September 2013- The Bakken

SEPTEMBER 2013

Plus:Drilling and Completion Strategies Responsible

For Accelerated Production

Page 28

AND: Williston Basin’s First

NORM disposal facility Page 22

Frack Water Recycling Era Has Begun

Page 36

Ron Ness and ND Petroleum Council communicate optimism, facts about the BakkenPage 8

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THEBAKKEN.COM 5

CONTENTS SEPTEMBER 2013 VOLUME 1 ISSUE 6

DEPARTMENTSMAKING IT

36 Forget the Future: Frack Water Recycling is HereHalliburton and Nuverra Environmental solutions have partnered to bring a proven produced water reuse system and logistics model to the Williston Basin. BY STAFF

CONTRIBUTION 40 Solidifi cation Solution

Fly ash plays a role in the Bakken oilfi elds.BY ANDY GLASS, HEADWATERS RESOURCES

Pg 22 LOGISTICS

NOW OPEN: First-Ever Bakken NORM Disposal Site

Ross Oakland, an oilfi eld worker turned big-time Montana farmer, has drastically changed how oilfi eld waste services do business.BY LUKE GEIVER

6 Editor’s NoteWhat Happens NextBY LUKE GEIVER

8 Petroleum Council: Special Edition Meet the Real North Dakota Petroleum Council Meet the Real North Dakota Petroleum Council BY STAFF

14 Bakken NewsBakken News and Trends

ON THE COVER: Ron Ness, ND Petroleum Council president holds a Bakken shale core sample. PHOTO: GLASSER IMAGES

Pg 28 EXPLORATION AND PRODUCTION

Well Worth the AttentionProppant placement strategies, longer laterals and cutting-edge downhole mechanical fracturing technology are extracting crude in less time, more effi ciently and, in some cases, at a lower cost. BY LUKE GEIVER

The BAKKEN MAGAZINE SEPTEMBER 20136

What Happens NextLuke GeiverEditorThe Bakken [email protected]

EDITOR'S NOTE

Walking to my truck on a hot August afternoon after a two-hour interview session with the North Dakota Petroleum Council, half-way between the NDPC’s Bismarck, N.D., offi ce and my parked vehicle, I panicked. I had just held what I believed was an incredibly productive, valuable and enlightening sit-down with several of the Bakken play’s lead-ing representatives, and then, reaching into my sports coat’s right pocket, I couldn’t locate the recorder I’d used to capture the session.

After a frantic search of my bag in the sweltering parking lot, the recorder was found and its contents, in this month’s special edition piece, “Meet the Real North Dakota Petroleum Coun-cil,” on page 8, show why I was relieved: The story of the transformation of the NDPC’s duties, and the perspectives of its members and staff, is something everyone should read. It provides insight into the play that Ron Ness, council president, calls a world class resource. I turned the truck west and headed for Dickinson, N.D., composing the story in my head as I drove.

Later the next day, I drove to Watford City, N.D., where I’d been invited to an unveiling event for potential clients of Halliburton’s frack water recycling system, which recycles produced water created during the hydraulic fracturing process. Walter Dale, strategic business manager of water management services for Halliburton, opened his presentation on the product by telling the crowd that everywhere he goes, he talks about water. For the next hour, that’s what he did, explaining in great detail the economics of a system that could drastically reduce the amount of fresh water needed to complete a single well in the Williston Basin and why the commonly held beliefs about the importance of water quality to a successful well completion are now outdated.

The Halliburton event and the NDPC interview session highlight the constant progression in the Williston Basin, from the way a trade organization approaches a community outreach strategy today versus fi ve years ago, to how veteran operators plan and budget for water-related costs today compared to two years ago. This month’s exploration and production feature, “Well Worth the Attention,” on page 28, also highlights the changes happening in the play. Proppant placement strategies are helping retrieve more crude faster by utilizing multiple proppant types in different sections of a horizontal. Longer laterals and the push to increase the number of discrete fracture stages in some wells is also altering the way a well is brought online now more than ever before. As the Bakken and Three Forks development continues, and the world class resource grows its global prominence, the news and technology we value today will become merely a reference point for future innovation. Case in point: Halliburton’s frack water recycling system. Everything about it is exciting. But, what’s more exciting is fi nding out what will happen next.

THEBAKKEN.COM 7

www.THEBAKKEN.com

VOLUME 1 ISSUE 6EDITORIAL

Editor Luke Geiver [email protected]

Senior Editor Susanne Retka [email protected]

Staff Writer Chris [email protected]

Copy Editor Jan [email protected]

PUBLISHING & SALES

Chairman Mike Bryan [email protected]

CEO Joe Bryan [email protected]

President Tom Bryan [email protected]

Vice President, Sales & Marketing Matthew Spoor [email protected]

Vice President of Content Tim Portz [email protected]

Business Development Manager Bob Brown [email protected]

Account Manager Tami [email protected]

Marketing Director John Nelson [email protected]

Circulation Manager Jessica Beaudry [email protected]

Advertising Coordinator Marla DeFoe [email protected]

ART

Art Director Jaci Satterlund [email protected]

Subscriptions Subscriptions to The Bakken magazine are free of charge to everyone with the exception of a shipping and handling charge of $49.95 for any country outside the United States, Canada and Mexico. To subscribe, visit www.thebakken.com or you can send your mailing address and payment (checks made out to BBI International) to: The Bakken magazine/Subscriptions, 308 Second Ave. N., Suite 304, Grand Forks, ND 58203. You can also fax a subscription form to 701-746-5367. Reprints and Back Issues Select back issues are available for $3.95 each, plus shipping. Article reprints are also available for a fee. For more information, contact us at 866-746-8385 or [email protected]. Advertising The Bakken magazine provides a specifi c topic delivered to a highly targeted audience. We are committed to editorial excellence and high-quality print production. To fi nd out more about The Bakken magazine advertising opportunities, please contact us at 866-746-8385 or [email protected]. Letters to the Editor We welcome letters to the editor. If you write us, please include your name, address and phone number. Letters may be edited for clarity and/or space. Send to The Bakken magazine/Letters, 308 Second Ave. N., Suite 304, Grand Forks, ND 58203 or email to [email protected].

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NORTH DAKOTA PETROLEUM COUNCIL THE MESSAGE: SPECIAL EDITION

The North Dakota Petroleum Council isn’t your average state-based trade organization. On a mid-August morning, The Bakken magazine sat down with every member of the team to fi nd out why. We talked about the daily challenges NDPC has in educating North Dakota citizens, business owners, community leaders and private investors on the oil and gas industry of the Williston Basin. The interviews revealed the NDPC’s accomplishments during the 2013 legislative session, the team’s reason for optimism in 2014 and why the Bakken shale play isn’t, as Ron Ness, council president put it, a western N.D. thing, a N.D. thing or even a U.S. thing. “This is a world game changer,” he said, sitting in

his offi ce that morning. “This resource is a game changer for the way the world will look at energy.”

