COLUMN: Shale Not Main Cause of Texas Water Shortage

NOTE: this article originally appeared in Forbes

One of the challenging aspects of shale oil and gas development in the United States comes from the fact that some of the large shale reservoirs are located in areas that are arid or semi-arid. Some, like the Eagle Ford and Cline Shales in Texas and the Niobrara in Colorado, are affected by ongoing drought conditions. This reality can make the sourcing of water for hydraulic fracturing operations a difficult undertaking.

This situation can also result in the industry taking full blame for water shortage issues in misleading and distorted media reports, like this one that ran in the UK Guardian on August 11. This article, which unfortunately has led to a series of follow-up pieces in other media outlets, spends its first 500 words or so placing full blame for chronic water shortages in and near Barnhart, Texas on the very recent boom in the oil and gas industry. While it finally does get around to at least indirectly admitting the real, far more complex crux of the matter in its final few paragraphs, the writer achieves her obviously intended effect of drumming up alarm about the Texas oil and gas boom.

What is the real crux of the matter? First, take a look at a map and see where Barnhardt is actually located: southwest of San Angelo, east of Fort Stockton, in the middle of the West Texas desert. This area has always, since human beings began settling it, experienced water shortages and wells periodically running dry.

Second, as the Guardian writer tangentially references in her very final paragraph, the area is now more than a decade removed from the last time it saw a Pacific or Gulf of Mexico tropical storm come onshore and move through West Texas dumping the flooding amounts of rain that have, since time immemorial, been a critical aspect of the water recharge picture in that part of the country. The oil and gas industry, for all of its supposed might, has no ability to prevent tropical storms from forming and coming onshore.

Third, the entire state of Texas is in the fifth year of a near-record drought cycle, the sort of which the state has also experienced periodically since time immemorial. Again, the oil and gas industry has no ability to create or end drought cycles.

Fourth, the Guardian writer herself talks about other communities in Texas, like Spicewood Beach near Austin, that are experiencing their own water shortages. There is not now and never has been any appreciable oil and gas development activity anywhere near Spicewood Beach, Texas.

Fifth, the area in and around Barnhardt, Texas is an area that is home to very heavy agricultural water usage that may well not be sustainable in the long run in such an arid part of the state. That’s not an attack on the ag industry (which my own family has been involved in for more than 100 years), that’s just a fact that water experts all over the state have long expressed concern about.

Finally, many of the oil and gas operators in the Barnhardt area aren’t even taking water from the shallow underground reservoirs discussed in the first 3/4ths of the Guardian piece. They are instead drilling deeper wells, often into semi-brackish or brackish formations that are unsuitable for drinking or agricultural uses. Nowhere does the Guardian mention that reality.

But the oil and gas industry tends to become an easy foil for agenda-based journalism because its operations are so visible, and because it tends to be the “last user in” in many parts of the country. Even though the Texas State Water Board admits that oil and gas water usage amounts to around 1% of overall water use in the state, when people see those big water trucks rolling down the highways, they tend to think the industry is the major user of water in the area.

The good news is that the industry is becoming increasingly creative in recycling, conservation and water sourcing efforts as time goes on, allowing the development of America’s incredible wealth of oil and natural gas shale resources to continue. The pre-existing water situation is unique to each part of the country, so solutions to water-sourcing challenges vary by region.

The northeast Louisiana area, home to the Haynesville Shale, provided a good example in recent years. The underground water aquifers in that area were not capable of providing the water necessary to sustain the rapid initial drill-out of that play, so companies were forced to look for other options. Many companies with leaseholds near the Red and Sabine Rivers, which flow along the Eastern and Western perimeters of the Haynesville play area, were able to obtain adequate water from those large streams. Other companies in the play were able to purchase treated effluent water from the City of Shreveport and treated wastewater from a large, nearby plant operated by International Paper IP -0.11% Company.

In the Eagle Ford Shale region, we see a much different situation. Most companies in the western 2/3rds of that region are able to source water from the deep, prolific Carrizo/Wilcox underground aquifer, which is a blessing since the only rivers in that region often run at little more than a trickle, especially during the drought the area has experienced over the last five years. Some of the small communities in the area have begun to follow Shreveport’s example, creating a new profit center by selling treated effluent water for oilfield use.

As is always the case in the oil and gas industry, advancing technology is also playing a key role in addressing water issues. Recycling and conservation have become key elements of the water equation in the oil patch. Smaller companies that own proprietary recycling systems have proliferated across the country, providing solutions in isolated areas.

But larger oilfield service providers with multi-million dollar annual research and development budgets are also playing a major role. For example, in March, Halliburton HAL +1.79% announced the commercialization of a new integrated suite of water services it calls H2OForwardSM. This water system formulates stable fracturing fluids that are able to work with water containing total dissolved solids (TDS) of up to 285,000 parts per million, an advance that Walter Dale, Halliburton’s Global Strategic Business Manager of Water Management Solutions, refers to as “…a paradigm shift that negates the use of fresh water and meets the supply chain needs of the customer.”

XTO Energy partnered with Halliburton in the use of the H2OForward system on a group of wells in Eddy County, NM, and earlier this year issued a report documenting savings of between $70,000 and $100,000 per well, with no discernible loss of production.

FTS International, formerly Frac Tech, has a treatment and recycling technology that it calls Aquacor. One of the company’s Aquacor units is capable of cleaning up to 15,000 barrels (630,000 gallons) of returned fracturing fluid each day. The company expects to have three of its systems in operation by year’s end.

Baker Hughes offers a water management technology it calls H2PrO. Tom Whalen, the company’s Vice President of Water Management, recently told Reuters that, when the company introduced its product about 18 months ago its customers initially expressed interest, but were slow to commit to using it on a daily basis. But, he said, “In the last 12 months, that’s totally changed”, and the company now has more than 300 employees engaged in water management in North American shale plays.

This growing ability of the industry to move to more and more use of brackish water in its hydraulic fracturing operations is critical for West Texas, since that region is home to enormous underground brackish reservoirs.

Of course, one of the industry’s ongoing challenges is to help the public and policymakers look at its overall water use in the context, and compared to society’s other uses of water. In recent years we’ve all seen factoids and slides comparing water used in the average hydraulic fracturing job to other uses like crop irrigation, power generation, city drinking water and other societal uses that consume far more water than the oil industry uses.

We talked in this space a couple of months ago about one of the more compelling comparisons in recent months comes from the June 28 edition of the Wall Street Journal. The Journal cites a study compiled by a University of Texas teacher named Rusty Todd, who compared water used in Texas for hydraulic fracturing operations to the volume of water used by Texans for watering their lawns. Mr. Todd’s somewhat astonishing finding was that the amount used for lawn watering was 18 times the amount of water used in hydraulic fracturing operations in Texas in 2011.

But the reality for this industry is that public perception, largely impacted by media coverage, matters. And it matters even more when the subject is water, one of our most critical life-sustaining substances. So in order to maintain the public’s confidence and ultimately its license to operate, the industry is obligated to continue to find ways to conserve and recycle water, along with creative ways to source it.

Fortunately, a lot of very smart people at many of the industry’s most innovative companies are involved in doing exactly that. Too bad the Guardian’s writer didn’t take the time to talk to any of them before filing her story.

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