Rising drilling-waste costs promote novel technologies, approaches

Aug. 11, 2003
The rising cost of handling drilling wastes is forcing the industry to implement cost-effective and novel technologies and approaches to meet ever-tightening regulations.

The rising cost of handling drilling wastes is forcing the industry to implement cost-effective and novel technologies and approaches to meet ever-tightening regulations.

A global survey reveals the cost of managing drilling waste will continue to rise. The survey entailed personal in-depth interviews with more than 100 drilling managers and engineers, including operator environmental specialists, and key governmental regulators across 12 mature and developing regions.

Along with the forecast economics of dealing with waste generated by the drilling process, the survey found several trends in waste-management technology for meeting changes in environmental requirements.

The survey had two objectives:

1. To define current and planned waste-management practices and expenditures.

2. Discover the drivers for waste-management procedures.

Additionally, the survey sheds light on decision-making processes as well as the availability of waste-management services.

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Given the regional differences in current waste-management practices, the cost of complying with local environmental regulations varies widely. For example, in the North Sea for every dollar spent on drilling fluids, operators allocated $0.50 for waste management (Fig. 1). Conversely, the survey found that very low costs were associated with waste management in the Middle East.

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For 2001, the survey determined that drilling waste-management expenditures were slightly more than 20% of the total costs of the fluids (Fig. 2).

To demonstrate the very dynamic nature of this cost, the ratio of waste management and drilling fluid costs nearly doubled in the Gulf of Mexico during 2002 with the introduction of more stringent regulations for the offshore disposal of synthetic-base drilling fluids.

Although the rate of increase is uncertain, the survey indicated that waste-management spending in relation to the drilling fluid costs will continue to rise, at least during the next 3-5 years.

Factors increasing costs

The survey showed that a number of factors will drive the upward trend in costs to deal with drilling waste, including:

  • Adoption of specific regulations defining the type and volume of drilling wastes that can be discharged in countries where such regulations currently do not exist.
  • Higher levels of enforcement for regulations currently in place.
  • Global application of corporate environmental standards by major operators, which often exceed local requirements.
  • Development and availability of new waste-management technologies that improve the technical and economic efficiency of current waste-management solutions.

As regulations are enforced more strictly with the imposition of stiffer penalties, the survey results disclosed that operators believe it is more economical to manage drilling waste efficiently rather than overlook the short and long-term ramifications of the alternative.

Not only is there great diversity in regulatory frameworks, actual waste-management technologies being employed or under consideration are highly variable and dynamic. Clearly, complex governmental restrictions, stringent corporate health, safety, and environment (HSE) standards and the wide-range of waste-management solutions available make technical expertise critical in not only minimizing the volumes of wastes generated, but also the associated costs.

Practices, standards

The survey results underscored both the wide diversity of environmental standards across geographic regions, as well as the highly dynamic nature of these standards in defining future drilling waste-management options (Table 1).
Click here to view Waste Management Practices in pdf format.

Regional trends were highlighted by placing the survey data into eight categories, as follows:

1. Regional regulatory structure.

2. Current environmental drivers.

3. Future environmental drivers.

4. Rate of regulatory changes.

5. Operators' current waste-management practices.

6. Industry concerns about current waste-management practices.

7. Current waste-management infrastructure.

8. Future trends in waste-management practices.

According to the survey some regions, such as the North Sea, enforce relatively stringent environmental regulations that clearly define minimum levels of compliance with efficient enforcement mechanisms.

In these regions, the industry has developed a waste-management infrastructure for supporting the need for waste-management solutions, but many operators polled suggested that these solutions are not optimal, thereby driving the need for more suitable solutions.

Dealing with drilling wastes

In the broadest sense, the survey found that the environmental performance requirements of each region polled fell into three categories:

1. Redefining waste through fluid design.

2. Minimizing waste volume through the design and execution of waste-management solutions in the fluids program.

3. Minimizing the impact of waste through secondary fluid recovery, treatment, and finally disposal.

These solutions represent completely different approaches to waste, involving various suppliers in different phases of the drilling operation.

The first approach, which is considered the optimum solution, falls strictly within the domain of the drilling-fluid suppliers and is at the center of developing new fluids.1-5

The second approach represents the joint design of the fluid and primary fluid-recovery systems, thus requiring close cooperation between the fluids and solids-control suppliers in both the planning and execution of a drilling project.

The goal is to minimize the volume actually generated at the wellsite.

The third approach focuses less on waste minimization by emphasizing fluids engineering. Although secondary fluid-recovery systems clearly contribute to minimizing wastes, this approach concentrates strictly on the processes and equipment used to minimize the impact of waste on the local environment.

Generally, service providers offer these three categories of environmental solutions separately. Some suppliers, however, were found to have broadened their product and service offerings to provide technologies and services within all three categories.

