# Water Requirements and Sustainable Sources in the Barnett Shale James ―Rusty‖ Werline Senior advisor, well completions EPA HF Technical Workshop March 29, 2011NYSE: DVN www.devonenergy.com page2 

# Introduction

• Devon’s water requirements in the Barnett Shale • Water use in Texas and the Barnett Shale • Water sources available to Barnett Shale operators • Devon’s water management/sustainability initiatives

# Water requirements in the 

# Barnett ShaleNYSE: DVN www.devonenergy.com page4 

# Water requirements Drilling • Each Barnett Shale well requires about 6,000 barrels (252,000 gallons) of freshwater for the drilling process.

− This represents about 6% of the total water use per well. • This water is mixed with 

### bentonite clay to create the ―drilling mud.‖ • Some of the drilling mud may be reused multiple times.NYSE: DVN www.devonenergy.com page5 

# Water requirements Completions

• Typically 6-10 stages for horizontal Barnett Shale wells • Approximately 4 million gallons of freshwater required per well • Represents 94% of the total water requirement for a Barnett Shale well

# Water use in Texas and the Barnett ShaleNYSE: DVN www.devonenergy.com page7 

# Competing water uses Texas estimates Percent of total Fort Worth water use in 2005 by Barnett Shale operators: • Groundwater 2.5 % • Surface water 0.2 % • Total freshwater 0.5% Total water use projected to rise to a maximum of 2% during peak drilling activity SOURCE: Texas Water Development Board 2008 Annual Water Use Survey Competing water uses - TexasNYSE: DVN www.devonenergy.com page8 

# Water use in the Barnett Shale By major water user groups, 2008

Source: Texas Water Development BoardNYSE: DVN www.devonenergy.com page9 

# Devon in the Barnett Shale

Parker Palo Pinto Hood Tarrant Johnson Erath Hill Jack Wise Denton
Ft. Worth Highly Urbanized

Denton Primary 504,000 Net Acres Emerging 85,000 Net Acres 

### Devon’s Position Devon Completions Year Wells 2006 314 2007 469 2008 584 2009 298 2010 420NYSE: DVN www.devonenergy.com page 10 

# Devon’s 2010 water use in the Barnett Shale Completion requirements • Horizontal wells fractured (420) 41.3 Million Bbls • Vertical wells refractured (150) 4.5 Million Bbls • Total 45.8 Million Bbls 

### Sources • Surface water 11.5 Million Bbls • Groundwater 32.3 Million Bbls • Recycle water 2.0 Million BblsNYSE: DVN www.devonenergy.com page 11 

# Monthly frack volumes

• Month/year 08/2008 01/2011 • Stages 292 202 • Wells 64 29 • Stages per well 5 7 • Water required 222,600,000 gallons 117,600,000 gallons • Water required 5,300,000 Bbls 2,800,000 Bbls

# Water sources in the Barnett ShaleNYSE: DVN www.devonenergy.com page 13 

# Devon’s Barnett Shale Water use sources • Groundwater sources
− Devon permitted water well withdrawal
− Landowner permitted wells • Surface water sources
− Permitted withdrawal from Trinity River (Tarrant Regional Water District)
− Permitted withdrawal from Brazos River (Brazos River Authority)
− Purchased municipal water supplies
− Surface use agreement— landowner ponds
− Permitted withdrawal from local streams and impoundments (TCEQ) • Recycled water
− MVR (Mechanical Vapor Recompression) unitsNYSE: DVN www.devonenergy.com page 14 

# Groundwater from Trinity Aquifer

• Barnett Shale extent (blue) • Trinity outcrop (solid 

### green) • Trinity subcrop (stippled light green) Structural boundaries of the Barnett shaleNYSE: DVN www.devonenergy.com page 15 

# Surface water map

Source: Texas Natural Resources Conservation Commission (TNRCC).NYSE: DVN www.devonenergy.com page 16 

# Mobile heated distillation units Devon’s water recycling locations Wise Denton Parker Tarrant Hood Johnson 

### Devon has four units operating at one strategic location:  

### Spain (SE Wise Co.) Past locations:  Johnson Ranch (E Wise Co.)  Godley (W Johnson Co.)  Circle R (W Johnson Co.)  Dove Hill (SW Denton Co.)  McCurdy (SW Denton Co.)NYSE: DVN www.devonenergy.com page 17 

# Devon recycling facility Freshwater storage and completion activity

# Water management/sustainability initiatives in the Barnett ShaleNYSE: DVN www.devonenergy.com page 19 

# Recycled water with MVR Devon and Fountain Quail Water Management • Devon evaluated several different technologies to treat Barnett Shale flowback water and Fountain Quail’s MVR unit was the most feasible. • Approved by the Railroad Commission of Texas in 2005. • Implemented in 2005. • Vaporizes flowback water and condenses it into clean, distilled water • Remaining concentrated brine removed for disposal • 2,500 Bpd flowback water capacity with approximately 2,000 Bpd of freshwater generatedNYSE: DVN www.devonenergy.com page20 

# Water sustainability Barnett Shale flowback analysisNYSE: DVN www.devonenergy.com page21 

# Before and after pre-treatmentNYSE: DVN www.devonenergy.com page22 

# Devon’s water sustainability Distillate recovery— MVRNYSE: DVN www.devonenergy.com page23 

# January 2011 recycling statistics Cost and production report Recycling statistics:



### – Feed water 305,415 Bbls

– Freshwater produced 213,547 Bbls

– Concentrate produced 91,868 Bbls

– Efficiency 70% The economics of this technology is heavily dependent on:

− Trucking and disposal costs

− Fresh water costs

− Proximity of recycled water to future wells

− Treatment costNYSE: DVN www.devonenergy.com page24 

# Water recycling results

• 22,500 bbls per day at peak • 13.9 million barrels processed (584 million gallons) • 10.8 million barrels of distilled water generated (454 million gallons) • 100+ wells fracked with recycled water Ellenberger Barnett Shale

# Thank You.