Key Shale Gas Water Management Strategies: An Economic Assessment Tool

Slutz, James A.; Anderson, J.; Broderick, Richard; Horner, Patrick

doi:10.2118/157532-ms

Cited by 35 publications

(44 citation statements)

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“…Corresponding water management options include Class-II disposal wells, centralized wastewater treatment facilities, and onsite treatment. 32 The raw shale gas, depending on specific shale play location, generally has a different composition.…”

Section: Background and Literature Reviewmentioning

confidence: 99%

Deciphering and handling uncertainty in shale gas supply chain design and optimization: Novel modeling framework and computationally efficient solution algorithm

Gao

You

2015

AIChE Journal

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in Wiley Online Library (wileyonlinelibrary.com) The optimal design and operations of shale gas supply chains under uncertainty of estimated ultimate recovery (EUR) is addressed. A two-stage stochastic mixed-integer linear fractional programming (SMILFP) model is developed to optimize the levelized cost of energy generated from shale gas. In this model, both design and planning decisions are considered with respect to shale well drilling, shale gas production, processing, multiple end-uses, and transportation. To reduce the model size and number of scenarios, we apply a sample average approximation method to generate scenarios based on the real-world EUR data. In addition, a novel solution algorithm integrating the parametric approach and the Lshaped method is proposed for solving the resulting SMILFP problem within a reasonable computational time. The proposed model and algorithm are illustrated through a case study based on the Marcellus shale play, and a deterministic model is considered for comparison. V C 2015 American Institute of Chemical Engineers AIChE J, 61: 3739-3755, 2015 Keywords: shale gas, supply chain, estimated ultimate recovery, uncertainty, stochastic program, stochastic mixedinteger linear fractional programming IntroductionIn recent years, the widespread application of horizontal drilling and hydraulic fracturing has led to a "shale revolution," which further results in the U.S. transitioning from an importer to a net exporter of natural gas.1 As reported by the Annual Energy Outlook 2015 released by the U.S. Energy Information Administration (EIA), 2 natural gas production is expected to grow by an average rate of 1.6% per year from 2012 to 2040, more than double the 0.8% expected annual growth rate of total consumption in the U.S. over the same period. The 56% increase in total natural gas production is mainly due to increased shale gas production, which will grow by more than 10 Trillion Standard Cubic Feet (Tscf). The percentage of the U.S. total natural gas production from shale gas is expected to increase from 40% in 2012 to 53% in 2040.Despite the optimistic forecast of shale gas production given by the EIA, a recent report by Post Carbon Institute unveils the fact that the actual future of shale gas may not be as bright as the EIA suggests.3 From a well-by-well-based calculation of shale gas production throughout the U.S., they conclude that the actual profitability of a shale well can be significantly affected by the uncertainty in the estimated ultimate recovery (EUR) and astounding decline rates of production ranging from 60 to 90% in the first 3 years. Considering the significant influence of the shale gas industry on the overall U.S. energy sector, it is essential to design and operate emerging shale gas supply chains with explicit consideration of EUR uncertainty and actual shale gas production profiles.Supply chain design and optimization under uncertainty has long been known as a challenging problem that is vital to the success of industrial concerns. 4,5 Currently, there a...

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Section: Background and Literature Reviewmentioning

confidence: 99%

Deciphering and handling uncertainty in shale gas supply chain design and optimization: Novel modeling framework and computationally efficient solution algorithm

Gao

You

2015

AIChE Journal

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“…Normally, the volumetric flow rate of flowback water is significantly larger than that of produced water, and the produced water tends to have higher concentration of TDS, likely because of its longer residence time downhole as well as a smaller flow rate. As a whole, we can observe the flow rate of wastewater decreases along with time while the salinity of wastewater increases with time . The resulting wastewater can be temporarily stored in tanks or impoundments, transported to Class‐II disposal wells for underground injection, transported to commercial centralized wastewater treatment (CWT) facilities for treatment, or directly treated by onsite treatment facilities for reuse .…”

