“Production will begin to return as temperatures rise, power is restored, and pipelines are brought back online,” says Trisha Curtis, co-founder of Denver, Colorado-based oil and gas consultancy PetroNerds.
“Some wells and some operators will be faster than others and may have better on-site field management…This is very much a problem for operations in Texas and Oklahoma, which don’t use the same equipment as those in Colorado or North Dakota,” Curtis said. “They simply aren’t designed for the cold.”
Originally Posted On: https://www.brinknews.com/can-the-oil-and-gas-sector-reinvent-itself-in-a-post-covid-world/
Restarting oil and gas wells closed by the extreme cold sweeping much of the U.S. isn’t going to be quick or easy, even once the ice thaws and power is restored.
Oil production nationwide has been cut by at least a third and in the Permian Basin of Texas, the heart of America’s shale industry, output has plummeted by as much as 65%. But bringing flows back is likely to take much longer than it took for them to slump.
Most wells produce a mixture of oil, gas and water and it is the last of these that causes the problems. Although it may leave the well at boiling point, the water immediately comes into contact with steel pipes more than a hundred degrees colder. That can cause it to freeze, choking off the flow from the well, according to Richard Spears, vice president of Spears & Associates Inc. an industry consultant.
Water can still cause problems even after it’s been separated from the valuable hydrocarbons. If the pipes carrying waste water away freeze, you can’t get rid of the water from the well and you have to shut the whole operation.
The other big problem operators face is their reliance on electricity from the grid to run pumps, compressors and the electronics monitoring and reporting from the drilling pad. Lose power and you lose flow and that’s when lines freeze, Spears added.
Warmer weather will help. With temperatures forecast to rise this weekend, the wells and pipelines should begin to thaw naturally. That will allow oil and gas to start flowing again, but that’s only the start of the process.
Some well sites could have experienced mechanical damage, with freezing water expanding to crack valves, compressors, and pipes.
“There’s a good bit of water produced with oil and gas, so in areas with higher water, you’re going to have burst pipes,” according to Jim Newman, Executive VP of Operations at Basic Energy Services. “Safety will be paramount because of the hydraulics being damaged. So there’s going to be a very meticulous reactivation.”
Just getting to the well sites could prove tricky.
“The rapid thawing and melting of snow is likely to create muddy roads, especially in West Texas, that will make it difficult for trucks to reach well sites to check for broken equipment,” said Anna Lenzmeier at BTU Analytics.
A shortage of people could also hamper the restart. The industry has shed a lot of workers, many of them experienced personnel, in the wake of last year’s production collapse. Basic Energy Services has reduced its workforce by roughly 50% over the last year. “It’s indicative of most companies,” says Newman. “It’s a vulnerable industry to start with.”
“Production will begin to return as temperatures rise, power is restored and pipelines are brought back online,” says Trisha Curtis, co-founder of Denver, Colorado-based oil and gas consultancy PetroNerds. “Some wells and some operators will be faster than others and may have better on-site field management.”
Restoring production in northern states, where severe winter weather is commonplace, may be more straightforward than in the south.
“This is very much a problem for operations in Texas and Oklahoma, which don’t use the same equipment as those in Colorado or North Dakota,” Curtis said. “They simply aren’t designed for the cold.”
Basic Energy’s Newman said full restoration won’t be quick: “I would say it will take weeks; a lot will unfold as we assess the damage as we thaw out.”