Energy 101: We Ask The Dumb Questions So You Don't Have To

0:00 Welcome to Energy 101, where we ask the dumb questions, so you don't have to. Today, we have Justin Hayes. He is a reservoir engineer

0:10 and he is the vice president of reservoir engineering and data science at Flow. And today we're going to frack around and find out. Justin, thanks for joining us and laughing at us.

0:25 I laugh quite a bit, but thanks for having me. Me too So this is going to be a giggly episode. I

0:32 worked for me. Oh, no.

0:36 Gigglers. Yeah. But no, for me, that would probably all. But yeah, thanks for having me. I'm excited. Right. So I'm super excited because I just love when we have a topic where it could just

0:46 be like blank 101. You know, we had Bobby talk about data and oil and gas, energy, everything. It's like, it seems simple. It's one word. You can't just say data 101. What the hell does that

0:56 mean? Yeah You say fracking, one of one. You know, I think fracking is a little bit more easy to break down, even at it is super complex and stuff. Yeah. But why don't we start off with that?

1:06 You know, I think most people who don't know much about energy kind of understand what fracking is, like they understand that you're going in the ground and making a big boom, basically. And some

1:17 people think it's good. Some people think it's bad. It's obviously super complex. I mean, why don't we start off with what, you know, what maybe people think the fracking industry is and what it

1:29 really is in kind of a simple way. Yeah. So there's two versions of fracking that kind of exist in the world. There's the public version. And then there's what, you know, patrol engineers think

1:42 of. And we'll stick with kind of the public definition from most of this. But from a, from a public perspective, you know, first I'd start with the moral case. Just put this on the table Because

1:56 of fracking, what. most people think of as fracking, we've basically met oil demand growth out of the US globally for the last decade or so, which is pretty impressive. Single handedly, we've

2:09 provided all the oil growth of the globe. Most of that coming from the Permian Basin. So, you know, it's critically important to oil production, clearly. You know, so then what is it?

2:22 Mainly what people were thinking about when they're thinking about fracking is a new version of oil and gas drilling and production, which involved turning horizontal beneath the surface, and then

2:36 doing what us engineers think of is actually fracking. So, that's part one drilling, and then part two is what we would call fracking, which is pumping down fluid with some additives, usually

2:47 mainly sand, I think like beach sand roughly,

2:53 and using pressure to open up the subsurface, open up the rocks down there, which helps us produce more oil. And the reason why that was necessary is because we ran out of, well, not completely

3:06 ran out of, but we were, we were struggling to find new resources of much easier to produce oil. So basically, fracking was a, a conversion of the industry from where we didn't need as much

3:19 capital to produce oil and gas, to where now we need much more capital to produce the same amount of oil and gas

3:28 due to these techniques. Yeah, I mean, literally before fracking, it was like, you drill a hole, get everything you could out. And that was it. You're shit out of luck. Fracking much lets you

3:40 go in there and get more, right? Yes. Simple as that sounds. Yeah, it's something that sounds it's true, though. I mean, it allows us to go to areas where we knew there was oil that

3:52 wouldn't produce on its own, basically, or wouldn't produce without such a complex technique of drilling horizontally and then adding this fracture stimulation on top of that. So, you know, from

4:06 my perspective, it's just a new generation of the oil and gas industry. We've known it's, you know, it's just taking the next level of technology and applying it and getting more production. Yeah,

4:16 I mean, technically it's a very old technique 'cause they used to just throw TNT in a hole, right? Is that

4:24 old-school fracking? Is that actually a thing? Do they used to do that? Yeah, so we've done a lot of different things. One of the interesting things I grew up in Colorado, one of the things

4:33 you'll hear, and you can look it up, is we even put a nuke down hole. Like an actual nuclear bomb, put it down hole. Oh, that's not a good idea. No, it's terrible idea. And, you know,

4:47 those wells don't produce, but like we've done a lot of different things through time Yes, it's been things like TNT Um, you know,

4:56 What we would call fracking today is a much more controlled technique where we do use what would be most closely approximating like a demolition charge. It's called a perforation gun, where it's

5:11 like a focused cone that pushes a hole about yay big for anybody listening in the size of a quarter, roughly. And then that's what we're pumping the water through So yes, we used to use really

5:28 rough techniques, but now it's a much more controlled, highly engineered technique of where everything's pressure contained and generally quite safe. Do they still explosives, though, inside of

5:41 them? The shape charges are, yeah, the perfs are. Those are basically explosives, yeah. It's

5:47 like multiple on the per - you all call it a perfor gun, right? Right, right And there's multiple shots and it's just like, wow. Yeah, I mean, it's, it's.

5:57 It's like a gun, but not a gun. We do call it a perf gun, a perforation gun, but it's not really a gun in the sense like it's not actually shooting a bullet. It's shooting, it's a demolition

6:08 charge where it's like, it is an explosion. So it's like a gun in that sense, but it's a shape charge which basically punches a hole through

6:20 the cement in the iron tubular goods as well So it doesn't really behave like a gun. They used to use actual guns, but those don't actually work very well. It's like a no country for old men, or

6:35 when the use is that weird device that like kills cows or something. I need to watch that. I don't remember that part. I think it like, the guy who walks around with like some device and it's like,

6:43 all I think it does is blow air like crazy fast Oh, yeah, yeah, okay, I think it's kind of, It's

6:53 like no. Nah, it's not really short, I'm just trying to relate. I like that, but no, I get it, you're just trying to relate. It's all good. It's its own thing. No, it's its own thing. I'm

7:02 trying to think of the easiest way to relate it. No, it's, you're totally explaining it. Yeah, you're explaining it

7:09 a lot. Yeah, that was great. Isn't it, they put it down, like, the wire line people. Yes, it's all wire line. Run the proof gun, down the hole. That's correct, yeah They use the wire line

7:17 to make it go down. Yeah, yeah, well, so it's on wire line, but it's not necessarily to make it go down. Gravity is really what's helping you out there, or you're pumping to help move it down

7:27 the hole. But

7:31 it's mainly on wire lines so that you can activate the charges when they're in place. You need a way to communicate with your gun down hole. Right, right, right. Okay. But yeah,

7:42 so once we've done the perforation part of it, than the real freckers. tracking part of it is really just pumping fluid. And you're using pressure completely to break the rock and access the

7:54 resource. So it's not really an explosion, even though a lot of people think of it as like an explosion, it's more like a,

8:04 yeah, it's more like a forced opening of the rock. Like you're wedging it open. Yeah. Yeah, well, you have to get in the detail of like permeability, is that the word?

