Permian Basin 2017

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PERMIAN BASIN: TECHNOLOGY 56 | November 2017 | As long laterals get thirstier, the push to provide water becomes more creative. While recycling produced water is on the rise, operators and midstreamers still look to good, reliable groundwater. For decades, a few thousand barrels of fresh-to-brackish groundwater could be brought in via trucks or small pipe to mix up drilling mud for a shallow vertical well. Non-potable was fine, and sinking a water well was common in most of the Delaware Basin. Bringing in 300 Mbbl to 750 Mbbl of water for a hydraulic fracturing job is off that scale, however. Enter the big-volume pipeliners. Layne Christensen and its engineering contractor, Lockwood, Andrews & Newman (LAN), set a torrid pace this past spring and summer, fast-fusing 20 miles of 22-in. HDPE plastic pipe at a rate of up to 3,000 ft/d over a 90-day project. The result: the $18 million, 100 Mbbl/d-capacity Hermosa Pipeline from Pecos northward towards Orla, Texas. The Hermosa pipe connects nearly 1,000 acres of non-potable water from the Pecos Valley Aquifer acreage to the proximity of western Delaware Basin operations of Energen, Carizzo, PDC Energy, Apache, BHP, Resolute, Centennial, Cimarex, Anadarko and WPX. Not all are customers yet but the opportunity is there. The Hermosa system includes six non- potable water wells, pump stations and in-ground reservoirs. "There is still a significant need for groundwater as an option when you are doing pad drilling," said Byron Geeslin, Layne's vice president, Business Development. "When an operator has a multiwell project, they can't bring in enough produced water at the right time. "So even as recycling becomes a bigger part, produced water is still blended with non-potable groundwater," he said. Geeslin points out that Layne is no newcomer to delivering H 2 O. "Layne has been in the water industry for 135 years," he said. After years of drilling water wells and building infrastructure for oil and gas clients, Layne "wanted to find a different way to deliver value to our customers," said Layne CFO J. Michael Anderson. "Owning these high-quality wells with access to a lot of water and delivering through large-scale infrastructure was a great way for us to get into the business. "We happen to think we're in the very best place in the United States," Anderson said. "One thing is producer economics. There's not a lot of infrastructure yet. Water is hard to come by. It is a nice triangulation." For the present time, Layne isn't announcing other large- scale company-owned infrastructure in the Permian or elsewhere. But they can muse about other opportunities. "Certainly in the Midland Basin," Anderson said. "Oklahoma's Scoop and the Stack have some interesting potential. There may be something in the D-J Basin. But right now we feel we have a lot of stuff on our plate in regards to the Delaware Basin. We'll build on that. Once you have infrastructure in place—adding on to it can be very favorable to us and our customers. Maybe we could get to a handful of other places. Hermosa Pipeline Offers Producers Pipe Reality An aerial view of the Hermosa Pipeline terminal reservoirs near Orla, Texas. (Photo courtesy of Layne Christensen)

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