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By Jeffrey A. Anderson, William H. Fronczak, and Stephen A. Goodwin U nconventional oil and gas (UCOG) exploration and production (E&P;) companies traditionally have not planned oilfield development with total water management solutions and costs in mind because past oil prices have resulted in high margins wherein water solutions and associated variances in water costs were insignificant (typically less than 10 percent with oil prices at $100/barrel). However, with the current downward spiral in oil and gas (O&G;) prices, total water costs are now a significant factor for operators to improve their margins in U.S. basins/plays where they are able to operate. While operators have been successful in improving drilling and completion efficiencies and reducing the costs associated with both, overall water costs and efficiencies have not followed suit. Complicating the matter are regulatory changes and the challenges associated with securing reliable water resources in arid areas, the logistics of moving water from the source to locations, handling flowback and produced water, and evaluating the total cost of water matters in the oil patch — for example, water purchase, water transfer, water hauling, water storage, flowback and produced water treatment, and disposal (see Figure 1). To address these total water management issues, which in turn will result in significant cost savings and improved margins, is to engage in upfront water planning and use decision support tools and preliminary engineering to quickly and accurately evaluate various water solutions strategies. Operators need to spend a little now on planning and the use of technology/ engineering to significantly save capital in the near term and have known costs for the future. New Perspective Traditionally, water management and associated costs have been separated between the drilling and completion (D&C;) and production business units. Because of this "siloed" approach to handling water management costs, most E&P; companies do not know total life cycle water management costs. For example, D&C; operations are concerned only with the water management costs associated with drilling and completing wells, much of which is temporary or transitory in nature. The D&C; water management costs are associated with pre- flowback operations and typically include: 24 wateronline.com n Water Innovations Saving Oil And Gas: Improving Profit Margins In Down Times With Innovative Water Management With oil prices depressed, exploration and production companies unearth the money-saving opportunities in water management planning. Figure 1. Oilfield water management life cycle (PacWest 2012)