As with perfection, the goal of achieving zero pipeline spills in North Dakota might not be attainable, but two of the opening speakers at the fourth annual Bakken Conference & Expo let it be known this is a challenge the oil and gas industry is taking seriously.
The first full day of the event at the Rough Rider Center in Watford City, North Dakota, began with keynote speaker Jason Swaren, vice president of operations with Oasis Petroleum. He was followed by Jay Almlie, principal engineer and mid/downstream oil and gas group lead with the University of North Dakota Energy & Environmental Research Center (EERC). Both organizations are involved in iPipe—the Intelligent Pipeline Integrity Program—which evaluates promising technologies to detect pipeline leaks and prevent spills.
Swaren described the the three companies that make up Oasis, beginning with Oasis Petroleum, the upstream exploration and production company formed 11 years ago that now holds 500,000 net acres in the Bakken. Although Oasis also has acreage in the Permian, the Bakken represents 95 percent of its production and 85 percent of its 2018 capital expenditures. “I can’t stress enough the importance of the Bakken to our company,” he stated.
Oasis Midstream Partners was formed to support the parent company across four commodity streams of fresh water, produced water, oil and gas. Oasis Well Services is a private company that focuses on frack operations to support Oasis Petroleum. It has done more than 14,000 fracks, employing high-intensity fracks and high-capacity pumping for well completions.
Swaren said Oasis plans to spend $1 billion in the Bakken this year and noted that the company has invested $10 billion in capital projects in North Dakota. By comparison, the states’ budget for the 2016 biennium was about $8 billion, he said.
Among those projects is a new gas processing plant north of Watford City that will add 10 percent to North Dakota’s overall processing capacity. Swaren said the plant is expected to come on line later this year and should help alleviate concerns about flaring. However, he said more capacity will soon be needed because of increasing production and higher gas-to-oil ratios.
Swaren emphasized the importance of the Dakota Access Pipeline to Oasis and other North Dakota producers. “It has made oil produced here competitive on the global landscape,” he said. He also noted the importance of training to maintaining a skilled workforce that understands “the Oasis way of doing things.”
According Swaren, Oasis is exploring the use of drones for surveying, turning jobs that used to take weeks into hours. He also described how the company is using cellular communications to task lease operators more effectively for wellsite maintenance and repairs.
Almlie noted North Dakota Gov. Doug Burgum’s challenge to industry to employ technology and innovation to achieve zero pipeline spills in the state. Oasis was one of the first three major players in the Bakken to accept the challenge. The EERC was brought on board to help evaluate promising technologies and administer iPipe.
Because 99.99 percent of pipelines don’t leak, the goal of eliminating the remaining .01 percent is a difficult challenge, but Almlie said industry is striving to get there to eliminate the inaccurate narrative that North Dakota is “the spill state.”
“We are on par with every other major oil producer state in the nation,” he said. The most effective way to prevent leaks and spills it to make certain pipelines are properly installed. “The days when things were installed too quickly because of the mad rush and lack of labor, I really believe that’s turned around,” Almlie said.
Beginning in 2015, the North Dakota Legislature tasked the EERC with doing the first of three independent assessments on potential solutions to pipeline leaks and spills from liquid gathering pipelines. Almlie said legislators wanted to know if there was feasible technology that wasn’t so expensive it would put the oil and gas industry out of business.
“Industry came to us and said we’re interested in responding to the governor’s challenge,” Almlie recalled. “They were interested in technologies that were not quite commercial and wanted to help them get them implemented.” This resulted in a consortium of oil and gas companies creating the $4 million iPipe program to demonstrate and advance emerging technologies with the greatest potential.
After going through a process modeled on the “Shark Tank” TV program, two companies— Satelytics and Ingu Solutions—were selected to this summer demonstrate their detection and leak-prevention technologies. Almlie said consortium members have made a three-and-a-half-year commitment to the iPipe program.
“Their effort is to keep each other bound and really move the needle on this problem of pipeline leaks,” Almlie said. He added, “There aren’t too many places in the country where you could do this. Now other states are reaching out to us about how to do it.”