More specifically, the methods available for managing drilling wastes also varies widely from simply transporting contaminated cuttings to dedicated disposal sites, to on site bioremediation-land farming to more elaborate offshore cuttings re-injection systems and other technologies.

Reducing waste

From a waste-management perspective, a fluid may cost more but be simple to remediate with relatively low treatment costs. Conversely, a lower-cost fluid may require a more complicated and expensive remediation method.2

"Reverse-wave engineering" addresses drilling waste management at the beginning of the fluid-development process to first determine the technical, environmental, and legislative targets that need to be met.

Afterwards, one can employ a more holistic approach for engineering a fluid that meets both the environmental and technical objectives of the well.

This approach contrasts dramatically with the traditional development process of establishing technical specifications for the fluid with little consideration to the eventual disposal of contaminated drill cuttings.

Critical to this methodology is the identification of the environmental issues associated with conventional formulations and the determination of the root causes in the additive chemistry. Afterwards, it becomes possible to development products that not only cause minimal environmental impact but also can actually enhance the receiving environment.

By following this approach, operators have a toolbox that allows them simultaneously to select product and treatment technologies that can cost-effectively achieve both drilling and environmental objectives.

Furthermore, it allows the service company to formulate a cost-effective and technically competent fluid system, using selected additives that can be combined with a treatment process that effectively meets consistent environmental performance standards at the lowest possible costs.

Enhancing the environment

Historically, contaminated drill cuttings and other waste produced from drilling operations were considered just that—a necessary evil that had to be treated and disposed of through a variety of techniques, all of which compounded overall project costs appreciably.6

Fluid researchers first elevated waste-management issues with the introduction of synthetic-base drilling fluids offshore. For the first time, operators could achieve the high-performance characteristics of an invert-emulsion fluid with the greater environmental acceptability of its synthetic oil-base counterpart.

By the mid to late 1990s, new methods for recovering and reusing water-base drilling fluids became cost-effective, thus benefiting both the operator and drilling-fluid provider.

More recently, this concept has been extended by the process of converting waste into a commercially viable and soil enhancing product. For example, M-I LLC employed the reverse-wave engineering process to develop a linear-paraffin-base drilling fluid designed to satisfy the dual objectives of improved drilling and environmental performance.

Moreover, the philosophy behind the research and development was not to design a system that merely posed a negligible effect on the environment, but rather one that would actually prove beneficial.3-5

Accordingly, M-I's goal was to select individual components of the fluid system, including the base fluid, emulsifiers, internal phase, weight material, and fluid-loss additives, that generate drill cuttings that enhance soil quality and subsequent plant growth. The generated cuttings when combined with worm-based bioremediation produce commercially beneficial soil-enhancing fertilizer (Fig. 3).

This system combines a linear-paraffin-base fluid with a calcium ammonium acetate brine phase and barite as the weighting agent. It contains no aromatics, and all of its components are biodegradable, making it ideal from an HSE perspective.

In this system, everyday earthworms transform the drilling waste into a commercially beneficial by-product. While worm farming, or vermiculture, is well established for treating organic wastes, a test in New Zealand in 2002 was the first time the process was employed to treat drilling wastes.7 In the test, more than 1,000 tons of cuttings were worm-farmed, thus reducing the hydrocarbon concentration to nearly background levels.

Currently, M-I is involved in a joint research project on worm-based bioremediation of drill cuttings in Norway.

Fluid stream integration

The survey showed that the second most popular approach for minimizing waste generated at the well site was to use one seamless process for treating fluids, solids control, and waste management.8-11

Unlike approaches that simply bundle services, a holistic approach incorporates the total management of all fluids and waste activities and includes project planning procedures, best practices, benchmarking, specially designed software, specifically trained personnel, and other fluid-related technologies.

Additionally, the inter-linked product and service approach includes integrated data management systems, featuring a common database to analyze the interactions between all fluid system components. This component is fundamental for continuous analysis and measuring improvement.

The natural grouping of fluid and waste-management products and services at the well includes drilling, reservoir drill-in and completion fluids, solids control and filtration equipment, and waste treatment and remediation equipment and services.

This grouping is natural to the extent that the performance of individual components is interdependent.

The process begins in the well-planning stages and extends through completion, including the ultimate disposal of the irreducible volume solid and liquid waste. The all-inclusive fluids management approach extends beyond shared infrastructure and personnel to exploit synergies in technology and delivery inherent in this natural grouping of products and services.

Early in the well-design phase, all pertinent personnel carefully analyze the drilling program to estimate the amount of drilling fluids and related chemicals required for each interval, while also anticipating any risks that could unexpectedly require additional products, sometimes at a moment's notice.