8:16 Yeah You say rock, you know, people think, oh, it's a rock and it cracks. It's like, no, it's like million year old sediment and there's all kinds of layers. And it's referred to more like

8:27 being like a sponge or something. Oh, it's much tighter than a sponge. So whereas like conventional resources, like the prior generation would have been close to a sponge in terms of like how easy

8:42 things are to absorb into it, what happened when we went to fracking. unconventional resources is it got so tight. So think of it is, you know how like when you drop water on cement, it doesn't

8:53 disappear immediately, it kind of sits there. Think of it as tighter than that. So like if we dropped water on the counter rocks that we're producing a while out of now, it would just sit there

9:03 roughly forever. You know, not literally, but like to our eye, it would feel like forever. Because it's just so much tighter and yeah, that's permeability, that's how we measure it. That's the

9:14 ability for fluid to flow through the porous media, sorry. Engineer, I came out for a second there. No, I was about to say, this is turning into like geology.

9:23 Yeah, this is gonna be all about the rock. Yeah, if we get into permeability and stuff like that, we're gonna get pretty deep, yeah. Permability, porosity, porosity is the capacity or like the

9:32 open area, permeability is the ability to flow through it. Okay. Okay, so you go down, you shoot, whatever. It's not really an explosion, but it, whatever. It is that. It is an explosion,

9:44 but it's not like It's a forceful opening

9:49 and then you pump down the water or some kind of liquid, then that kind of force is the oil out. No, so what we're actually doing is think of it as like, we're building the highway. So we've

10:05 opened up these highways into the rock, right? So we've got these fractures, that's where the name actually comes from, is fractures. We've opened up the rock, we've created these fractures And

10:14 really what those fractures do is act like highways back to us. Okay. So what actually forces the oil out is the in situ pressure. So there's pressure in these rocks due to having lots of stuff

10:28 sitting on top of them, basically. And we use that pressure to produce it back to us. So it's not really the fracking that makes it produce. What the fracking does is allows it to produce easier.

10:41 So that we don't have to suck as hard, we can get more production now using the same amount in it. So how, once the oil is being pumped out, how do you separate all like the sand, all the water,

10:54 all the other? Yeah. Also, I wanted to kind of pair it together, sand and water are heavily used and fracking. Correct. Just overall, combined with her question, like, what is going on here?

11:07 What's the sand doing? What's the water doing? Yeah. So this is highly debated. Oh. This isn't scientific? Well, I mean, there's science to it, right? But the thing you had to keep in mind

11:17 about oil and gas in general and what actually attracted me to the industry in the first place is like, we never actually get to see what we do, right? You're, you know, when we're talking about

11:26 fracturing or fracking, we're talking about generally being at least a mile beneath the surface. And then we're talking about potentially being a mile to two or three or even four or five now. Some

11:37 people are doing miles away from that.

11:42 We're talking about something that's happening potentially five miles away from us that we can never actually go touch, right? So yes, there's a lot of science and there's lots of smart people

11:50 working in labs with PhDs and stuff and they're testing things and constantly developing theories.

11:59 It's still not exactly known from the sense like we can't just go watch it. We don't know exactly what's happening. So there is debate, but generally the water in the sand had different purposes.

12:14 So the water generally creates the fracture. So it opens the rock, creating pressure, sorry, creating pressure, it forces the rock open. So that's generally the goal of the water. And we're

12:30 using water in a very broad term right now. There's potentially additives in the water depending on what type of frack you're talking about.

12:39 they're sand in that water. So we're pumping down sand at the same time. And what the sand is for is there's lots of pressure on these fractures that we've created. And what the sand does is it

12:50 keeps those fractures open. That's really all it's supposed to do. So like there's lots of force on this rock that we've opened up. And then as we produce that water back as we start producing oil

13:03 out of that rock, that pressure is pushing on that frack. So the sand is supposed to keep it open That's the idea.

13:11 So then, you know, where the debate is is, you know, how far does the sand go? How much of the frack does it keep it open? How much sand do you actually need? How much water do you need, et

13:22 cetera? That's where the debate starts to happen. So I like it, it's so simple. It just sounds so simple. It's like we go out there, explode, and then you use water and sand. Like you're not

13:31 saying like we use like crazy, like big words. I know like acids also involved. It can be, yeah. All kinds of chemicals, yeah But it's just - It kind of just sounds very simple. Yeah, and

13:42 let's talk about the water briefly real quick, just - Yeah, is it fresh water, salt water? Yeah, yeah. So generally we're using what's called non-potable water, but like non-drinking water.

13:54 But we aim for fresher water that tends to do better because we add additives.

14:01 One of the main additives, and probably like the biggest additive use today is friction reducer And friction reducer is

14:10 a surfactant, it's a technical term, but it's basically a soap, a surfactants or soaps. Or, well, let me rephrase that. Soaps are surfactants. That's

14:18 the easiest way to think about it. And what that does is basically makes it easier to pump everything down. It literally reduces the friction. It's kind of a soft pan. It's like the non-stick pan.

14:29 Yeah, it's kind of like that. I mean, it's a chemical. So it's not like Teflon and an non-stick

14:37 pan, but it does the same thing. it makes it harder for things to stick to the pipe and allows us to pump with less pressure. So that's probably the number one additive. Historically, we used to

14:49 use a lot of guars or gels. And the easiest way to think about that is like the kind of stuff that makes Jell-O kind of Jell-O up. It's something, it's a thickening agent. And the reason why we

15:03 used to use that much more than we do today is because we thought it was necessary to help convey the sand down But it turned out those didn't do very well.

