Hydraulic Fracturing & Water Stress: Water Demand by the Numbers

The rise of hydraulic fracturing and horizontal drilling technologies for extracting oil and gas resources has a significant impact on water availability, particularly in already water stressed regions of the country.
Ceres’ latest research on this topic, Hydraulic Fracturing & Water Stress: Water Demand by the Numbers, provides first-of-its-kind data on the various water sourcing risks facing oil and gas companies in 8 regions of intense shale development in the United States and Canada. It shines a spotlight on the volumes of water used for hydraulic fracturing by specific companies and puts regional industry water use into the context of local water stress, groundwater depletion and drought. It provides investors, lenders, and regulators recommendations for how oil and gas companies and their service providers can minimize their water demands and reduce their impacts on communities and the environment.
Download the report: Hydraulic Fracturing & Water Stress: Water Demand by the Numbers

Interactive Maps (click maps to zoom)	Key Findings
	Nearly half (47%) of oil and gas wells recently hydraulically fractured in the U.S. are in regions with high or extremely high water stress. Explore the map. Download the report.
	More than 55% all U.S. wells are in areas experiencing drought. Explore the map. Download the report.
	Thirty-six percent of all U.S. wells are in areas experiencing groundwater depletion. Explore the map. Download the report.

Company Findings

Anadarko Petroleum was found to have the highest water risk exposure among leading shale energy producers, with more than 70% of its wells in high or extremely high water risk regions (including Texas and Colorado).

Apache, Encana and Pioneer also had most of their wells developed in high or extremely high water stress regions
Chesapeake Energy was the biggest user of water for hydraulic fracturing at 12 billion gallons, with most of its wells in regions of medium water stress.
The top 3 service providers: Halliburton, Schlumberger and Baker Hughes – accounted for about half of the water used for hydraulically fracturing nationally.

Download the report: Hydraulic Fracturing & Water Stress: Water Demand by the Numbers

Regional Findings

Eagle Ford Play (Texas): The Eagle Ford in south Texas faces some of the biggest water challenges of any shale play. Hydraulic fracturing water use was the highest in the country at 19.2 billion gallons. The region is meeting an estimated 90% of water demand from groundwater while concurrently experiencing significant groundwater depletion challenges. Operators with combined large financial and water risk exposures in the region include Anadarko, EOG Resources, SM Energy, Marathon Oil, Chesapeake and Murphy Oil.
Permian Basin (Texas & New Mexico): The Permian Basin faces significant water demand pressures, drought concerns and high groundwater use and stress. More than 70% of the Permian’s wells are in extreme water stress areas and the basin overlaps parts of the depleted Ogallala aquifer. Over 9,300 wells have been reported developed in the Permian since 2011 and hydraulic fracturing water use is forecast to double by 2020. Apache, Pioneer, Devon, Occidental Petroleum, Cimarex, Concho Resources, Energen and Laredo Petroleum have the highest combined financial and water risk exposures to the region.
Denver-Julesburg (DJ) Basin (Colorado): 100% of all wells hydraulically fractured in the DJ Basin were in high or extremely high water stress areas. Much of the industry’s water use is centered in two counties: Weld and Garfield, which combined represent 89% of all hydraulic fracturing water use in the state. Anadarko, with over 1,200 wells developed in the basin since 2011, is the major operator in the region.
The Marcellus (Pennsylvania & West Virginia): The Marcellus was the second highest water use play behind Eagle Ford, using over 13.5 billion gallons of water. Average water use per well is relatively high, at about 4.4 million gallons. Although most wells in the region are in areas of medium or lower water stress, seasonal variability in surface water flows has forced regulators to limit industry water use in summer months. Chesapeake is the largest operator in the region, followed by EQT, Range and Cabot.
California: Nearly all hydraulic fracturing water use in California is in regions of extremely high water stress, although water use per well remains relatively low. Most of the industry’s activity is centered in Kern County, which has a large agricultural water demand and heavy reliance on stressed groundwater resources. Occidental Petroleum, Aera and XTO Energy are the operators with the largest water use in the region.
Download the report: Hydraulic Fracturing & Water Stress: Water Demand by the Numbers

Recommendations for Shale Energy Operators

Disclose to investors, stakeholders and regulators: total water volumes and sources used in each shale play, future sourcing options and plans to reduce use; breakdown of present and future use from freshwater and non-freshwater sources; volume of water returning to the surface after fracturing; current revenues and future growth in water-stressed regions.
Implement operational practices to minimize water use; collaborate with industry peers and other industries on local water sourcing challenges; develop local source water protection plans; minimize the use of aquifer exemptions and deep well injection disposal sites.
Engage with stakeholders, including with: local communities on water needs and challenges before starting operations and after they begin; local and regional regulators on water challenges; employees and suppliers to provide incentives for reducing water use.
Embed consideration of water risk across all business units and business planning activities, from the boardroom to the drill site.

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