Why Everyone Is LookingBased on the average

day for Tessa Sandstrom, NDPC’s communication’s manager, it is easy to see that the world is becoming fi xated on the Williston Basin. The organization takes weekly media requests from Japan, Switzerland, Norway, England, Australia, Germany and others, she says, in addition to the national media attention the Bakken has received for the past few years. “A group of decision makers from California visited just last week. We don’t usually go to other states,” she says. “We have people coming here from around the world.”

For Ness, the reason for

the global attention is simple. “They want to understand, is this Bakken real?” he says. “I had two executives here because this [the Bakken] is changing the way Toyota thinks about making cars and what their fuel of the future is going to be.”

The attention on the oil patch in western N.D., isn’t always positive however. “At times it gets overwhelming,” Ness says, “but then you look at this as an opportunity to attract the great minds here that can help us achieve successful results while proving out technology.” The technology in the play isn’t an element Ness is worried about. “People know that we are going to take this technology developing right here and we are going to be able to export it all over the world.”

To help the Bakken shale play truly blossom into a global leader for unconventional oil and gas retrieval practices, Ness and his staff have transformed their organizational objectives from those centered on member services and lobbying, to include education and diplomacy. According to Ness, the team has spent much of the past two years

Meet the Real North Dakota Petroleum CouncilThe story behind the Bakken’s leading voice

By Staff Photos by Glasser Images

THEBAKKEN.COM 9

trying to educate people across the state about the opportunities created from the oil and gas development. “If we do this right, we will have generations of tremendous upside,” he says.

During the past year, Ness estimates he spent roughly 80 percent of his time working to educate the public, the media and foreign countries about

the Bakken. Although the team continues to answer questions about the basics of hydraulic fracturing or the geological extent of the Williston Basin, Sandstrom says, the education efforts are helping in- and out-of-state individuals comprehend the magnitude and complexities of the play. During educational events, the halls and meeting places

are always packed, Ness says, the communities are getting more educated and the questions are getting more sophisticated. “One of the great things about North Dakota is that we have been able to get across the state and educate people because they truly do want to listen,” he says.

The teaching efforts aren’t just about answering

NORTH DAKOTA PETROLEUM COUNCIL


questions or explaining the industry’s processes. For Sandstrom, education means reaching out to young students and future grads on the opportunity of the play. The NDPC staff currently works with and targets every school grade class from third to seniors in high school. The goal is to highlight the multi-faceted nature of the oil patch, she says, including the job market. “There are more jobs than just those dealing with oil, dirt and heavy equipment. There are very technical jobs and employers are looking more and more for those with two-to-four year college degrees,” she says, adding,

“there are a lot of people with degrees that are needed now and are going to be needed in the future.”

Goals for the FutureAlthough education has

become a main staple of the NDPC’s focus and outreach efforts, the team also maintains its exhaustive work to provide solutions in the Williston Basin for everything from fl aring to dust control. Kari Cutting, vice president of the NDPC, concentrates her time working on regulatory affairs and state issues. Cutting, facilitates the work of the NDPC regulatory committee, a group of NDPC member company employees

who are knowledgeable in issues of extreme importance to the state, including air quality, environment, and endangered species, among others. Cutting’s work places her in contact with nearly every possible state and federal agency. Cutting and the regulatory committee have established relationships with the U.S. Bureau of Land Management, the U.S Forest Service, U.S. EPA, U.S. Fish and Wildlife Service, as well as several state agencies.

“Developing a working relationship with agencies allows you to collaborate towards a successful solution,” said Cutting “That

is the purpose of all of NDPC’s efforts, whether it is government relations, education and outreach, or regulatory issues —fi nd a solution to the challenges that come with the huge opportunity that is the Bakken.

“One of our member CEO’s said it best, ‘We sit down with all the stakeholders at the table, defi ne the problem and then work together to come up with a workable solution.’ We are North Dakota nice.”

And the work rarely slows down. Topics that will defi ne a Cutting’s agenda in the coming months include mitigating wildlife impacts in areas of


Ron Nesspresident

'The Bakken is unique, it is a world class resource. The peak in 1984 was 150,000 barrels of oil per day. We produce that today before the sun comes up.'

THEBAKKEN.COM 11

development and serving on a committee to discuss disposal options for naturally occurring radioactive material.

Alexis Brinkman, regulatory affairs manager, also works on regulatory and legislative issues. Brinkman spent many hours during the previous biennium lobbying at the Capital. Like Cutting, Brinkman can cite several examples of how an NDPC staffer has helped to solve an issue in the Bakken. Due to the attention on fl aring in western N.D., Brinkman has had to help conquer easement fatigue, a term she says explains the fatigue landowners have experienced as pipeline installers request passage through a section


Kari Cutting vice president

'Our main mission for our members can be summed up in one word, problem-solving. Everything we do, whether it is government relations, regulatory affairs, public education and outreach or the many NDPC events, reflects that mission.'

Tessa Sandstrom communications manager

'This has been a story of rural revitalization, opportunity and growth—of a strong and fast turnaround from the stories of decline and decay that were reported just eight years ago.'


of land. On any given tract of land, three to four pipelines could be planned, she says, and eventually landowners get tired and just say no. But, because pipeline infrastructure is the main element needed to reduce fl aring, Brinkman had to fi nd a way to ease the minds of those landowners and make it easier for them to say yes. In the 2013 legislative session, Brinkman brought together a group of landowners to help form the legislation currently in place that has helped easement fatigue and sped up the pipeline installation process without putting further stress on landowners.

The issue of fl aring remains the number one issue


Brittany Rud membership services manager

'As the interest in the Bakken grows, so does our membership, and we are continuously working to meet our members’ needs, from planning conferences and additional networking opportunities to making sure our members’ views are heard through our government affairs and outreach activities.'

Alexis Brinkman government relations manager

'My main job is to help with legislative issues. During the last biennium, there was a huge amount of oil specific legislation, more than any other session has ever seen.'

THEBAKKEN.COM 13

for Brinkman, however, and she is currently working to fi nd a solution to reduce the amount of fl aring over the next two years. “We know that we are going to have to make signifi cant progress in decreasing fl aring or we are going to see more fl aring legislation next session. We would love to deal with it prior to that,” she says.

The Main MessageSince the main installment

of the Bakken’s development began roughly seven years ago, Ness says, the NDPC has grown signifi cantly. In 2007, the council consisted of 150 members, and today the membership is closer to 400. The members drive Ness and his staff to put together community events ranging from city-wide BBQs, to golf outings to fundraisers. The message he hears constantly from his members is one of public education and more importantly he says, of being part of the solution to issues created by oil and gas retrieval. “When people ask us if they should become a member, I ask if they are part of the oil and gas industry and if they want to be part of the solution to any challenges,” he says.

