There’s Something in the Permian’s Water, and That’s a Problem

Every barrel of oil produced in the Permian Basin comes with a few barrels of water attached. Right now, it’s about 4 bbl, and the water-to-oil ratio is rising. Also, it’s not just water, it’s “produced water,” containing high concentrations of salt, heavy metals and other toxic substances.

By 2030, the Permian is expected to produce more than 6.5 MMbbl/d of oil and more than 26 MMbbl/d of water, according to B3 Insight, a water data and intelligence firm. Frac crews blast the shale in the Permian with water and sand to release the oil and gas in the rock, and the water comes up with the fuels.

The Permian is “generating an unprecedented volume of produced water—a costly and complex byproduct of hydrocarbon extraction,” B3 said. “Managing this deluge efficiently will define the next phase of the basin’s evolution.”

In the days of vertical wells, this waste product could simply be pumped back where it came from. With horizontal drilling and hydraulic fracturing, that’s not possible.

The combination “opens up previously impermeable rock for oil and associated gas (and produced water) to flow out—but not for produced water to flow back in,” analyst Housley Carr wrote on RBN Energy’s daily blog in August.

The industry initially relied on injection wells to get rid of the waste, an approach that B3 said is becoming more difficult “due to rising volumes and regulatory restrictions in response to seismic risk due to over-pressurized formations.” The seismic risk is earthquakes, like the magnitude 5.0 tremor that struck near the Culberson County-Reeves County border in February.

New Mexico has restricted injection wells for years, which prompted companies to carry water across the state line to Texas. Now the Railroad Commission of Texas is also taking a harder line against injection wells.

Aris Water Solutions CEO Amanda Brock said it more simply at the Produced Water Society conference in February in Sugar Land, Texas: “There’s this realization that you’re going to have to do it differently.”

The change is beginning. B3 points out that big operators like Aris and Deep Blue are pouring money into water infrastructure and midstream firms are expanding water treatment and recycling capacity. It’s prohibitively expensive to make the water drinkable again. A more feasible option is to pull out enough of the salts so that the water can be used for agriculture.

The real problem is scale, said Patrick Patton, vice president of product at B3.

“It’s still a massive scale to treat, to do all that, even if you could easily get permits,” Patton told Oil and Gas Investor. “The Permian’s producing more oil than anywhere else in the world, and so that’s more water than anywhere else in the world. You need a combination of solutions.”

A host of smaller firms are entering the fray—companies like Cavitation Technologies, 374Water, Espiku and Lithium Harvest.

Cavitation technologies

Cavitation Technologies Inc. (CTi) started operations in 2008 with the intent of using its signature nanocavitation technology to process biodiesel fuel. Over the years, CTi’s technology has been used to process vegetable oils and to clean water.

Cavitation is what it sounds like—the formation of cavities in liquid, generally brought about by low pressure. CTi and Intelligent Water Solutions are partnering to develop the technology for treating produced water.

“Basically, we’re creating tiny bubbles,” said Duane Germenis, president of Intelligent Water Solutions. “We’re going to send water through a Venturi [water jet pump] and create a lot of microbubbles. When a pump cavitates, it’s going to have this pressure drop, and you’re going to create tiny, tiny bubbles, and it’s going to kill anything in its place. The bacteria, the enzymes, the protein, whatever is in there that we can’t get with traditional oily water separation.”

CTi treated about 3 MMbbl of water in the Permian Basin from 2020 to 2022 in a partnership with Enviro Watertek, according to its news release. Now it’s adapting to the new expectations in the Permian, CEO Neil Voloshin said. The system is being tested at a major water remediation company in Texas, CTi said.

The procedure works without chemicals, Voloshin said, significantly reducing operational costs.

Germenis said the high saline levels of Permian produced water are a big issue.

“Besides removing contaminants and hydrocarbons and anything else that’s in the water, [cavitation] can desalinate it,” he said. “That wasn’t the driver, but it was a nice side benefit. And we have people coming to us with the cavitation technology and the plasma technology saying, man, this looks interesting. So, we’re right at that, where it’s about to take off.”

