This edition of the Oil & Gas Measurement Podcast features Stephen Anson, the Director of Measurement at W Energy Software, discussing a recent API update on custody measurement of produced water.

In this episode, you will learn about what started the recent focus on water measurement, including API’s current position regarding the topic, and what’s covered by a new technical report that will provide guidance for the dynamic quantity measurement of produced water.

Custody Measurement Produced Water: Show Notes, Links, and Insider Terms

• Stephen Anson is the Director of Measurement at W Energy Software. Connect with Stephen on LinkedIn.
  • W Energy Software is dedicated to bringing the latest technologies to energy companies to support efficiencies. Their measurement software, WE Measure, uses modern technology to perform insightful measurement analytics.
• API (American Petroleum Institute) has developed more than 700 standards to enhance industry operations. Today, it is the global leader in convening subject matter experts to establish, maintain, and distribute consensus standards for the oil and natural gas industry.
  • API 18.2: This standard defines the minimum equipment and methods used to determine the quantity and quality of oil being loaded from a lease tank to a truck trailer without requiring direct access to a lease tank gauge hatch.
• AGA (American Gas Association) represents companies delivering natural gas safely, reliably, and in an environmentally responsible way to help improve the quality of life for their customers every day. AGA’s mission is to provide clear value to its membership and serve as the indispensable, leading voice and facilitator on its behalf in promoting the safe, reliable, and efficient delivery of natural gas to homes and businesses across the nation.
• ISHM (International School of Hydrocarbon Measurement) provides instruction in both technical and non-technical measurement subjects for personnel in the industry. Problems that pertain to the measurement, control, and handling of both gaseous and liquid hydrocarbons are studied so that useful and accurate information can be developed and published for the benefit of the public.
• Rocky Mountain Measurement Society (R.M.M.S.) is committed to the advancement of hydrocarbon measurement for the mutual benefit of the members, industry, and society. Its mission is to educate members on standards, regulations, and common practices while communicating new ideas, technologies, and emerging trends.
• Natural Gas Sampling Technology (NGSTech) is an emerging industry association focusing exclusively on the science and advancement of natural gas sampling technology.
• GPA (GPA Midstream) is the primary advocate for a sustainable Midstream Industry focused on enhancing the viability of natural gas, natural gas liquids, and crude oil.
  • GPA 2172 (Calculation of Gross Heating Value, Relative Density, Compressibility and Theoretical Hydrocarbon Liquid Content for Natural Gas Mixtures for Custody Transfer) is a standard that presents procedures for calculating certain properties of natural gas mixtures, including gross heating value, relative density (real and ideal), compressibility factor, and theoretical hydrocarbon liquid content.
  • GPA 2145 (Table of Physical Properties for Hydrocarbons and Other Compounds of Interest to the Natural Gas and Natural Gas Liquids Industries) provides the gas processing industry with a convenient compilation of authoritative numerical values for hydrocarbons and other compounds occurring in natural gas and natural gas liquids as well as other compounds of interest.
• FLOWCAL by Quorum Software is an oil and gas measurement software platform that is used by operators for the back-office validation, processing, and reporting of natural gas and hydrocarbon liquids.
• Coriolis Meters measure mass flow of natural gas and liquids, as opposed to measuring volumetric flow, such as an orifice meter. Metering is based on the principles of motion mechanics.  
• Wedge Meter is a type of differential pressure meter that can be used with high viscosity fluids and dirty fluids, which might otherwise foul a concentric orifice meter. The primary device is a cylindrical meter body with an embedded wedge.
• Biogas is a renewable fuel produced by the breakdown of organic matter such as food scraps and animal waste. It can be used in a variety of ways including as vehicle fuel and for heating and electricity generation.
• Renewable Natural Gas (RNG) is a pipeline-quality gas that is interchangeable with conventional natural gas, derived from sources such as landfills, bio-digesters, and waste treatment plants. 
• Natural Gas Liquids (NGL) are components of natural gas that are separated from the gas state in the form of liquids. This separation occurs in a field facility or a gas processing plant through absorption, condensation, or other methods.

