Shale-gas Water Provides New Business for Altela
October 7, 2011 | Reprint from New Mexico Business Weekly;
Altela Inc. is gearing up for a wave of demand for water-cleansing services in the northeastern U.S.’ shale-gas Marcellus Basin.
The Albuquerque company, which uses proprietary technology to purify industrial water, set up its first plant this year to treat shale-gas water in Williamsport, Pa.
The plant, owned by waste services company Clean Stream LLC, is treating 100,000 gallons per day of extremely saline, brackish water produced through hydraulic fracturing in Marcellus shale-gas deposits.
Altela has signed two joint ventures, one with landfill operator Casella Waste Systems and the other with power company American Consumer Industries (ACI), to provide waste energy from their operations to run two more Altela water-cleansing plants, said President and CEO Ned Godshall.
“We sold our first system to Clean Stream, but we won’t sell off the system in these new plants,” Godshall said. “We’ll put them in the field and make money through treating water for customers and charging them on a per-gallon basis. We prefer the recurring revenue model.”
Altela’s new partners will contribute 50 percent of the investment to build the plants and share in half the revenue generated, Godshall said. He declined to divulge how much the plants will cost to build.
The company’s technology uses a low-energy distillation method that mimics rainfall. Industrial water is placed into plastic containers, or small towers, where the water is heated to generate vapor. The vapor floats up until it hits cool air at the top of the tower. It then condenses into fresh water that trickles down to tanks below, leaving a small amount of leftover sludge for disposal.
Altela’s technology is less costly than that of competitors that use high-pressure systems to distill, or desalinate, water, Godshall said. Those technologies require extremely sturdy facilities that include metal to withstand pressure. They consume a lot of energy, and ultimately, metal corrodes.
Altela uses low-cost corrugated plastic in its towers. The system doesn’t use pressure, but requires a little heat for the distillation process.
Under its new joint venture agreements, Altela will locate one plant at a Casella landfill in McKean County in western Pennsylvania. It will use methane from the dump to provide heat for distillation.
The second plant will be built next to an ACI coal-fired generator in northeastern Piney Creek. Altela will use waste heat from the generating station to operate the distillation system.
The new plants will begin treating about 100,000 gallons per day of shale-gas water. As demand grows, the plants will expand.
The company moved into a new, 18,000-square-foot manufacturing facility on the Westside in 2010. It grew its workforce from 17 a year ago to 38 now, and plans to hire 13 more to manage a second production shift, starting this fall.
Altela previously received $11.2 million in venture capital from the Verge Fund and others.
“I’m bullish about Altela’s prospects in the Marcellus Basin and in other gas-producing regions,” Verge Managing General Partner Tom Stephenson said.