15:12 And slick water, just water that's not cross-linked Jell kind of took over. So that's mainly the additives you're seeing today. It might be some guar, some kind of gilling additive, and then

15:25 friction reducer. That's probably 90 of the additives that are in the water itself. So the goal is to get hydrocarbons, usually the two you think of as oil and gas. So when you're fracking, are

15:37 you getting - only one of the other? Is it both? What is the actual goal when it comes to oil and our gas? Yeah, so I guess back to your question earlier, you know, like what's coming out, like

15:47 we get everything out, right? So we pumped down some water, some sand, these additives, that generally tends to come out first. We don't always recover all of it. And then we're getting gas,

15:60 water, so natural gas, like think like propane style natural gas, not like gasoline gas, water and oil. So like produced water comes out a ton, like more, you probably get more of that than you

16:14 do. Yeah, we have much more produced water than what we put down, generally. So how, like, that's not the same water that you frack with, that's just more water from the air. Yeah. And what

16:26 do we do with it? So it's a problem, right? Yeah, well, it's a cost for us, right? Like, and don't, don't some people like inject it back in? Yes, so, So first, the amount of that water

16:39 that comes back is highly dependent on the field that we're talking about. So, you know, if I were to go to Eagleford, which is South Texas versus Midland, we were talking about Midland earlier,

16:51 like we're gonna see much different amounts of produced water coming back versus, say, Williston, which is in North Dakota, that's easy even more. So if we're kind of ranked those, Eagleford

17:04 tends to produce the least, Midland, Permian Basin produces kind of in the middle, and then Williston produces more generally.

17:13 Nobody coming from me, please.

17:16 Broad speaking here. And that water, just like the oil, is sitting in the formation before we go frack it. So then,

17:30 what do we do with it? That can vary, we have programs where we recycle it sometimes four-frack water, we have programs where we inject it into non-drinking water aquifers. So drinking water tends

17:50 to be kind of like, we'll say like 500 foot and up beneath the surface. We'll generally inject these disposal water into like 3, 000 foot type depths.

18:03 So then that's like a permitted process But for us, it's mostly a cost because we have to handle it on surface. It can be corrosive. It can be highly has a lot of dissolved stuff in it, which

18:19 causes problems for us. Comes out like scale, think like salt.

18:23 And then, you know, we can't sell it. That's the biggest problem, right? Like we can't sell it. Nobody wants this water. So we have to find ways to either clean it, dispose of it safely, et

18:34 cetera. Yeah.

18:36 So you brought up horizontal drilling earlier, and I kind of wanted to transition to a whole segment about this. So I got a little, I'm gonna preface this, so bear with me. So what we're gonna

18:48 talk about is the shale revolution, which is a big moment that happened, what, like 2012, '20, 2007.

18:59 So I would say the shale revolution really started. And there's a great book about this called Meet the Frakors It's a great name by, oh man, it's like - Ben Siller.

19:11 No, it's a great book, I - I'll look it up. Yeah, I think his name is Greg Zuckerman, I wanna say. I'm editing this, so I'll just - I recommend the book, you're looking at it now, thank you.

19:22 But basically what started unconventional shale revolution and fracking, really, in the context that I'm using it, was the combination of horizontal drilling. So we had drilled horizontally before,

19:34 directionally before. And then

19:39 we combined that with what engineers would call fracking, which is the actual pumping of the water on the sands. On vertical wells, we combined these two technologies, right? So both of these

19:50 technologies existed prior to Shell Place. We were drilling horizontally. We were drilling directionally. And then we were fracture stimulating vertical wells as well And then

20:03 Mitchell Energy, working in the Barnett Shell, a play I worked briefly. Where's the Barnett? Barnett is basically underneath Dallas and then West. Sorry, I'm not very good at cardinal directions

20:16 sometimes.

20:18 But yeah, so basically think Dallas and West. So then if you - they tested the idea of horizontal - well, not really tested They were testing fracture simulations. They made a mistake and did a

20:33 slick water job. like they didn't add - What does slick water job? So slick water just means we didn't put the gels in. Okay. Like I was describing a little bit earlier. And that's what makes it

20:43 slick as opposed to a gel job. So they pumped a slick water on accident. And then they realized like, Hey, that well is our best producer in this field. So like they combined that with horizontal

20:59 drilling and that created the Barnett

21:02 shell, which was a natural gas play And that was the start of the shell revolution. That was really the first time that we had done fracking to produce unconventional wells or shell wells, or sorry,

21:14 I used those words interchangeably. Right. They all mean the same thing to me. So this is a huge moment because it unlocked more complex basins like the Marcellus, natural gas is just blowing up

21:29 and helps phase out oil and coal

21:33 and everything else because. I mean, natural gas is literally like, straight from the ground. Like it's almost not processed, right, right? You still have to process a little bit, but it

21:44 depends, right? So like say you want propane, everybody's familiar with a propane tank, then you have to process it to get out just the propane. But, you know, if you're thinking about just a

21:55 general electricity source, yeah, it's minimally processed. We do process to get more valuable stuff out of it

22:03 But that same natural gas goes into basically synthetic fibers. Like, I have a friend who works in chemical engineering. He produces synthetic fibers. Like, they use natural gas.

22:16 It basically replaced coal over the last, I guess it'd be like 20-something years. And then not fully replaced coal, but like. You look at charts from the EPA. And like, there's like a literal X

22:31 where like it goes down, That goes up absolutely worldwide like Gas has changed the world with the creation of LNG, which is liquid natural, liquefied natural gas, to import, to export to

22:45 countries who don't have like the most efficient energy mix. And then countries are still developing and go and do legislation, can't say that word. Like Australia, they're having like a huge play

22:58 that I've been tackling for a year. Yeah, the big one. Working with Brian Sheffield. And it's still not like, I feel like no one's still talking about it. Like, these like the regulations are

23:08 being passed. And these countries are like finally having access to all their gas. And they're, you know, you got like Guyana who they have all the gas offshore. And like they're coming from like

23:20 a nobody country to like super rich and wealthy. Like a lot of countries are doing this in the most recent like decade. Like it's very crazy all over the place. If we stick more domestically,

23:32 Let's talk the Marcellus. Um, I, I, from my understanding, it's, there's a huge basin there, right? Like spreads over the entire Appalachia. Yeah. And I guess it's always been kind of hard

23:43 cause of the terrain there, but the shale revolution has that made that easier or horizontal fracking, all that. Like what, why is the Marcellus so huge now? Well,

23:55 the Marcellus is huge mainly because it is probably now the lowest cost source of that natural gas growth you just described. Okay. So let's, let's back up a little bit. Yeah, please. Um, you

24:09 know, going back to the Barnett, well, let's, let's talk about what did natural gas look like before the Barnett before the Barnett, when I was first entering oil and gas, natural gas prices

24:18 were like12 in MCF. Wow. That is the real thing. Yeah. Yeah. Yeah. And, and we were, and at the company I was working at the time, at a Darko, we were building an LNG plant for import into

24:34 the lower 48. So you probably saw me smile a little bit while you're describing LNG because I was like, yeah, I remember when we were trying to import LNG, not export it.