Custody Measurement Produced Water: Full Episode Transcript

Weldon Wright:  Welcome to the Oil & Gas Measurement Podcast, episode 2, sponsored by GCI, the Gas Certification Institute, providing training, standard operating procedures, consulting, and field operations software to the oil and gas industry for over 20 years. For more info on GCI, visit GasCertification.com.

[background music]

Announcer:  Welcome to the Oil & Gas Measurement Podcast, where measurement professionals, Bubba geeks, and gurus share their knowledge, experience, and likely a tall tale or two on measurement topics for the oil and gas industry. And now, your host Weldon Wright.

Weldon:  Welcome to the Oil & Gas Measurement Podcast. Today, I have Stephen Anson with W Energy on the call with us. He’s going to be giving us an update about API and what they’re doing with their new technical report on the measurement of produced water and the custody transfer of that.

Stephen, before we get started and dive into all the technical details and what API is doing, tell us a little bit about yourself and how you came to be working for W Energy, and what you’re doing over there at W.

Stephen Anson:  Yeah, sure. Thanks, Weldon, for having me on. Like you’ve already mentioned, my name is Stephen Anson. I work for W Energy Software. W Energy Software creates a multitude of different oil and gas softwares, everything from field data capture to forecasting and financials.

I am directly responsible for the design and development of our measurement platform, which would help oil and gas producers and transporters manage the measurement data aspect of that.

I’ve been in the oil and gas industry for over 20 years. I started out as a technician, doing field installations and repairs and calibrations of all different types of equipment for oil and gas metering. Over those 20 years, I’ve spent time in different technical engineering and management roles for different upstream and midstream operators in the industry.

I’ve had the pleasure to work on a lot of new and emerging standards that are now in publication now, which directly relates to the work I’m doing here with the custody transfer of produced water, a technical report being generated through API.

I’m a voting member and a regular contributor to the American Petroleum Institute, as well as the American Gas Association. I’m a general committee member of the International School of Hydrocarbon Measurement and a regular instructor there, and I have served previously as board members for Rocky Mountain Measurement Society and Natural Gas Sampling Technology.

Weldon:  You get around quite a bit there, Stephen.

Stephen:  I have been known to do that.

Weldon:  [laughs] I guess we probably met…it’s only been about five years ago, maybe six years ago, probably, on a project when I was still over at FLOWCAL. I think back then you were working in, let’s see, somewhere up there in Colorado. We probably met in Denver originally, didn’t we?

Stephen:  Yes, sir. I think at the time I was working for a small Denver-based oil and gas producer called Extraction Oil and Gas.

Weldon:  That’s right.

Stephen:  They were trying very hard to implement their own measurement data system. That project took them longer than expected and saw several hurdles prior to me coming on board.

Weldon:  I think just about every project implementing measurement software generally takes a little bit longer than what we all think is happening. I know I saw that when I was at FLOWCAL, before I was at FLOWCAL, as a customer of FLOWCAL, and as a customer of PGAS, we experienced the same thing. Projects just take a while.

Before we get into what API is doing right now, I’d like to talk for just a couple of minutes about why y’all got there and what’s been going on. Because I know in the past, measuring water has been the wild wild west, as far as the oil and gas world.

I’ve seen everything from turbine meters that got gummed up with paraffin and sand to good Coriolis meter installations, to wedge meters, and probably a few other things out there. Almost all those cases, there was no correction or inadequate corrections being done to the volumes. In most cases, it was just, “We need a number. We don’t care how accurate is was. It’s just water,” you know?

Stephen:  That’s right.

Weldon:  A lot of focus has changed lately. All of a sudden, water has become a commodity that’s being sold in some places. Tell us what you’ve seen along those lines. What was the background that got API to determine they need to march down the road of doing a technical report and possibly even a standard?

Stephen:  It’s interesting because, if we look at an entire lifecycle of what our industry has done with regards to the fluids that are produced, it’s changed. Even in the 20 years I’ve been in it, and obviously, the industry has been around a lot longer than that, but just looking at these past 20 years, you look at how onshore companies used to just be a gas company, or they used to be an oil company. They drilled oil wells, and they drilled gas wells.

