SPE Tech Talk: The Path to Eco-Conscious Hydraulic Fracturing

VortexPrime™ leads the industry in eco-conscious hydraulic fracturing without sacrificing power and production. In this conversation with SPE Tech Talk host, Joe Sinnott, Seth Moore, Catalyst COO, discusses how VortexPrime’s turbine technology helps operators lower costs, reduce emissions, speed-up set-up/take-down, and decrease the operations’ footprint. Check out the recording for details about our patents-pending, proprietary technology.

Watch here:

https://www.worldoil.com/podcasts/world-oil-deep-dive-the-technology-shaping-the-upstream/

Relevant links:

Seth Moore

https://www.linkedin.com/in/seth-r-moore-1b02908/

Joe Sinnott:

https://www.linkedin.com/in/jamesmichaelwatkins

The Path Toward Eco-Conscious Hydraulic Fracturing – SPE Energy Stream


Transcription:

Joe Sinnott:

Welcome and thank you for joining us today for this SPE Tech Talk with Catalyst Energy Services. I’m your host for this broadcast, Joe Sinnott. And I’m excited to lead a conversation about hydraulic fracturing, which has been under immense pressure from both the general public and the oil and gas sector itself to clean up its act and reduce waste. This has resulted in a difficult juggling act for operators as they try to balance financial demands from investors, changing industry standards, and pressure to use cleaner technology. Catalyst Energy Services joins us today to discuss a recent innovation that can help operators reduce emissions and keep investors happy without breaking the bank. And as always here on SPE live, we want you, the audience, to be the catalyst that transforms this show from an informative discussion between me and our guest to an engaging dynamic stimulating forum that weaves together the insights, questions, feedback, challenges, and curiosities of our global audience watching us today in real-time

Joe Sinnott:

So please use that comment box freely, let us know where you’re watching from, and be the catalyst that will drive this conversation. And in particular, the Q & A section we will have later in the show in a direction that’s most valuable for you. And again, if you don’t have any questions now, that’s okay because we actually have a poll question for you to kick things off today. And that poll question is, “What is the greatest pressure on frac operators in the industry today?” Is it A) ROI, B) emissions, C) efficiency, or D) production? Tell us what you think puts the most pressure on frac operators. And we’ll take a look at the results later on in the show. But for now, let’s get started and introduce today’s guest. Seth Moore is Executive Vice President and Chief Operating Officer for Catalyst Energy Services. Seth has over 34 years of industry experience and now dedicates himself to research, engineering, new technology, and implementing cutting–edge methods within the fracturing arm of the energy sector. His efforts have helped improve operating efficiency and lower environmental impact. Seth earned a bachelor’s degree in Petroleum Engineering from Nicholls State University and a master’s degree in Business Administration from Texas A&M. Seth is considered a thought leader by his peers and has garnered extensive recognition in the industry. Hello, Seth, and welcome to SPE Tech Talk.

Seth Moore:

Good morning, Joe. Thank you so much for having us on today.

Joe Sinnott:

Alright. Well, our pleasure, Seth, and I guess we can go ahead and get things started. If you would, can you give us the lay of the land, a little bit of history about traditional frac operations and the challenges that traditional frac operations have faced?

Seth Moore:

Sure. Yeah. You know, frac has really become a very capital equipment intensive endeavor. It requires lots of heavy equipment, requires a lot of people. It requires a lot of fuel. Typically, we see large amounts of diesel being burned to complete the fracs that we’re doing today. And just overall, it’s a very intense task that operators have to go through in order to complete wells. And we’ve seen over the years (I’ve been at this a while, as you mentioned) we’ve seen that grow and it continue to get larger and larger and the demands on equipment become greater and greater. So that’s kind of the landscape. And I think now we’ve figured out how to do that. And how do we become really efficient and how do we do this in a way that’s eco-conscious. So that’s been the landscape over the last few years.

Joe Sinnott:

Great. So landscape of, intensity getting stuff done, not without challenges, but as is the case with the oil and gas industry, you’re not going to rest on your laurels. And my understanding is Catalyst has not been resting on the laurels of fracturing technology. And you’ve got some new technology out there that you’re excited to talk about. So I know that the name of the technology is VortexPrime™. So, if you would, Seth maybe talk about this exciting new technology. What is VortexPrime™, and how is it helping to address some of the challenges that you just laid out here at the intro?

