Living on a planet where water covers 71 percent of the surface, you might question the scarcity of this precious resource. But if you stop to consider that most of that is salt water, you begin to understand why the freshwater found in ice, rivers, lakes, streams, and underground aquifers must be carefully managed.
Factor in myriad ways we use and rely upon water, and you begin to grasp the value behind the work being done at Digital H2O, a tech startup co-founded in 2012 by Brandon Pearlman (M.S. EMS ’14).
Digital H2O creates software tools that help energy companies more efficiently manage the water used in the drilling and production of gas and oil wells.
The idea for the company flowed from Pearlman’s entrepreneurial spirit and his background in management consulting, including a nearly six-year post as vice-president of a private equity firm focused on the renewable energy field.
“Through my work in the renewable energy space, I knew traditional fossil fuels were still an important part of the overall energy landscape. Then, I found a way to leverage my background, software, and a lack of market transparency to bring efficiency around water-management operations,” explains Pearlman, who serves as Digital H2O’s chief operating officer and head of product development. “Companies that drill for oil and gas still care about the environment, and they want to be good stewards. One area where they can make a meaningful impact is with their water usage.”
When drilling a new well, energy companies inject a high-pressure mix of water, sand, and chemicals into rock to fracture it and release the oil or gas, which then flows into the well and is recovered. The entire process takes up to 3 million gallons of water per well. Each well also produces wastewater as a byproduct, which must be recycled, treated, or stored in a disposal well.
Digital H2O’s software platform, Water Asset Intelligence (WAI), provides built-in algorithms and a database of water observations—including production data from existing gas and oil wells in a given geographic area—that allow companies to benchmark or predict such things as water use, wastewater production, and the availability and capacity of disposal wells.
The overall aim is to help energy companies quantify and reduce their water consumption.
“A lot of them lack a holistic understanding when it comes to the water component and, if you can’t understand it, you can’t optimize it from an environmental or a cost standpoint,” Pearlman says. “These guys want to do both.”
WAI currently provides data and analysis for drilling operations in Texas and will soon expand the platform to include New Mexico. By the close of 2015, Pearlman projects the software will include every state nationwide that is involved in gas or oil exploration. He also has his eye on expansion into Canada and possibly other countries depending upon market demand.
“We have a real water scarcity issue in the world,” he says. “My hope is that by helping oil and gas companies better manage this scarce resource there will be a net positive effect on the overall water landscape. That means less competition for water used for oil and gas production versus agriculture or drinking water. That’s the green, sustainable impact.”
“Chicago Is the Place for a Fracking Software Startup? Yep”: www.chicagobusiness.com/article/20141007/BLOGS11/141009873/chicago-is-the-place-for-a-fracking-startup-yep
Digital H2O: www.digitalh2o.com