How to reduce electrical power costs without sacrificing
David Coston (firstname.lastname@example.org), Coston Energy,
Inc., Carmi, Ill.
Bryan J. Dicus, Equinox Oil Co., Crossville, Ill.
Bottom line. By
installing timers and pumping during off-peak hours, Equinox Oil reduced electrical power
consumption in Illinois South Albion field by 25%. Operating costs were also reduced
by $2,000 per month, without adversely impacting production rates. Payout for the project
occurred in one month.
The problem. High
electrical energy costs have always been a major expense in oil production, especially in
mature properties such as Illinois basin waterfloods. The comparatively high cost of
electricity ($0.05 to $0.06/kWh), combined with a depressed crude oil market, forced
operators into implementing cost reduction programs some of which were not considered
viable in the past.
off-peak hours. Equinox Oil Co. operates several leases in southern Illinois. In
its South Albion field, lifting costs (particularly those related to electrical power) were
very high, especially due to the high water-cut production. Electrical power costs alone
were about $3.40 per bbl of oil produced.
Several years ago, Equinoxs energy consultant, Coston
Energy, Inc. (CEI), noted that the electrical rate tariff was structured to promote off-peak
power usage. The tariff provided for both a time-of-day and a seasonal discount. Under this
tariff, demands created by equipment operated during off-peak periods were not counted
toward the billing demand charge.
Energy consumed during off-peak periods was discounted by
30% during winter months (October to May) and by 57% during summer months (June to
September). Off-peak periods were considered from 9:00 PM to 9:00 AM during the week, plus
all day Saturday, Sunday and holidays.
As a result of these tariffs, CEI recommended that Equinox
install seven-day timers on its pumping units. These would allow wells to be pumped during
off-peak hours, keeping pumping units idle during peak hours. Equinox had initially balked
at the idea of timers because of uncertainty about reducing oil production. The company was
concerned that intermittent pumping might decrease field production, since pumping time
would be reduced by 60 hours per week for each well with a timer (five days per week at 12
hour-per-day peak periods).
But in March 1998, as oil prices were falling, Equinox
decided to experiment with timers. By the end of the summer, timers were installed on 20
wells. The injection pumps run continuously, playing "catch up" while the
producing wells are down. This explains why there is still a demand charge on the
electricity bill, although reduced from the original levels.
production fluctuated, since timers allowed the wells to be pumped only 12 hours per day
during the week, Fig. 1. Production rebounded when the wells were pumped 24 hours per day on
weekends and holidays. Despite the fluctuations, the average weekly production level did not
change appreciably after the timers were installed. The wells produced 569 bbl per week from
January through March 1998, and 547 bbl per week from April through November 1998.
Fig. 1. Seven-day timers were installed
on pumping units, which allowed wells to be pumped during off-peak hours and
keep them idle during peak hours. Despite fluctuations, average production did
not change appreciably 569 bbl per week without timers (JanuaryMarch
1998) and 547 bbl per week with timers (April-November 1998).
As a result of its experiment with timers, Equinox was able
to greatly reduce electrical operating costs per unit of production, Fig. 2. While average
production remained fairly constant, electrical consumption dropped by an average of 25%.
Total electrical costs also dropped by about $2,000 per month. With a cost of $100 per well
for the timers, payout was realized in about a month. Equinox has installed timers on an
additional 40 wells in the area, bringing to 60 the total number of wells with timers.
Fig. 2. After installing 7-day timers,
average production remained fairly constant, but total electrical costs dropped
by about $2,000 per month. With a cost of $100 per well for timers, payout was
realized in about a month.
is president of Coston Energy, Inc., which offers energy cost saving services including
electric rate and usage analysis, lighting and HVAC system efficiency improvements, and
process efficiency upgrades. A registered professional engineer in Illinois and Indiana,
Coston holds a BS in electrical engineering from the University of Illinois.
Bryan Dicus is
district engineer for Equinox Oil Co. in its Crossville, Ill., district. Before joining
Equinox, Dicus was with Mobil Exploration and Producing, US, working primarily on production
and completion engineering in Kansas and Oklahoma. He holds a BS in petroleum engineering
from the University of Missouri-Rolla.
Copyright © 1999 World
1999 Gulf Publishing Company