Water management

Water-Resource-Management Guide Offers Method for Identifying, Managing Risk

While water issues are often location- and situation-dependent, a standardized guide to water-resource management has been developed for upstream oil- and gas-production projects and operations.


While water issues are often location- and situation-dependent, a standardized guide to water-resource management has been developed for upstream oil- and gas-production projects and operations. The guide provides environmental, regulatory, and socioeconomic practitioners with a consistent and effective method to identify, assess, and manage water-resource-related risks and opportunities. The guide has four steps, each with embedded and scalable tools—data acquisition, data analysis, risk assessment, and risk management.


The availability and quality of fresh-water resources, coupled with increasingly stringent regulatory requirements in many locations, continue to challenge the oil and gas industry. Accordingly, the industry recognizes its responsibility to surrounding communities and to the environment regarding its management of fresh water. One company’s water-resource-management program is built upon a framework of principles designed to help manage interactions with water in order to

  • Protect human health and the environment
  • Consider local water needs when addressing operation requirements
  • Continuously improve technologies, practice, and performance
  • Engage stakeholders in development of sustainable water solutions

In order to provide environmental, regulatory, and socioeconomic practitioners with the knowledge and methods to implement these principles, an upstream water-resource-management guide was developed. The guide does not contain any new requirements but rather is intended to function as a road map for practitioners to help them manage water resources more effectively within the context of existing internal requirements and external considerations, constraints, and requirements.
The objectives of the guide are to

  • Enhance the quality of data gathered regarding the use of water resources
  • Identify and manage water-related risks
  • Assist in the application of appropriate technology and operational practices to improve water-use efficiency and safeguard water quality

The Upstream Water-Resource-Management Guide

The upstream water-resource-management guide was developed to consolidate appropriate pieces of internal and external references into an effective four-step process for better management of water resources. As shown in Fig. 1, the steps are data acquisition, data analysis, risk assessment, and risk management.

Fig. 1—Context of the water-resource management guide relative to company requirements and external guidance. OIMS=operations integrity management system; EPI=environmental performance index; WBCSD=World Business Council for Sustainable Development; GEMI=Global Environmental Management Initiative.

Step 1: Data Acquisition

Local advisers and water-resource subject-matter experts define water-resource-related data needs by the nature and location of the activity, project, or producing asset. Two types of water data are considered—data related specifically to the project or operation itself, referred to as internal data, and external data that relates to the project’s interactions with the environment and community.

With regard to internal data, an activity/project/producing asset is directed either to collect a basic level of water-resource-related information or to develop a comprehensive water footprint. Activities/projects/producing assets in water-scarce areas require more-detailed collection of data, while those with more straightforward water issues typically warrant a more-limited data set.

Step 2: Analysis

Practitioners next need to analyze the water-resource-related data that were acquired to facilitate benchmarking and stewardship, prepare for risk assessment and management investigations, and identify and evaluate continuous-improvement opportunities.

The analysis of water-resource-related data requires metrics to be selected specifically to assess performance and promote continuous improvement appropriately. Metrics serve as the basis for the assessment of water-related risks because they help identify issues and opportunities that require additional scrutiny. Metrics also can be used to communicate water-use performance externally and demonstrate the response to stakeholder expectations. Key water-resource-related metrics include

  • Withdrawal—a measure of the quantity of water removed from a source over a finite period of time.
  • Consumption—the amount of water not returned to the original source because of usage and losses; consumption= withdrawal−discharge (formula assumes a common source for withdrawal and discharge).
  • Percentage of use—the ratio of natural-source waters (surface and groundwater) consumed at a specific location (by an activity, project, or producing asset) vs. the total amount of water withdrawn for use (for the same activity); for example, a site that uses produced water for steam generation in place of using fresh water for this purpose will have a lower “percentage of use” than a site that disposes of its produced water and uses only fresh water for steam generation.
  • Efficiency—the unitless ratio of the number of units of fresh water used to produce a unit of (hydrocarbon) product equivalent.

Armed with (internal) activity/project/producing-asset-specific water-resource data, external critical assessment criteria, and an understanding of (internal) benchmarking and stewardship expectations and requirements, a practitioner is well-positioned to enter the risk-assessment step. Note that data analysis does not stop at this step but that it continues throughout the remaining steps.

Step 3: Risk Assessment

A risk-screening and subsequent structured risk-assessment approach is then used to determine the level of management and intervention, commitment of resources, and budget required to manage identified water-related risks.

