Having done their very best to boost an oil and gas fracking industry that leaves behind massive quantities of contaminated water, U.S. pipeline companies are looking to their next big business opportunity in hauling that water.
“As booming U.S. oil production unleashes a torrent of contaminated water that rises to the surface with crude, pipeline operators may be in the best position to harness those flows and expand into the water handling business,” Bloomberg reports, citing a conference presentation last Friday by Peter Bowden, global head of energy investment banking at New York-based Jefferies Group LLC.
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In Texas’ Permian Basin alone, “the combination of salt water from wells and water used in the fracking process is expected to be three times larger than crude output by 2023,” the news agency states. “Pipeline owners already are adept at transporting oil and gas, so adding water to their portfolios may be a logical next step,” with Gabe Collins of Rice University pointing to US$2.5 billion in “Permian-focused water deals” so far this year.
“Water is going to offer them more growth than their core business,” Bowden said.
Where will they take this contaminated water?
Thanks, Ellen. The story didn’t say, but we’ll be watching for updates. (Please let us know if you spot one first!)