These investments are starting to pay off. Photo credit: Flickr/Tax Credits
Fracking has helped to open the flood gates for unconventional oil and natural gas production in the U.S. Technology continues to push the industry further by reducing costs, increasing efficiency, and boosting production potential. One company that's leading the way is Halliburton Company (NYSE:HAL), which has made it a point to remain a leader in technological development and operational improvements.
It's "Frac of the Future" initiative is helping Halliburton Company (NYSE:HAL) to separate itself from the pack in the fracking business. This bodes well for the future of fracking and, of course, Halliburton's investors.
Fueling the future
One of the many aspects of its "Frac of the Future" program is to save millions of gallons of diesel each year by using natural gas to fuel drilling equipment. Not only is this good for the company's bottom line, as natural gas is cheaper, but it's good for the environment because natural gas emissions can be 90% lower than those of diesel.
One customer that's benefiting from this is Noble Energy, Inc. (NYSE:NBL). The company is working with Halliburton Company (NYSE:HAL) in Colorado to fuel its fleets in the region with natural gas. It's a change that's not taking place overnight, but Noble Energy, Inc. (NYSE:NBL) is slowly developing ways to fuel its field fleets with natural gas. In the long run this will help both companies boost margins while also reducing their environmental footprints. Noble has called Halliburton's initiative "a vision of where the field operations need to go" because it helps the company with its goals to reduce its "footprint both physically and with emissions."
Castles made of sand
Halliburton Company (NYSE:HAL)'s Sandcastle vertical proppant bin is not only reducing the physical footprint at the well site by going vertical, but it's cutting the carbon footprint as well. Instead of using a diesel engine for its power needs, Sandcastle uses solar panels.
Proppants are critical to the fracking process. In its most recent earnings release, Pioneer Natural Resources (NYSE:PXD) pointed to its use of lower-cost white sand as being one of the keys to its success in keeping well costs down in the Eagle Ford. In fact, the company was able to shave about $1.1 million off its well costs in the quarter, while still enjoying similar results as more expensive ceramic proppants. The company's plan is to use larger volumes of sand proppants so that innovations like Halliburton Company (NYSE:HAL)'s Sandcastle will help companies save more than just money; they also save space at the well site as well as decrease diesel emissions.
Next on tap: water
A final area where Halliburton is really making waves is in handling frac water. The company recently partnered with Nuverra Environmental Solutions Inc (NYSE:NES) on its H2O Forward service. This has the potential to be a real game-changer for the industry because it recycles produced water on site, eliminating substantial amounts of the freshwater that's required to frac oil and gas wells.
Halliburton has been testing this program out for a while and the results have been very promising so far. A 94-well test of the company's full-service system with recycling saved over 94 million gallons of water, which had the effect of removing 125,000 round-trips for trucks. The net effect was a savings to producers of $3.26 million dollars, which shows that going green can also save a little green.