Evalua&ng)The)Economics)Of)Crea&ng)&)Opera&ng)

Your)Own)Disposal)Well)Vs.)Using)A)Third)Party)To)

Determine)The)Most)CostEEffec&ve)Op&on

PRODUCED)WATER)REUSE)

INITIATIVE)2014)
Presenta&on)Topics)

2!

Evalua&ng)The)Economics)Of)Crea&ng)&)Opera&ng)Your)Own)Disposal)Well)Vs.)

Using)A)Third)Party)To)Determine)The)Most)CostEEffec&ve)Op&on

➧ Comparing!the!costs!and!2me!commitment!of!drilling!and!opera2ng!your!own!

disposal!well!to!trucking!water!off!to!a!third!party!

➧ Iden2fying!the!most!cost;effec2ve!strategies!for!iden2fying!loca2ons!for!and!

drilling!a!disposal!well!

➧ Detailing!the!key!equipment!required!for!opera2ng!a!disposal!well!and!how!to!

op2mize!it!to!keep!costs!down!

➧ Providing!insight!into!emerging!techniques!for!disposing!of!wastewater!

without!the!need!for!a!disposal!well!or!trucking!to!a!third!party!
Owned)vs)Third)Party)Disposal)

3!

➧ A!Risked!Life!Cycle!Model!Evalua2on!

➧ Differen2a2ng!Risk!Factors!

➧ Regulatory!Approval!

➧ Local,!County,!State,!Federal!

➧ Disposal!Well!life!

➧ Volume!Envelope!

➧ Decline!curve!

➧ 3rd!Party!availability!/!capacity!

➧ Life!Cycle!Model!Variables!

➧ Transporta2on!Costs!

➧ U2li2es!–!Fuel!vs!Electric!

➧ Disposal!Water!Forecast!

➧ Downhole!Maintenance!
Water)Disposal)Forecast)

4!

!! Monthly)BBLS)

!! December) January February) March)

Budget) 209,392! 152,134! 134,606! 146,248!

Field)Es&mate) !!!!!!!156,518! 131,837! 129,837! 148,584!

!! Variance)

Field)Es&mate/) 25.3%!! 13.3%! 3.5%! ;1.6%!!

Budget1)

1December!to!January!Variance!due!to!squeeze!work!

0!

1,000!

2,000!

3,000!

4,000!

5,000!

6,000!

7,000!

8,000!

)BBLS/Day)

Wedge!

Base!

Capacity!

Field!

Es2mate!

New!Disposal!

Well!online!

Forecasted)

flowback
Drilling)and)Opera&ng)Commitment)

5!

Comparing!the!costs!and!2me!commitment!of!drilling!and!opera2ng!your!own!

disposal!well!to!trucking!water!off!to!a!third!party!

➧ Costs!

➧ Time!(spud!to!first!disposal)!

➧ Permiang!Time!

➧ State!/!County!!

➧ Drilling!Sequence!

➧ On!pad!/!Off!pad!Decision!

➧ 3rd!Party!Considera2ons!

➧ Hauling!Fees!

➧ Contract!Tipping!Fees!
Con&nuous)Comparison

Water)Hauling)

➧ Contract!Hauling!$1.30!or!$1.40!

➧ Disposal/2pping!Fee:!$0.40!

6!

Month) Bbls)Hauled) LOE) $/Bbl

November! 10,160! $15,443! $1.92!

December! 8,980! $9,309! $1.44!

January! 10,893! $13,012! $1.59!

February! 9,551! $10,421! $1.49!

March 9,225! $9,985! $1.48!

Preliminary financials

➧ Truck!driver!

➧ DOT!Cer2fica2on!

➧ Wage!/!Compensa2on!

➧ Truck!Maintenance!
Addi&onal)Infield)Opportuni&es

Piping)from)well)pads)to)SWD)Infrastructure)

➧ Drucker!1N!well!pad!2e;in!

➧ 378!BWPD!gross!

➧ 10!mo.!payout,!121%!IRR!

➧ Installed!and!pressure!tested!

➧ Dallas!SWD!

➧ 210!BWPD!exis2ng!

➧ Poten2al!Kirby!20!#1!Shut;in!(~190!BWPD)!

➧ Drill!SWD!well!on!Dallas!21!#2!site!

7!
Disposal)Well)Loca&on)Strategy)

8!

➧ Forma2on!

➧ Vicinity!to!exis2ng!well!bores!/!cement!tops!

➧ Electric!U2lity!vs!Gas!Driven!Generator/Pump!

➧ Pipeline!ROW!

➧ Road!Access!

➧ Mileage/travel!2me!to!largest!producing!wells!/!route!map!

➧ Frequency!

➧ Eleva2on!change!
Key)Equipment)

9!

Detailing!the!key!equipment!required!for!opera2ng!a!disposal!well!and!how!to!

op2mize!it!to!keep!costs!down!

➧ Tank!Bakery!

➧ Offload!sta2ons!

➧ Separa2on!

➧ Pump!

➧ Reciproca2ng!Piston/Plunger!

➧ Centrifugal!

➧ Filtra2on!

➧ Skid!Building!

➧ Par22on!wall!to!separate!Electrical!room!(non;classified)!and!the!Pump!room!(Class!I!Div!II).!

➧ Non;Residen2al!Modular!Housing!Division!to!meet!Resolu2on!35!!

➧ Water!Analysis!/!Material!Selec2on!
SWD)Facility)

10!
Alterna&ves)

11!

Providing!insight!into!emerging!techniques!for!disposing!of!wastewater!without!

the!need!for!a!disposal!well!or!trucking!to!a!third!party!

➧ Variability!of!feed!Stock!!
Process)Treatment)

12!
Alterna&ves)

13!
Centralized)Storage)and)Handeling

14!
Reclama&on)&)CleanEup)costs)

15!
Ques&ons)E)Discussion)

16!

Michael!Rynearson,!P.E.!

Opera2on!Manager!

Caerus!Oil!and!Gas!

MRynearson@Caerusoilandgas.com!
Credits)

17!

Slide!12:!picture!diagram!from!futuretechme.com!

Slide!13:!pictures!from!oilandgasonline.com!