Seth Moore:

VortexPrime™ is an exciting technology that we built a company around – the concept of doing something different. We looked at the equipment and the processes that were going on and what was required to complete a well from a frac perspective and looked at all of the major, we’ll say cost buckets that were out there or impediments to efficiency that existed. We decided to go the route of taking a military-grade turbine engine and directly coupling that to a reciprocating pump. And empowering that with natural gas. So you’ve got the benefits of high horsepower density. You’ve got the benefits of fewer pieces of equipment to accomplish the same work. There’s lots of efficiencies in that, but real importantly is, you’re burning natural gas.

Seth Moore:

In some of our prior operations, we’ve burned 2300, 2500, 2700 gallons of diesel per hour. I’ll let you like, let that sink in a minute. This burns natural gas, it takes that away, takes the vast majority of that away. So that was really a big part of the driver behind this technology. Looking at how much that can mean to the overall cost of the operation, but also what that can mean from an ESG perspective. So this again lowers greenhouse gas, 40% emissions, much lower than what you see with the tier two or tier four equipment, even lower than some of the DGB type equipment or biofuel equipment. The waste stream, we really didn’t realize this until we went into it, but the waste stream is so much smaller.

Seth Moore:

One, you’re talking again much lower pieces of equipment, but these military grade turbines require quarts of fluids instead of gallons and gallons of fluid. The air filtration – you don’t replace them, they clean themselves. So you don’t have these large amounts of air filters to deal with. And all of the secondary and tertiary benefits of that, less traffic through areas, less trips to the recycler, less trips to the landfill. So there’s efficiencies, but also very much has an ESG component driving that we’re very proud to bring to the market.

Joe Sinnott:

The element of fracing, obviously. The community element and truck traffic let alone the waste and the emissions. That’s great and I’m sure our audience listening again, they have their own opinions of fracing, whether they’re directly involved or not. So I will take this time to remind our audience to, again, use that comment box, offer your opinions, your feedback, your questions thus far. And again, we’ll get to as many of those throughout the show as we can. That being said, you talked a little bit about, again, why VortexPrime™ is necessary. Were any of those drivers, did they rise above the others in terms of right? Why VortexPrime™, there’s other technologies out there there’s other attempts to use, as you said, natural gas to reduce diesel out there, but, what was the real impetus for VortexPrime™? What drove you guys to say, this is the approach that we need, and this is really going to make a difference.

Seth Moore:

I think overall if I had to pick one word, it would be efficiency. So capital efficiency, one, having a technology that let’s say, doesn’t break the bank. It needs to be competitive from a capital perspective. It needs to have an operating, an OPEX efficiency with it. And that is very much a benefit here, the fuel savings when we looked at it. And Bobby Chapman, our CEO, likes to say this technology checks all the boxes, which I can’t agree with more, but when we looked at it, fuel was the big component. If you look at the cost of a completion from a frac perspective, that’s a big part of it. And then being able to burn natural gas, which then sometimes is flared, right?

Seth Moore:

It’s flared to get rid of it. And we can take that and use that, consume that, you’re driving efficiency from a cost perspective, knocking that fuel cost down significantly. And again, I’m sure I don’t have to speak about the ESG benefit of the emissions, but that’s, that was a big part of it. The design itself, though, Joe, when we looked at it, we said, look, we want something that’s fully, self-contained where each unit has its own turbine, its own pump, its own drivetrain. We pull up to the well site, we hook in natural gas. We hook in fluids and we put discharge irons to the manifold to tie into the well, and we’re good to go. So we didn’t want a high degree of complexity that we had to deal with or have specialists on hand. We wanted to make sure that what we did, we could apply it in any basin that we decided to go to. So those were the main drivers.

Joe Sinnott:

Great. I think I just started to discuss maybe the setup and the equipment a little bit. Think you answered Garrett’s question who asks, “does each pump have its own turbine? Can you clarify that?”

