Schlumberger (NYSE:SLB), the world’s largest oilfield services provider, has entered into a deal with Energy Recovery Inc. (NASDAQ:ERII), initially valued at $125 million, for the exclusive rights to use the first hydraulic fracturing manifold system designed to isolate fracking pumps from abrasive proppants that can cause pump failure.
Energy Recovery Inc. manufactures energy recovery devices for the oil and gas industry. The deal gives Schlumberger license to use Energy Recovery’s VorTeq hydraulic pumping system for a period of 15 years. In current operations, a “missile” routes water, proppants and chemicals downhole at pressures up to 15,000 pounds per square inch (psi). The proppants used, however, can result in frequent failures of high-pressure hydraulic fracturing pumps.
With the VorTeq system, high-pressure fracking pumps will process clean or proppant-free water and transfer the hydraulic energy to the fracturing fluid within the VorTeq missile. At the heart of the system is Energy Recovery’s Pressure Exchanger technology, a leading pressure energy recovery device with over 16,000 devices in use worldwide.
In a statement, Energy Recovery CEO Joel Gay said, “We believe this technology offers Schlumberger the immediate benefit of reducing wear and tear on its pumps, as well as reducing downtime. In the medium-term, we believe it provides Schlumberger additional savings associated with eliminating redundant equipment onsite. For a company in this market who wants to keep producing but needs to be mindful of costs, this technology tackles these challenges and delivers meaningful results.”
The system works by capturing and recycling otherwise wasted pressure energy in fluid flows with a clean liquid-to-liquid energy exchange between high- and low-pressure fluids. The technology features only one moving part made of tungsten carbide, one of the most abrasion resistant materials known to man. The system is able to withstand tremendous pressure and harsh conditions, and transfers as much as 95 percent of the hydraulic energy from one fluid to the next. The company estimates that the pumping system will provide costs savings of up to $5 per barrel drilled.
Gay added, “We are thrilled to be working with Schlumberger … We believe VorTeq is a paradigm shift for the hydraulic fracturing industry as it significantly reduces maintenance costs associated with pumping downtimes and provides considerable redundancy efficiencies.”