The impact of chemicals is not typically at the forefront of consideration when oil and gas companies set their ESG guidelines. But if you ask Flotek Industries Inc. CEO John Gibson, they should be.
“Chemicals have not yet ascended to top of mind as our industry has focused ESG agendas on greenhouse-gas [GHG] emissions and water. We believe chemistry will lead the agenda in the coming years,” Gibson told Oil and Gas Investor. “No other decision can have as large an impact on air, water, land and people as the selection and execution of delivering chemistry to the well site. From responsible sourcing, transportation hazards, waste management, human health and safety, priority air pollutants to persistent land contamination, chemistry can affect a company’s ESG reporting across many categories. We have a duty of minimizing the impact of hydrocarbon extraction on society.”
“Everything we’re doing is tied back to how we can improve the environmental performance of our customers and improve their ability to retain their social license to operate,” Gibson said. “Fundamentally, we transitioned from being a chemistry company committed to ESG into an ESG company with chemistry at our core.”
For nearly two decades, Flotek has worked to reduce the environmental impact of energy through technology-driven green chemistry, data and analytics. Although developing clean technology is nothing new for Flotek, its efforts are gaining more support within the oil and gas industry as companies seek to define and report ESG performance.
“Environmentally speaking, Flotek built its reputation and patent portfolio by using renewable resources, such as terpene, as the basis of its chemistry,” Gibson said. “Aside from its production performance improvements, the solvents are biodegradable.”
Terpenes are a better alternative to xylene, Gibson added.
“Replacing xylene with natural solvents means that hazardous chemicals don’t need to be produced, transported, handled or injected,” he said. “This prevents workers and neighboring communities from even being exposed to harmful materials.”
On the governance side, Flotek is working with a sustainability audit standards organization to help its customers determine how they can track their chemistry usage and selection relative to ESG goals.
Flotek’s newly designed scorecards help companies identify the most problematic chemistries impacting air, water, land and people. The assessment assists customers in decreasing volumes of all chemistry used, which in turn minimizes waste, handling risk and GHG emissions.
The company is partnering with customers to show how its new scorecard analysis can be incorporated into the company’s self-reported data.
Flotek’s line of ecofriendly equipment includes an analyzer that allows operators to measure the composition and physical properties of hydrocarbons while flowing, without having
to open the pipe and release anything into the atmosphere. Previously, many workers were required to open and close valves to take samples.
“We’re able to tell you—in real time—what the composition is,” Gibson said. “That is a tremendous improvement over the past.”
A current Flotek solution eliminates the costly and time-
consuming task of separating refined products that become mixed in the pipeline during transport.
“In our case, we’re able to identify within 15 seconds a change in product within the pipeline enabling our customers to minimize mixing through new processes and automation with savings typically exceeding $100,000, not including the reduction in additional emissions,” Gibson said.
The company is also using data analytics to improve people’s understanding of crude, condensates and refined fuels. For example, by fingerprinting crude, companies can identify and track crude from its source, helping account for how much CO2 is associated in its production. Flotek plans to expand its digital monitoring technology into the direct measurement of GHGs and other unwanted molecules as well.
“Flotek has been a proven leader in natural terpene systems for more than a decade,” James Silas, the company’s senior vice president of research and innovation, told Oil and Gas Investor. “Our large patent portfolio centers on sustainable natural chemistry and the ability to safely and effectively treat subsurface formations for greater production.”
“We strive to lead the industry in terms of the most effective and safest chemistries out there,” Silas said.
During his eight years with Flotek, Silas said he observed a shift across the board within the oil and gas industry to look more favorably toward green chemistry.
“We’re seeing ESG discussions not just from the investor or the shareholder base. They are working their way through the C-suites of companies and now pushing down to their operations as well,” Silas said. “There have been aspects of ESG discussed before, but now we are really seeing action toward more safe chemistry, more effective chemistry and more efficient chemistry. And that’s where we think Flotek has the greatest ability to provide value to our customers.”
Looking ahead, Flotek is looking to expand its business outside North America and into the North Sea, the west and east coasts of Africa, and parts of the Mediterranean, said Ryan Ezell, Flotek’s president of chemistry technologies.
“The ESG emphasis of the industry is not limited by the borders,” he told Oil and Gas Investor. “Offshore drilling and production operations across the globe are moving toward zero discharge. They’re very aware of the environment.”
Ezell said Flotek’s technologies have great utility in many applications for drilling, production and remediation of offshore wells, particularly in environmentally sensitive areas.
“Our genesis can be found in the creation of better cleaner chemistry,” Gibson added. “We have taken that heritage and evolved to being the first ESG-centered chemistry provider for our industry without compromising performance. We believe our approach and solutions can improve both your ESG and financial results.”