24:43 So then Marcellus comes along, Hanesville comes along, Barnett comes along, all these natural gas, unconventional basins come along, and basically what they did is they changed the entire picture

24:58 of the economics of natural gas So the reason why Marcellus is such a dominant in Marcellus being a play inside Appalachian Basin, the reason why that's so dominant today is because it is one of the

25:10 lowest cost sources of natural gas in the entire globe. And it's really because unconventional resources unlock that. Like if we were to go drill that vertically, yeah, we get some gas, but it

25:22 wouldn't be economic like it is now with fracking with, you know, horizontally drilling

25:29 hydraulic fracturing. So that's really what's happened. And the entire picture has changed, right? Where we've gone from talking about importing natural gas, being like nations like I think of

25:39 Japan, when I think of nations that need to import natural gas using LNG.

25:46 We went from being a nation like that, when I was first entering industry, to a nation where like we're trying to build, you know, 25 BCF a day of natural gas, of LNG plants along the Gulf Coast

25:57 to start exporting to other countries And you have Tokyo gas

26:02 buying assets in Haynesville because they see it as a way of securing their natural gas demand for the future. So we've completely changed the natural gas picture for the last 20 something years just

26:18 by doing hydraulic fracking or fracking. Yeah. So that's why like, I love like the shale revolution, like it deserves that name Like it really is like a moment in time, a milestone. And -

26:30 Absolutely. Oh, sorry. I was gonna say, do you have any like stats on like what we were producing pre-shell revolution? I know that kind of puts you on the spot, but. Well, I'll put it this

26:40 way. I don't have stats, not off top of my head, but the Marcellus has grown something like 30 BCF over that timeframe we discussed. And when I say BCF, that's BCF per day, which I'm

26:57 trying to think of how to. The B and there's billion. Yeah, the B and there's billion, yeah It is a lot. It means a lot. Yeah, yeah, yeah, long story short, it's a crap ton.

27:09 That's the technical term, is it's a crap ton. But no, it's a lot. It's hard to explain, like when you're thinking about the natural gas at your house, I mean, you're talking about like a

27:21 standard cubic foot, and we're talking about billions of those, right?

27:26 So it's a lot It's enough to have taken. What was a very scarce resource, you know demanding12 an MCF, which is a thousand cubic foot? To something that now you know for a long time was like two

27:42 dollars three dollars an MCF And now it's still even though it's run up a little bit floating around four dollars Slightly beneath four dollars. So it's it's been a Huge boom to the to the United

27:54 States to the point where like I said earlier. We've got foreign Foreign countries trying to invest into our resources to lock in some of their own needs for the future In like we discussed earlier

28:07 replaced coal Just because it was cheap basically of course so not only did like Americans kind of like we kicked off that whole show revolution, right? That's like that was our thing, right? We

28:19 also we kicked off LNG right here in Houston. Is that accurate? I? I don't want to be on record saying that because I feel like that's probably not accurate, I don't know. That's cap, Jacob.

28:30 Colin always talks about, there's a guy, I don't know his name. I mean, the technology may be originated here, but I would say other countries have been much more reliant on LNG than us, so

28:42 that's why I get nervous about that. And I don't know, just to be clear, I don't know. Are you talking about like fracking or LNG? I don't want LNG terminals, like where you get the big old

28:55 tankers and you turn the liquid back in the gas. Yeah, we should probably describe what LNG is for anybody listening. 'Cause we've talked a lot about LNG. It's basically how you just transfer to

29:04 gas, you shrink it by liquefying it and it's super complex and expensive and crazy. Yeah, but it allows us to ship it from like here to Japan or to New Zealand or wherever, right? Because we

29:19 could then fit it on a boat. Trivia question, do you know how many days that would take?

29:25 From here to - Let's say Houston to Japan. Roughly. Oh, I don't know. I would guess probably close to a month, something like that. I think on a graphic I saw recently, it was like 21 days.

29:35 Yeah, that feels right. But I don't know that because I'm in LNG. What's funny about that is I know that 'cause like, just like shipping goods around the world, that's where I was thinking about.

29:48 Yeah, maybe they're a little slower.

29:51 I mean, they're big ships, they're very large ships Yeah, so let's get back on fracking, 'cause an allergy can have, it's a whole episode. So I have some questions that just kinda come to mind.

30:01 By the way, we do ask dumb questions here, so. It's all good. Let me ask something, I don't know why it seems like different, but do we frack offshore? Do we frack offshore?

30:13 The technical, like if you're asking an engineer, they would say no, but do we pump water and sand offshore to complete Wells Offshore, yes we do. but it's not what we would call fracking. It's

30:27 what most people would call like a gravel pack type completion. So no, the short answer is no. Is all offshore conventional technically? To date it is, but there has been,

30:44 what would I call it, like exploration of the idea of doing unconventional resources in the offshore environment as well. I feel like that's not talked about a lot. No, it's not talked about a lot

30:52 because it's seen as stupid levels of expensive.

30:57 So it wouldn't be economic today, but in a world where oil is much more expensive or the technology becomes less expensive than it would start making sense. But yeah, I mean, I've worked on

31:07 projects where we were looking at directionally drilling offshore wells to tap more resource. So it's being talked about just publicly. Getting back on shore, what's it called?

31:24 I'm sorry, yeah. That was a funny pun. What are you punny? I thought you were joking at first, I'm sorry. Very punny, big deal. I'm not sure, I'm not sure. What are electric fracks?

31:34 Electric fracks. Is this like a modern better? Is it E-frax? E-frax? Yeah, we mostly call them E-frax, but electric fracks are, so when we're pumping the fluid in the sand, we have these large

31:48 pumps, generally they're powered by diesel or something like that. Think like a 18-wheeler motor driving a pump. An electric frack basically says, I can use electricity to drive those pumps,

32:02 which is cleaner. You don't

32:05 have the on-site emissions, you don't have to burn resources to do it. You can, heck, you could power it with solar panels if you wanted to. You would need some very large batteries,

32:16 So that's what people are referring to with eFrax. So it doesn't really change the downhole side of it, it just changes the surface equipment. Okay. And I guess something similar, which is kind

32:24 of like making fracksites just more efficient is a simultaneous fracturing or simulfrax. Simulfrax, yeah, trimulfrax, simulfrax, yeah, it's like the new buzzword.

