SLIDE 1
OVERVIEW
I.
Our Story - Company Profile
II.
Connate Water Solutions Services
III.
Industry Water Trends
IV.
Basic Hydrogeology & Regulations– TDLs vs. Term Licensing
V.
Connate Water Internal Test Hole Projects : East Duvernay
VI.
Corporate Presentation and Overview - July 2019 Connate Water - - - PowerPoint PPT Presentation
Corporate Presentation and Overview - July 2019 Connate Water - - - PowerPoint PPT Presentation
Corporate Presentation and Overview - July 2019 Connate Water - water trapped in the pores of sedimentary rock during deposition OVERVIEW Our Story - Company Profile I. Connate Water Solutions Services II. Industry Water Trends III.
SLIDE 2
SLIDE 3
OUR STORY - COMPANY PROFILE
- Founded: 2016
- Specialty: Hydraulic Fracturing Groundwater
Sourcing and Licensing
- (>3,650 m3/year – P.Geo. Required)
- Markets: Licensed in Alberta, BC, SK & ON
- Obtained 150+ Approved Groundwater Temporary
Diversion Licenses (TDLs)
- Solid Client Base – Over 15 Deep Basin Operators
- Millions of dollars saved utilizing Groundwater
2016 2017 2018 (Est vs. Actual) Connate Water Revenue
SLIDE 4
FOUR CORE SERVICES
Water Supply Well Logging and Supervision Aquifer Testing & Specialized Hydrogeological Equipment Rentals Water Act Licensing and Reporting Corporate Water Management & Prospect Generation
SLIDE 5
INDUSTRY WATER TRENDS
HYDRAULIC FRACTURING- WATER USE INTENSITY INCREASED BY >250% From 2013 – 2017
AER, 2018 2017 ALBERTA - H2O MARKET
SLIDE 6
Hydraulic Fracturing – Temporary Diversion Licensing (TDL) and Term Licensing
SLIDE 7
BASIC HYDROGEOLOGY – PASKAPOO FM
In Alberta, the Water Act defines saline groundwater as any water with a Total Dissolved Solids (TDS) concentration of 4,000 mg/L or
- greater. [1]
< 4,000 mg/L = > 4,000 mg/L = Fresh or Non-Saline Water Paskapoo Formation (~$60k / Well) Saline Water (ex. Belly River Formation) (~ $1M + / Well)
SLIDE 8
BASIC HYDROGEOLOGY – PASKAPOO FM
- The Paskapoo consists of a succession of
interbedded sandstones, siltstones, mudstones with thin coal beds. (Bedrock Aquifers)
- Depositional Environment = Alluvial and
Fluvial-Lacustrine (Channel Deposition) capped by Quaternary Deposits (Till)
- Regional yield values for the Paskapoo range
from 150 to 720+ m3/day as a result of fracture based flow (Secondary porosity - Fracturing)
SLIDE 9
GROUNDWATER (GW) – HYDRAULIC FRACTURING SUPPLY
- Cost effective
- Reduced surface water
usage
- Safety
- Company Controlled
Infrastructure
SLIDE 10
PROCESS AND TIMELINE – GROUNDWATER TDLs FOR HYDRAULIC FRACTURING
Step #1: Planning of Target Aquifer and Planned Total Depth (Ex. 150 metres). (1 week) Step #2: Drilling and Installation of the Water Supply Well and Observation Well (~3 days) Step #3: Development & Step-Testing (1 day) Step #4: Constant Rate Aquifer Testing (length dependent on rate required) (1 week) Step #5: Data Analysis, Reporting and Submission to the AER (4 weeks) Average project duration around 6 – 8 weeks EMPTY PIT – USE GROUND WELLS
SLIDE 11
TEMPORARY DIVERSION LICENSES vs. TERM LICENSES
- A Temporary Diversion Licence (TDL) allows for the diversion of water for
a period of up to one year for hydraulic fracturing usage.
- One renewal will be granted and operators have up to two years to use
TDLs until a Term-Licence must be in-place for continued usage.
- No priority of water use is granted with a TDL, however, it is with a Term
Licence
- First in Time, First in Right (FITFIR) – A TERM LICENCE is the END GOAL
SLIDE 12
2019 STRATEGY - INTEGRATED FLUID SOLUTIONS & OPTIMIZE WATER
Secure Energy Services Corporate Presentation- June 2018
- EX. SECURE ENERGY SERVICES,
TERVITA ETC.
SLIDE 13
Fully Integrated Water Management
- 2. Sourcing
- 3. Blending
- 4. Chemical
Treatment
- 8. Water
Treatment
- 5. Midstream
Transportation
Surface Water Options Groundwater Options: Fresh aquifers (<4,000 mg/L TDS) Deep Saline aquifers (> 4,000 mg/L TDS)
- 6. Frac Water
- 7. Produced
Water
- 1. Design
Formation Water Flowback (~10 – 25%) Formation Loss (~75 – 90%) Existing Production, EOR Industrial and Municipal Wastewater
www.connatewater.ca
Blending Multiple Sources Biocides, Corrosion Inhibitors, Scale Inhibitors, etc. Analysis Location, Demand, Operator Activity, etc.
LINK TO ARTICLE
SLIDE 14
Connate Water: East Duvernay and Kakwa Internal Aquifer Mapping
Connate Water has anticipated the rapid growth
- f
industry well completion needs in the East Duvernay Shale play and is well positioned to deliver practical industry leading water solutions to
- perators in the area.
SLIDE 15
EAST DUVERNAY WATER MANAGEMENT – THE OPPORTUNITY IN H20
SLIDE 16
SCALE OF EAST DUVERNAY OPPORTUNITY
In Terms of Operating in the East Duvernay. Potential Challenges and Opportunities include:
- 1. Population
Density/Stakeholders
- Ex. Agricultural Users
- 2. Lack of Stable Water Supply
for Completions (Ex. Groundwater)
SLIDE 17
SCALE OF EAST DUVERNAY WATER OPPORTUNITY
- No Large Water Storage
- r Central Water Hub
Has Been Press Released Yet
- High Intensity Fracs and
Large Water Volumes (40,000 - 60,000 m³).
- Shallower than the West
Duvernay (2,000 - 2,300 m TVD)
SLIDE 18
East Duvernay – Freehold Lease Still In Place – Drilled in March 2018
SLIDE 19
CASE STUDY – ROCKY MOUNTAIN HOUSE AREA
- Three Confined Paskapoo Water Supply
Wells Drilled
- Licensed Groundwater Yield from All
Three Wells = 1,200 + m3/day
- Budgeted Water Cost = $30+ m3
- Final Water Cost per m3 = <$2 per m3
- Total Allocation = 400,000 m3 - Excess
SLIDE 20
POSITIVE CATALYSTS – CWS 2019 - 2020
- April 2019 - Opened Connate
Water LLC Office to Service the Eagleford & Permian Basin (San Antonio, TX )
- Start Process for Next Test Hole
Program in Alberta & Texas
- Industry Turn-Around with
upcoming Elections (Provincial & Federal)
SLIDE 21