Now, through necessity and nature and the shale revolution, you’re both. You’re an oil and gas company. Your wells produce oil and gas. They probably always did. Now, the oil companies are having to deal with that gas as a byproduct. The gas companies are having to deal with oil as a byproduct. With that has now brought the produced water aspect. That’s always been there too, right?

Weldon:  Right. It’s always been there. It’s been a problem. It’s been something we had to get rid of.

Stephen:  It was just a nuisance. It was just that thing that came with it. All the companies were concerned with was just getting it off of the lease. So, disposal and transportation of it. It has now become a commodity just like the oil and gas that they’re producing because it always cost the company to get it off the site, but now that cost is a little more noticeable, because we have water management companies out there, and transportation, and pipeline, and gathering systems purely dedicated to it.

And, a lot of this has an environmental aspect. That’s why companies are paying closer attention to it now. But, over the last few years, that recognition of this produced water that historically has not had an economic value now does because there’s transportation fees, gathering fees, disposal fees. There’s a larger cost associated with managing this byproduct fluid.

Weldon:  If you go back and look at the history of our industry, there weren’t many places in the world that you could find a pipeline to even pump your produced water out.

You trucked it out, and if you had a well that produced significant amounts of water, if it didn’t have a good water to oil ratio, that got to be a big expense. There was no such thing as a gathering system put together just for that water, right?

Stephen:  That’s right.

Weldon:  That’s something we’ve seen pretty new.

Stephen:  I’d say the last handful of years. That’s what led to the start of this water standards discussion because through the lack of standards and guidance, we saw a lot of cowboy mentality. That’s very common in oil and gas.

Before there’s rules, before there are standards, there is a “do it however you can” approach. Now that produced water is being billed, it’s incurring a fee, and there’s entire business models built around the gathering, transportation, and disposal of produced water, people had to start measuring it.

Because it wasn’t oil and it wasn’t catching tens of dollars per barrel, there was less focus on the measurement equipment and the practices around that. It was, “I got to have a meter. Let’s put the cheapest meter out there with the cheapest installation and the cheapest level of monitoring.”

As those fees increase and the focus increases, accuracy, reliability, reproducibility, all of those accepted and important measurement buzzwords came into play. Water starts getting viewed as a commodity.

Now that a commodity label has been applied to it, people want some type of documentation that they can reference in a contract or an agreement. Something that allows for consistency across produced water measurement, and equipment design, and specification, and performance criteria. That’s what led to this.

I would say probably in 2017, maybe ’18, this conversation started coming up in the American Petroleum Institute regular meetings. Within API, there’s the Committee on Petroleum Measurement, the COPM, and there are several sub-committees under that. The conversation kept coming up.

Finally, when it came up enough and there were enough people behind it, the COPM asked the Committee on Liquid Measurement, which is a sub-committee of them, to then look into the necessity of having a standard around custody transfer of produced water.

If you’re familiar with the American Petroleum Institute, you would know that their focus has largely been on hydrocarbons. Water is a non-hydrocarbon fluid, so there was never any standard around the measurement of produced water.

Weldon:  It was probably a fairly big discussion about whether they even needed to be involved in it, I would imagine, to start with.

Stephen:  That’s why it started off as a request to just evaluate the necessity of this, because what’s important to me may not be important to you, and that applies across the industry.

But enough people who were part of that evaluation process came back and said that this is absolutely worth exploring more and developing some type of documentation around the consistent approach around produced water measurement.

Weldon:  That makes perfect sense, Stephen. Talk to us about where API is right now. I guess I was one of those people with their head in the sand. Since I haven’t been active in API, I’m more focused on what GPA and AGA are doing.

I thought y’all were still in the “talking about it” stage, but I understand from our prior conversation that y’all are way past that now. Tell us what y’all are doing. Where you are at this point in time.

Stephen:  We are well beyond the “talking about it” stage. Like I mentioned, I think that the conversation first started around 2017.

It wasn’t until 2019 that API as a whole sanctioned the ad hoc group to look into this. That was like spring of 2019, and we spent the next several months discussing this and just evaluating the issues at hand and trying to determine how we can address those issues.

