"Water can be as valuable as oil" A brief look into water consumption as it relates to shale development.

1. Wastewater reuse in shale development:
drivers, strategy, and market size
Prepared for Infocast
January 2014

2. The Future of Water in Unconventionals
Marcus Oliver Gay
Research Director
IHS Energy Insight
Marcus.Gay@ihs.com
www.linkedin.com/in/marcusgay
Sarah Fletcher
Senior Research Analyst
IHS Energy Insight
sarah.fletcher@ihs.com
www.ihs.com/waterunconventionals
Copyright © 2013 IHS Inc. All Rights Reserved.
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3. The Future of Water in Unconventionals
“ Water can be as valuable as oil ”
”
Copyright © 2013 IHS Inc. All Rights Reserved.
3

4. The Future of Water in Unconventionals
“ Recycle will double in next 10 yrs ”
”
Copyright © 2013 IHS Inc. All Rights Reserved.
4

5. The Future of Water in Unconventionals
“
Industry must spend $370bn
over the next 10 years ”
Copyright © 2013 IHS Inc. All Rights Reserved.
5

6. Water can be as valuable as oil!
T3:
Source: IHS Energy Insight
Copyright © 2013 IHS Inc. All Rights Reserved.
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7. Recycle will double over the next 10 years
Wastewater
management
strategies
Wastewater Generation
from an oil or gas well
100%
90%
80%
Surface
Discharge
Volume
70%
Centralized
Recycling
60%
Flowback fluid
50%
On-site
Recycling
30%
Produced water
40%
Injection
20%
10%
0%
30-90 days
20 years
Flowback
Fluid
Produced
Water
Time
Source: IHS Energy Insight
Copyright © 2013 IHS Inc. All Rights Reserved.
7

8. Recycle will double over the next 10 years
Copyright © 2013 IHS Inc. All Rights Reserved.
8
Source: IHS Energy Insight

9. Recycle will double over the next 10 years
Copyright © 2013 IHS Inc. All Rights Reserved.
Source: IHS Energy Insight
9

10. Recycle will double over the next 10 years
Copyright © 2013 IHS Inc. All Rights Reserved.
Source: IHS Energy Insight
10

11. Recycle will double over the next 10 years
Source: IHS Energy Insight
Copyright © 2013 IHS Inc. All Rights Reserved.
11

12. Recycle will double over the next 10 years
Source: IHS Energy Insight
Copyright © 2013 IHS Inc. All Rights Reserved.
12

13. Recycle will double over the next 10 years
100%
90%
Effect of policy on field water consumption
94%
92%
Average water consumption
80%
70%
60%
60%
55%
50%
40%
30%
20%
10%
0%
Base
Regulation A…
Regulation B…
Regulation A…
Source: IHS Energy Insight
Copyright © 2013 IHS Inc. All Rights Reserved.
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14. Industry must spend $370bn over next 10
years
Source: IHS Energy Insight
Copyright © 2013 IHS Inc. All Rights Reserved.
14

15. “ Water can be as valuable as oil ”
The Future of Water in Unconventionals
”
15
Copyright © 2013 IHS Inc. All Rights Reserved.

16. “ Water can be as valuable as oil ”
The Future of Water in Unconventionals
“ Recycle will double in next 10 yrs ”
”
Copyright © 2013 IHS Inc. All Rights Reserved.

17. “ Water can be as valuable as oil ”
The Future of Water in Unconventionals
“ Recycle will double in next 10 yrs ”
“
”
Industry must spend $370bn
over the next 10 years ”
17
Copyright © 2013 IHS Inc. All Rights Reserved.

18. Thanks
IHS and CAP Resources
Copyright © 2013 IHS Inc. All Rights Reserved.
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19. Want to learn more?
IHS Future of Water Product Site:
www.ihs.com/waterunconventionals
IHS Unconventionals Blog:
www.ihs.com/unconventionalsblog
Marcus Oliver Gay
Research Director
IHS Energy Insight
Marcus.Gay@ihs.com
www.linkedin.com/in/marcusgay
Copyright © 2013 IHS Inc. All Rights Reserved.
Sarah Fletcher
Senior Research Analyst
IHS Water
sarah.fletcher@ihs.com
19