Lithium harvest

One of the solids found in produced water is lithium, which is used in the lithium-ion batteries that power electric vehicles and laptop computers. Lithium hydroxide goes for about $10 a kilogram, and demand is expected to rise well into the future.

Lithium Harvest was founded in 2020 to address the growing demand for more sustainable and efficient ways to produce lithium battery compounds, co-founder and CEO Sune Mathiesen said at the Produced Water Society conference in Sugar Land in February.

“We can transform the waste of produced water into value, we can increase profit from every level of oil or water that is coming out of the oil,” Mathiesen said.

Lithium Harvest builds a lithium extraction and refining facility on site, taking out transportation costs.

“We produce the lithium and send it off to the battery manufacturer, who then sends it off to the EV manufacturer,” Mathiesen said. EVs are driving lithium demand now, and he expects stationary batteries for grid backup to increase demand in the future.

The math for a plant that can produce 1,500 metric tons of lithium per year works like this: Lithium Harvest can build a 62,000-sf facility in 10 months with a capital expenditure of about $18 million. The plant will generate $25 million a year in revenue at current prices—more, if the price of lithium rises. Lithium Harvest can build the plant with its own money or form a partnership with the oil producer.

“We transform something that is waste today, which is a big problem today, into a lucrative asset we can reuse to treat the water for reinjection,” Mathiesen said. “You can reuse it for irrigation depending on where we’re located, and if there’s a business case for the water, we have the fastest deployment and returns.”

374Water

Science lesson: The different forms of water—liquid, gas, solid—are phases formed by pressure and temperature.

With enough heat and pressure, water enters a phase called “supercritical.” The combination required is pressure of 221 bars (1 bar is normal ground-level pressure on Earth) and temperature of 374 degrees Celsius (705 Fahrenheit), and now you know where 374Water got its name.

374Water combines air with a process called supercritical water oxidation, or AirSCWO, to treat many forms of industrial waste. It dissolves all carbon materials and oxygen in the feed, resulting in a stream of water, dissolved gases and inorganics. The water cools, the gases are vented and the inorganics turn to ash.

“This is really helpful to break apart any organics that you don’t want in your water or your waste that you’re treating,” said Naomi Senehi, an applications engineer at 374Water presenting at the Produced Water Society conference.

“Inorganics just precipitate out,” she said. “When you have things like lithium or some other salts that you’re trying to preserve, those will come out of your solution preserved and you can recover them later.”

The reaction time for SCWO is about 6 seconds, Senehi said. The process does emit CO₂ and methane. 374Water recycles the heat back through the system to save energy.

AirSCWO has been used to destroy PFAS, “forever chemicals,” from groundwater samples for the U.S. government, and the company says it’s in position to capitalize on increased demand for PFAS destruction. It’s also developing a system for the Orange County Sanitation District in California.

Senehi said the process can apply to produced water as well.

“If you have water that happens to have really high organics, we like that because organics fuel the process, but you could also just have something that has a high concentration of some valuable inorganics that you want to recover,” she said.

Espiku

Espiku is one of five energy startups selected in December to collaborate with Halliburton Labs. The Halliburton subsidiary helps businesses scale up by providing access to facilities, networks and financing.

Espiku’s systems turn produced water into clean water for reuse, recovering some potentially useful minerals along the way.

“We are proposing a technology that starts with water—recycles, reuses, just keeping the water clean and creating value that way,” said founder Bahman Abbasi, an associate professor of energy systems engineering at Oregon State University. “We drastically reduce the amount that needs to be disposed.”

Espiku is working on a pilot project that will put produced water through a three-stage separation process:

• First is a simple density separation that removes most of the oil and heavy organic materials;

• Next is a dehumidification process “that is really the core of our technology,” Abbasi said. “It’s designed to get water out of the system without fouling up the whole place” and

• The final stage condenses water out of the gaseous stream.

The pilot’s goals are to show the system can run well with minimal human intervention, deliver the quality of water reached in lab tests and work financially.

The side streams will vary depending on location, but they will typically contain useful amounts of lithium, magnesium, cobalt and nickel. It wouldn’t make economic sense to drill for any of these in the Permian but they can be a profitable byproduct and help companies save on the cost of transportation, injection and storage, Abbasi said.