32:37 So really what people are doing there is they're stimulating multiple wells at the same time. And what that really allows them to do is just be more efficient with that surface equipment, right? So

32:47 if I have to move a ton of surface equipment to complete a well, I'm better off making sure that equipment is running all the time. And that's really what they're doing there. They're stimulating

32:58 multiple wells at the same time. Is that what is happening when you see like multiple trucks lined up at a well site? But there's like multiple holes. Most likely. Or is that something else? If

33:13 you're seeing multiple trucks. And they're all lined up, yeah. And they're all lined up, you're seeing correct. That's connected to like one in the middle. Correct, yeah, you're seeing

33:22 fracking. Okay, on multiple wells or like - That could even be one well. So it does require multiple trucks to do even one well.

33:34 It's a lot of force. That's crazy. It's a lot of force. It's a lot of energy that we use to frack a well. I feel like I need to

33:42 be invited to a frack job Highly recommend going to a frack. I have some pictures. I have some pictures. I'll pull up shortly. Yeah, I was gonna say I'm a site. I just did. And I believe

33:51 there's a simulfrack there. It was happening while you were there. I believe one of the frames I have is a simulfrack. Well, probably. A lot of people are trying to do simulfrack now. So like

34:01 when you're seeing a picture of the trucks though, you're seeing a frack. It could be a frack. It could be a simulfrack. What makes it simulfrack is that they're hooked up to multiple wells at the

34:09 same time. But generally now there's multiple wells, even on a single frack job site. They're just treating one out. one of them at a time. What makes it a simulfrack is that they're treating

34:17 multiple wells at the same time. Are

34:20 you gonna ask about refracks? That will be the third one.

34:26 That's what we're hearing all right. We're hearing E-frax, simulfracks, and refracks. refracks, yeah. And refracks is literally the perfect name. It's like you're literally refracking, or is

34:36 it - It is, no, it's not topic, it's basically. Now, there's a, you know, someone who's a specialist in refracks, they would have, you know, the bones to pick with you on that broad

34:45 characterization 'cause there's multiple ways to refrack a well. But yeah, refrack basically says, I'm going back to a well that's been fractured, simulated, it's been in fracked going and

34:53 redoing it because I feel like I can get more resource out because my original frack wasn't as good. That's all refrack is. Is there anything we're missing? Like, that's kind of like at the state

35:03 of fracking that we're at, right? Pretty much, I mean, the big, the big state of the art or the big buzz right now is the simulfract stuff. Refracts are growing.

35:15 But you don't hear them talked about as much in my world, which is kind of public investor world. We just don't hear about them as much.

35:23 But there's tons going on now.

35:27 That's probably it, yeah. OK. So I'm sure I'm forgetting something. I got one more question before we go into some on-screen stuff. OK. Basically, I have some photos from a shoot I just did in

35:38 Midland. And then I got a fun, unrelated thing Because I had a colleague of yours getting a little heads up on a fun thing we could do. So let's talk. Exactly. That's what I'm known for. Let's

35:56 do politics. OK. Dangerous. I know. Where are you going? So energy is very political. There's save the planet. There's - well, we got to do this. So what else we can't live off solar. Energy

36:10 poverty. Yeah.

36:13 Something you'll learn, especially with Kamala trying to win last year was she famously denied or like was against fracking. And everyone's like, well, she better say she's forward if she's

36:25 seriously considered running. And of course, she had an interview and she said, yes, I approve of fracking, whatever. And it's like, well, yeah, no shit, because when she'll learn about

36:35 fracking and how important it is, like,

36:39 we basically, we need it and you're not gonna win anyone over If anyone who actually understands how energy works and energy poverty works is, you know, yadda yadda. I mean, famously, you can

36:50 find dozens of like panels or speeches, whatever, from Obama, like absolutely praising, fracking, natural gas. And I think - Let me talk about that briefly real quick. I think people forget

37:03 that like, yeah. Well, I may be going where you're about to go, but like, you know, I talked about When I first joined the industry. that natural gas was like12 in

37:16 oil on roughly my start date or basically the month I joined the oil and gas industry working full-time, was July 2008. And the oil price at that time, unadjusted for inflation was145 a barrel.

37:30 That's the peak all-time oil price. Same. Quickly followed by. Well, then what happened right after that is fracking took off and basically then suppressed price in natural gas and oil since then,

37:46 right? So we've been under this huge boom in terms of the resource and like thinking back to Obama's timeframe, right? That's around the timeframe, Obama gets elected. And you're talking about

38:02 a time when we went from the big buzzword at the time was energy independence. Yeah Like, people forget this. this phrase, but like, I remember organizing, we had this guy named Robert Bryce,

38:15 who is an energy pundit at

38:19 my school, Carla School of Mines. We brought him in to talk about energy independence because it was a major concern. It was like, where are we gonna get our future energy needs that are costing

38:28 us145 a barrel and12 an M? You know, which are roughly, you know, in inflation adjusted terms, you're talking about like two to three times current prices You know, so think about your, your

38:39 gas at the pump being twice as expensive, three times as expensive. Think about, you know, your energy use at home being two to three times as expensive. That's the kind of world we were living

38:47 in.

38:49 You know, so then, of course, politically, you can't really make the statement that we can't use this stuff because it's been such a big boom for the United States, right? And that's kind of

38:60 where I started with a moral case. 'Cause to me, you know, within my lifetime, within my professional career, tracking has basically taken a resource that was.

