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Houston-based oil services company Baker Hughes uses the Permian Basin in western Texas to launch a fleet of new turbines that use excess natural gas from a drilling site to power equipment. hydraulic fracturing – reducing flares, carbon dioxide emissions, as well as equipment and personnel in isolated locations.
Baker Hughes CEO Lorenzo Simonelli spoke about the company's "electric frack" technology during an investor phone call Tuesday morning. The company said its first-quarter profits fell by more than half, from 70 million USD to 32 million USD for the same period of the previous year. Revenues reached $ 5.6 billion, compared to $ 5.4 billion in the first quarter of 2018.
As production continues to exceed gas pipeline construction in the Permian Basin, operators burn or burn about 104 billion cubic feet of natural gas per year instead of shipping them to the market. Simonelli said that he considered the waste of natural gas, a by-product of oil drilling, as a business opportunity.
"We are solving some of our customers' toughest problems, such as logistics, energy, and reducing flare gas emissions, with the products in our portfolio," Simonelli said during the meeting. 'call.
Climate change: Baker Hughes pledges to reduce its carbon dioxide emissions to zero by 2050
Baker Hughes estimates that 500 hydraulic fracturing fleets are deployed in shale basins in the United States and Canada. Most of them are powered by trailer mounted diesel engines. Each fleet consumes more than 7 million gallons of diesel per year, emits an average of 70,000 tonnes of carbon dioxide, and requires 700,000 truckloads of diesel fuel trucks delivered to remote sites, according to Baker Hughes.
"The electric frack makes it possible to switch from diesel pumps to electric motor pumps, powered by modular gas turbine generator sets," said Simonelli. "This eliminates several limiting factors for the operator and the pressure pumping company, such as diesel truck logistics, excess gas management, carbon emissions and the reliability of pressure pumping operation."
Baker Hughes estimates that the 500 diesel frack fleets require a combined energy of 20 million horsepower, representing a potential market for supplying 15 gigawatts of electricity using gas turbines. Up to now, eight electric frack teams are deployed in the Permian Basin.
.Market Outlook: Baker Hughes plans LNG growth in 2019
Baker Hughes is not the only one to have developed a technology using natural gas that would otherwise be burned. Denver's EcoVapor and Capstone Turbine recovery systems in Van Nuys, California, have developed similar technology to use excess natural gas as a fuel to produce electricity.
"Permian farmers are burning enough gas every day to meet the domestic needs of every Texas," said Colin Leyden, chief executive of the Austin office of the Environmental Defense Fund and author of the newspaper. a report on Permian burning. "This kind of waste is unacceptable. On-site capture solutions such as this are both welcome and necessary. "
The Environmental Defense Fund calls on the Railroad Commission, which regulates the Texas oil and gas industry, to eliminate permanent burning permits, needs new technologies to reduce burning, improve emissions reporting, and end a gas tax exemption.
"Flaring is a very visible example of an industry that continues to fight against waste and pollution and ultimately questions the ability of natural gas to compete in a low-carbon future," he said. said Leyden. "The Railway Commission and other regulators should look for ways to incentivize such technologies."
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Baker Hughes merged with the oil and gas division of the Boston conglomerate, General Electric, in July 2017. Turbine technology and the company's combined electric fracturing equipment come from facilities in Italy purchased by Nuovo Pignone in Nuovo Pignone in December 1993.
While General Electric is expected to divest its stake in Baker Hughes, the two companies have already concluded a series of agreements in November defining long-term collaboration in the field of turbine technology. As part of these agreements, Baker Hughes will retain access to the technology and become its sole supplier.
With annual revenues of nearly $ 23 billion, Baker Hughes employs more than 64,000 people in 120 countries.
@SergioChapa on Twitter
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