A year later, March of 2020, we were actually approved to start a working group. Between 2019 and 2020, we were doing the evaluation of what this working group would even do from a standards standpoint and approach.

We submitted what API calls an “SR cubed,” which is a Standards, Resource, and Requirements Request. It’s basically the governing document that you will use to develop your standard or the project. It’s like a project management tool.

This is where you define your scope of the standard, you give some background information. We submitted this and it was approved in the Spring 2020 meeting. What we’ve been doing since then is actually writing the document.

This will not be an actual standard to start with. We’re going to produce a technical report, which is one level below a standard, but it gives the industry something that they can reference in their contracts and agreements and use to help them in the decision-making and selection process around a produced water measurement system.

What we recently finished this past November, so November of 2021, is we finished the technical report. We broke it up into different sections. We had drafting groups contribute to those specific sections. Once we cleaned up everything and put it into one cohesive document, it’s now been submitted into the internal working group for review and ballot.

It is actually under review right now by the working group. We’re collecting comments on it through the end of this month that we’re recording, so December 2021. In January, we’re going to start going through the comment resolution process with the goal of, by March of 2022, submitting this to the COLM within API for larger approval.

Weldon:  That really surprises me that y’all moved as fast as you can. Having worked with some of the other standards bodies, the time from first discussions to balloting something, five years, I guess it’s happened a few times.

If you look, for instance, at bio gas, or renewable natural gas, whatever label we want to put on it these days, that’s something that’s been in the discussion phase for a lot more than five years and I guess we’re still not quite that far along with it.

Tell us about some of the specifics that are in the technical report that y’all have now. What’s being covered by it? I assume it’s going to be some information on device type, equipment standards. I’m sure there’ll be some calculation and correction factor detail in there. Give us some detail there. Get geeky with us.

Stephen:  Yeah, sure. Happy to. You’re absolutely right. Typically, standards take a handful of years to even get started because there’s a lot of discussion that goes on. However, when there is a lot of interest and a lot of passion, and you get the right group of people together, you can make headway very quickly.

We saw this with API 18.2, which was a standard I was proud to be able to work on and we’re seeing it again with this technical report for the custody transfer of produced water. That drives it a lot, too.

Going into some of the detail of what this technical report will cover, it’s exactly like you said. We had to be very specific and clear with what our goal was or our scope of this. When we look at that, our scope was to provide guidance for the dynamic quantity measurement of produced water. I’ll break that down for just a minute.

Dynamic quantity measurement of produced water. Dynamic means it needs to be a flowing condition. Not a static condition, like in a tank. There are tank measurement standards out there already and they apply to hydrocarbons and non-hydrocarbon liquids alike. When we’re talking about dynamic, we’re talking about flowing through a meter.

Quantity, we’re only talking volumetric or mass results. We’re not talking about the quality component, meaning sampling or any type of laboratory analytics behind that. We’re just talking about volume or mass, quantity measurement.

Then produced water. That sounds easy enough, but we actually had to go in and create some type of boundary limit around what produced water is right. We had to give produced water a definition. While that might sound easy enough, you ask 10 people…

[laughter]

Weldon:  We still haven’t agreed on air yet, so yeah, I can see it.

Stephen:  You ask 10 people to define produced water and you will get at least 10 different definitions. For the purpose of this conversation and how the document is written right now, produced water is being defined as a homogeneous liquid that is produced from an oil and natural gas well, injection water, and any added chemicals.

We’re not talking about frack water. We’re not talking about any other water used in the production of hydrocarbons that are not naturally produced or injected. That’s probably as clear as the driven snow, right?

Weldon:  Hey, I told you to get a little geeky. It’s interesting that frack water got singled out and excluded there.

Stephen:  That’s right.

Weldon:  There’s a lot of intricacies in any standard like this. As you say, 10 people would define water differently. You’re exactly right. With GPA and our work on the 2172 and 2145 standards over there, air itself got to be a moderate matter of dispute.