As for the NDPC staff, there is one theme that seemed to be woven into every conversation we had during that mid-August morning

behind-the-scenes look into the trade organization. Before Ness, Cutting, Sandstrom, Brinkman and Brittany Rud, member services manager, ended their conversations, they were asked what they believed was important to note about the Bakken, what they believed an article on the NDPC should include. “This is a substantial economic driver, a substantial resource that is going to have a long-term effect on what we do in North Dakota and every aspect of what North Dakota is all about,” Ness said.

Brinkman put it in real-life terms. “So many of the kids that I grew up with are able now because of the Bakken to make a home and a career in North Dakota, A lot the generations before me had to leave.”

Sandstrom shared the same sentiment. “The economic impact of this is just so huge. Sometimes I think it is understated,” she noted.

“We had exported all of these great North Dakota young people and now they come home to fi nd work and that is not going to change,” Ness said as we ended our conversation. “There are issues with development, but we will fi gure it out. The rest is all semantics about how we make it work. That is going to solve itself over time.”



BAKKEN NEWS BAKKEN NEWS & TRENDS

Public Offi cialsVisit the Bakken

There are many reasons to visit the Williston Basin. U.S. Department of the Interior Secretary Sally Jewell paid a visit in August as did U.S. Postmaster General Patrick Donahoe. West Virginia Senate President Jeff Kessler has announced plans to make a late-summer trip to the region.

Jewell toured the area for two days, seeing fi rst hand the

oil and gas developments in the region. She was accompanied by U.S. Senators John Hoeven, R-N.D., and Heidi Heitkamp, D-N.D., and several other pub-lic and private representatives. Kari Cutting, vice president of the North Dakota Petroleum Council, was one of the private members on the tour. Accord-ing to Cutting, Jewell was im-pressed with the technology on

IN PERSON: Secretary Jewell visits with Continental Resources officials, Harold Hamm, CEO, right, and Rick Bott, chief operating officer, left, at the Atlanta Well Pad near Williston, N.D.PHOTO: U.S. DEPARTMENT OF INTERIOR

display in the oilfi elds. Cutting also noted that during the trip, Jewell said North Dakota could become the model for other shale plays across the country.

“The Bakken boom is a perfect example of how new and improved technology is allowing industry to tap previ-ously inaccessible or unknown energy resources to create jobs, decrease our dependence on foreign oil and grow our economy,” Jewell said, follow-ing her visit. “Working hand in hand with industry, we have an opportunity to use innovative technologies.”

The Interior’s Bureau of Land Management is already utilizing new technologies and approaches in the Bakken oil play. The North Dakota Field Offi ce has implemented an electronic submission process for Applications for Permits to Drill. The process has allowed the BLM to provide application updates while speeding up the entire process for the BLM and applicants.

Donahoe has also helped bring a focus on effi ciency to his staff linked to western N.D. Donahoe has directed staff in Sioux Falls, S.D., to work at recruiting additional employees for western N.D., in addition to directing a full-time staff mem-

ber to focus on staffi ng issues. In August, Donahoe announced plans to visit the region to as-sess mail service. “We’re pleased Postmaster Donahoe has agreed to visit North Dakota to see fi rsthand the impact of eco-nomic and population growth in the western part of our state,” said Hoeven. “Those growing communities are in need of reli-able and timely postal services now more than ever.”

Kessler also believes a trip to N.D. is worth his time. Kessler has proposed funding legistlation that will utilize oil and gas taxes generated in his state for a state-based invest-ment fund similar to North Dakota’s Legacy Fund. Kessler announced he would bring a small delegation during his visit. “If we can create the fund and begin investing in it now, it will send a powerful message to Wall Street that West Virginia, during these tough economic times, is not only balancing its budget but also saving for the future,” he said. In addition to learning about the Legacy Fund, Kessler also voiced his hope to learn about the ways the state man-ages its energy resources.

Kessler Jewell Donahoe

THEBAKKEN.COM 15

Since the beginning of 2012, 18 of the top 50 wells in the North Dakota portion of the Bakken have been Hess Corp.-operated. In the second quarter of this year, the company’s Bakken produc-tion total rose 16 percent from the same period in 2012. The company also re-duced its well costs in the second quarter of 2013 by 28 percent compared to the same period in 2012. Greg Hill, executive vice president of worldwide exploration and production, said the global energy fi rm remains optimistic about the long-term upside of the play.

That enthusiasm is refl ected in two of the fi rm’s latest an-nouncements. In an effort to become a pure play exploration and production company, Hess has sold its energy marketing business for roughly $1.025 billion. Hess has also signed a contract with China National Petroleum Corp. for onshore unconventional exploration in the Malang Bloc of the Santanghu Basin in north-west China. According to a company spokesperson, the contract includes rights for Hess to participate with CNPC if oil or gas in commercial quantities is found. The block covers 200,000 acres

of Permian Lucaogou Shale, and the agreement “builds upon our company’s unconventional experience in the Bakken and Utica Shale plays,” the spokesperson said.

BAKKEN NEWS

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BAKKEN NEWS

The Port of Vancouver USA is looking inland for crude. The POV’s board of commissioners has unanimously approved a 10-year lease with a joint venture group formed between Tesoro Corp. and Savage Co. to construct a crude oil handling facility that will import Bakken crude. The crude will be shipped to the port via rail before transfer to marine vessels headed to refi neries in California, Washington or Alaska.

In total, the port will dedicate 42 acres to the Tesoro Savage joint venture (TSJV) for a rail unload-ing facility, storage tanks and a vessel loading area. TSJV will invest roughly $100 million in the facility. Revenue generated over the lease period is expected to exceed $45

million for the port. The crude transloading facility will also create 120 permanent jobs and 250 tem-porary construction jobs.

The 120,000-barrel-per-day site is exciting for Tesoro, accord-ing to Greg Goff, president and CEO of Tesoro. The facility will be operational by 2014, and could be expanded to 280,000 barrels per day. “Building upon the recent success of the rail unloading facility at our Anacortes, Wash., refi nery, where we have been delivering Mid-Continent crude via unit train,” Goff said, “this project is the ideal next step for Tesoro as we drive ad-ditional feedstock cost advantage to the remaining refi neries in our West Coast system.”

Port of Vancouver Taps Into Bakken Crude

READY BY 2014: The port facility will be operated by Savage Co., a rail and transloading expert with other inland locations operating in the Williston Basin.PHOTO: PORT OF VANCOUVER USA

THEBAKKEN.COM 17

North Dakota is the third best state in the U.S. in which to do business. The American Economic Development Institute, in conjunc-tion with Pollina Corp. Real Estate Inc. and CNBC LLC, has each released reports ranking every state’s business climate in 2013. Both reports ranked N.D. third.

