California Resources Corporation (CRC) serves the state as a net water supplier by extensively reusing, recycling and reclaiming water from oil and gas reservoirs that would not otherwise be available.
CRC’s water management team of hydrologists, environmental scientists, engineers and operations personnel works diligently to implement conservation and recycling projects that decrease our fresh water use, develop alternative water sources like repurposing treated produced water from oil and gas reservoirs, and help to sustain fresh water resources in the communities where we operate.
CRC’s investments in water conservation and recycling directly advance the state’s policy under Water Code Section 106.5 that every human being has the right to safe, clean, affordable, and accessible water adequate for human consumption, cooking, and sanitary purposes. The state’s Water Conservation Act of 2009 mandated a 20-percent reduction in statewide water use by 2020 to be achieved through implementation of best management practices and optimization of water reclamation opportunities in the urban, industrial and agricultural sectors. The State Water Resources Control Board (State Water Board) and the Regional Water Quality Control Boards (Regional Boards) have also expressly encouraged the use of recycled water to reduce demand on potable (i.e., drinking water) supplies and other fresh water sources. In particular, these agencies have sought to restrict the use of potable water for non-potable uses wherever recycled water is available. CRC has demonstrated our commitment to conserve potable water and to reuse, recycle and reclaim other water supplies, both in recent drought years and in our 2030 Sustainability Goals.
The vast majority of water managed by CRC, called “produced water,” occurs naturally in hydrocarbon reservoirs and is brought to the surface during the production of oil and gas. CRC separates produced water, which typically contains minerals, from the produced oil and gas. In 2017, over 89 percent of our produced water was reused, recycled or reclaimed, with the remainder disposed via reinjection into zones designated by regulatory agencies. California Senate Bill 1281 requires California oil and gas producers to submit detailed quarterly reports on sources and disposition of water used in their operations, which is publicly accessible through the Division of Oil, Gas, and Geothermal Resources’ water use reporting website.
We directly reuse or recycle over 78 percent of our produced water in our improved or enhanced recovery operations, typically in a closed loop system by reinjecting it into the same oil and gas reservoirs from which it came. Even though recycled produced water is already our primary water source for our operations, we have continued to invest in significant water recycling and treatment facilities to ensure that our fresh water use does not affect the availability of high-quality water to cities, towns, farms and ranches near our operations. These investments have enabled CRC to expand our role as a net water supplier to agriculture every year since our formation, supporting over 5,000 acres of productive farmland and associated farmworker jobs.
In 2017, we supplied 4.9 billion gallons of treated, reclaimed produced water for agricultural water districts, 11 percent of our produced water. This delivery set a new company record and reflected an 85-percent increase from 2015. For every gallon of fresh water we purchased in 2017 for our statewide operations, we supplied nearly 3 gallons of reclaimed water to agriculture. Our reclaimed water is blended with water that water districts obtain from other sources. The reclaimed water and blended irrigation water are sampled and analyzed on a monthly and quarterly basis by an independent state-certified laboratory for up to 120 compounds and reported in a publicly accessible format to the Regional Board to ensure that the water used for irrigation or recharge meets water quality permit requirements. Moreover, water districts and the state’s Food Safety Expert Panel have also conducted crop sampling to validate the safety of reclaimed produced water for irrigation.
In 2017, we achieved our maximum water delivery to agriculture, since we recycled or reclaimed nearly 100 percent of the produced water from steamflood operations at our Kern Front Field. To continue to increase deliveries, we will need to generate additional produced water at Kern Front or obtain permits at other fields to reclaim water for agriculture. We continue to evaluate projects to replace fresh water with recycled water in our operations wherever feasible and to reclaim even more water for beneficial uses. Recycling and reclaiming produced water adds to California’s water balance a new source for agriculture and industry and extends supplies from existing water sources. Through our internal reuse and recycling and our supply of reclaimed produced water for agriculture, we help the state to sustain fresh water resources for cities, towns, farms and ranches, as well as for wildlife in river ecosystems.
Our Board of Directors has adopted an annual Health, Safety and Environmental (HSE) metric for water conservation to measure our performance as a net water supplier to agriculture. The water conservation ratio is our volume of reclaimed water delivered to agriculture divided by our total purchased volume of fresh water. A ratio above 100 percent means that we are a net water supplier. As described in our Proxy Statement, this metric directly affects the incentive compensation of our employees. As shown in the graph below, we have continued to improve our water conservation ratio.
CRC’s purchased volumes of potable and fresh water are summarized in the table below. CRC has successfully reduced our potable water use by 30 percent since 2015. For comparison, our statewide operations use less than 0.0075 percent of urban potable water production as reported by the State Water Board.
About 55 percent of our purchased fresh water is used in power plants to generate electricity at Elk Hills and Long Beach. The remainder of our purchased fresh water is used in oil and gas drilling, steam generation and farming operations on land that we own. During the height of the drought in 2016, CRC voluntarily reduced our use of fresh water from a local water district by 43 percent, allowing that district to meet its mandatory state water restrictions without curtailing its municipal or agricultural customers. That decrease, along with reduced drilling activity, resulted in a lower volume of purchased fresh water in 2016, compared to 2015 or 2017.
|Water Volume in Acre-Feet||Percent Change|
|Potable Water Purchased||574||462||412||28% decrease|
|Non-Potable Fresh Water Purchased||4,551||4,270||4,793||5% increase|
|Total Fresh Water Purchased||5,125||4,732||5,205||1.6% increase|
|Reclaimed Water Delivered to Agriculture||8,144||12,101||15,035||85% increase|
|CRC Water Conservation Ratio Metric (Reclaimed Water to Ag over Purchased Fresh Water)||159%||256%||289%||82% increase|
Finally, our Board adopted a 2030 Sustainability Goal to significantly increase the volume of produced water we reuse, recycle or reclaim by 30 percent against a 2013 baseline. This goal is important because it reflects the beneficial use of produced water from underground oil and gas formations that is only accessible to contribute to the state’s agricultural or industrial water supply because of in-state production. As of year-end 2017, we had increased our recycled produced water volume by more than 15 percent from our 2013 baseline, and we are on track to achieve our 2030 Sustainability Goal for water conservation.
Fresh Water: Water typically purchased from municipal sources, water districts and water companies that requires little or no treatment for use. Fresh water may be potable or non-potable.
- Potable Water: Water that is suitable for drinking and residential use.
- Non-Potable Fresh Water: Fresh water that is not suitable for drinking or residential use without treatment but that may be used for agriculture or other uses.
Non-fresh Water: Water from sources like reclaimed municipal wastewater, collected storm water or agricultural runoff that requires a significant amount of treatment before it can be used.
Produced Water: Water that originates in oil and gas formations and is brought to the surface during the production of oil and gas.
Reclaimed Produced Water: Produced water that has been treated by separation of oil, gas and solids for delivery to agricultural water districts for use in irrigation or recharge.
Recycled Water: Water that is treated to remove solids and impurities and reused.
|CRC 2019 Water Brochure|
In light of CRC’s detailed public reporting to state agencies of our water sources, uses and quality, we do not participate in the CDP water questionnaire, which applies terminology and criteria that differ significantly from our California focused reporting.