Water Treatment Market Opportunities in Unconventional Oil & Gas

Tyler Algeo,

Senior Research Analyst,

Head of Unconventional Fossil Fuel and Water

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O2 Environmental Overview

O2 Environmental(Consultancy)

BlueTech Research

(Intelligence Service)

BlueTech Forum(Annual

Conference)May 14th, 2013

Amsterdam, The Netherlands

O2 Technology Assessment Group (TAG)

The BlueTech Research Teamat the 2013 BlueTech Forum

Our scientists and engineers are experts in water technologies and the global water market.

Office Locations

North America Europe

Asia (planned 2014)

What we doActionable Water Market Intelligence & Strategic Support

BlueTech Innovation Tracker Company Reports Monthly Intelligence Briefings Insight Reports on Markets &

Technologies Webinars on Hot Topics Analyst Access

• Strategic Support

• Commercialization Support

• Acquisitions Pipeline Support

• Investment Due Diligence

• Business Development

• Custom Research

• Market Intelligence

Four Core Practice Areas

Water Re-use and Alternative Water Sources

Unconventional Fossil Fuels and Water

Energy and Resource Recovery

Smart Water

What Clients Use our Service for

Identify new market opportunities and areas for growth

Competitor Analysis & Technology Analysis

Analyzing water technology patent trends and identifying water technology licensing, investment and acquisition opportunities

Other Benefits:– Educational tool for engineers and scientists in the

organization– Identification of strategic partners – Support in identifying R&D directions, and unique solutions for

client problems

Shale Gas in Context

Conventional56%Tight

10%

Shale28%

Coalbed6%Remaining technically recoverable natural gas resources by

type, end-2011

Source: www.worldenergyoutlook.org

What is produced water from shale gas?

Typical depth >3,000ft (914m)

Frack Fluids

Flowback, mostly Frack Fluid

Produced Water – formation water and Frack Fluids

Initial Fracking up to a few weeks (large volumes)

Ongoing Produced Water (small volumes)

Flowback Ongoing Produced Water

Produced Water Volumes Over Time

WaterShale Gas

Producing Time (up to a month)

Pro

du

cti

on

Ra

te

By mass the primary contaminant is Salt

TDSTSS

Polymers

SVOCs

Hydro

carb

ons

VOCs

1

10

100

1000

10000

100000

1000000

Contaminant

Ty

pic

al C

on

cn

etr

ati

on

Ra

ng

e (

mg

/L)

Technology Trends

TSSElectrocoagulation

Sock Filter

Clarifier

Oil & GreaseDissolved Air Floatation

Induced Air Floatation

Walnut Filter

BacteriaChlorine disinfection

UV disinfection

Ozone disinfection

Primary treatment technologies are mostly genericMetals (Ba, Sr)Chemical Precipitation (Sodium-Sulfate, Lime,

etc.)

Ozone

Electrocoagulation

HardnessLime and soda ash

Iron (Fe)Precipitation with NaOH

SulfatePrecipitation with

BaChloride

Membrane (Nanofiltration)

Proprietary technologies tend to be desalination technologies

Reverse Osmosis Evaporator Crystallizer

< 45,000 ppm 45,000 – 120,000 ppm 120,000 – 300,000ppm

Technology Used

TDS Concentration

Pri-mary Treatment Only50%

Pri-mary and De-

salina-tion

Treatment21%

De-salina-

tion Treatment Only29%

Key Market Trends in Shale Gas Produced Water Treatment

• The route to market is through Oil & Gas Service Providers

• Disposal of Produced Water is dominated by ‘truck and haul’ to disposal wells

• On-site reuse for fracking instead of treatment for discharge is resulting in reduced treatment requirements– Reuse driven by challenges in both disposal of Produced Water

and in sourcing fresh water for fracking

• Innovative water treatment technologies in the shale gas produced water space tend to be thermal treatment technologies and some membranes

Water Treatment in the Alberta Oil Sands

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In-Situ or Mining Depends on Depth of Overburden

Photo Source: University of Alberta

InSitu Oil Sands Production

Cyclic Steam Stimulation (CSS) Steam Assisted Gravity Drainage (SAGD)

Produced Water Treatment (Deoiling)

Skim Tank

Induced Gas Flotation

Depth Filter

Makeup Water

SAGD Treatment Train Options

DRUM Boiler Steam Generation

Trends in Water Treatment Technologies in the Oil Sands

Mining

Steam Extraction

Once Through Steam Generators

Conventional Treatment (WLS, Filter, WAC)

In-Situ

Research into non-water based extraction methods

DRUM Boilers

Use of Evaporators

Key Market Trends in Oil Sands Produced Water Treatment

• The primary route to market for treatment equipment is through selling to E&P.– Extraction is a water based process – any setback in water

treatment is lost oil production

• The industry is interested in robust technologies that are simple, have a small footprint, and are modular.– New technologies must be proven through extensive piloting– Primarily targeting oil removal (as well as silica, hardness, and

dissolved organics)

• Innovative water treatment technologies in the oil sands tend to be thermal treatment technologies and some membranes

Research into Alternative Treatment Trains

Veolia CeraMem has been piloting Ceramic Membranes

COSIA has been piloting Ceramic Membranes

Testing of membranes as pre-treatment for RO

Pre-Treatment Reverse Osmosis Steam Generator

Evaporator

100% 75%

25%

25%

Evaporative and Membrane Technologies

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Ceramic Membranes in Water and Wastewater are Predominantly Monoliths/Multichannel Elements

Ceramic Membrane

Materials in order of

Prevalence

𝛼 - Al2O3

Alpha-

Alumina

TiO2 Titania

SiCSilicon

Carbide

ZrO2 Zirconia

SiO2 Silica

ɣ - Al2O3 Gama -

Alumina

Ceramic Membrane Advantages to Oil and Gas Industry

Robust

High Effluent Quality

Simple Process

Modular

Ability to handle high temperature and pressure

Can feed advanced treatment (RO, IX, Evap)

Reduced number of unit processes, footprint

Reduced Installation cost, easy expansion, suitable for offshore

Companies offering or piloting Ceramic Membranes for the Oil and Gas Industry

Veolia CeraMem (SiC)

LiqTech (SiC)

Hyflux (alumina)

Purifics (SiC)

KSM Water (Alumina)(formerly 3C Membranes)

Meidensha (alumina)

Desalination Technologies

Most evaporative technologies appear to be based on Mechanical Vapor Recompression

Alternative desalination technologies include:– Membrane Distillation– Electro-chemical – Humidification-Dehumidification

Examples of Early Stage ZLD Companiesin the BlueTech Research Innovation Tracker

Company Technology Type Development Stage

Memsys Clearwater Membrane Distillation Commercial

Altela Humidification-Dehumidification

Demonstration Scale

Saltworks Technologies

Humidification-Dehumidification

Demonstration Scale

Saltworks Technologies Electro-Chemical Demonstration

Scale

Atlantis Electro-Chemical Pilot Scale

Thank you!www.bluetechresearch.com

tyler.algeo@bluetechresearch.com

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