CNBC’s report, “America’s Top States For Business 2013,” used 10 broad categories to create its rankings. The categories were then assigned a point total based on the frequency each state cited those categorical metrics, such as quality of life, innovation or access to capital, in-state-based economic development marketing materi-als. “That way,” CNBC said, “our study ranks the states based on the

criteria they use to sell themselves.” North Dakota’s highest rankings were in the categories of economy and infrastructure.

According to CNBC’s expla-nation of its category metrics, each state’s economy was ranked based on credit ratings and outlook, revenues compared to budget pro-jections and the number of major corporations located in the state. For its infrastructure and transpor-tation category, the study looked at the quantity of goods shipped by air, waterways, roads or rail, the availability of air travel, quality of roads, and work commute time. The cost of doing business followed by each state’s economy were the top two most heavily weighted categories in the report.

Along with CNBC’s report, the state was also ranked third in Pollina’s, “Top 10 Pro-Business States,” a nationally recognized report. The report used 32 factors related to each state’s handling of

taxes to energy costs. Regarding its list, Pollina Corp said, “All 10 top-ranked states should be held up as models for the other 40 states and the federal government.”

BAKKEN NEWS

North Dakota: The No. 3 Business State 2ND

ECONOMY

2NDINFRASTRUCTURE

8THWORKFORCE

5THQUALITYOF LIFE

46THTECHNOLOGY& INNOVATION

6THBUSINESSFRIENDLINESS

36THEDUCATION

30THCOST OFLIVING

29THACCESS TO CAPITAL

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BAKKEN NEWS

The Vantage Pipeline will transfer ethane, a component of natural gas, from the Hess Corp. owned-and-operated gas plant in Tioga, N.D., 430 miles to Empress, Alberta, Canada. The 80-mile leg of the pipeline in North Dakota was recently ap-proved, completing a three-year process from submission through fi nal permitting, which Sen. John Hoeven, R-N.D., noted following the announcement. “The project illustrates clearly how modern pipelines can create jobs, make us more energy secure and do so with good environmental stew-ardship,” he said.

The pipeline will require roughly 400,000 man hours to construct while injecting $300 million into the U.S. and Canadian

economies. The ethane will be used as a feedstock to produce plastics, rubber, detergents and other consumer products by NOVA Chemicals. The project will also mark the fi rst time that liquids from the Williston Basin will fl ow north and tie into Al-berta infrastructure, according to Vantage Pipeline. The facility will move 60,000 barrels of ethane per day. “The ability to transport ethane for use in the plastics in-dustry will provide an important new revenue source for gas pro-ducers in North Dakota and will also allow producers to reduce fl aring,” said David Schmunk, chief operating offi cer of Mistral Energy U.S. Inc., the limited part-ner of Vantage Pipeline U.S.

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YEARS22

Oil and gas in underground

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Natural gas (methane) is

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Oil is transported to

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Impact of the proposed Vantage Pipeline Project

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BAKKEN NEWS

™

MORE THAN

MODELS O N H A N D

100

A new survey com-pleted by the Grand Forks (N.D.) Region Economic Development Corp. provides statistical evidence that the impact oil and gas develop-ment in western N.D., has had on eastern N.D. Accord-ing to a survey dispersed among Grand Forks and East Grand Forks, (Minn.) Chamber of Commerce members, 67 percent of respondents believe

revenue over the past two years is, in part, related to

the Bakken, and 23 percent have added staff to support that business growth. “These results are exciting for our region, demonstrating a much

greater impact,” said Barry Wilfahrt, president and CEO of the Chamber, adding that the respondents who’ve experienced business growth are those in the industries of automotive services, real estate, construction and manufacturing.

Klaus Thiessen, GFEDC president and CEO, said the entire region is expanding because of the Bakken and existing businesses are attract-ing new customers. “At the end of the day,” he said, “we can undeniably say the oil and gas industry is helping this region grow and create new jobs”.

Oil Activity in West NDImpacts Growth in East

believe revenue fromthe Bakken hasimpacted easternN.D.

67%

have added staff tosupport thatbusiness growth

23%Has the oil and gas development in

western N.D. impacted eastern N.D.?


BAKKEN NEWS

Pending New Federal Fracking RegulationsThe question regarding the

U.S. Bureau of Land Manage-ment implementing a federal ruling on hydraulic fracturing is not a matter of if, but when. During his August Director’s Cut press conference, Lynn Helms, director of the North Dakota Department of Mineral Resources, shared his insight regarding meetings he attended in Denver with several members of the BLM. “That agency is very very committed to putting out a regulation for hydraulic fracturing. They were not com-mittal at all about the timing of that. It just seems very certain that something is going to come out,” Helms said.

Any regulation implemented by the BLM would not affect private land minerals unless the U.S. EPA were to adopt the same regulations. In North Dakota, the main areas that would be impacted by new hydraulic fracturing regulations would be the National Grasslands and the

Fort Berthold Indian Reserva-tion. Although Helms said the federal regulations would be very similar to those already used in North Dakota, there would be some new requirements that could slow drilling in the Bakken on an individual-well basis by 10 percent.

The slowdown would be a result of several factors: additional drilling log require-ments for operators, an increase in permit-related paperwork and a BLM staff that is shrink-ing. “Added workload and less people, you know what that means,” he said.

Under the new regulations, drilling operators would be required to verify the amount and placement of all concrete pumped down the well to ce-ment the well casing. Under cur-rent regulations, drilling supervi-sors are required to verify that the entire casing has been fi lled by proving the cement reached the surface of the well. Accord-

ing to Helms, 98 percent of the time, drilling teams will succeed in doing so. In the event that cement did not reach the surface, thus proving the entire well cas-ing was fi lled, the team has to use certain tools to measure how much cement is in the casing and where it is.

The new regulations would differ in the way drilling teams are required to measure and as-sess the amount and placement of cement in the well. “They [BLM] want to preapprove the amount of cement that is going to be placed in the well and then have precise measurements of how much went in and where it went,” Helms said. To do that, the drilling rig would have to shut down for three days to allow the cement to cure giving the necessary measuring tools the ability to accurately measure the cement.

The anticipated impact of the rule would slow down drill-ing teams and decrease invest-

ment into the region, he noted. The rules would also increase the time needed to permit a federal well by 50 percent to 100 percent. The national average for a federally permitted well is roughly 225 days.

And, although the rules would only apply to federal min-eral lands, Helms pointed out that the entire Williston Basin would be affected. “One of the little known facts of North Dakota is that in the process of farm foreclosures and such in the 1930s, the BLM acquired lots of minerals across the state,” he said. The tracts are mostly small, totaling only 160 acres or less, in most cases. But, he added, “90 percent of our spacing units have some federal minerals in them. So, even though they are dominantly private land, there could be one or two or three well bores that would have to get a federal permit.”

