Pioneer Energy, a disruptor in the world of oil and gas, has designed two innovative product families to tackle industry-wide carbon emissions.
CEO Eyal Aronoff explained how the company is accomplishing this in an exclusive interview. Report by Imogen Ward.
For more than a decade, Coloradobased Pioneer Energy has been on a mission to decarbonize oil and gas production by focusing on developing and deploying new oilfield technology.
“As the industry moves towards netzero emissions, there needs to be an answer for both the larger and smaller emitters,” explained CEO Eyal Aronoff.
“Until now, the industry has been focusing on measuring emissions while picking the low-hanging fruit. That's not going to be sufficient going forward.
“Emissions from so many parts of the sector must be addressed, from field process equipment and gas lift
compressors to heater treaters and pilot burners. Our equipment addresses every element.”
Targeting market mispricing
While assessing the market, Pioneer Energy identified two key areas where oil producers were losing money. First of all, producers often sell natural gas liquids (NGLs) to the gas midstream at a huge discount.
“We identified that during oil production, a failure occurs in the separation phase because the industry is still relying on passive phase separators that were developed
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in the 1920s and have had little improvement since,” said Mr. Aronoff. “It’s a lousy method that leaves a lot of gas in the crude that eventually leaks into the atmosphere, while at the same time it leaves a lot of crude in the gas, in the form of NGLs.
“All of the crude that remains in the gas is then sold to the midstream at a considerable discount.
“There is a huge disparity in the money these producers make from NGLs compared to what they get for crude oil. So, we set to work deciphering how we could better separate the crude, while also increasing the crude recovery volume and eliminating the methane and ethane in the oil, reducing emissions.”
Emissions Control Treater
To overcome this loss in revenue and help companies produce a cleaner cut between the gas and crude, Pioneer Energy developed the Emissions Control Treater (ECT).
Having dedicated three years to developing and testing this solution, Pioneer Energy has seen excellent results after commercially deploying the device.
“The Emissions Control Treater is designed to manage emissions and increase crude yield during oil production,” explained Mr. Aronoff. “I am excited to reveal that this device is now officially in commercial deployment, and during our testing, we have successfully achieved
a crude yield increase of 11 percent. That is a huge accomplishment.
“Of course, this doesn’t mean we will achieve those numbers at every site; it is very much dependent on the location. This particular site had a high propensity for increased crude yield.”
Mr. Aronoff explained that the ECT will be the perfect solution if a field has a high gas-to-oil ratio and high-BTU gas sales.
Despite these positive results, the journey is not without its challenges. With the oil and gas industry remaining quite conservative, Pioneer Energy has come up against a lot of skepticism.
“It is natural to be skeptical, but we are confident in overcoming that by implementing pilot tests with those producers,” said Mr. Aronoff. “That’s our plan over the coming years. We have also submitted a grant request to the Department of Energy to help fund a larger-scale pilot.
“We have confidence in these pilots. As the CEO, it is my job to always be optimistic but slightly paranoid because you never know what will happen. We have very strong support in the State of
Colorado – not only is it our home, but it is also an oil state – and it is determined to become the center of excellence for emissions reduction in oil production.”
The company is already running pilots in the Denver-Julesburg Basin and hopes to initiate more in North Dakota’s Bakken fields, the Permian Basin, and South Texas. Mr. Aronoff would also love to see an international pilot come to fruition because the prevalence of flaring and methane emissions is much higher internationally despite the smaller infrastructure in relation to the United States.
“Although I would love to see this happen, unfortunately, a lot of international oil producers prefer to spend their capital drilling more holes than addressing the problems with their existing infrastructure,” continued Mr. Aronoff. “Some projects are beginning to take place, but those are in very early stages and are few and far between.”
The ideal conditions
Pioneer Energy noted the second market failure was how oil producers fuel their operations. According to Mr. Aronoff, around 10%
of the diesel produced in the U.S. is consumed by oil producers in the field.
“That equates to around $20 billion per year, and all the while, these producers are selling their natural gas for almost nothing,” explained Mr. Aronoff. “In March 2024, 1MCF of natural gas is selling for $1.70, the fuel equivalent to six gallons of diesel sold for $3.50/gallon. So, these producers have a huge opportunity to profit from using their own natural gas sources to fuel their production.”
To help businesses overcome this problem, Pioneer Energy has developed the Pegasus Field Gas Conditioner. Designed to condition raw field gas into fuel-quality gas, the company now has an entire line to target the various equipment used at an oil site.
“The Pegasus is capable of conditioning this gas on or near site, ready for use in drilling,” said Mr. Aronoff. “Then, once drilling is complete, the Pegasus can fuel the fracking, and after that, the producer can continue using conditioned gas to keep the site running. The Pegasus helps reduce the carbon footprint and pollution from the production site.”
The company began developing its flagship Pegasus unit to target gas conditioning for frack fleets. Due to the huge fuel requirements of the pressure pumps and the constant variation of demand, they are very challenging to fuel with gas. Having successfully achieved this, the company produced the Pegasus Mini, which is perfect for drilling rigs, compressors, generators, and turbines, as well as for conditioning
gas for onsite burners such as pilots and heater treaters.
“Our equipment can now be used with a full range of pressures, capacities, and capabilities,” added Mr. Aronoff. “They’re also fully automated with remote connections , so they can be easily integrated into a wellsite’s management software.”
As Pioneer Energy continues its mission to decarbonize oil and gas production, the company has several long-term goals in place.
“We would love to see companies utilizing our equipment in conjunction with each other [referring to the Emissions Control Treater and the Pegasus], because they solve different issues,” Mr. Aronoff said, in conclusion. “Following the mega-mergers occurring now, we hope to see an uptick in adoption, and 2025 will be dedicated to increasing adoption of our equipment in support of this goal.
“The U.S. is moving very rapidly when it comes to reducing emissions. I think the second half of 2024 will bring many exciting new develop ments, and it is great to be part of that journey.” n
