The ongoing evolution of the shale industry means that those providing products and services to producers are continually having to come up with innovative solutions to unprecedented new challenges. Increasingly, these challenges include minimizing carbon emissions and other environmental impacts while responding to growing demand for new infrastructure. And one solution emerged in recent days on news that a division of Chevron Phillips Chemical Company LP is supplying EVX Midstream Partners LLC with a new type of plastic pipe for a saltwater disposal pipeline project.
Under the deal, Chevron Phillips’ Performance Pipe division will supply a type of high-density polyethylene (HDPE) pipe it describes as “unique” to EVX. The PlatinumStripe 1800 Series PE-RT Piping will be used for a project in the Eagle Ford shale, with the goal of transporting produced waste water to multiple saltwater disposal (SWD) facilities in a more sustainable manner.
The pipeline will also be notable for being the longest to transport produced water in the Eagle Ford, at more than 300 miles. The use of HDPE pipe is expected to help reduce demand for heavy-haul trucks to transfer wastewater, bringing down traffic on public roads in the region by an estimated 250,000 truck trips per year. Chevron Phillips said that as well as saving municipalities the expense of maintenance caused by potential wear and tear on public roads, the new pipeline would reduce the carbon emissions associated with these heavy-haul trucks.
The announcement comes as more attention is being paid to the impact of new infrastructure in shale plays, both locally and as part of operators’ broader emissions reduction strategies. The pursuit of efficiency gains, particularly in recent years, has led shale producers to experiment with longer laterals and increased proppant volumes during the hydraulic fracturing process.
Some shale wells now use around 25 million gallons of water per well. This has led to a boom in new infrastructure for handling produced water, which comprises a mix of fracking wastewater and brackish water that is dislodged by shale drilling.
The Permian Basin, which is by far the largest contributor to U.S. tight oil production, is estimated to use more than 195 million gallons per day. The Bakken and Eagle Ford plays are the second- and third-largest oil-producing shale regions respectively, and are also experiencing growing demand for water handling infrastructure.
Wastewater from shale drilling can reach high temperatures, particularly in the Eagle Ford according to Chevron Phillips. Produced Eagle Ford water is often in the 160 F to 180 F range, and this makes standard steel piping more prone to being corroded. For producers trying to keep a lid on spending, the ability to minimize pipe maintenance and replacement costs will thus be appealing.
HDPE benefits from being among the most chemically inert of all plastics, as well as being far easier—and therefore cheaper—to transport than steel. Indeed, HDPE pipelines are already an existing option for wastewater handling, but because of the temperatures involved, standard HDPE pipes require cooling, which is powered by diesel motors. The installation and operation of these motors is an additional cost, as well as resulting in carbon emissions. Performance Pipe noted that its new HDPE pipe would eliminate these costs and reduce the associated emissions.
“The installation of Performance Pipe’s Platinum Stripe 1800 Series PE-RT Piping provides numerous benefits to safety, the environment and the local community,” Performance Pipe’s general manager and president, Mike Zeglin, said in the company’s statement. “Our product helps meet the water handling requirements of shale producers in an all-around safe and reliable manner, from reducing the carbon footprint associated with saltwater disposal to creating less truck traffic and related emissions.”
“This project is a great example of how Performance Pipe products carry significant advantages on multiple fronts, including in this case for shale production, the environment, public safety and our highway infrastructure,” said EVX’s CEO, Herb Chambers IV. “That is why we believe our SWD pipeline network represents a true win-win for shale producers, our company, local landowners and the Eagle Ford’s economic growth.”
Neither EVX nor Chevron Phillips had responded to Hart Energy’s queries about the pipeline project.
One factor that could make other midstream players look to HDPE pipe for water infrastructure is the U.S. tariffs on steel imports from most countries. A number of U.S. industries have either delayed steel-heavy projects or switched to alternative materials since the tariffs were introduced in March 2018. In line with this, the oil and gas sector, while still heavily reliant on steel, will be keen to explore other options.
Performance Pipe says it has a presence in every U.S. shale play, though this is the first time this HDPE specialty product has been used in the Eagle Ford. If the project is a success, this could encourage other midstream operators to increasingly adopt this type of HDPE pipe for their operations as well. And the trend will likely be spurred by the rise of water recycling in shale plays, especially as Texas has recently enacted a law that will encourage the reuse of water once it goes into effect on Sept. 1.
Pinnacle also began construction of a crude oil stabilization facility capable of stabilizing up to 5,000 barrels per day, which could be expanded as needed to meet customer demand.
In China, tariff rhetoric kept heating up, this time over LNG with the country threatening a 25% tariff on U.S. imports.
Enterprise paid the first installment of $1.15 billion, and the final $1 billion payment is due on the first anniversary of closing date. The transaction’s effective date is July 1.