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The frack sand industry is rapidly evolving, and for several production or distribution compa-nies, this summer has also meant expansion. Unimin Corp., a frack sand supplier, has leased space at a New Town, N.D., transloading facility to supply frack sand to the Williston Basin. The facility, set for completion in January 2014, will offer a throughput capacity of 750,000 tons per year. Sand for the facility will arrive from Uni-min's Tunnel City, Wis., plant by rail on Canadian Pacifi c’s network. Dakota Plains Holdings Inc., land owner of the Unimin facility, will provide transloading services. Unimin will directly market its sand products to oilfi eld service companies and will also fund the construction of four new ladder tracks and sand storage infrastruc-ture, according to Unimin. The lease for the frack sand location will last 30 years.

Lou Mastandrea, execu-tive vice president of sales and marketing for Unimin, said the

location is ideally situated and will help the company respond to proppant requirements in the Bakken and surrounding areas.

Victory Nickel Inc., a min-ing and frack sand supplier with several operations in Canada, is also expanding in the area. The company recently announced it has received approval from the Alberta Energy Regulator to de-velop a 400,000-ton-per-year frack sand processing facility south-west of Medicine Hat, Alberta, Canada, known as the 7P facility.

“The AER approval has huge implications for Victory Silica Ltd.’s plan to begin market-ing frack sand in 2013,” said Rene Galipeau, vice chairman and CEO of the company. “We will now begin the reclamation work and the upgrades at the 7P plant,” he added. “Producing frack sand from the 7P facility is the fi rst step in VSL’s three-phased plan to establish Victory Nickel as a premier frack sand supplier to northern markets.”

Preferred Sands LLC, another major frack sand supplier present in the Williston Basin, is also looking to expand. The company has partnered with E Proppants, a Monterrey, Mexico-based proppant manufacturer.

The collaboration is a strategic endeavor launched due to the increased demand for Preferred Sands product line in the explo-ration and production sector, according to Michael O'Neil, company founder and CEO.

Frack Supply Industry Evolving, ExpandingHistorical and Projected Proppant Demand

20012006201120162021

2.16.3

21.730.7

40.70 5 10 15 20 25 30 35 40 45

SOURCE: THE FREEDONIA GROUP

OTHER

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LOGISTICS

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THEBAKKEN.COM 23

LOGISTICS

When Jason LaQua, general manager of Oilfield Waste Logistics, heard about Oaks Disposal Services LLC on an early summer Friday af-ternoon, he was in his Culbertson, Mont., office. By early morning the fol-lowing Monday, he was in Lindsey, Mont., waiting in his vehicle, eager, excited and uncertain about meeting the team from Oaks Disposal Services. “My fi rst reac-tion,” he says, upon hearing of the facil-ity, “was that it was too good to be true.”

The facility, as LaQua understood, would be the fi rst-ever landfi ll in Mon-tana capable of disposing oilfi eld waste generated during the drilling and produc-tion process. He found out that Monday morning, what he had heard was true, and thanks to a former oilfi eld worker turned big-time farmer, OWL and other waste disposal fi rms in the Bakken oil and gas play can now dispose of naturally occur-ring radioactive material (NORM). “This could be the single one biggest change in the Bakken in the last year and a half,” LaQua says.

onOTA

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Oaks Disposal Services LLC is nowaccepting oilfield naturally occurring radioactive material, 40-miles from the North Dakota border.By Luke Geiver

NOW OPEN:First-Ever Bakken NORM Disposal Site


His statement might sound over-arching, but LaQua has a point. Until the Lindsey facility opened, oilfi eld waste such as drill cuttings, fi lter socks used during drilling and fl owback material generated on well sites in North Dakota or Montana had to be shipped to Colorado or Idaho. Neither North Dakota nor Montana had an authorized, capable facility. For LaQua, the 650 miles his drivers don’t have to travel to dispose of material has changed his operational model immensely. His die-sel costs have drastically decreased, along with vehicle maintenance and driver time. His customers may be even happier about the facility than LaQua, as the price to do business with OWL has dropped. “I don’t have the same amount of equipment, and it takes one day to get rid of a load and it used to take three days,” he says.

The reason for the long miles and drive time relates to the way the North Da-kota Department of Health Oilfi eld Waste Management deals with oilfi eld waste. In

the state, the maximum allowable limit for NORM is fi ve picocuries per gram. LaQua says most proppants used in the drilling process contain more than fi ve picocuries per gram before ever entering the ground. The Oaks facility is capable of disposing material containing NORM with up to 30 picocuries per gram, a measurement that shows the level of radioactive elements that naturally exist in the earth such as radon.

Oaks Disposal Services HistoryIn the early 1980s, Ross Oakland was

working in the oilfi elds of Montana. Fol-lowing a brief stint in the oil industry, he started a farming operation and today he considers himself a big-time agricultural operator. After witnessing a drilling opera-tion adjacent to his property in Montana for several days, Oakland paid a visit to the well site to chat with the drilling operator. The conversation revealed the challenge that particular operator, like every other in the play, had with waste disposal.

DIRT WORK: The facility opened early this summer after two years of permitting and design. PHOTO: OAKS DISPOSAL SERVICES

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Oakland decided to pursue a landfi ll facility capable of handling the material. After talking with the Department of En-vironmental Quality, Oakland says his early assumptions that he could fi nd the money and write a check to the state to begin con-structing the facility possible were inaccu-rate. “I’m a get-it-done-now type of guy,” he says.

To get the facility done, Oakland had to invest roughly $5 million and spend two years helping his consultants and engineer-ing teams wade through the proper permit-ting and regulation processes required by the DEQ to make such a facility happen.

Kent, Wash.-based Northwest Lin-ing and Geotextiles Inc., was brought in to design the facility. The fi rm had previously designed other landfi lls in Montana. The fa-cility features a scale, an offi ce and a deten-tion pond that has been heavily engineered and lined. The lined portion of the facility is 23.1 acres, and features an impregnated liner, a 60 mil liner, a mesh liner and several

levels of gravel. In total, Oakland devoted 130 acres to the facility. The location has several underground monitoring units that can assure the facility’s status now and well into the future. The facility has capacity to last 14 years or until reaching 2 million tons of waste. Each truck that comes into the landfi ll typically averages 25 tons. “We built it safe, we didn’t cut any corners. That is what all the oil companies wanted,” he said. And, Oakland believes that the facility could be expanded.

In addition to drill cuttings and other waste, the facility is capable of handling fi l-ter socks used to fi lter wastewater at drill-ing sites. The socks must be buried upon dumping within 24-hour period, Oakland says, to minimize the potential of wind or other weather relocating the material.