A central element in the fluids integration process is the determination of the ideal waste-remediation scheme.

Secondary recovery, treatment, disposal

The survey found that most operators used a variety of techniques to deal with the waste produced in the drilling process. The most common methods reclaim environmentally unacceptable fluids from the cuttings or otherwise treat cuttings before disposal.

Drill cuttings when combined with worm-based bioremediation produce commercially beneficial soil-enhancing fertilizer (Fig. 3).

Containment and transportation of the cuttings pose a major challenge to the overall efficiency of the selected waste-management solution. But recent developments have made these safer and more efficient.

The treatment and disposal methods used greatly depend not only on the regulations in force in a particular area, but also on the existing infrastructure in place to perform these tasks.

One method for secondary fluid recovery is the use of built-for-purpose environmental facilities that include several services with the overall goal of minimizing the waste stream, reducing disposal costs, and eliminating liability. Filtration and remediation services at these facilities provide significant performance and cost benefits while simultaneously meeting environmental regulations.

Operators can discharge clean water where permitted, but otherwise the water and fluid have to be recycled for new applications or used as raw materials in manufacturing new fluids.

Rig, tank, and boat cleaning is an adjunct service of the dedicated environmental facilities, again with the aim of waste minimization and the reuse of spent fluid.

As environmental drivers become more stringent, dealing with wastes can no longer be an afterthought.

Instead, waste management must be considered in detail throughout the process, from fluid development to well execution.

The drilling fluid, solids control, and waste-management sector, working hand-in-hand with operators, must continue to develop technologies to significantly reduce the waste that remains at the end of the drilling process. F

References

1. Curtis, G.W., et al., "Can Synthetic-Based Muds be Designed to Enhance Soil Quality?," Paper No. AADE-01-NC-HO-11, AADE National Drilling Conference, Houston, Mar. 27-29, 2001.

2. Paulsen, J.E., et al., "Creating near-zero discharge in Norway: A novel environmental solution," World Oil, December 2002, pp. 37-40.

3. Growcock, F.B., et al., "Designing Invert Drilling Fluids to Yield Environmentally Friendly Drill Cuttings," Paper No. SPE 74474, IADC/SPE Drilling Conference, Dallas, Feb. 26-28, 2002.

4. Sørheim, R., et al., "Oily Drill Cuttings – From Waste to Resource," Paper No. SPE 61372, 5th SPE International Conference on Health, Safety and Environment, Stavanger, June 26-28, 2000.

5. Getliff, J., et al., "Drilling Fluid Design and the Use of Vermiculture for the Remediation of Drill Cuttings," AADE Drilling and Completion Fluids and Waste Management Conference and Exhibition, Houston, Apr. 2-3, 2003.

6. Carroll, L., "Turning drilling waste into a resource," Offshore, November 2002, p. 96.

7. Norman, M., et al., "Minimizing Environmental Impacts and Maximizing Hole Stability: Significance of Drilling With Synthetic Fluids in NZ," New Zealand Petroleum Conference, Auckland, Feb. 24-27, 2002.

8. Pruett, J., and Hudson, C., "Integrated Approach Optimizes Results," American Oil & Gas Reporter, August 1998, pp. 86-91.

9. Hudson C., and Nicholson, S., "Integrated Fluids Approach Cuts Waste, Costs in Texas Wildlife Refuge," Petroleum Engineer International, March 1999, pp 37-41.

10. Getliff, J.M, et al., "Waste Management and Disposal of Cuttings and Drilling Fluid Waste Resulting from the Drilling and Completion of Wells to Produce Orinoco Very Heavy Oil in Eastern Venezuela," Paper No. SPE 46600, SPE International Conference on Health, Safety and Environment in Oil and Gas Exploration and Production, Caracas, 1998.

11. Minton, R.C., "The pneumatic collection, handling and transportation of oily cuttings – two years of field experience," Paper No. SPE 83727, SPE/EPA/DOE Exploration and Production Environmental Conference," Mar. 10-12, 2003, San Antonio.

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The authors
Reg Minton ([email protected]) is vice-president for waste-management business development for M-I/Swaco, Houston. He is involved in developing the company's waste-management business on a global basis. Previously, he worked for BP PLC in a variety of capacities, including drilling fluid mud engineer, drilling engineer, waste-management project manager, drilling operations project manager, and drilling R&D manager. Minton has a BSc (Hons) in applied biology and a PhD in marine biology. He is a member of SPE.

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Judith McGlaughlin ([email protected]) is manager of market research and planning for M-I/Swaco, Houston. She is responsible for competitive intelligence, industry forecasting and analysis, and market research. Previously, she worked for Shell Oil Co. as a corporate planning analyst. McGlaughlin holds a BS in sociology and statistics from Texas A&M University and an MBA from the University of Houston.