By Jared Lazerson, Guest Columnist
As the upstream oil, natural gas, and natural gas liquids (NGLs) industry gets back to work across North America, technological innovation may hold the key to cutting costs and growing margins, especially in the area of wastewater handling, treatment, and disposal. Rapid growth of the industry, over the last decade, has brought on new challenges in efficiency and public perception. Parallel to the continued evolution of exploration and production technologies, mounting challenges directly related to wastewater disposal present an opportunity for innovation in this space.
Much of the growing regulatory and financial challenges associated with disposing oil, gas and NGL wastewater can be traced to wastewater injection wells and transportation for injection disposal, and the costs continue to rise. In 2014 hydraulic fracturing players in the United States spent more than $6.38 billion (US) on water management, according to Bluefield Research, with a 10-year forecast of $250 billion in costs over the next decade to address the issue. Increased activity, along with increased public and media attention to spills and heightened seismic activity associated with injection wells, has led to a tightening of regulations at various levels, adding complexity to the already labyrinthine regulatory landscape companies must navigate to remain compliant.
In an environment where companies must navigate long-term price instability, reactivation of E&P in North America is leading the industry to focus on building the most efficient operations possible in the face of more stringent regulations and more intense public scrutiny. As highlighted by the recent report from the Water for 2060 Produced Water Working Group in Oklahoma, thin profit margins and regulatory shifts present both challenges and opportunities to address externalities through improved wastewater disposal practices.
New technology offers a pathway to overcome both the financial and regulatory issues associated with wastewater disposal to meet the concerns of shareholders and community stakeholders alike. Recent technological advancements are making onsite treatment and re-use more cost-effective and accessible than ever before, saving money and decreasing the legal and reputational liability associated with off-site wastewater transportation for treatment and/or disposal. And it is Canadian companies that are leading the way to address water management issues across North America.
Industry veterans must be willing to get behind this technology to ensure the vitality and long-term sustainability of our industry. Much of the focus at my company, MGX Minerals, for this very reason has been to invest in the research and development of new technology that’s creating cutting edge solutions for E&P companies to tackle regulatory, financial, and reputational challenges at once. In the case of MGX Minerals, we’ve invested in a low-cost, low-energy, Katerva Award-nominated, patented nano-filtration process that removes metals and hydrocarbon from wastewater, allowing producers to reuse the water for their own operations, or sell the recycled wastewater to partners, creating a new revenue stream. Depending on the feedstock, our technology also allows oil and gas companies to further monetize their wastewater streams through the extraction of valuable minerals, using the very same purification technique. It is now possible to deliver a level of water purity that makes controlled release into the environment a new and attractive option for producers as an alternative to injection wells or transporting produced water to different jurisdictions for disposal.
Now is the time to invest in technologies like these to create a 21st century oil and gas industry that supports economic growth and environmental conservation. It is imperative for the industry to devote itself to innovating new solutions to wastewater challenges. Not only will it ensure a dynamic and resilient upstream sector but will also ensure our place in the new energy future, as drivers that powered the 20th century and will continue to do so in the 21st.
Author: Jared Lazerson is the president, CEO and director of MGX Minerals. He has worked in the mining and technology industries since 1994, with companies including Osprey Systems (GPS and digital mapping), United Helicopters, Copper Island Mines and Manto Resources. Jared holds a BA in International Relations from the University of Pennsylvania.
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