LaQua, the only service provider in the Bakken capable of disposing of fi lter socks at the Oaks facility, thanks to a contract spawned in that early morning meeting, couldn’t be happier about the addition of

LOGISTICS

'I was quite surprised when I found out it was a local farmer. I thought it would be a huge company. He accomplished what they [big companies] failed to do.'Jason LaQua,Oilfi eld Waste Logistics

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the fi lter sock disposal option, even though fi lter sock disposal is less than 1percent of his overall business.

The Future of OaksLaQua still can’t believe that Oakland was able to make

the facility happen. The last Montana landfi ll before that took fi ve years to go through the permitting and approval process, he says. “I was quite surprised when I found out it was a local farmer. I thought it would be a huge company,” he says of the entity that would make such a facility happen. “He accomplished what they [big companies] failed to do.”

The complex design of the site features gravel and liners to maintain the integrity of the facility and once full, Oakland says it will be in fi lled with gravel, soil and lined again before it is planted over with grass.

Oil companies and disposal services are now aware of the

THE SITE: Roughly 23-acres are permitted for NORM disposal. An entrance gate manned with an Oaks employee, tracks the amount of waste and time of disposal before any dumping occurs.PHOTO: OAKS DISPOSAL SERVICES

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LOGISTICS

facility and the phones haven’t stopped ringing, Oakland adds. The fi rst thing everyone wants to know is the type of liner used and if the facility was built right. Because Oakland and the engi-neers worked closely with the DEQ, calling and meeting frequently to make sure every step was done right, Oakland says he is confi dent that the facility will always live up to its billing.

The use of the facility may cost more than other typical landfi lls, but as LaQua says, it will change the way everyone does business in the Bakken. But, not for Oakland. Although he cur-rently operates the facility, in part, he

says, to gain an understanding of how to train future employees, he will always be a farmer. And, if his early phone calls regarding the facility are any indication, he will be a retired farmer. “It’s been a great experience,” he said of opening and running the landfi ll. “I have never advertised it for sale, and I have had fi ve companies come in and negotiate and want to buy it.”

Author: Luke GeiverManaging Editor, The Bakken [email protected]


EXPLORATION AND PRODUCTION

AERIAL VIEW: A fracking and work over rig location in North Dakota south of the Missouri River, roughly 10-miles north of Watford City.PHOTO: OVERLAND AERIAL PHOTOGRAPHY

THEBAKKEN.COM 29


Effective strategies are increasing initial production rates and ushering in new completion practices in the Williston Basin.By Luke Geiver

Well WORTH THE ATTENTION

Retrieving oil from the Williston Basin is almost a guarantee for those who deploy the appropriate capital. Today, with new well-com-pletion strategies, hydraulic fracturing teams and producers have the ability to turn a well-pad into a record-breaking site regard-less of the well’s geographical location. The strategies aren’t just about extracting more oil out of the reservoir. Some new com-pletion methods are lowering the cost of doing business while retrieving a greater amount of the recoverable oil in less time.

Proppant Placement EvolutionCARBO Ceramics is the world’s largest ceramic proppant

supplier. Terry Palisch, director of petroleum engineering for CARBO, says the company isn’t just about proppant supply.


“We are trying to help clients with their proppant selection so that it maximizes their return on investment,” he says. To do that, Palisch and his team sit down with prospective clients to better understand that client’s wells, completion preferences and frack design plans. “Then we will run models to help them determine what is the most economic proppant to use for their specifi c conditions and goals.”

The CARBO approach to proppant selection may not have been as widely used fi ve years ago, but today the em-phasis on proppant selection and usage in the Williston Basin is undeniable. Ac-cording to the Energy and Environmental Research Center, from 2008 to 2012 the amount of proppant used on a pound-per-foot of lateral-length basis increased from 100 to 350. During that same period, the ceramic fraction of all proppant used increased from 10 to 40 percent. And, the average number of fracture stages per well rose from roughly 10 to roughly 30. “Of all the major plays in the U.S., the Bakken

employs more ceramic proppant than all the others,” Palisch says.

According to Palisch, the increased focus on proppant isn’t just about volume, as producers are now taking a close look

at the type, size and placement of prop-pant. As a proppant material moves from sand to a ceramic, the proppant will gain strength, consistency in shape and tem-perature stability. In the proppant spec-


NEARLY NEW: The NCS Oilfield Services bottom hole assembly tool can be used to produce an unlimited number of hydraulic fractures. The photo shows the BHA after a 24-stage frack job.PHOTO: NCS OILFIELD TECHNOLOGIES

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UNLIMITED OPTIONS: The closeable frack sleeve technology created by NCS Oilfield Services allows for completion designs that call for higher than average fracture stimulation stages. NCS' record is currently around 60 stages on a single horizontal.PHOTO: NCS OILFIELD SERVICES


trum, there are three types: ceramic, resin-coated sand and uncoated sand. All three are used in the Bakken, and Palisch says all three must be used because there is not enough ceramic to go around.

The product with the most conduc-tivity or fl ow capacity is ceramic, followed by resin coated sand and uncoated sand. The CARBO approach to proppant is unique, Palisch says, because the company deploys an engineering and design team along with computer modeling to pin-

point the appropriate proppant size and type for any given well. “As an industry, we want to get to a standardized comple-tion design,” he says, a design that can be used in particular areas for most wells in that area. “By doing that you can really be effi cient; unfortunately you may sacrifi ce the optimal completion because even over a short distance a reservoir can change substantially.”

Due to heterogeneous and reservoir characteristics, a typical completion de-


2008-2012Well Completion Trends

Pounds of proppant per foot of lateral length increased from 100 to 350

350%

Lateral length per stage (ft) decreased from 700 to 300

57%

THEBAKKEN.COM 33

sign may not be possible to achieve for an entire fi eld in the Williston Basin, but well optimization can be. Several factors have to be considered for an operator as it creates a frack design and completion program in accordance with budget constraints or concerns, but there are proven approach-es some are using to increase production without increasing the budget. “The deci-sion the engineer has to make is a cost-ben-efi t decision,” Palisch points out.

One major trend Palisch has seen is re-

lated to proppant placement. He compares the trend to downtown Houston. To effi -ciently move more traffi c into downtown Houston, the city requires more lanes and highways closer to the city than it does in the suburbs because traffi c from several areas are moving towards a single area. “That is exactly what we are doing with our hydraulic fracturing. We are putting these roads and highways out into the reser-voirs,” he says. The closer to the well bore (Houston), the more fracture-fl ow capacity

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Average number of stages per well increased from approximately 10 to approimately 30

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and conductivity is needed as oil from the furthest sections (suburbs) of the fracture are moving towards the heel and then the wellbore.

