Mike Christensen strides among rows of gleaming steel tanks, pointing to pipelin...
BIG SPRING, Texas - Mike Christensen strides among rows of gleaming steel tanks, pointing to pipelines that arrive from miles around to this corner of former farmland near Midland, Texas, the heart of the largest oil patch in the United States.
While U.S. oil production has reached record levels on account of the shale revolution of the last decade, much of the supporting infrastructure has failed to keep up, including how to transport the large quantities of water used in the hydraulic fracturing process and the water that is produced from wells alongside oil and gas.
“You can’t bring production online until you have a solution for the water,” said James Lee of Riveron Consulting. Christensen’s company, On Point Oilfield Holdings, owns a water disposal network that this year will take up to 375,000 bpd of wastewater. Some of that water will be recycled, but millions of gallons will eventually be sunk deep underground in West Texas. “Water was always an afterthought for producers,” said Christensen, who stretches him arm and draws a 360-degree arc to show the locations of lines carrying oilfield bilge to the site. “Now it’s a business plan in itself.
“When capital discipline is higher on the priority list, it’s very attractive to monetize” water management assets, said Benjamin Shattuck, an analyst at consultancy Wood Mackenzie.The average frack job now consumes 13 million gallons , up 40 percent in two years, according to a Reuters analysis of Permian producers’ data reported to FracFocus.org.
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