On October 4, Shea Morenz, CEO of Morenz Group and Bobcat Group, spoke on the panel “Balancing Property Rights & Economic Interests As Landowners Engage With Industry On Water” at the 2019 Oilfield Water Industry Update. During this discussion, Morenz addressed the need to turn to logistical optimization to reach the next horizon of gains for exploration & production (E&P) companies.
“The old wildcatter model has been transformed,” said Morenz following the event. “Horizontal drilling into shale has led to much larger operational footprints and certainty for oil and gas companies, but new reports indicate that wells in the Permian Basin have plateaued. It’s becoming clear that the Delaware, and the rest of the Permian Basin, will no longer provide the same level of oil well productivity gains or profits without investing heavily in water logistics.”
Morenz refers to water as the “lifeblood” of the frac industry, averaging roughly 600k barrels of source water per well, as well as it being a source of “massive uncertainty and potential liability,” averaging a 4:1 ratio of produced water to oil in the Permian (as high as 10:1 in parts of the Delaware). Current research shows that 54 million barrels of dirty produced water, the traditional byproduct of fracking, will be produced in the U.S. per day by 2025. With costs for transporting, treating, recycling and/or properly disposing of these fluids ranging from $1-$3 per barrel, it’s easy to see how the way a company manages produced water can affect overall profitability.
And, with this space in the Permian alone poised to grow by another $10 billion annually by 2025, optimized scale and logistics can make a big difference. That’s where the Bobcat Group is focused.
Morenz Group’s first platform, The Bobcat Group, was established to give landowners the capital and opportunity to close the gap between landowners and oil companies to most effectively optimize surface estates and water-related operations. By collaborating with landowners and making efforts to ensure a mutually-beneficial experience, companies can successfully overcome profitability imbalances by reducing the cost of transporting and treating water.
“The U.S. has provided the lion’s share of the non-OPEC growth in oil and gas over the last decade, shielding the market from volatility in the Middle East and becoming poised to answer increased global demand.” The Bobcat Group understands how vital the state of Texas and the Permian Basin are for global growth and stability, which is why Bobcat makes such a dedicated effort to enable landowners to participate in this growth by supporting efficient logistics leading to lower costs and more sustainable solutions for all involved parties,” said Morenz.