To optimize a well, completion teams are placing different types of proppant in different sections of the fracture. Many are placing high-conductivity, engineered prop-pant that offers uniform shape and con-sistency in the last third or half of the hy-draulic fracture closest to the wellbore. The tip of the fracture may be stimulated with

sand, a less expensive product. “That is how they are able to maximize production with-out spending as much money,” he says, by creating a better highway system near the wellbore that acts as the city and helps to move a greater amount of oil out of the reservoir faster.

The Completion BusinessNCS Oilfi eld Services does not have

the size or scope of business that CARBO Ceramics does. The company does believe

in the power of retrieving oil as fast as pos-sible, though. The fi rm has designed, and proven a system capable of an unlimited number of fracture stages. To date, the re-cord for the company is 60 discrete fracture stages. The basis of the NCS process is a mechanical system that combines ported fracture sleeves with a bottom hole assem-bly tool that eliminates the need for perfo-rations that puncture a well casing, and ball dropping, which is used to portion off and plug one section of a well from another. The main benefi t of the process is that is allows users to place fracture stages at near-ly any interval without removing the entire system between fractures.

Eric Schmelzl, vice president of busi-ness and part designer of the process, says that one operator in the U.S. recently issued a Society of Petroleum Engineers paper comparing a plug-and-perf cluster opera-tion with the NCS technology on a two-well pad. Each well was completed with 27 frac-ture stages, but each well used a different approach. “After several months of produc-tion they plotted the expected recoveries of each well. The NCS technology is expected to recover 107 percent more than the other well,” Schmelzl says.

The secret to the NCS approach is the ability of the operator to place individual fractures with great certainty. In most clus-ter fracturing instances, enough pumping horsepower and fl uid is used to place three fractures at once, and operators can only expect to be certain of one to two of the fractures, Schmelzl says.

“Sixty-six percent of the fractures you are placing in that well, you are uncertain about,” he says. “It becomes a real Russian roulette to well completions—you don’t know what you did, you only know what production you got.”

The cost to use a technology like that of NCS’s versus other methods is nearly a wash due to the decreased amount of horse-power needed at the well site for pumping purposes. The time to complete a well does take longer, but the result is a well that gives more fracture placement certainty to the op-erator combined with the ability to place an incredibly high number of fracture stages.


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“When you stop and think about the economics of completing the well, by put-ting in additional frack stages of equal size in, you are accelerating the speed at which you drain the reservoir,” he says. “When you look at the time value of money, hav-ing your money this year is worth more to you than having it next year.”

Initial production rates are benefi ting from the strategies focused on proppant placement and increased discrete fracture stages. The cost-to-benefi t ratio is still a major reason why some wells produce at record breaking levels, however. And, ac-cording to Dale Larsen, account manager at CalFrac Well Services Corp., the lateral lengths used in the play are also helping. Larsen’s customers are now preparing for three-mile laterals. “We are going to see the longer horizontal lengths,” he says, “and

continue to see more stages per more well bore.”

The practice of longer laterals may add costs during drilling, but as Schmelzl says, the producer doesn’t have to waste money on drilling down to the second lateral. “It can have a signifi cant economic impact if you are able to function reliably two to three miles sideways,” he says.

The effect of longer laterals, increased fracture stages and sophisticated proppant placement programs will all help producers to retrieve a greater amount of crude from the reservoirs, in some cases, faster. There is a trade-off, however. The time to drill and complete the wells will increase.

For companies like CalFrac, a mid-sized fracking company capable of han-dling major drilling schedules, or small-time, one-well-per-year programs, the recent trends seen at the well site do require a new approach. “Although a lot of other processes have stayed the same,” Larsen says, “the time on location is going to in-

crease.” Because of that, companies that offer the services CalFrac does will need to tweak its long-term manpower planning. In some cases, companies will need to keep rotating crews at a well site for a longer pe-riod of time.

“When there is an inventory of un-completed wells sitting out there, there is going to be a demand for our service,” he says. “Oil and gas producers don’t like to have a well sit, they want to get it producing as soon as possible so they can start seeing cash fl ow.”

Author: Luke GeiverManaging Editor, The Bakken [email protected]


'When there is an inventory of uncompleted wells sitting out there, there is going to be a demand for our service. Oil and gas producers don’t like to have a well sit, they want to get it producing as soon as possible so they can start seeing cash fl ow.'Eric Schmelzl,NCS Oilfi eld Services


RESOURCE UTILIZATION: Recycled water created from Halliburton's process will initially be stored in frack fluid tanks at central locations.

MAKING IT

Flat screen televisions and water produced during the hydrau-lic fracturing process have a lot in common. Walter Dale, strategic business manager of water management services for global energy ser-vice provider Halliburton, can explain why. Just like the flat screen TVs we used five years ago, produced water and pro-

ducers' understanding of the resource has changed, Dale says. With the commercial launch of Halliburton’s trade-marked H20 Forward water re-cycling and reuse process, the difference in how produced water will be handled in 2013 versus 2009 could be more than just a change. As the process becomes more widely used and accepted (it has already been proven in more than 60 wells

Forget the Future: Frack Water Recycling is HereBy The Bakken Magazine Staff

THEBAKKEN.COM 37

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and 280 fractures), it could cre-ate a new approach to the way the oil and gas industry and the entire Williston Basin thinks about water, or as Halliburton believes, a paradigm shift of fluid technology.

The H20 Forward process can recycle produced water in the same reservoirs that hold the hydrocarbons unlocked during the hydraulic fracturing process, and the flowback water that is pumped into the well and

then returned during extrac-tion. This allows for unlimited reuse of the produced water in new well completions instead of disposal in deep injection wells. “When you think about the industry and all the people

that are involved, they’ve always said you need good quality wa-ter [for fracking] and now we are saying you don’t,” Dale says.

In August, Dale and oth-ers held a one-day event to showcase the product, explain the process and answer ques-tion from producers consider-ing the approach. The process combines two main steps: electrocoagulation and bacteria control.

The electrocoagulation process removes colloidal mat-ter present in a produced water stream by releasing positively charged ions into the water that attach to negatively charged ions. The process bonds the ions to any colloidal matter in the water stream. Through the use of gas bubbles, the bonded matter particles become buoy-ant and surface, , leaving behind clear water suitable for drilling, and completed wells. The pro-cess creates a clean brine suit-

NEW STANDARD: Multi-well pads are a common sight in the Williston Basin, and water recycling units and sites might not be far behind.


able for complex and slick wa-ter fluids used to frack a well. The components of the water removed during the process include hydrocarbons, sus-pended solids and metals. The key to the entire recycling pro-cess is the understanding that the water for future use only needs to be suitable, Dale says.

In combination with the electrocoagulation step, the system uses an ultraviolet (UV) bacteria control process that helps to reduce bacteria present in the waste water. When water is pumped into a well, it returns with bacteria present in the earth’s surface. That bacteria, left untreated, can lead to the corrosion of iron or steel and can also thin out a fracture fluid limiting its

effectiveness. The UV pro-cess flashes UV rays through the water, treating both aero-bic and anaerobic bacteria, a step that helps to reduce the amount of biocide, a bacteria control agent.