Seth Moore:

Yes, it does. So it’s one turbine, one drivetrain, and one pump per unit. We typically go with eight pump set-up for, I say typically, let’s call that a Permian Basin style fac. I know in other parts of the world, it may require less, it may require more, but when we’re comparing that each of those pumps are self-contained, they each go out with the ability to tie the manifold fuel and fluids from the blender and you’re set.  There’s a big footprint reduction, which we realize in a lot of areas of the world where you have to disturb less of the local landscape to prepare for a completion job for a frac job, there’s a benefit to that.

Seth Moore:

There’s certainly an environmental benefit to having that smaller footprint. Of course, you know, traveling again through maybe sensitive areas with eight pumps versus 20 pumps, there’s a benefit there. These are built on a body load design, which was something else, a throwback from a prior role I was in. I really liked the body load design where things are compact. So we put a lot of equipment in a small package. t’s actually pretty amazing to see. So we’re excited about that, but you see this kind of graphical depiction here of the amount of savings and footprint that this technology creates. And I go back to the word efficiency, it’s a more efficient use of space. I hope I answered the question.

Joe Sinnott:

Great. Yeah, you answer the question we had and my questions. And I think it speaks to not just reduction in waste, but reduction in space, which is, as you said, a priority. And at the same time, again, as we sort of teased at the beginning from an investment standpoint, a higher return on investment, which is maybe a good time to revisit our poll question that we asked at the beginning. I think we may have only gotten one response from the outside there, but then it was a question on, “What is the biggest pressure facing frac operators?” And the answer we got was ROI. So again, you’re talking about everything that’s sort of not ROI, but at the same time, I imagine that’s a driver. So any comments again, would you like to answer that poll question yourself, Seth, in terms of how people should be sort of weighing the different benefits of what you’re talking about?

Seth Moore:

I’m not sure there’s a, I’m not sure there’s a wrong answer to that question. I think in different scenarios, different answers can apply. Return on investment is certainly a big a big driver and return of capital. Certainly things that we discuss here at Catalyst and I think you do that. So one of the ways you do that is having technology that is efficient in its design and its layout as well as its cost to create, and then it has to be efficient in its daily operating. How, how you operate that, that equipment has to have some advantage as well. And we really think we have hit on, we’ve landed on, that very well with VortexPrime™.

Joe Sinnott:

Great. All the info to this point, we’re at about the halfway mark, which in TV land would be a good time for a commercial break, but we’re not going to take commercials now, but I do want to queue up a video that summarizes some of what you’ve talked about so far, if that’s alright with you, Seth.

Seth Moore:

That’s perfect.

Joe Sinnott:

Alright. So we’re back from that little interlude summary. And for those of you who are just joining us, you know, you just saw a summary there of some of the things that Seth’s been talking about. Also want to remind our audience that, of course we are live. So, you know, we want your questions, we want your feedback, we want your observations. And again, we’re talking about direct drive technology here and on SPE live, there’s no middle man. So you got a question, you can go straight to Seth. You don’t have to add extra steps here. So much like VortexPrime™, this is a direct-to-guest experience here. So take advantage of that if you will.  With that, coming back to some of the things we talked about in the first half of this conversation, Seth, you still have exhaust, right. You still have, you know, emissions?

Seth Moore:

Right.

Joe Sinnott:

Is Catalyst doing anything to capture those or deal with those emissions lower as they may be? Anything you can shed some light on?

Seth Moore:

Yes, Joe. Great, great question. We are looking at some technology now and it’s actually some unique technology that can reduce those emissions further. It’s in the development stages. I’m not at liberty to go into great detail, but we think that we can make those emissions even better. One of the really unique components of this technology is our ability to shut it off and start it and go back to creating full horsepower with it in a very short time, we’re talking minutes, under five minutes, we’ve done it in under four minutes. So you just think that’s from full horsepower, full frac down to complete shut, to restart and back to full horsepower. There’s some safety features of that. There’s also a lot of emission features to that for those that are familiar, I’m sure you’ve been on a frac job.

Seth Moore:

You’ve seen that there’s times that unanticipated things arise. You may have a leak on surface equipment. You may have some issue getting water to the site. There are a myriad of things that can happen. And sometimes you’re uncertain how much time you’re gonna spend chasing those problems and creating a solution. So sometimes, in the past, you’ve just let equipment run because the startup time of it is so long. Well, while that equipment is on idle, it’s creating really high emissions, typically – of most any technology – it’s not as efficient in emissions when it’s idling. These, we can just shut down. So there is no emissions, they’re shut down and we can come back on in a very short period of time.