Identify and Characterize Aspects. A water-resource-related risk assessment is initiated by identifying water-related environmental and socioeconomic aspects related to an activity, project, or producing asset over its foreseeable life cycle.

Characterize the Environmental, Social, and Regulatory Setting. The environmental setting in a particular location constitutes the living systems and other natural resources that may be affected by the industry’s interactions with water resources. From a physical water-resource perspective, the area of influence of an activity/project/producing asset must be determined appropriately. This is a function of the rates and volumes of water used relative to the magnitude and variability in supply and the geography (water-shed and subwatersheds). The social setting refers to the proximity of people and their relationships with the natural environment, including water resources. The regulatory setting refers not only to applicable host-country regulatory requirements but also to design practices or internal standards that may extend beyond such requirements. When characterizing the environmental, social, and regulatory setting associated with a particular location (especially with regard to water resources), it is typical to start with the current and local setting and then expand the focus.

Identify Alternatives. Activity, project, or operating alternatives are discrete sets of choices for attaining defined business goals; assessing alternatives from a risk point of view can assist in the identification of the best overall alternative. It is recommended that water-resource-related alternatives be examined early and that the results be used to identify the preferred course of action. Alternatives that are not examined early enough can lead to the application of inappropriate or unnecessary risk-management measures.

Alternatives related to water resources include

  • Treatment and conveyance technologies to increase efficiency and reuse opportunities, allow for the use of lower-quality source water, or increase the quality of effluent water for discharge or beneficial reuse
  • Seasonal adjustments in water withdrawals, discharges, conveyance, or storage
  • Use of alternative water sources, including lower-quality sources or sources not competing directly with local or regional users
  • Reduction or elimination of water use through application of technological, chemical, operational, or other alternative methods

Develop Risk Scenarios. This step entails the development of a credible sequence of events or conditions leading to a potential consequence for each water-resource-related aspect assessed. This sequence of events is referred to as a risk scenario. A scenario forms the foundation for the assessment of consequence, severity, and probability and ultimately for the determination of overall risk.

Assess Risk Significance. The significance of the risk scenarios identified in the develop-risk-scenarios step entails evaluating each of them on the basis of an estimate of consequence/severity combined with an estimate of the probability that the scenario could occur. The combination of consequence/severity and probability allows for the risk to be quantified. Each scenario is assigned a risk (probability and consequence/severity) in health-and-safety, environmental, public, and financial categories. The risks can then be ranked to prioritize prevention, management, or improvement options. For risks that are deemed to be unacceptably high, the same risk scenarios need to be re-evaluated after risk-reduction measures have been applied.

Step 4: Risk Management

The results from the preceding three steps provide the blueprint for the development of an appropriately scaled water-resource-management plan. Such a plan integrates metrics with existing programs and the latest technologies (where feasible) to avoid, reduce, or remedy identified and assessed water-related risks.

The preparation of a water-resource-management plan is recommended to help manage elevated water-related risks. A water-resource-management plan typically focuses on managing interactions with affected water sources through reduction in use, conservation, monitoring, the identification of viable alternatives, and continuous improvement. It is recommended that a water-resource-management plan be scaled appropriately to the size of interactions with specific water sources, resource availability, and the assessed level of risk.

A water-resource-management plan typically includes a presentation of the data and information generated in support of the water-resource risk-assessment process. Components of this type of plan typically include

  • Historical and current reference conditions
  • Analysis of alternatives to using fresh water
  • Internal water balance
  • Targets and key performance indicators
  • Operating and maintenance procedures
  • Water-metering practices, use-estimation procedures, and conservation measures
  • Influence on external water supplies
  • Education and training
  • Internal and external communications

Many of these topics were addressed in the guide’s process and should be included in a water-resource-management plan. The four-step process of data collection, analysis, risk assessment, and risk management (as shown in Fig. 1) needs to continue over the life cycle of a producing asset to measure and report water-use performance, identify and manage source changes, identify emerging source-related risks, and identify opportunities for continuous improvement regarding overall water-resource management.
This article, written by Special Publications Editor Adam Wilson, contains highlights of paper SPE 168520, “One Company’s Upstream Water-Resources-Management Guide,” by Stuart R.D. Lunn, SPE, Imperial Oil, and Mark R. Decatur, Michael L. Allen, and Rick A. Mire, ExxonMobil, prepared for the 2014 SPE International Conference on Health, Safety, and Environment, Long Beach, California, USA, 17–19 March. The paper has not been peer reviewed.