Tailwater Capital

Asset developer Renovo Resources looks for greenfield produced water opportunities

A newly formed asset development company backed by private equity wants to sell treated produced water to municipalities in arid regions of the United States. It believes it can do so at a price point comparable to what its prospective offtakers are paying now.

Newly formed asset development company Renovo Resources is looking to implement a series of greenfield produced water treatment plants across the US after securing a substantial equity commitment from Tailwater Capital.

“Our goal is to provide turnkey solutions for the treatment of produced water for beneficial reuse, and we will partner with construction companies to build the facility, technology companies to supply the technology, and service companies to operate the facility,” explained Renovo CEO Naggs Nagghappan.

“Our value proposition is that we’ve done this multiple times before, and we know what technology to apply. We know how to create large assets with project financing, and Tailwater’s expertise in infrastructure building and supporting the sustainability mission helps us significantly,” he told GWI this month.

Renovo’s strategy is to structure long-term greenfield build-own-operate contracts, treat produced water in large, centralised facilities using either reverse osmosis or MVC evaporation technology, and sell the treated water to local municipalities and industry for reuse in non-potable applications.

“A big part of this is the sustainability piece on the back end. We’re not only minimising a problem for the energy industry, but we are also creating a freshwater source. In a region like California, the demand for fresh water is huge, and in places like Texas, it minimises injection volumes substantially, and provides an alternative solution for the disposal of produced water,” said Nagghappan.

Last September, the Texas Railroad Commission restricted the injection of produced water into saltwater disposal wells in a highly productive 250-square mile area of the Permian Basin, raising the prospects for the further take-up of produced water treatment and reuse projects.

If you build it, will they come?

Nagghappan insists that Renovo will only build facilities where it has identified demand for the treated water, and where it can be delivered affordably.

“The size of the plant, the technology we select, and the salinity of the feedwater will dictate the price point, and we think that it could be cost-effective to do this in the regions that we’re evaluating,” he told GWI. “It all comes down to the logistics of the particular location.”

Before joining Renovo, Nagghappan spent 22 years at Veolia North America, latterly on business development in the upstream oil and gas division, where he was involved in the execution of four large produced water treatment facilities for clients including Antero Resources and Plains Exploration & Production. Joining him in the core development team at Renovo are fellow Veolia veteran Brad Biagini (as vice president of technology) and EPC specialist Gabriel Reyes as VP, design-build.

Full article here

About Renovo Resources

Renovo Resources is a portfolio company of Tailwater Capital focused on developing greenfield produced water treatment solutions for beneficial reuse. Founded in 2022, the company will source, develop and execute water treatment infrastructure projects in the energy and industrial sectors across North America. For more information, please visit www.renovoresources.com.

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