Seth Moore:

So that’s a component of this technology that really helps the emissions just by making sure there are no emissions when you’re not pumping. We are looking at other things that we can do. We had some really smart people start doing comparisons and running the math on these, the emissions and like what it means. I tell my grandkids that this VortexPrime™ technology is kind of the equivalent to removing almost 79,000 cars from the road annually. I mean, that’s the emission savings of this technology versus like a tier two and tier four technology. Over the course of a year its the equivalent to reducing that much emissions, which is big.

Seth Moore:

That’s a change in emission reduction, an improvement. The fact that we’re taking often times flare gas, and I can’t talk about that enough, but the technology’s there for us to take gas that would be wasted. We’re taking a potential waste product and capturing that and using that to do something useful and productive with, there’s another great benefit of that. So those are things that really excite us on the VortexPrime™ side.

Joe Sinnott:

No, that’s great. Some big numbers there, some powerful numbers. And I will say though, you know, your grandkids, even if they’re not impressed by the numbers, when you were talking about startup and shutdown, I’ll be honest, being on frac locations 10 years ago, my time as a completion engineer, when you’re starting up and you’ve got 15 diesel powered trucks, it’s a pretty big boom of black smoke. So again, setting aside those numbers, I think if you brought your grandkids on a traditional frac location to not have that site, right there, I mean, that, that speaks volumes too. A mixture of real world impacts here, also speaking of which, and we have some comments here, you just touched on flare gas elimination, obviously – talk about emissions reduction.

Joe Sinnott:

We have a comment here, “I am impressed by how much the oil and gas industry are fighting to reduce greenhouse gas emissions. So again, yes, Catalyst is part of a bigger effort to really make a dent in things. So again, I appreciate the comment there and certainly appreciate what Catalyst is doing.” Gary Nelson, “Nice shift to clean burning, natural gas for frac power needs. Again, this is making a difference, so kudos to Catalyst on that, but natural gas, isn’t the only thing in the news these days, right? A lot of people talking about hydrogen.” You have a question here from Chad Gibson, “Have you tried any hydrogen mixtures on the gas inlet side?”

Seth Moore:

We have not, we have discussed it. We’re a small company. We like to tell everybody we have to try harder. We’re a small company. We have studied that technology some, there’s still more work to do on our side. We think it, from what we see, we think it holds promise, but I think we need to spend more time going down the road of looking into that and partnering, probably partnering with someone when you’re small. A company like Catalyst, you get the benefit of choosing partners and we’ve partnered with some great companies. And that’s something that we would love to do.

Joe Sinnott:

Back into some of the technical questions here. We have a couple more.  “What is the max working pressure question we received here from our audience?”

Seth Moore:

Yeah. 15,000 PSI. We have kind of the same working pressure of a conventional frac fleet.

Joe Sinnott:

Okay. That being said, sort of a follow up question to that. Zach Ward asks, “With this equipment, can you still get the pump rate needed to frac deep horizontal wells? And he has a follow up here. You can answer both. “Can you timely jump the rate during a pump schedule if needed?”

Seth Moore:

Yes. So we’re able to get, 15 to 20 barrels per minute, per pump, depending upon the pressure. The engine that we use is very responsive to changes to rate.  We have our proprietary control system that we developed in house. And it’s very precise. It allows us with precision to adjust the rate. And I’m amazed, when we tested this unit on the test stand, what we were able to achieve with it in terms of responsiveness to changes in rate, it’s seconds, single digit seconds to go from very low, to very high, max to max rate. Yes, we did it in the field and we see this too. We replicated that in the field multiple times where we needed to jump the rate. So we’re very happy with what we see there.

Joe Sinnott:

Great. That exciting, we’re talking about new technology, innovative technology, I guess one logical question is, “Is this available? Is this on the market? Is this out there? Is this being used?”

Seth Moore:

Yeah, so we’ve been commercial since February. We were in a field trial environment, before that. We’ve been commercial since February. We’re building units now, we build them ourselves. So we have our own manufacturing – we’re in west Texas – and we’re building those units now. So if an operator has interest, the customer has interest, we would love to have that conversation.

