Suppling Surface Equipment for Palo Petroleum’s Heavy Oil Field in Missouri

Principal Technology Inc., a provider of total system solutions for natural gas, refining, chemical, process and manufacturing facilities, is supporting Palo Petroleum, Inc. with surface equipment for an enhanced heavy oil production operation in western Missouri. Dallas-based independent oil and gas producer Palo Petroleum is using a heavy oil recovery process relying on controlled horizontal steam flood to produce oil from the field. Principal Technology’s engineering and systems and industrial fabrication divisions are supplying equipment for the surface operations in the field, including steam generation, oil separation, produced water disposal systems, instrumentation and controls.

The Palo Petroleum heavy oil production process is unique to the area using a combination of horizontal production wells and multi-zoned vertical steam injectors to provide top-to-bottom and North-South control of the steam front to maximize oil recovery. To make this possible on the rural, undeveloped site, Principal Technology provided engineering, design, and integration services for the field surface facility. Using the only outside utility available, natural gas, Principal Technology and Palo Petroleum developed a self-sufficient and fully integrated facility to generate electricity and steam, separate the produced oil and water, and provide a means of disposal for the resulting waste process water.

A critical element of the Palo Petroleum controlled steam flood process is the ability for the operators to monitor and control the steam injection in real-time. To meet this need, Principal Technology’s systems and industrial fabrication division provided a modular e-house and PLC control system integrated with the surface facilities and field instruments for live data monitoring and history logging for future analysis.

“Principal Technology not only designed the surface equipment for the Palo project but we are providing support through the life of the project with technical assistance, trouble shooting and equipment changes as needed to support the evolving process,” said Matthew S. Hodson, P.E.(Texas), president and CEO of Principal Technology. “Teams from our two divisions coordinated efforts to deliver seamless service to Palo Petroleum and make this oil production site possible.”

The engineering division at Principal Technology was responsible for a majority of the surface equipment, including storage tanks for fresh water, water treating, and produced water and oil separation and storage, pumps, flow controls and instrumentation for the liquids and steam systems.

Principal Technology’s systems and industrial fabrication division supplied a modular control building containing all the motor switchgear, PLC monitoring controls, operator work station and satellite connection that allows for remote monitoring and system access. Principal Technology constructed the entire building at its facility in Texas and delivered it to Missouri for final placement, where connection to power and field instruments was all that was required in order for the building to be fully operational.

“Palo Petroleum is experiencing reliable, successful operation of the surface systems at the Missouri well site. The flexibility of the control systems and adaptability of the equipment has been a real advantage as production and operations have expanded,” said Jace Graham, vice president of operations, Palo Petroleum. “Principal Technology’s broad expertise in steam production and process equipment allows them to be a one-stop provider of all the surface equipment and controls a producer such as Palo needs to efficiently and economically establish field operations.”

Palo evaluated heavy oil deposits throughout the United States and believes the acreage block they have assembled in Missouri is an optimal place for exploration. Engineers estimate that between 31.5 and 45.2 million barrels of the oil are in place under Palo’s leases in Missouri.

Palo Petroleum is a family-owned, independent oil and gas operator founded in 1976. Palo drills and develops resources in areas of known production and blanket deposits, thereby reducing geological risk. Palo is aggressively looking for new areas in the U.S. where it can utilize its knowledge and expertise to develop potential unconventional oil fields to create value for its investors and partners.