39:11 getting to the point where it's unaffordable for the average American and made it affordable, right? And it made it affordable to the extent where we were able to replace coal on the natural gas

39:20 side of the equation, right? And then we don't talk about this, but like think about on the oil side of the equation, everyone drives SUVs and trucks now. Like Toyota is projecting the sell. I

39:35 think it was like 60 or 80 of their vehicles in the United States will be a truck or an SUV now. So if we were in a world where gas prices were two to three times as more, we wouldn't be able to

39:47 afford the cars that we're driving today. So anyway, that's why I started with that, because I think when people think about fracking, they're not thinking about that side of it. Like we've not

39:57 done a good job of talking about it. And honestly, that's why I wanted to talk about fracking, 'cause I feel like it's been a huge game changer. Yeah. Yeah, I mean, basically it just, you know,

40:05 you look at Obama, Biden, and Kamala literally changing her mind. There's a reason that they. Don't oppose fracking and you won't find any world leader doing that. I have an off topic

40:18 statement. Yeah, go for it. Okay. So I had never thought about this before, but I was on a plane next to a guy going in front of, I don't know, his legislation for coal. And because coal is

40:32 really like, if you see how much oil and gases demonized coal is even more so, especially by oil and gas too. Yeah. Yeah. Cause there'd be a case where it's like, yeah, yeah, there'd be a case

40:47 where maybe coal isn't that bad and still needs to be in the mix. Well, this is, this is definitely off topic. But, um, you know, I think in a world, you know, one of the things that's

40:60 happening right now is everybody's trying to pick their horse, right? Yeah. So we talked about, you know, Obama and even Biden and Kamala saying, Hey, I'm not against. cracking, but then on

41:12 the Republican side, we're seeing, okay, well, I need to kill renewables. And, you know, if we think about a world where, you know, that alternative universe where we hadn't found

41:23 uncommentionals, right, or the world where we may be in the future if uncommentionals become scarce, where natural gas prices are12 an M and oil prices are inflation adjusted, something like200 a

41:34 barrel today,

41:38 then we're in a world where we need renewables too, and we need coal, and we need

41:44 biofuel, we need anything we can get, right, like, and I think that's one of the things that I wish we were a little bit better about understanding is like, we've never really done what we call

41:57 an energy transition. There's only been one successful energy transition at the global scale, which is the move away from well oil. That's the only one. We still. So, let's think about that.

42:07 Chalk's favorite topic Yeah, but it's true Like, we still burn the same amount of biomass that we did way back before oil and gas really took off. Like, we're still burning that same amount today

42:20 as a fuel source, right? So we're talking about like trees, like stuff like that. Poop. Yeah, or poop. What? Yeah. Like, we're talking about burning stuff that you think of when you think of

42:30 like the stone age. And we're still doing that. And everybody's trying to make an energy transition happen to their chosen source But like, it's probably not the right way to think about it. The

42:42 right way to think about it is probably like, hey, how do we get as much of all the above as possible? Because we've never lived in a world where we could actually transition. And care about the

42:51 global, I think, situation rather than, I feel like Americans definitely just think about America. Yes. And it's a privilege and they don't realize that, like, yeah, we have a lot to end. We

43:08 can't like deprive other countries of that because I don't know, it's just crazy to me. Well, in going a little bit closer to topic. Yeah. Try and keep Jacob happy. Spin it back. I'm working on

43:22 it. No, no. But seriously though, you know, one of the things that will likely happen soon, ish, in that world where, you know, say US. the resources do become scarce, then we're gonna have

43:35 to do fracking elsewhere, right? Basically, North America, so US. and Canada, are the only places really doing it. We do some in South America, in Argentina, the Baucomarta, and

43:48 that's basically it. But there's oil everywhere. Is that because they ban it, or they just haven't tried it, or it's just different rocks? Yes, yes, and yes.

44:01 It's all the above. Like, so as an example, UK. has banned it, because yeah. They were exploring it at a time where it was very contentious even here. So

44:13 then they just banned it and they haven't really gone back to, they haven't re-explored that. We've had moratoriums on a state level, I believe. Yeah, we have New York. New York is still

44:24 moratorium, as far as I know. I'm not regulatory experts who don't quote me on that, but I know I'm on a podcast.

44:31 But seriously, I think so There's an entire county of the Marcellus that you can't access because it's underneath Pittsburgh, basically.

44:42 That county has banned it. We were on from Colorado, has explored many times, not necessarily banning it, but creating an environment where it would be too hard to really exploit. Basically,

44:55 they're creating what's called a setback rule. So you can't do fracking within a certain distance of something

45:02 So yeah, it's been a very contentious topic. And again, that goes back to why I wanted to start with the moral case. It has been one of the biggest forces in my lifetime in making the world a

45:13 better place. So then how do we get that message out, I think is pretty important. Just as much as like, what is it? Right. Cool. All right, let's wrap this up. Yeah.

45:25 You got pictures.

45:27 Oh. Oh. This is our new tally book. Yeah. If you want one, you'll have to figure it out. You'll have to figure it out right now. You'll have to frack around and figure it out Anyway, can you

45:38 explain to me why there's no K after the word frack here? Yes. So everyone publicly calls it frack with a K, but in industry, it stands for hydraulic fracture ring, which there is no K in

45:53 fracturing, the word. So it's just basically frack apostrophe, right? So in the industry, we always just call it frack. So how do you spell fracking? Like how do you personally spell fracking?

46:07 This fracking is with a K. Fracking with a K is not a K. Yes. And then frack is how you weed out who's an industry or not. That's actually pretty accurate.

46:18 That is roughly it. So if you see someone spell it without the K and they just spell frack, then you can pretty much assume they work in industry. Right. If they spell it with a K, you can assume

46:29 they don't work in industry. And they hate it.

46:32 Generally, if someone is talking about fracking outside of the industry, they generally do hate it, unfortunately. But again, that's why I wanted to talk about the moral case for it. But then,

46:44 you know, me personally, I use all of the above. Actually, it just depends on what I'm talking to.

46:49 I always spell fracking. Like if it's fracking, I spell it with a K. Yeah, fracking always, I'm always okay. 'Cause I think it looks so silly within a posture for you. People do that in a

46:58 posture for you. People do that in a posture for you. You are like, freezing. I feel like with the apostrophe, you're just being kind of passive aggressive. You are.

47:05 It's like, let it go. It's okay. Yeah. Anyway. It's an engineer's favorite topic though. All right, so I just went to Midland. Yeah, yeah. And there's a really cool, really cool trip. I

47:14 went to TCU with the students and we showed them like some conventional pump jacks, went to a drilling rig and went to a frack spread And so here's some stills from the frack spread. There you go.

47:25 I didn't get to go. I know. And we're just gonna be like, what is this? Can you explain what these like boxes are and these rigs and yada yada. So here we go. Okay, here's kind of the whole

47:34 thing. Yes. So my favorite thing is those little things sticking out the ground, they're all like colored. The multi-colored ones. I think well, okay. Have you seen that before? Is like a

47:44 stylistic thing?