They had to change the definition of air, actually remove the word “air,” and start talking about the mixture. Because air, just like water, who, what, when, and where? Those all have to be defined in it. Do y’all get into detail on the type of equipment being used?

Stephen:  We do. I mentioned earlier that we broke this down into sections. Our sections came into three primary groups. There were general considerations when measuring produced water.

These could be process conditions, these could be different equipment or different contract agreements. Just things that you need to be aware of when you’re designing any measurement system. There were those general considerations.

We also get into the guidance for the design of this produced water measurement equipment. When you’re measuring produced water, it’s not totally different than a crude oil or an NGL other than the fact that when we’re measuring this, we’re not taking that quality component into it. We’re not looking at the lab results or any other specifics around what makes up that fluid. We’re focusing primarily on primary measurement elements. 

Meter types, we talk about the other equipment that gets bolted onto a measurement system, like your flow computers, and your pressure and temperature transmitters, and things like that. But because produced water doesn’t have the type of calculation correction tables that we have for crude oil, we’re just talking about gross volume.

Weldon:  Just gross? Okay.

Stephen:  In this technical report, we will not be addressing temperature and pressure correction factors.

Weldon:  That’s one of the things I was wondering about in there because when you start looking at any other fluid, whether it’s liquid or gaseous, there’s a lot of detail in there. Historically, we haven’t looked at any correction factors on water. That would be a whole other research project if they want to open that up, won’t it?

Stephen:  That’s right. Anyone who listens to this is probably going to know, “Well, there are correction tables for water.” That’s a true statement… for pure water.

Weldon:  Yeah, that’s not coming out of that well.

Stephen:  No, that’s not what’s coming out of the well. What’s coming out of Well A is not what’s coming out of Well B. Those corrections cannot be directly applied. That was recognized early on in this effort.

Weldon:  The whole effort is recognizing the fact that we’re not undertaking a task to analyze, and define, and break down the specific stream that’s coming through this well. It sounds like you’re recognizing, yes, there are going to be some slight inaccuracies because of variations in that and the composition of the fluids are measuring, right? That makes perfect sense.

Stephen:  That’s right. The whole objective here was not to limit or constrain any producer, operator, gatherer, whoever you are. We don’t want to constrain you to a prescriptive set of rules. We definitely don’t want to inhibit emerging technologies.

What we wanted to do was, “This is what is available to us right now, and these are some of the best practices and recommendations to do it consistently across the industry.”

Weldon:  Great. You mentioned that you’re in workgroup balloting now. You expect to go to general ballot here. When do you expect to see an actual published technical report? What’s y’all’s goal? That’s got him on the spot there…

Stephen:  Yeah, that’s a hard one to answer. We will submit this to COLM in the spring of 2022. About mid-March, we’ll submit this to COLM. COLM will then do an entire vote throughout the committee on liquid measurement.

Depending on the number of comments we receive, we have to go through a comment resolution process. Because API is a standards organization body, they have very strict protocols and procedures on how this stuff gets published.

It will depend on the number of comments we get back and how the comment resolution process goes. If we can get this submitted to COLM in the spring, we would establish a target of a fall or late 2022 publication.

Weldon:  That’s pretty cool. Thanks for this update, Stephen. A lot of great information there. Something that’s been way overdue in my book anyway.

We’re hoping to begin to build on this and make it a measurement resource that new folks coming into the industry or people with a particular question will be able to go in and do some googling. Hey, there’s a podcast episode on that. Let’s see what Stephen told us. Appreciate it again. Thanks again for being here.

Stephen:  Thanks for having me on the show. I really enjoyed it.

Weldon:  Thanks again for listening. If you like our podcast, please leave a review on iTunes or wherever you get your podcast fixes from. A full transcript of this and the other episodes are available on the Oil & Gas Measurement Podcast section of the PipelinePodcastNetwork.com website.

There’ll also be definitions of any geeky terms if we got out of control with those. New episodes of our podcast will be posted each month.

If you have suggestions for topics, questions, or if you’d like to volunteer as a guest, drop me a note on LinkedIn or click the Contact button on our website. Thanks again for listening.

Transcription by CastingWords