Joe Sinnott:

Great. I think we covered a lot of the environmental benefits, the benefits to the community, but in terms of just going back to the basic difference between direct drive and its benefits versus traditional turbine technology or other technologies, what’s your summary? How do you wow them with just the basic differences between direct drive? Why does that matter?

Seth Moore:

I think the big thing is horsepower density. We’re going to be able to move a fleet from one well to the next well or one pad to the next pad in hours versus days. We’re going to save a significant amount of money over the course of the project in fuel savings, a significant reduction in the operator’s cost. It’s simplicity. People think of a turbine. They think it’s real complicated and it’s a simplistic approach to doing things that really screams, a need for simplicity. So when you couple all that together, we’re going to be more efficient. We’re going to get the project done in a quicker, shorter amount of time. We’re gonna do that with less risk. We haven’t really talked today much about the risk to employees of rigging up less pieces of equipment, maintaining less pieces of equipment, but we’re going to reduce that risk at the end of the day though, we’re gonna be more efficient.

Seth Moore:

We’re going to add to their overall project by being more efficient. And I think in summary to me, those are the big things that are tangible, that you see right here right now today. The eco-conscious eco-friendly nature of burning natural gas versus liquid fuels is really just the cherry on top. And it can’t be underscored.

Joe Sinnott:

I hear what you’re saying. I don’t know if I heard the words exactly, but ESG, is there something out there in your mind that even touches ESG on the frac side? Given what you’ve been talking about today, can you maybe in closing here, nothing’s a hotter topic than fracing than perhaps ESG. So kind of bringing those together, if you would, how do you, again, put another cherry on top for those who have been paying attention today and are looking for a way to really make a difference in their sustainability scores and ESG scores and everything else they’re trying to do.

Seth Moore:

Yeah. I think just circling back, when you look at taking something like flare gas, it’s going to be wasted. Repurposing that and turning that to hydraulic fracturing. Looking at the amount of reduction in waste stream that we can keep out of the landfills and from having to be recycled each year, having less traffic and putting people in harm’s way less. All of those things just scream ESG to me. And this technology is at the forefront of that. So at Catalyst we’re very proud of VortexPrime™, what it means, not just for our company, but what it means for our industry and really what it means beyond that. We’re small. We try hard. We think this is certainly a viable technology that can help this industry. I think someone said “clean up its act,” to the degree that Catalyst can impact that. We’re glad to play a part in that.

Joe Sinnott:

That’s great. One final, quick, lightning round question here, and that is – “What is the cost difference?” We’ve talked about all the benefits, but what is the cost difference versus a conventional or even a tier four fleet, if you would here to wrap up our conversation today, Seth.

Seth Moore:

If you’re talking about a purchase from a purchase cost perspective, we have an advantage on the dollars per hydraulic horsepower. It actually costs less than say a tier four fleet, from dollars per hydraulic horsepower perspective. We’re proud of that, as I said earlier, from a capital efficiency standpoint, we check that box.

Joe Sinnott:

I appreciate all your, your time and your feedback today, Seth. If people do want to learn more about this technology, what’s the best way to get a hold of you?

Seth Moore:

Yes. I think on the screen, it’ll pop up. We’ve got the Catalyst website. They can go to the Catalyst Energy Services website and there’s a box on there. They can also reach out to me on LinkedIn.

Joe Sinnott:

Great. Yeah. Reach out. Don’t be afraid to connect with him for those of you who did engage with us today, appreciate you all for, again, being a catalyst in helping to drive a great conversation today. So thank you again, Seth, a special thank you to Catalyst, of course. And if you would like to watch a replay of this episode, you can go ahead and do so on the SPE Energy Stream, the industry’s digital pulse visit streaming dot SPE.org. I’m your host, Joe Sinnott. Join us again next time, right here on SPE Tech Talk.

Closing:

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About Catalyst Energy Services

Catalyst Energy Services started with the idea that technology is the key to the future. We take the stewardship of preserving our world’s resources seriously and are dedicated to constantly innovating our sector of the energy industry to achieve cleaner, safer, and optimized production. Built by an accomplished executive team with over 100 years of hands-on experience in the field, engineering, and business management, we are an emerging stimulation service company specializing in hydraulic fracturing treatment.

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