Water not wasted

BRIGGSDALE – As oil and gas producers come under increasing pressure to reduce their use of fresh water, they’re turning to players such as High Sierra Water Holdings LLC, a company that has built some of the largest recycled-water processing plants in Northern Colorado.

High Sierra, which has its roots in Greeley, has developed industry-leading treatment processes, allowing oil companies to turn over their used water to a High Sierra facility, where it is treated and transported back to the oilfields.

This year the company expects to recycle about 2,000 barrels of water daily at its Weld County facilities, up from some 1,500 barrels last year.

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A division of Denver-based High Sierra Energy LP, the company has charted strong growth in recent years. A wholly owned subsidiary of Tulsa-based NGL Energy Partners LP (NYSE: NGL), High Sierra acquired Greeley-based Conquest Water Services LLC in 2011.

High Sierra has operations in the Denver-Julesburg Basin, which includes Northern Colorado, and also works in Wyoming, Oklahoma and Kansas. In Weld County, High Sierra owns two water-recycling facilities, one in Briggsdale and another in Platteville, which company representatives believe are the largest such facilities in Northern Colorado.

“The field seems to be moving toward recycling slowly but surely,” said Doug White, vice president of High Sierra Water.

Companies can use more than 3 million gallons of water per well during hydraulic fracturing, a well-completion technique that involves pumping water, sand and chemicals at high pressures to crack tight shale formations and release oil and natural gas. After the well is complete, water flows back to the surface where it is captured and transported offsite. Most of this contaminated water still is disposed of via deep-injection wells, but growing amounts are treated and reused.

High Sierra Water owns nearly half of the 25 deep-injection wells operating in the greater Wattenberg area. These are designated specifically for wastewater and regulated by state authorities. The greater Wattenberg area spans nearly 3,000 square miles north of Denver and through a substantial portion of Weld County.

High Sierra has developed water-treatment systems that remove elements such as barium, calcium, magnesium, silica, strontium and iron so companies can reuse the water for hydraulic fracturing.

The company has the ability to treat water to match the quality of fresh water, company representatives said. In Wyoming, for example, the company operates a water-treatment facility that has recycled more than 32 million barrels of water and discharged more than 5 million barrels of highly treated water into the New Fork River, a tributary of the Green and Colorado rivers.

“We have standard water-treatment equipment that we’ve manipulated and put in place to accomplish certain tasks,” said Josh Patterson, director of operations for High Sierra Water.

“Anybody can treat water,” White added. “This oilfield water is harder to treat, but most people can treat it. The difference is the cost to treat it.”

High Sierra Water representatives declined to disclose the company’s cost for treated water. In Weld County, the company recycles less than 5 percent of the water hauled by trucks to its facilities, but it believes that percentage will only increase, Patterson said. Most of the company’s business comes from deep wastewater well injection.

Trucks typically haul water to High Sierra Water’s facility, but the company plans to build a 4-mile pipeline that will take newly treated water from its Briggsdale facility back out to the oilfield to be reused for fracking.

High Sierra has worked with a number of oilfield services companies such as Halliburton Co. (NYSE: HAL) and oil producers such as Noble Energy Inc. (NYSE: NBL) to help them with water recycling.

Noble Energy said in October that it had recycled about 2 percent of its water so far this year, or 600,000 barrels.

But Noble is in the midst of a major expansion of its water-recycling program. Today, about 80 percent of Noble Energy’s water comes from ponds and wells and 18 percent from cities, while 2 percent is recycled. Noble Energy plans to raise the capacity of its program to recycle 5.8 million barrels of water next year, nearly 10 times more than its current level.

Despite the efforts of companies such as High Sierra Water and Noble Energy, water recycling remains uncommon in Northern Colorado despite heavy drilling activity.

It is more common in Western Colorado, where about half of water used in oil and gas production is recycled, said Ken Carlson, a civil engineering professor at Colorado State University.

Further water recycling would help conserve an important resource as well as reduce use of water-hauling trucks that damage roads and pollute the air, he said.

But in Northern Colorado, oil companies use a viscous, gel-like fracking fluid that makes water-recycling more expensive than in places such as the Piceance Basin on the Western Slope or the San Juan Basin in Southern Colorado, Carlson said.

“It’s more difficult to treat it and reuse it and not have it foul up the well the next time you use it,” he said. “The technology … being developed really breaks the gel and makes it more like regular water, and then it can go through a typical water-treatment process.”

However, the real challenges come not with treating the water but in addressing logistics and infrastructure, such as pipelines and facilities to transport and treat water.

Along with High Sierra Water, Carlson and a team of graduate students have worked with Noble Energy to help the company recycle more water. Several other oil companies also now have water-recycling programs, he said.

“It’s not just talk,” Carlson said. “There are real programs to increase the recycling of water in the Denver-Julesburg Basin.”