America’s biggest source of energy has power problem


America’s fastest-growing source of energy has a power problem.
The Permian Basin, which produces almost 4 million barrels of oil a day, has expanded so quickly that suppliers of the electricity needed to keep wells running are struggling to keep up. The Delaware portion alone consumed the equivalent of 350 megawatts this summer, tripling the load from 2015. That’s enough to power about 280,000 US homes. And providers say the draw is likely to triple again by 2022.
Providers are rushing to build new power lines, but it takes three to six years to get them up and working. In the meantime, drillers are bemoaning the reliability of the system and desperately seeking alternatives, exploring the use of solar and natural gas to fuel power-generating gear on-site.
The electrical grid in West Texas “was not set up to withstand that much power going through it,” said Marco Caccavale, a vice president at the oilfield services company Baker Hughes. “Plain and simple, you have reliability challenges.”
Power is just one more oilfield complication in a region struggling to deal with extraordinary growth over an incredibly short period of time. Worker and pipeline shortages are major concerns, along with the growing levels of water and sand needed for fracking. Meanwhile, highways initially designed for minimal use are gridlocked in the day and deadly at night.
Conventional drilling with vertical wells in the region reached an apex in 1973, producing about 763 million barrels for the year. Output then steadily declined, falling to 309 million barrels in 2006.
That threatened to turn a hot and dry region with few large communities back into a dusty afterthought requiring minimal electricity. The iconic 40-horsepower “nodding donkeys” that power vertical wells draw about 30 kilowatts each.
But since the advent of fracking a decade ago, they’re being supplanted by sophisticated equipment that needs more and more power to operate. At the same time, the well count has grown dramatically, rising by 33,483 since 2006, according to Austin-based Drilling Info Inc.
Shale wells developed using fracking can run horizontally for miles. To lift oil out, companies now depend on electric submersible pumps that
individually draw about 300 kilowatts, according to Toni Jameson, an electrical-engineering consultant who leads a coalition of Permian companies studying the issue.
“Power is the last thing that anybody really ever thinks about,” Jameson said. “Most operators and producers out here, they’re here to produce. No one thinks about power until they realise, ‘We can’t produce that well without it.’”
The industry has studied the use of solar and wind at well sites, she said, but found the costs were high and that they couldn’t provide the power and consistency needed to run the new oilfield machinery. The Permian power grid is the equivalent of a one-lane country road, she said, adding,” we need about a 12-lane highway in both directions.”
The oilfield’s big-ticket items, drilling rigs and frack pumps, still mainly run on diesel engines, and aren’t affected by power outages. But for a well that’s moved past the drilling stage and into its longterm production phase, power is often the No. 1 operating cost.
Determined to find alternatives, the industry is experimenting with gear that can run off the natural gas produced in nearby wells. Gas-compressor sales in the region are up, which suggests more field gas is being processed locally to be used to generate power, James West, a New York-based analyst at Evercore, said.

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