanks for heater treating (180 deg. F, 2 diesel & 1 nat. gas 

heaters), de-emulsification if necessary, and gravity settling. 

Oil from this operation is drawn (< 1% BS&W) to sales tanks and 

then sold to a pipeline company; sales price is pegged at $3 to 

$4 less than the current posting for South Texas sour crude, 

(sour because the incoming materials are from sour crude). 

Solids (tank bottoms, etc) from processing are sent into another 

settling tank, let to set/settle for about 2 months, any free 

water is drawn off for trucking to class II well. Trucks free 

water from primary and secondary gravity settling operations to a 

state-approved class II facility; pays 30 cents per bbl for 

disposal (delivered to well). All solids/bottoms are landfarmed 

on-site in 4 "plots" used exclusively for Atascosa's wastes. The 

"plots" are individually bermed and monitored (lysimeters), and 

are state licensed. 

Incoming materials volume typically ranges from 4700 to 5800 bbl 

per month. Of this, 2800 to 3500 bbl is net oil sold per month. 

The remainder (1900 to 2300 bbl per month) is water and solids 

that are disposed as described above. 
P.12 

Typical monthly expenses (includes materials, labor, utils.): 

Raw materials collection $ 9,000 (includes equip repairs) 

Heat/chem treatment 7,000 

Landfarming solids 750 

Water disposal at class II 2,000 

G&A & Misc. 5,250 (includes owners salary, 

report generation, etc.) 

Total $24,000 per month 
P.13 

November 6, 1990 

Rick Conner, Oklahoma Corporation Commission, Oil & Gas Division 

405-521-2273 

Conner provided us with his office's most recent list of active 

oil reclaimers (via fax on 11/6/90) 

Identified over phone to me which of those are the larger 

reclaimers. 25 of the 145 listed were identified as being the 

larger operations. 

Reclaimers are required to be bonded for $10,000 minimum and to 

register with the OK Tax Commission. Thus, the Tax Commission is 

the sole State source of information on product volume/sales by 

reclaimers. However, Conner said the Tax Commission rarely 

releases such information to outside parties. 

The Motor Carrier Division of the Corporation Commission would 

handle any manifest system required of haulers/reclaimers. 

Conner does not think that the manifest system would provide 

volumes of reclaimers "raw materials" but provided a contact. 

The Motor Carrier Division contact is Don Colston at 405-521-

2965. 

Many if not most of the reclaiming is as skimming of produced 

water at class II disposal wells rather than processing of tank 

bottoms. Tank bottoms are most typically "donated" to county 

commissions for use as road oiling or paving materials instead of 

undergoing processing for crude oil recovery. Each county 

commission must approve the acceptance/use of such materials. 

There are also state regulations that prescribe how the materials 

must be applied to roadbeds (application rates, method of 

discing, etc.) 

0. Ruddy telecon note*