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January 17, 2012 
 
 
 
Sutherland LTIle
A LIQUID ASSET
IN THE SHALES

 
Millions of gallons of water are needed to hydrofrack a deep-shale natural gas or oil well. And companies, seeing the dollar signs, are scrambling to dive into the water reuse business. (So if you already filled your pool, get out there and see what people will pay you for it.)
 
We snapped Neohydro CEO Dean Themy last week at his office in Sugar Land to learn more. Neohydro is using an electrochemistry water reuse technology, which helps companies save money by allowing them to reuse flow-back water instead of disposing of it. He's witnessing the entrance of mid-sized companies wanting to get in the water recycling business and even larger companies like Schlumberger and Baker Hughes looking to create technology for water reuse. Dean says this is good news for Neohydro, because it’s thriving in a market he wasn't sure would be there.
Small entrepreneurs have been developing technology to meet this need, and the big companies want to buy the technology in order to offer a full-service water solution. Only 30% of the water sent down a well flows back, so a source of water is always needed. The other 70% stays in the formation. The flow-back water has to be cleaned before it can be reused; above, Neohydro’s technology is being applied to water in the white truck and then transported into the blue truck. (The yellow containers are 20,000-gallon frack tanks). Neohydro can process 8,800 barrels of water a day or five to six barrels a minute. (We can't even decide on a lollipop flavor in a minute.) One issue: Locals find thousands of trucks a nuisance as they clog up the roads. A solution can be finding water or buying it and having it piped to the site to eliminate the vehicles.
Neohydro charges $3 to $4 per barrel to recycle frack water. Distillation and filtration—older technologies—are not as viable because they cost $8 to $9 per barrel. Also, there is no place to store the flow-back, so treating it on the fly also saves money. In the Marcellus, only clean water can be stored in the open, such as a pond; dirty water has to be held above the ground and covered. Pennsylvania has no injection wells, so dirty water had to be transported to Ohio. It costs a company $2 per barrel of frack water an hour to be transported, in addition to $2 per barrel to dump it into the earth. It could end up costing $8 per barrel. Multiply these numbers by millions and you'll see why more industry wants to get into this biz.

Bisnow
BAY AREA TO BE NEXT ENERGY HUB?
 
We ran into Bay Area Houston Economic Partnership exec director Dan Seal and marketing manager Barbara Cutsinger last week at Lupe Tortilla’s off Bay Area Blvd. Dan says that while the aerospace and specialty chemical sector are two of the main pillars of the Bay Area economy, their group is looking to attract more mainstream energy and engineering companies. Barbara says that as NASA reaches out to partner with industry, especially energy, this will be a natural procession. (Though there's a nagging feeling Dan might just want to ride in a spaceship.) Last fall, they helped roll out a program called BayTech, a public/private technology partnership that brings business and academia together to support federal agencies.

Bisnow
TIME FOR AN ELECTRICITY DIET?
 
The Electric Reliability Council of Texas says that the region’s electricity use increased 5% in 2011. Spokeswoman Dottie Roark told us today this is mainly because of the scorching, hot summer we experienced. The grid operator reports that the net energy for load was 335k GWh for the year, compared to 319k GWh in '10 and 308k GWh in '09. April saw the greatest energy jump compared to 2010 with 14.4%, followed by July, which increased 12.2%. The fuel type breakdown: Natural gas increased 2.2% over last year as a percentage of the total energy. Wind went up almost 1% over 2011 and was 8.5% of the overall energy picture. The forecast: a 2.5% annual growth rate from 2012 to 2021 for peak demand and energy.

Bisnow
THANK YOU, DR. KING
 
Dr. Martin Luther King Jr
Like many of you, we took yesterday to acknowledge the service of Dr. Martin Luther King Jr. We admire his courage and continuing impact on the US. This picture is from 1964, and if 95% of the Bisnow staff had been alive then, we'd certainly have been there to take it. But from what we can glean, it looks like Dr. King's response to someone asking, "How big an impact will fracking have in the year 2012?" Whether he's saying "a lot" or "why are you asking me this," it's an appropriate response.
 
On this day in 1995, The Golf Channel began on some US cable systems. Tell us who’s a big driver in your company by emailing greg.miller@bisnow.com.
 
 
 
 
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