Produced water—from oil and gas fields and related operations—is often treated as a waste stream requiring disposal or reinjection. Yet in water-stressed regions and industrial clusters, produced water can become a strategic resource, especially as demand grows for low-carbon hydrogen and electrified processes that require significant volumes of treated water. At Energy Solutions, we examine when treating and reusing produced water for green hydrogen electrolysis, cooling and process water is technically feasible, economically competitive and environmentally rational.
Produced water is a complex mixture of formation water, injected fluids and treatment chemicals. Its quality varies widely across fields and over time, with key parameters including salinity, hardness, organics (oil, dissolved organics), suspended solids and trace contaminants such as heavy metals and naturally occurring radioactive material (NORM).
Today, the majority of produced water is:
| Pathway | Share of Volume (%) | Typical OPEX (USD/m³) |
|---|---|---|
| Reinjection (Disposal) | 50–70 | 0.3–1.0 |
| Reinjection (Pressure Maintenance) | 10–25 | 0.5–1.5 |
| Offshore Discharge (After Treatment) | 10–20 | 0.3–0.8 |
| Beneficial Reuse (Irrigation/Industrial) | <5–10 | 1.0–3.0 |
These values are stylised and mask significant regional variation in regulatory requirements, geology and infrastructure.
To reuse produced water for green hydrogen, designers must consider two stages:
Electrolysis vendors typically require low conductivity, low organics and stringent limits on scale-forming ions to protect stacks and maintain efficiency.
The chart below depicts a stylised treatment train and indicative removal duties at each step.
Producing electrolysis-grade water from produced water can be compared against alternative sources such as desalinated seawater or municipal water.
| Source | Raw Water | Treatment to Electrolysis-Grade | Total Indicative Cost |
|---|---|---|---|
| Produced Water (Moderate Salinity) | 0.3–1.0 (handling/disposal baseline) | 0.7–1.5 | 1.0–2.5 |
| Seawater Desalination | 0.4–0.8 (intake/pumping) | 0.6–1.2 | 1.0–2.0 |
| Municipal Water Supply | 0.5–1.5 (tariff) | 0.3–0.7 | 0.8–2.2 |
In practice, co-location, existing infrastructure and regulatory conditions can shift these ranges significantly.
The bar chart below translates water costs into USD/kg H₂ for different supply options.
Integrating produced water reuse with green hydrogen projects hinges on:
A coastal refinery complex in a water-stressed region evaluates using produced water from nearby onshore fields to supply a new 200 ktH₂/year electrolysis plant.
The integrated design improves resource efficiency and supports corporate water stewardship goals.
An onshore gas producer partners with an industrial off-taker developing green hydrogen and process electrification in a mid-continent industrial cluster.
The line chart below shows stylised abatement costs (USD/tCO₂e) for different levels of produced water reutilisation within an industrial cluster.
Reusing produced water is not impact-free. Key considerations include:
These factors underscore the importance of integrated water-energy planning rather than viewing produced water reuse in isolation.
A critical view highlights several challenges:
By 2035, we expect:
For operators and hydrogen developers, a screening framework should address:
Technically, most produced water can be treated given sufficient process steps and energy, but economics and environmental impacts may not always justify it. High-salinity or highly contaminated streams may be better suited for lower-spec uses or reinjection.
It can improve water stewardship by reducing freshwater withdrawals and, in some cases, reducing overall water system GHG. However, the net climate benefit depends on the energy mix for treatment and the alternative fate of the produced water.
Water cost is typically a modest share of total LCOH—often 0.02–0.08 USD/kg H₂ for mainstream cost ranges. Electricity and electrolyser CAPEX dominate, but water choices can still matter in water-scarce regions and for ESG narratives.
Fouling and scaling of membranes, organics breakthroughs, variability in feedwater quality and concentrate management are key technical risks. Robust pre-treatment, monitoring and modular design help mitigate them.
Ownership models range from operator-owned facilities to water-as-a-service offerings from specialist providers. In industrial clusters, shared water companies or public-private partnerships may manage water infrastructure on behalf of multiple users.
In water-stressed regions, reducing freshwater withdrawals for industry can ease pressure on local supplies and improve community relations. However, concerns about contaminants and brine disposal must be addressed transparently through robust monitoring and engagement.
Some jurisdictions are tightening discharge standards and encouraging beneficial reuse, while others remain cautious about using produced water outside the oilfield. Clear water quality and use guidelines are critical for project bankability.
It should be considered as one tool among many. In some clusters it will be a high-impact lever; in others, conventional desalination may remain simpler and more scalable. Integrated water-energy planning is more important than any single solution.