47:47 This is a new thing that's probably happening because it's time of frack, honestly. But no, I've not seen a multicolored like this. It's cute. It's so cute. It's like appealing. Not in person,

47:55 sorry, I've seen pictured, but yeah, not in person. It's probably though because of simulfracking. Okay. We'll get our deep one. Is that three different wells? Well, six actually, I see six

48:05 wells here. So you got the orange, the yellow, the green, the red, the blue, and the silver. And they're fracking. What are these huge cranes doing? Are they in the middle of like installing

48:12 themselves? So the cranes look like, yeah, they look like they're holding some equipment on standby Okay. So the one on the right looks like from here, looks like a set of

48:27 EOPs, honestly, is what that looks like, which is interesting. But I can't see for sure. Right here? Yeah, that one is what I'm talking about. On the left, I'm not sure what that is. Okay.

48:34 And some trivia or whatever. What do we nicknamed these? So generally they're just called trees, or a frack tree, or a frack head. But you're not saying the word. Yeah, Christmas trees. Oh,

48:47 Christmas. Yeah, I don't use the word Christmas when I talk about trees. But yes, they are generally called Christmas trees. Okay. I don't know, they were called Christmas trees. Yeah,

48:56 because they look kind of like Christmas trees. Not this version, but when you have a producing version on, without the frack equipment, it's kind of shaped. Right. Sorry, triangular, like a

49:05 tree. So that's where that name came from. Next slide. Okay, so we're talking about sand sand. This is the sand, right? Yeah, this is the sand. This is like beach sand, that's what it looks

49:14 like. I kind of want to sled down it, you know. It's kind of like beach sand, yeah. It's a little more standardized in beach sand, but yeah. Okay But yeah, that's just sand and you've got like

49:23 the conveyors are basically pushing it to the hoppers that will feed the pumps. So it's going through the hoses? It will eventually go through the hoses, yes. It's like some kind of conveyor

49:32 system, maybe. Well, the conveyors just taking it probably from the mound. So they probably have something off screen to,

49:41 well, no, okay, I see it now. So they're using the dozer. You can see the edge of the dozer on the right. Getting it from the pile, putting it into this conveyor, pushing it into these hoppers,

49:51 which will eventually feed the pumps going down whole. Okay. That's a good picture, Jacob. Yeah, that is a good picture. This is a frame from a video, actually. We got that. You killed it.

49:59 Yeah, that's a great picture. Okay, this is my favorite thing. Yeah. I feel like all of it has been your favorite thing. I wish there was a video because these black things here, they do. They

50:09 vibrate. Yeah, it's like, what is it called? I mean, I just call them vibrating. Because, well, so these are the pumps that you're looking at, right? So kind of where it says Q10-X. That's

50:24 the actual pump head. That's where the pressure is created. And then you're probably just seeing the hoses vibrating from the pump cycling. So there's multiple valves in there and you can see how

50:33 many valves roughly, it looks like five. But

50:39 the vibration is literally just the stroke of the pump. So the faster it's vibrating, the more the pump is stroking.

50:46 These, I think Nicky was calling them like a blender or like a mixer 'cause it's kind of like, it's kind of stirring whatever's in there around, right? Uh, all ten of these - These are coming

50:57 from the blender. Oh, okay, okay. Yeah, so that's a little weird, but - Or, you know, I'm just maybe misinterpreting it. She knows what she's talking about. Yeah. It's kind of goofy looking

51:07 'cause all the little black things all move at their own rate and it just kind of - I need to see a video. Kinda looked fun. Yeah, I didn't see the video, but - Is this a frat? Basically, what

51:15 the hoses are feeding from is the blender where the sand and the chemicals come from and then it goes into the pump. And then after that, you're in hard iron because of the pressure. Okay. Well,

51:25 you know, just stay tuned for the video, the whole video, 'cause we had the people on, the operators actually explain everything. So, you know, the - I mean, I finished that. That'd be better,

51:33 yeah. Probably better than me. That's a lot of footage.

51:37 I imagine there's a lot of footage. Here's a random thing, what is this? These are accumulators, but I'm trying to figure out what they're for. With the red and the green meat. There's some

51:45 acronym that says energy services. Does that have to do with like the power or electricity? Uh, no, I don't think so. I mean, there probably is power going through this kid. Yes, but like this

51:58 looks like pressure accumulators. And the reason why I'm saying that is 'cause you see the tubes or their tanks technically, but yeah, on the back, those are usually meant to hold a hydraulic

52:09 pressure. So I'm not sure what this is though, to be honest Okay. I wish you'd have the actual answers. Um, he is the answer. I know some of these answers, but yeah. Oh, what's his box? Oh,

52:20 I see. What's his box? We got a box.

52:24 It's a box.

52:27 So, well, you were talking about power on the left there is some power. That's a generator. That's a generator. Yeah, yeah. Shout out to intelligent well-head systems. Yeah, that's just a,

52:37 sorry. I thought he was joking, but the box is literally just a box. their equipment storage in there. That's how they move around there. No, they have like an actual high voltage area where it

52:47 was like, you can't go near there. And there's all like, okay, I don't wanna. Next, okay, these are the, or these are plugs. Are these the guns that shoot or just no? So there might be guns

53:00 on the left side of the picture where you see like the bands. I can't see it well enough to tell you. But the bottom part, these like tip pieces, those look like plugs to me. Which is what? So

53:11 the plugs, when we're doing fracturing, we have to do it in multiple, well, we don't have to, but it's best practice to do it in multiple stages. We don't do the entire well in one go. We do it

53:22 in multiple stages. And the plugs help us create separation between each stage so that we can force fluid to go in one stage at a time. Okay. Yeah. For more pressure? The

53:36 short answer is yes. The longer answer is, It helps to. keep the pressure separate so that when you create the new frack, it's more effective. Got it. Basically. Okay. Yeah. We have a video

53:49 where Colin went to Midland and went to a wire line guy, Andy, and he's literally holding the pref gun and explaining it, so. Yeah. You can look on the Collag YouTube channel and there's a

53:60 detailed look at that. It looks similar to this. It like fits on the end, right? It'll look similar to that, but it's usually skinnier, honestly. That's why I said it might be this side on the

54:09 end, but even that looks too thick to me And you'll know you're looking at a perf gun because it'll have multiple circles around it, and they'll be in kind of a spiral around it. That's how you're

54:19 looking at a perf gun. And I can't see them here if they are there. That's why I said I didn't know. Oh, good. Okay, so here's just like a better photo of the Christmas tree. Ooh, that's so

