Electric fracturing experts told Mike Segura that there was no way he could pump a frac job powered by electricity from the grid.
Now, with the results from over 300-stages of grid powered fracturing in hand, the Halliburton vice president‘s response to those who said it could never work: “It can, and it does.”
Tests run late last year by Cimarex and Halliburton show it is technically possible to efficiently run fracture pumps using power from a grid Cimarex built for its operations in in the Delaware Basin.
They are now running more tests in nearby Reeves County, Texas, building up data to figure out if the benefits of grid power justify the cost of delivering that power to the site and using new electric fracturing equipment.
For those involved, the industry skepticism was understandable given the level of difficulty. “From an electrical engineering perspective, there is not a more challenging problem in our industry said Michael DeShazer, vice president for Cimarex in charge of its Permian Basin operation.
What makes it hard is that fracturing is mobile.
An auto assembly plant requires a huge amount of power from the grid, but it is in a fixed location with fairly predictable, long-term power needs.
In contrast, hydraulic fracturing requires a lot of power delivered to remote locations on a hard-to-predict schedule.
DeShazer said he is not aware of any other company in the oil industry “trying to a move a massive amount of load around the grid from week to week.”
Other industry experts have said grid power would be impractical because so much of the power is required at startup, leading to demand surges that could destabilize it.
As one of the few companies in the shale business with its own power grid, Cimarex was able to build a system that can handle the load, drawing on the expertise of an electrical engineer on staff.
That also means its cost is limited to the time and money required to increase the capacity of the line going out to the site and ensure its substations have the capacity to convert enough power from the transmission lines to do the job.
Electric fracturing could become the latest return on an electric infrastructure investment made years ago when Cimarex was ramping up development of oil shale acreage in Culberson and Reeves counties.
Cimarex faced a common problem in the Delaware—the wells produced a lot of oil, and a lot more water. It decided the most cost-effective solution was to build its own water management system, including saltwater disposal wells.
That plan presented a second problem: finding the power to run the injection pumps in Culberson County, Texas, where the electric system was built to serve the needs of 2,100 people scattered over 3,800 sq miles.
“It was like drilling on the moon,” DeShazer said. In keeping with that image, Culberson County is also home to a rocket launch site built by Blue Origin, a venture started by Amazon founder Jeff Bezos.
Over time, that power supply facilitated a growing number of improvements, from an automated system to manage tank batteries to powering drilling rigs. DeShazer said they are considering whether it can be used to run the compressors in its gathering system.
Fracturing stands out because it is so power intensive. A single well can require 20 megawatts, DeShazer said. For that test they used the grid to power three of the pump trucks used.
The field test married Cimarex’s electric grid and Halliburton’s on-site electric supply and pump systems.
Cimarex installed a heavy-duty power line to the site, rated at 3.6 times more amps than its typical lines. At the site, the power flowed into a transformer Cimarex mounted on flatbed truck. From there a thick cable plugged into a truck-mounted Halliburton power control unit with lines running to the pumps.
While DeShazer said the fracturing crew was excited to do something new, the job design was not changed because of it. The stages went so smoothly that Segura was happy to report, “it was a boring operation.”
A key question is: Can grid power allow them to operate frac pumps at a higher rate than other power sources?
The joint news release said the test showed line power delivers 30 to 40% more horsepower than a diesel pump with a comparable capacity. Diesel output can vary due to factors such as the fuel quality and the temperature.
If that advantage is confirmed by further testing, that may mean they can fracture a well using 9 to 10 pumps rather than 12 to 14 pumps, DeShazer said. They are now gathering data at a fracturing site in Reeves County.
The other payoff is eliminating the emissions associated with diesel- or gas-powered units at the site.
While there are emissions associated with generating electricity, west Texas is home to a large, growing concentration of wind and solar projects. Cimarex draws on power from the power grid covering Texas, known as ERCOT, which estimates that 18% of its power is from renewables, reducing the carbon footprint of grid power.
Other operators have shown an interest in grid power, DeShazer said. Using it would require building a system that can deliver the required power or working with a utility to do so.
There are other electric fracturing options available and Cimarex has tried gas turbine power units on location. DeShazer said they are focused on grid power because it eliminates emissions at the site and the risks that come with moving high-performance equipment over rough roads.
Even if Cimarex decides grid power is the way to go for hydraulic fracturing, it will probably only be used on pads with multiple wells nearby to frac. It would be too costly to run high-capacity power lines out to scattered well sites when they are delineating a new area, DeShazer said.
Halliburton has been investing in electric powered hydraulic fracturing, and is seeing growing interest from users, Segura said. Its equipment is designed to work with a range of electric power sources.
Halliburton’s CEO, Jeff Miller highlighted the grid power announcement during a recent earnings call. “I think customer interest will be high” he said. That comes with some qualifications: this change will take time and require agreements with operators that justify the cost of developing and acquiring new equipment and training crews to use it.
If oil prices stay above $50/bbl, fracturing activity may increase enough to significantly increase pressure pumping prices. That would help because electric fracturing costs more than doing it with older equipment, which became cheaper last year when pressure pumping rates followed oil prices downward.
“It takes quite a bit of work upfront to get that all put in place. And very much in commitment by the operator to stay the course,” Miller said.