Section: Introductionmentioning

confidence: 99%

“…As a whole, we can observe the flow rate of wastewater decreases along with time while the salinity of wastewater increases with time . The resulting wastewater can be temporarily stored in tanks or impoundments, transported to Class‐II disposal wells for underground injection, transported to commercial centralized wastewater treatment (CWT) facilities for treatment, or directly treated by onsite treatment facilities for reuse . Multiple technologies are involved in each of these water management options, which are explicitly introduced in the Background Section.…”

Section: Introductionmentioning

confidence: 99%

“…With the rapid development of hydraulic fracturing in recent years, there is an increasing concern regarding freshwater consumption and wastewater disposal. Existing publications in this area focus on the environmental impacts of hydraulic fracturing, or on the technoeconomic analysis and optimization of specific water management options, and water consumption is considered as an important issue for shale gas production . The recently published report by the U.S. Department of Energy emphasized that water scarcity, variability, and uncertainty are becoming more prominent, potentially leading to vulnerabilities of the U.S. energy system.…”

Section: Introductionmentioning

confidence: 99%

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Optimal design and operations of supply chain networks for water management in shale gas production: MILFP model and algorithms for the water‐energy nexus

2014

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The optimal design and operations of water supply chain networks for shale gas production is addressed. A mixed‐integer linear fractional programming (MILFP) model is developed with the objective to maximize profit per unit freshwater consumption, such that both economic performance and water‐use efficiency are optimized. The model simultaneously accounts for the design and operational decisions for freshwater source selection, multiple transportation modes, and water management options. Water management options include disposal, commercial centralized wastewater treatment, and onsite treatment (filtration, lime softening, thermal distillation). To globally optimize the resulting MILFP problem efficiently, three tailored solution algorithms are presented: a parametric approach, a reformulation‐linearization method, and a novel Branch‐and‐Bound and Charnes–Cooper transformation method. The proposed models and algorithms are illustrated through two case studies based on Marcellus shale play, in which onsite treatment shows its superiority in improving freshwater conservancy, maintaining a stable water flow, and reducing transportation burden. © 2014 American Institute of Chemical Engineers AIChE J, 61: 1184–1208, 2015

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“…The other two options are treatment options, namely centralized water treatment (CWT) and onsite treatment. Both of them have their own capacity limits or technical constraints [6]. However the water treated by CWT can be directly sent to surface discharge and return to natural water cycle.…”

Section: Introductionmentioning

confidence: 99%

Optimization of water management in shale gas production process

Gao

You

2014

53rd IEEE Conference on Decision and Control

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We propose an optimization model for the design and operation of the water management system in shale gas production process. The objective is to maximize the profit per unit freshwater consumption. This model is formulated as a mixed-integer linear fractional programming (MILFP) problem, which takes into account both the economic performance and water-use efficiency associated with the shale gas production. We also present tailored optimization algorithms for efficiently solving the MILFP problem, which results from the water management optimization model. We apply the proposed optimization model to a long-term spatially explicit case study. The optimal results show that the net profit for shale gas production per unit freshwater consumption after water treatment is $1,756 per thousand barrels of freshwater. The results also indicate that an efficient water management strategy should be a combination of different water management options, including centralized wastewater treatment, underground disposal, and onsite treatment.

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Key Shale Gas Water Management Strategies: An Economic Assessment Tool

Cited by 35 publications

References 1 publication

Deciphering and handling uncertainty in shale gas supply chain design and optimization: Novel modeling framework and computationally efficient solution algorithm

Deciphering and handling uncertainty in shale gas supply chain design and optimization: Novel modeling framework and computationally efficient solution algorithm

Optimal design and operations of supply chain networks for water management in shale gas production: MILFP model and algorithms for the water‐energy nexus

Optimization of water management in shale gas production process

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