Five things I learned from the virtual PWSME operators’ panel

Some key takeaways from the first Produced Water Society Middle East chapter webinar event, held on July 9.

For its first webinar, the Produced Water Society Middle East (PWSME) chapter brought key operators to discuss regional produced water challenges, particularly in light of the current oil price downturn. The panel was moderated by Hani Al Khalifa, PWSME president and senior operations advisor at Saudi Aramco. Saada Al Shukaili of Petroleum Development Oman, Ammar Al Mashjari of ADNOC Group, Shadi Al Adel of Saudi Aramco and Amir Al Wazzan of Dragon Oil were among the panelists. Here are some key takeaways from the discussion:
1. COVID-19’s impacts on operations are many
Everyone is keenly aware of how COVID-19 has transformed global hydrocarbons demand and, subsequently, the oil price environment. Operators have slashed capital expenditures (capex) and prioritized the simplest projects with the highest returns, shifting funds away from key R&D projects aimed at difficult challenges, including those pertaining to produced water. There is concern that this slump will push key talent out of the oil & gas industry, further limiting plans for produced water treatment and management projects. However, several panelists agreed that the downturn has provided a key opportunity to find ways to collaborate and address the region’s water issues.
2. Capex is not the only thing on the chopping block
While optimizing operating expenditure (opex) has long been a goal of operators, there is more pressure to do so in the wake of this year’s oil price crash. A large chunk of opex is tied to the management of produced water volumes, which are rising as Middle East fields mature. Operators are investigating ways to lower chemical use for treatment and energy consumption for pumping and reinjection in order to reduce opex in a meaningful way. Trimming opex is key to project economics, especially as most of future global production will likely come from the Middle East region.
3. Despite market volatility, water experts remain interested in R&D and new technologies
With Middle East operators focused on opex optimization, produced water experts continue to push for new technologies, particularly those that can minimize water management and treatment costs while improving operational efficiencies. Examples include better oil-water separators for highly emulsified oil in water, digital and automated systems and downhole water reduction technologies. Renewable energy-based desalination could also enable lower-cost advanced treatment, potentially leading to more opportunities for recycling and beneficial reuse.
4. Collaboration is key to achieving goals
All of the panelists spoke of the need for cooperation among the various stakeholders involved with produced water – operators, technology developers, services providers, government agencies, universities, and even internally between field teams, project managers and R&D divisions. While much R&D is typically undertaken by operators themselves, the urgency of the water challenge requires partnerships to find better solutions and more quickly. The types of collaboration discussed included risk-sharing service models, joint ventures, consortiums and more formal associations that can support Middle East-focused initiatives to address common issues across the region.
5. Recycling and beneficial reuse can go a long way in the Middle East
Given water scarcity in the region, the high costs and energy consumption associated with deep well disposal, and the trajectory of produced water volumes, recycling and beneficial reuse are increasingly appealing. Oman is intensifying efforts to recycle produced water in fields for enhanced oil recovery, reaching 60% reuse already. That country is also a leader in the beneficial reuse space, with its unique Nimr reed beds project being an example of how to “green” the desert and provide treated water for other potential reuse schemes. Saudi Arabia is looking into the feasibility of similar projects. Panelists said that using produced water to generate power – for example, by using steam made from produced water to drive turbines or extracting hydrogen from the water – is another interesting area.