Expectations are rising and wells are getting deeper and tighter. Oil & Gas Middle East speaks to decision-makers at the leading wireline companies competing for your business.
Several regional oil fields are reaching or have surpassed peak production maturity. Exploration attention is turning increasing to deeper, tighter reservoirs and unconventional sources.
Operators’ expectations are rising, and advancements in enhanced oil recovery (EOR) and digital oilfield (DOF) are passing the need to innovate down the contractual chain.
In this environment, quality wireline products and services are vital to the success of upstream projects.
While there are challenges, the region also has plenty of opportunities, most notably in Iraq, where exploration and production is booming.
We hear from decision-makers at wireline and fishing tools companies operating from different positions in the market.
THE GLOBAL SERVICES GIANT
Hany Banna, Wireline Vice President, Schlumberger
Schlumberger, the world’s largest oilfield services company, invented wireline logging in 1927, and the technique has been widely used in the industry since then.
“Wireline logging is a method in which sensors are lowered into a well using a cable (“wireline”) to measure the rock and fluid properties and characteristics to identify hydrocarbon types and volumes,” Banna explains. “We provide the entire range of wireline services for formation evaluation, perforating and production logging in any well from vertical to horizontal”.
Banna says Schlumberger invests “more in R&D than all of our competitors combined”. “The result is a continual stream of new, more accurate measurements that help customers characterize their oil and gas reservoirs with more certainty,” says Banna. This in turn helps operators maximize recovery.
Schlumberger owns several unique technologies, that can be used to monitor the injection fluid front deep into the reservoir. “We also have expertise specifically related to enhanced oil recovery,” Banna says.
Banna still puts the Middle East at the center of Schlumberger. “One area of growth that everyone is interested in participating is Iraq,” he says, “we are well positioned to capture this growth, and we look forward to contributing to the redevelopment of the Iraqi oil and gas sector”. Banna sees 2011 as a “year of growth”.
In May, Schlumberger launched their latest formation evaluation technology, the Dielectric Scanner, to the Middle East market at the International Digital Oilfield Conference in Abu Dhabi.
Banna believes it will revolutionize formation evaluation measurements. “It is the first and only technology in the world to use multiple frequencies downhole to measure dielectric dispersion,” he explains. “The result is real-time continuous data that provides highly accurate information about rock texture, water volume and, ultimately, hydrocarbon volume”.
THE MANUFACTURING KINGPIN
Brian King, general manager of NOV ASEP Elmar Middle East
NOV ASEP Elmar has 15 locations around the world and over 900 employees. From its regional hub in Dubai, the company provides wireline pressure control equipment for both slickline and e-line use, grease & hydraulic control modules, pressure test units and wireline winches.
The firm is expanding into locally-manufactured wireline winches to cut lead times, and has a comprehensive rental service, covering long and short term projects with either on or off-site servicing.
King says trust is the key to winning clients. “Slickline tools may not always be thought of as high technology, however the failure of a slickline tool can have expensive repercussions, thus clients value a reliable supplier,” he explains.
Slickline tools are NOV’s fastest-growing product, with customers including Schlumberger, Halliburton, Baker Hughes and Weatherford. “However, all clients are big for NOV ASEP Elmar and we give them all equal attention,” says King.
“We have recently opened a facility in Saudi Arabia,” says King, “this brings NOV ASEP Elmar closer to our customers”. The firm saves time by servicing equipment in-country.
In addition to Saudi, growth areas for the company include India, Iraq and Oman. “We have supported a great number of start-up companies in the Middle East, especially in Oman and Kuwait”.
“The Middle East is a competitive region, but NOV ASEP Elmar quality products are well respected,” says King. “Clients are willing to pay that little bit extra for fully certified quality equipment which some of our competitors cannot supply”.
On financials, King says 2010 was a good year, with the company booking over-budget revenue. “2011 will be a challenging year, especially in the Iraqi market, where around 22% of our business came from” says King. “We do not see the same requirements there in 2011”.
As a result, in addition to working with major slickline service companies on tenders falling due 2011/12, the company is pushing into India in 2011-2012, which King describes as a “vitally important area for the future of our business”. King cites the difficulty in making the case for using new technology, with its attendant price premium, as a challenge of doing business there.
THE SPECIALISTS
Dan McAleese, General Manager, Nordic Energy Services
Nordic Energy Services are a thru-tubing specialist based in Saudi Arabia. “We provide clients with everything from basic down-hole tool assemblies used in cleanouts and N2 lifts, to full milling and fishing tool packages complete with NES engineers on-site,” explains McAleese.
The firm used to provide other products but in June 2010 decided to specialise, giving NES a unique place in the market. “We are now a “new” NES,” McAleese says.
“Our management and methods of operation were completely changed, and we are still a work in progress”. McAleese heads up a “small but dedicated team”, and emphasises the expertise of his people. “It’s personal to us” he says.
Specialising has paid off for NES, with recent contracts from Aramco, Tatweer, Schlumberger, Qatar’s National Petroleum Services and Halliburton. NES has worked throughout the region, including in Syria, Pakistan, the UAE, Qatar, Kuwait and Bahrain.
McAleese sees the Middle East as “mature and developing,” and describes the region as “our bread and butter”. He is looking to expand, both within the GCC and more widely.
Highlights have included fishing out radioactive waste, a job that required detailed preparation and training. “We were contacted to remove it from a stuck drill pipe,” McAleese explains. “We ran in-hole, latched the fish, and pulled the waste to the surface in one run. The job was successful with no safety incidents”.
“What the sector is crying out for is technological development, both to assist in complicated and critical operations – which could otherwise result in a lost well – and of course to be financially viable,” says McAleese. “The old adage of “deeper, cheaper’ applies to all aspects of oil & gas.”
THE REGIONAL HEAVYWEIGHT
Bob Thubron, General Manager, Specialized Oilfield Services
Specialized Oilfield Products produces a full range of surface wireline equipment, mast
units, and test and control skids. The firm is also is poised to release a range of pressure control and coiled tubing equipment.
“We pride ourselves on manufacturing exactly to client specifications and provide excellent after sales service,” Thubron says, citing product quality, reduced delivery time and the firm’s health & safety record as factors that set SOP apart.
The uncertainty from the financial crisis is taking time to shake off, even after the oil price has risen to once acceptable levels.
“Manufacturing industries tend to suffer far more than our counterparts in the service sector during downturns,” he says. “SOP has, however, managed to sustain growth during the past four years and looks set to continue into the future. The Middle East has seen significant growth, particularly in Iraq,” he says.
“Outside the region, CIS countries, South America and Africa are all ramping up their activity”. For the time being, the Middle East remains SOP’s primary focus. “We have worked hard to establish ourselves in the face of stiff competition, gaining significant market share in some areas,” says Thrubron. “We have seen market growth in the Middle East previously of 2-3% annually and we expect that to rise to around 5% in 2011-2012.”