54:28 pretty. Yeah, I know, you look at this. Like when someone pictures fracking and they don't know what, you know, they think

54:36 it's underground, they don't really know what it looks above, but like they would never guess in a million years that this is what a frack spread is. No, if you hadn't been, if you hadn't seen

54:43 one, you wouldn't guess this is what it looks like. You might guess the pumps, but you wouldn't guess this side of it for sure. Yeah, it's almost satisfying. You know, all the tool, all the

54:55 infrastructure, whatever you want to call it in like oil and gas, it's pretty cool. Like the pump jacks are iconic. Dremeling rigs are my favorite. Just like

55:03 the, it's just big old tower. And like you picture like the old towers like on this frame here, you know, like the Santa Rita, you know, but like now, yeah, yeah, but now it's good. You know,

55:15 like they're, you know, what's the word? They're willing to blow an iron like this. Yeah. And then like the guys are in the middle just clamping it like so cool. So also the wind turbines out

55:26 there. I absolutely love driving out to Midland and just seeing we have like a rig and then the huge turbines that make them able to tiny. The tiny, yeah, no, the turbines are huge. Yeah, it is.

55:37 I'm obsessed. That's like my favorite like I pick that view over mountains. One of the coolest things, I used to work offshore. To me, the offshore rigs are really cool. Oh yeah, that's all,

55:49 that's always been my favorite. Oh yeah, every time I look up stock footage or photos, it goes straight to offshore. Yeah, they work for me. Yeah, I worked offshore for a few years in. Great

55:58 food.

56:00 Well, it's funny because basically the chef's offshore are the guys that used to work on cruise ships. That's usually where they hire them from. So yeah, it's great food, but it's not good for

56:10 you food

56:13 That's pretty sure. But yeah, it's the offshore rigs and the offshore production facilities are really cool. But I mean, it's just like this, right? Like most people are not really familiar with

56:24 what it looks like. Yeah. I like the colors. Until you get out there. Yeah, the colors, I like that. No, I am impressed how clean it is because it is so dusty out there. Yes, it is very

56:35 dusty out in Midland. Oh, I did want to circle back. So if they were BOPs, they were wireline BOPs. You can actually see 'em sitting on top of the blue tree. Okay. That was one of the first

56:45 pictures where the crane was holding something. Yeah. Yeah, so this was one of the things that was holding their wire line VOPs. And VOP is blocked, preventer, basically it's valves that help

56:54 maintain safety at the well side. That's what they do in the ocean too, right? We do 'em everywhere that we're doing anything where we're dealing with high pressures at surface. We use VOPs to

57:08 help control 'em It's just a safety device. If all's going well, you don't use them. Cool. They're in case of emergency brake glass. You should be a piece. Awesome. I think we're wrapping it up

57:20 here. Yeah, this is the last one. Yeah, so that's an actual wire line unit. Exactly, yeah. It's a very nice wire line unit. Big. Yeah, my favorite part is that, I mean, what you're looking

57:31 at is a truck with a giant-ass spool with fancy wire. But does this one even have the truck on it? Or is it just a trailer? It's on wheels. It's on wheels. Well, it's on wheels, but like -

57:39 Where do you drive it? You don't see the trailer on that. Yeah, it is a trailer, right? Yeah, I think it's just a trailer hooking up. Back, not back in my day, back to the ones I'm used to,

57:47 they're smaller and they are literally just a truck. Yeah. I think like a U-Haul truck side. Wow. So it's not even on its own trailer like this. Okay. This is a big. I thought how I've seen

57:58 them as well. Yeah. Only that. I wonder if this was like a real job or was it like a - No, there's a real job looking at it,

58:06 it's a real job. Literally gonna have Massey Elle on this week who is a wire line and we're gonna talk only about that, but it's

58:14 a, yeah, I mean - Well, this is probably E-Line too, which means it has power commands through the line itself. So that might be part of why it's so big. Right. It's, I mean, Wireline's part

58:28 of EP. Like it's one of the first things you do to like check out the whole, But then you use it again for fracking to put the stuff down? It's like a double whammy, dual use job, right? And

58:40 then even after the well is on production, we'll use it again for like diagnostic purposes or to like change downhill equipment. Yeah, very useful tool. Basically, it just allows us to access

58:52 inside the world board. Cool. Well, yeah, I think one of the funniest thing about it is that here, like this line, it just went towards the Christmas trees. Like you can just like touch it and

59:02 grab it. And I'm like, I don't know if I should do that. Probably not Especially not if it's E-line, don't do that. But yeah, like, you know what I'm talking about? Oh sure, I should see this.

59:11 It's kind of, it is like eight feet high, but like, anyone can kind of touch it. I'm like, yeah? Well, usually they'll have like a long back half. Usually they'll have like warning signs,

59:22 like, hey, don't go in here because it can be moving pretty fast. Okay, that's why you don't want to touch it. Even if, and then if it's E-line, it can have power, high voltage going through

59:31 it. Cool.

59:33 Awesome, awesome. All right, well, you got to see a lot of cool stuff. That's a good trip. Yeah, we got a video where there's a lot more and they're explaining to us over very loud noises. So,

59:43 yeah, it's really cool. Yeah, yeah, it is loud. Were the pumps going? Were you actually out there? I don't know how to tell. If it was really loud, chances are they were. Well, no, you

59:54 said the blender was active. So, yeah, they were going. The pumps are going if the lenders act like that. Well, I didn't feel anything in the ground. You know, I did write down a stupid

1:00:02 question, a dumb question, which is, do you feel the fracks? Oh, no, no, 20, 000 feet down, like. And they set them off, like, are you gonna actually feel that? No, we actually have to

1:00:13 use a specialized equipment, which this could be another topic you could cover. Micro seismic, it's kind of nerdy. Micro seismic? We've done an episode on that before. Oh, you did? Nice, nice,

1:00:22 nice, yeah. Okay, wow. So, yeah, micro seismic is the idea, like, just like you can measure an earthquake, that's seismic activity, we can measure the frack activity

1:00:33 'cause they're micro seismic events. That's where the name comes from. But yeah, so because we're cracking rock, just like a earthquake, just at a much, much, much, much smaller level, you

1:00:44 have to use specialized equipment to measure it. That's what micro seismic is. Cool, I think that's it. Cool. Justin, thanks for coming on. Yeah, thanks for having me. Thanks for fracking

1:00:52 around and finding out.

1:00:55 You guys in the frack around.