STW Resources to build produced water recycling plant in Texas with Tiburon Research

Oilfield services and water reclamation company STW Resources will build, own and operate a produced water recycling facility in West Texas oilfields near Midland under a joint venture with Tiburon Research Holdings (TRH).

It has signed an agreement with TRH to recycle a 336,000 gallon (8,000 barrels) per day produced water recycling plant to provide re-usable water to oil producers in the area.

As part of the agreement, STW will undertake the design, construction, permitting and operation aspects of the plant on Powell saltwater disposal site owned by Tiburon Research Holdings (TRH).

TRH, through its co-management of the Tiburon Saltwater Reclamation Fund I (TSWR), has agreed to finance $3m for the joint venture.

STW Resources CEO Stanley Weiner said the company has designed scalable systems to economically process any volume of water after cautiously analysing, testing and processing several types of oilfield waters.

"Our systems are scalable to process any volume of water that is required by our clients. Working for several years, we have refined our processing systems and optimised designs for various types of water encountered in the oilfield," Weiner added.

With plans underway to begin operations of the facility in the second quarter of 2013, the two companies are looking at replicating the concept on a large scale at several salt water disposal facilities in West Texas and in the Eagle Ford Shale Formation, owned or managed by TRH.

Two such facilities have already been identified for the replication of produced water recycling, said STW Resources.

At optimal capacity, each facility would provide revenues of about $6m per year for STW, which comprise produced water disposal, likely sale of concentrated brine by-product for use as a drilling fluid and sale of recycled water that can be reused in well-drilling operations.

TRH founder Paul Brahe said the company is looking to develop and operate co-location disposal sites that allow reclamation and recycling of water from oil and gas production.

"STW brings technical experience and knowledge that can make this type of operation economically viable. Current and future water shortages create significant demand for these services; our combined business models will meet those needs," Brahe added.