Shale-Oil Drillers Are Running Out of Places to Dump Toxic Wastewater

Drill pipe sits on a rack near a Nabors Industries Ltd. rig drilling for Chevron Corp. in the Permian Basin near Midland, Texas, U.S., on Thursday, March 1, 2018. Chevron, the world's third-largest publicly traded oil producer, is spending $3.3 billion this year in the Permian and an additional $1 billion in other shale basins. Its expansion will further bolster U.S. oil output, which already exceeds 10 million barrels a day, surpassing the record set in 1970. , Bloomberg

David Wethe, Bloomberg News

May 18, 2023

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(Bloomberg) -- Oil drillers in North America’s biggest shale field are running out of easy places to dispose of toxic saltwater that gushes out of wells alongside crude. 

So-called disposal wells where oil companies have long stowed wastewater in the Permian Basin are seeing increasing pressure buildup, limiting their capacity to accept more water, according to industry data provider B3 Insight. 

It’s a critical issue for the industry because shale producers can’t drill new wells without somewhere to bury wastewater that can be 10 times saltier than the sea. In addition, disposal wells have been linked to the increasing frequency of earthquakes in Texas, Oklahoma and other oil-rich states because they can intersect with natural geological fault lines. 

Read More: West Texas Hit by Largest-Ever Quake, Rattling Oil Region

The Texas Railroad Commission, which regulates drilling in the largest US oil state, in December announced cuts to water disposal in certain areas after a 5.4-magnitude quake rocked the region. 

“We are one earthquake away from having a whole different dynamic” in the shale sector, Railroad Commissioner Jim Wright told the Oilfield Water Markets Conference in Fort Worth this week. Drilling will “come to a screeching halt” unless the industry develops “seismic-resilient” disposal techniques or alternative uses for the 16 million barrels (672 million gallons) of wastewater injected underground in the Permian region on a daily basis.

The water-recycling sector only has the capacity to process about 30% of the waste flows for reuse in fracking, Amanda Brock, CEO of Aris Water Solutions, told the conference. 

The sheer volume of wastewater is “challenging the industry,” she said.

Long-term, the solution may lie in developing technology for cost-effectively cleaning the wastewater so that it can be diverted into agricultural uses such as irrigating cotton fields. But for now, more water pipelines and more disposal wells will be needed, Kelly Bennett, chief executive officer of B3, said during the conference. 

“Pressure is stressing out the basin,” he said. “There’s just a big wave of water that we’re going to have to manage in the future.”

(Adds Texas Railroad Commissioner’s comments in fifth paragraph.)

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