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Global business challenge: Breaking the oilgas water dependency with a cost-effective no-waste nanomembrane technology for water reuse

Periodic Reporting for period 1 - CleanOil (Global business challenge: Breaking the oilgas water dependency with a cost-effective no-waste nanomembrane technology for water reuse)

Reporting period: 2016-05-01 to 2017-04-30

The Oil&Gas industry is one of the most water-intensive industrial sectors: E&P activities produce more than 100 billion barrels/year of produced water, whose disposal cost can be as high as 10€/barrel. Emerging extraction activities have contributed to an exponential production of oily wastewater worldwide. As a reference, on average three barrels of water are generated for the production of one barrel of oil (in USA, this figure rises up to eight barrels water/barrel oil). By 2020, it is estimated that the industry will generate over 800 million barrels of produced water per day.

Produced water has been traditionally considered a non-revenue product, but it can have significant value if it meets certain quality standards: the efficient treatment of produced water can lead to added value through incremental oil recovery and by incurring a lower cost disposal via re-injection of clean water. There is also increased interest in the beneficial uses of produced water, such as surface discharge for agricultural uses and industrial applications. In this context, membrane filtration appears as one of the most promising technologies for produced water treatment due to the high efficiency in emulsified oil removal and the high quality of the treated water. However, the major concern is referred to the compatibility of materials and the long-term fouling control. Likuid ceramic membranes are highly hydrophilic with low fouling trend, and can deal with high concentration of oil, high temperatures and chemicals. They can efficiently get clean water ready to reuse, minimizing the fresh water consumption and as a result, significantly reducing the environmental impact.

The project consists on the validation and introduction into the market of an innovative filtration solution to treat and reuse the so-called produced water. The solution will allow achieving up to 80% reduction of water demand for oil extraction through the reuse of up to 95% of the produced water and it will be based on a proprietary product: ceramic membranes for oil/water separation with an innovative production process. With the ceramic membranes as the core of the innovation, fully integrated filtration systems comprising equipment, instrumentation, control tools and monitoring software are going to be developed.

The main objectives of the project are:
• To reduce the target price of the membranes, thanks to the upscaling of the process and the manufacture of membranes with bigger specific filtration.
• Upscaling the existing production line with the aim of increasing the production capacity and get a massive market access with a more cost-effective product.
• Launching worldwide highlyefficient ceramic membranes-based filtration products for the treatment and reuse of produced water in the Oil&Gas industry.
• International consolidation of the company through strategic partners in high potential markets.
During the first year of the project a major part of the work related to the technical developments has been carried out. The optimization of membrane production has dealt with the development of membranes with new geometries and the upscaling of the manufacturing process, including the validation of the new tools and equipment.
Based on these new membranes, the produced water treatment solution has been developed, including the new fouling monitoring and control tools. The pilot-scale validation has allowed to study the influence of operational conditions and to validate the technology in terms of effluent quality. As a result of the foregoing, the guidelines for design and operation of the filtration system have been also defined. The demo activities to be carried out during the next period will be the key actions for the final validation of the technology. In relation to the demonstrations, up to now the guidelines for the demonstration activities have been set, the corresponding agreements with the final users of the technology have been signed and the two demo units have been designed and partially executed.
The introduction into the market of the new product has been addressed through the proactive search of key partners in the different geographical areas. Five agreements have been signed or are in progress. Moreover, very good response has been obtained from other five high-potential partners (OPCs and OEMs) in different geographical areas, with whom a specific agreement has not been signed yet, but who are willing to introduce the new technology in their portfolio. Other contacts such as platforms, clusters and research institutions related to the Oil&Gas industry are high-value influencers, through whom the access to end-users is going to be facilitated for the future Phase 3 of the project. Finally, the presence in trade fairs and events related to the Oil&Gas industry has enabled to present the CleanOil project to many companies, potential customers and even potential investors. During the reporting period Likuid has taken part in five trade fairs (both as exhibitor and visitor) and in one B2B event related to the offshore market segment.
The expected outcomes of the project are the following:

PRODUCT: Updated Likuid-PW filtration system, based on the ceramic membrane technology.
DEMOS:
Onshore demonstration (Canada)
Offshore demonstration (Brazil)
MARKET:
Penetration in onshore market, with 680 Mill.€ target market (USA, Canada, Colombia and Mexico).
Penetration in offshore market, with 490 Mill.€ target market (North Europe and LATAM).
BUSINESS:
International consolidation through commercial agreements with key partners, aiming for a 3% share of the Likuid’s specific target market in industrial filtration, doubling the existing actual staff and achieving a tenfold increase in EBITDA by 2020.

In terms of impact, the technical outcome of the project will solve urgent needs regarding the produced water treatment and reuse, which cannot be properly addressed by alternatives from competitors. Up to now, the vast majority of produced water has not been reused but reinjected into the ground for disposal. This has been working for decades, but there is great room for improvement if the main drawbacks that limit reusing are solved. The innovation guarantees a sustainable E&P activity, allows water reuse and minimizes its environmental impact.

The main users for Likuid’s solution are the intermediary EPC, OEMs and OFS companies that would include Likuid-PW solution in their supply/service and the oil producers – as end-users of the technology. For all of them the main economic benefit is the reduction in the cost associated to fresh water supply and produced water disposal, which ultimately is reflected in a lower production cost per barrel of oil.

Likuid has identified two market segments targeted by its innovative solution: onshore segment will be addressed with a Canadian demonstration and offshore segment is related to a demo study with Petrobras. Successful demonstration will boost the market uptake of the new highly-efficient and cost-effective Likuid’s solution, thus helping European cutting-edge technologies to position in the lead of sustainable Oil&Gas production.
CleanOil Project Poster