Thursday, January 10, 2013

AMG aims to recycle wastewater from oil drilling using new process

Apex Management Group LLC (AMG) a San Antonio-based oil-field services management company is rolling out an oil-field technology aimed at recycling contaminated wastewater generated during production.

This process could remove toxic chemicals from the wastewater so it could be reused in the drilling process, eliminating the need for using fresh water for each well, said David Akin, CEO and president of . However, the company hasn’t yet filed permission with the state agency that governs the oil and gas industry.

The new process is used in northwestern Oklahoma in the Mississippi Lime rock formation, Akin said. This area has seen a boom in oil drilling, particularly by SandRidge Energy, Chesapeake Energy and Devon Energy. Akin declined to state which large independent company was contracting his services, due to a non-disclosure agreement.

In that area, exploration and production companies must use millions of gallons of fresh water during part of the drilling process known as hydraulic fracturing, or fracking. A company typically pumps about 4 million to 6 million gallons of water per well, as well as thousands of pounds of sand and tens of thousands of gallons of chemicals deep into underground rock formations. Fracking, combined with horizontal drilling, is credited with the current boom, and taps oil and gas resources that were previously regarded as unobtainable.

The Mississippi Lime formation also has lots of highly salty water with the oil and gas. Producers must dispose of millions of gallons of saltwater mixed with flow-back water that flows back up to the surface from a frack job. There is so much contaminated water produced in the area, SandRidge is drilling one disposal well for every eight petroleum wells and Devon is drilling one disposal well for every 10 petroleum wells.

With so much contaminated water, companies are looking for a way to turn that waste product into a resource. Akin said his process is more efficient than existing technology using centrifuges or filters to clean flow-back water.

Akin said the process uses methane gas that would otherwise be flared into the atmosphere to power natural gas turbines. The turbines are similar to helicopter engines that are frequently used in hospitals and in universities. The turbines superheat the contaminated water, similar to a distilling process. Though the end product isn’t drinkable, Akin said, it is clean enough to be used in fracking jobs.

He declined to state exactly how much his company spent to develop the process, but said that it was in the millions of dollars. Apex spent about three years developing and refining the recycling process, and has been operating a beta test of sorts with one company for about a year and a half.

In recent years, the Oklahoma Corporation Commission has modified and created new rules for companies developing processes for recycling water used in drilling operations. Last year, the agency had at least three cases looking at the process of commercial soil farming.

The process of soil farming combines waste mud laced with petroleum chemicals used in drilling with fertilizer and crushed gypsum rock and spreads it on farmland. The drilling mud in question must be tested to ensure that it doesn’t contain high levels of salts, heavy metals or petroleum products. Akin said residual material recovered from the recycling process is superheated to remove chemicals and could be used in soil farming operations.

Matt Skinner, spokesman from the OCC, said Apex’s technology would likely be covered under existing rules for recycling flow-back water. If the residual material removed from the water process meets acceptable levels, it could be used in commercial soil farming operations. The agency hasn’t yet received any applications from the company.

Sources: Dolan Media Newswires, Lexis Nexis, WaterWorld.com

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