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Firm seeks to patent liquid-free fracking technology

Oil and natural gas companies that operate in US shale plays use enormousamounts of water, sometimes requiring upwards of 5 million gallons to frack asingle well. And there are significant costs and operational requirementsthat come with using so much water, such as trucking it to remote job sites,mixing it with various chemicals, and later removing those chemicals from theoil and gas that fracked wells produce.

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But a New York-based energy-technology company called Expansion Energy saysit has invented a type of fracking that will allow oil and gas firms to avoidall of those water-related costs and operational hassles. David Vandor andJeremy Dockter, Expansion's co-founders, say their process will allow shaledrillers to frack oil and gas wells without using a single drop of water.Moreover, the process does not require drillers to use other types offracking liquids that are sometimes used instead of water, such as liquidpropane or liquid nitrogen, Vandor and Dockter say.



"We think we have a better mousetrap," said Vandor, who is seeking to patentthe liquids-free fracking technology under a fast-track patenting programthat the Obama administration launched in 2010 for environmentally friendlyenergy technologies.

The process, called Vandor's Refrigerated Gas Extraction, or VRGE, usesordinary gas to fracture shale formations and to deliver sand or otherso-called proppants to hold open the fissures in the rock. The gas comes fromthe targeted hydrocarbon formation itself, following an initial "charge" ofgas or liquefied natural gas delivered to the well site to begin the process.

Using cryogenic technology, the gas is then processed into something thatExpansion calls "cold compressed natural gas," or CCNG. Vandor says CCNG issimilar to LNG in that it can be pumped to very high pressures. But he saysCCNG is "not a true liquid" because Expansion's technology cools it tobetween minus 160 to minus 170 degrees Fahrenheit -- substantially warmerthan LNG, which is typically cooled to minus 250 or minus 260 F. Vandor'spatent application (No. 2012/0118566) makes that claim in detail, saying CCNGfluids "are not true liquids," but that they are "viewed as liquids by pumps."

Expansion Energy has already secured multiple patents for a related inventionthat it says can economically produce between 2,000 to 50,000 gallons of CCNGor LNG per day -- a much smaller scale than other systems. Vandor says the2,000 gal/day version of that technology, dubbed the VX Cycle, can fit insidea standard, 52-foot-long, rubber-tired trailer that can easily be towed tofracking sites. Vandor says drillers who use the patented VX Cycle device inconjunction with the patent-pending VRGE system can effectively frack oil andgas wells using no liquids whatsoever. He said other key aspects of thefracking process remain the same, such as using sand, ceramic pellets orother materials as proppants to hold open the newly created cracks in theshale.

"Fissures are created and held open without use of water or other liquids,and the proppant is delivered without water or other liquids," Vandor wrotein his patent application.

No foreign chemicals to remove

Vandor says fracking with natural gas instead of water, liquid propane orother fluids has a host of advantages that will save drillers time and money.Among these, he said, is that drillers do not have to separate out theforeign chemicals that inevitably get mixed into the oil and gas that frackedwells produce. Vandor acknowledged that GasFrac Energy Services, aCalgary-based oilfield-services company, has made headlines with its patentedapproach of fracking wells with gel-like propane, and that other firms areusing liquid carbon dioxide or other substances.

But he said the problem with all of those approaches is that the frackingfluids contaminate the very oil and gas that drillers are going after. Evenfracking with water is problematic in that regard, he said, because drillerstypically add chemicals to lessen the water's impact on the shale formation,among other things.

"We take the position that what you want to send down to the formation thatyou want to fracture is not water, not diesel fuel, not all kinds of otherchemicals, because every one of those other liquids tends to contaminate thenatural gas that you are tying to release," Vandor said. "So if you send downCO2, when the natural gas finally comes up out of the ground, it's CO2-laden.And the same with the nitrogen -- those are precisely the things you don'twant in the natural gas" or oil.

GasFrac, the Canadian propane-fracking company, recently announced at anindustry conference in Denver that it had recovered and sold much of thepropane that it used in a fracking operation in Colorado. But Zeke Zeringue,the company's president and CEO, also said that because propane is a highlyflammable substance that could potentially explode, his company must conductits fracking operations by remote control, with no workers in the immediatevicinity of the well.

Expansion Energy's Dockter, who handles the business side of his firm'soperations, called that another advantage of VRGE. He said workers can beonsite to operate Expansion's VRGE system, which he likened to "LNGdispensing units that are all over the world."

Fewer trucks required

Dockter said another major advantage to fracking with gas is that it isreadily available at shale plays such as the Bakken in North Dakota, and thusdoes not need to be trucked to remote job sites as propane, nitrogen and evenwater must be. Dockter said all the gas that drillers need to frack a newwell with Expansion's VRGE system can be easily obtained from an adjacentwell or a nearby pipeline.

"With GasFrac -- you've got to truck in all of that propane," he said. "Thetechnical merit could be there, -- but it's a very large expense and anadditional complication logistically that we can avoid using with the VRGEapproach."

Indeed, Dockter argued that eliminating the need to hire trucks to transportwater or other fracking liquids to and from job sites is one of the primaryreasons that Expansion Energy's approach will be less expensive thanconventional fracking.

"We predict that it will be much less costly than today's hydraulicfracturing [because] we avoid the majority of all that truck traffic that isrequired to bring in water and to take away water, as well as avoiding thecost of the chemicals that are added to the water beforehand," he said. "Wecan shrink the footprint of the fracking operation by a dramatic percentage."

Dockter and Vandor also noted that liquid-free fracking would diminish theneed for wastewater disposal wells, which some studies have found can causeearthquakes -- a conclusion that the oil and gas industry vigorously denies.

"The earthquake issue is not so much about the fracking, but about thedisposal wells," Vandor said. "You certainly don't want to end up with a verylarge disposal problem" by using water or other liquids for fracking.

Vandor said Expansion has estimated how much gas it would take to fracktypical oil and gas wells, but he said he's not yet ready to release thatproprietary information to the public. But Vandor did say that it's a "smallfraction" of the equivalent amount of water that's normally used in fracking.

"People talk about millions of gallons of water, and it's a much smalleramount of natural gas," he said.

Vandor and Dockter both argued that their system will be cheaper thanconventional fracking, in part because drillers will no longer need to truckliquids back and forth. But they said the capital costs of their mobile CCNGplant and associated equipment will not be prohibitively expensive, either.For example, a mobile plant capable of producing 2,000 gallons of CCNG perday would probably cost "well under $3 million," Vandor said.

"That's a small, small fraction of all of the costs of trucks bringing inwater, the chemicals and all the cleanup," he said.

Dockter noted that a driller could move its mobile CCNG plant from frack siteto frack site, or it could leave it in one location that's particularly richin natural gas liquids, which currently fetch much higher prices than drygas. Using the plant's deep refrigeration ability to separate out those gasliquids would be a good way to "get your money back pretty quickly," he said.

Dockter and Vandor said they expect to sign a licensing agreement for themobile VX Cycle CCNG plant part of their operation in October. They said theycannot yet say who is going to license the technology, other than it is a"big company" that already provides equipment to the oil and gas industryglobally.

"We're not trying to be the next Schlumberger here," said Dockter, referringto the giant Houston-based oilfield-services company. "But we would like tolicense this technology to the likes of Schlumberger and others who docompletion services and fracking, or producers, depending on how it all worksout."

Vandor said the patent for Expansion's liquids-free fracking system may beissued by the end of the year.

--Brian Hansen, brian_hansen@platts.com