The H20 Forward pro-cess presents several benefits, including: effective water treatment, fluid formulation qualities, effective biocide use and a logistical compo-nent for handling, storing and moving the water. Halliburton will move 60,000 barrels of produced water and 20,000 barrels of flowback water to a central recycling loca-tion. Producers can then take 80,000 barrels of clean brine to use in any future well.

To move, handle and

MAKING IT

UNDERSTANDING THE PROCESS: The electrocagulation unit, above, uses ultravioletlight to reduce the amount of bacteria present in flowback water. The process, inturn, helps to reduce the need of biocide, a fluid also used to reduce bacteria. Below,potential clients and attendees ask questions about the unit.

THEBAKKEN.COM 39

store the produced and flow-back water, Halliburton has partnered with Nuverra En-vironmental Solutions. Nu-verra will place recycling sites in locations central to several clients, or, according to Mark Johnsrud, CEO of Nuverra, the company can set-up sites in remote locations. Nuverra will utilize frack water storage tanks to store recycled water.

The system doesn’t only reduce the need for fresh wa-ter, it also can reduce the well completions and overall op-erations costs for producers. Dale estimates the water costs for wells in the Williston Basin total roughly $16 per barrel. Depending on the amount of water recycled, Halliburton cli-ents could reduce the amount spent on water anywhere from $100,000 to $500,000.

“Overall efficiency is go-ing to be extremely impor-tant,” Johnsrud says. Currently,

he believes roughly seven or eight clients are signed up to use the recycling process. The North Dakota Industrial Commission has worked with Halliburton through the devel-opment stages of the process and at this point, there are no regulatory constraints that will impede the rapid deployment of the service.

The process will allow for the use of commingled water, and the site preparation for the first recycling facility is already underway east of Watford City, N.D. According to Dale, water managements costs related to hydraulic fracturing are roughly $51 billion annually. “Everybody,” Johnsrud said, at the demonstration event, “will be watching to see how it [the Halliburton-Nuverra process] happens.”

MAKING IT

SERIOUS EQUIPMENT: During the process showcase, operating unit managers described the process and what they've learned after running the system on multiple jobs.

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soutthhwestern North DServing


The claims and statements made in this article belong exclusively to the author(s) and do not necessarily reflect the views of The Bakken magazine or its advertisers. All questions pertaining to this article should be directed to the author(s).

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North Dakota has just reached the No. 2 spot in oil production in the United States and in

order to do so, produc-tion and drilling must be extremely high. The nearly 200 drilling rigs in

the state need special agents during and after the drilling process including drying agents to solidify the oil cuttings and waste.Fly ash is the leading dry-ing and solidification agent in the Bakken oil fields. It is wide-ly used as it is affordable, capa-ble of solidifying into cement, and has hygroscopic (ability to absorb water) properties.

Fly ash is primarily used in the concrete industry as a ce-ment replacement and product enhancer. It makes concrete stronger, more durable and more resistance to chemical at-

tack. It also is used in many oth-er products and in many other products and processes, includ-ing in concrete block, as a soil stabilizer, and in carpet backing and roofing shingles.

Fly ash is generated at coal-fired power plants where dust collection systems collect the fly ash in the flue gas as it exits the plant. The use of fly ash throughout the world has incredible benefits to the envi-ronment. It keeps ash out of landfills while it improves and enhances products and dis-places cement use. Every ton

Solidification SolutionFly ash finds new use in treating oil cuttings and waste.By Andy Glass

"IN 2009, BASIN ELECTRIC AND ITS MEMBER SYSTEMS PLANNED FOR 400 MEGAWATTS OF LOAD TO DEVELOP IN THIS AREA. BASIN ELECTRIC IS NOW PLANNING FOR LOADS TO GROW AN ADDITIONAL 1,000 MEGAWATTS BY 2025." –Basin Electric Power Cooperative on serving the Bakken.

THEBAKKEN.COM 41

of coal-combustion products used to improve our nation’s highways and buildings is a ton that is not deposited in a land-fill, saving the same amount of space that the average American uses over 455 days. For every ton of cement that is replaced with fly ash, we would save enough electricity to power the average American home for 24 days and reduce carbon dioxide emissions equal to two months use of an automobile.

Fly ash’s role in North Da-kota is increasing immensely. The two main uses for fly ash within the Bakken oil field are constructing the oil pad site and access road, and solidifying the drill cuttings and liquids that are a byproduct of the drilling process.

As a location is surveyed and is deemed viable for drill-ing, an earth-moving crew is hired to construct the pad site as well as an access road. With the truck traffic and weights of

the loads, these roads and pad sites need to be well-construct-ed and able to withstand high use. These pad sites and roads are being topped with scoria rock over a base layer of solidi-fied soil. Fly ash is being mixed with the earth and clay to pro-duce an incredibly strong base that will allow the road to last. Fly ash is delivered via bagged material, pneumatic tankers or live-bottom grain trailers and applied to the ground. Water is applied to create the opti-mum moisture level. The soil material, fly ash and moisture are mixed to create a homog-enous mixture. Once complet-ed, it is rolled, compacted and then allowed to setup, creating strength. Once the appropriate amount of time has passed, the top layer of scoria rock is ap-plied.

The biggest use of fly ash is during the drilling process itself. Drill cuttings composed of drilling fluids (fresh water

and oil-based liquid), dirt, clay and rock are created as the hole is drilled deeper and deeper. These materials are solidified two ways. One, as they come off the rig, they are mixed with fly ash and disposed of in the solids pit on the pad site. Or two, the solid and liquid cuttings are hauled off-site in closed top containers. Once the material reaches a landfill, it is solidified with fly ash. Approved landfills are found throughout the oil field.

With nearly 20 million tons of coal combustion products (CCP’s) under contract and contracts with over 90 utilities, 110 locations and 43 rail termi-nals, Headwaters Resources is the nation’s preeminent man-ager and marketer of CCP’s. Headwaters Resources employs more than 700 people, serving utility clients and end-use cus-tomers across the United States and Canada. Headwaters is the only CCP marketer owned by

U.S. management and inves-tors. Headwaters has long-term contracts with most utilities in North Dakota and eastern Montana. Headwaters has just completed an ash-lime blend-ing facility in Stanton, N.D., servicing both the bulk and bag market. Fargo, Washburn and Bismarck are the homes of the North Dakota offices.

In addition to extensive marketing services, Headwa-ters has the resources, person-nel, and technical expertise to provide total long-term man-agement programs as well as specific CCP management ser-vices.

Fly ash use is a great way to help our environment while adding value to the oil industry.

Author: Andy GlassBusiness Development [email protected]

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September 2013- The Bakken