SandRidge Energy Inc. will be a guinea pig for a Louisiana company and an industry giant looking to test natural gas-powered oil field equipment.
The Oklahoma City-based oil company has agreed to let Green Field Energy Services Inc. provide power to a well in northern Oklahoma's Mississippian formation from natural gas being produced there.
“We're excited to be part of this groundbreaking test in which our well will be producing on artificial lift without the use of an external fuel source to power the downhole pump,” spokesman Greg Dewey said. “This technology has the potential to significantly reduce our operating expenses and our environmental impact at the same time.
SandRidge, which has struggled to get electricity to its well sites in rural Oklahoma and Kansas, also is using 43 natural gas generators to reduce its diesel usage, Dewey said.
Green Field is teaming with GE Oil and Gas to bring cheaper, cleaner power generation options to the oil field, the Louisiana-based company announced this week. SandRidge and Houston-based Apache Corp. will test the equipment in their operations.
Green Field announced this week it had signed a global supplier agreement with GE, which last year partnered with Oklahoma City-based Chesapeake Energy Corp. to promote natural gas as a transportation fuel.
Chesapeake subsidiary Peake Fuel Solutions is marketing GE's modular “CNG in a Box” units to ease the spread of fueling infrastructure.
Green Field also will use the units as it works to provide customers with natural gas-fueled drilling and hydraulic fracturing equipment. The companies also plan to work together to develop other ways to deploy their technology together.
“We're thrilled to be collaborating with GE, and we're proud that this global leader in energy and power generation recognizes the advancements we have made with our turbine driven technology,” CEO Michel Moreno said.
Moreno said Green Field's systems are superior to other available options because its bi-fuel engines are capable of running on pure field gas, rather than a mix of natural gas and diesel. That makes it easier for Green Field customers to switch from diesel to natural gas to fuel their field operations, he said.
Mike Hosford, general manager of unconventional resources for GE Oil and Gas, said he expects the company's collaboration with Green Field to help resolve some of the biggest challenges facing the industry.
“By using Green Field's bi-fuel technology on the gas turbines, we have the potential to switch the power source at drilling sites to abundant, reliable, and cleaner-burning natural gas — a source of energy that can help meet our world's growing energy needs for decades to come,” he said.
Many energy companies have tried to find ways to incorporate natural gas into their operations.
On several occasions, Chesapeake CEO Aubrey McClendon has said companies that fail to use natural gas are like dairy farmers who don't drink milk.
Chesapeake is working to convert its truck fleet to CNG to help build demand for natural gas as a transportation fuel. The company also is trying to convert its diesel and electric drilling rigs to natural gas.
Continental Resources Inc. has used natural gas to power a couple of its rigs in North Dakota, which helped cut fuel costs by about a third, said Rick Muncrief, the company's senior vice president of operations.
He said further infrastructure is needed to make such applications more widespread, but the company, and the industry, is monitoring developments.
“That's just the way our industry is,” Muncrief said. “We're pretty good at developing new approaches.”