Key Strategies That Will Put You Ahead
What went wrong? The oil collapse has left a graveyard of devastation in its wake. From December 2014 to December 2015, an estimated 288,000 Texas jobs have been lost. That includes an estimated 72,000 direct oil and gas jobs and 210-220,000 indirect/induced jobs, according to Karr Ingham, a petroleum economist for the Texas Alliance of Energy. Thousands more were lost in other shale-plays not to mention service businesses in towns reliant on the oil boom.
In a land of untrustworthy forecasting trends it’s difficult to take any leading experts advice on a commodity that affects the livelihood of many Americans and some shale producers won’t start production back online until prices are higher. However, there is light at the end of the tunnel. “We can’t control the commodity prices, be we can control the efficiency of our wells,” said Ben Mathis, Statoil’s Eagleford operations manager. “The industry has taken this is as a wake-up call to get more efficient or get out.”
Loss Forces Innovation
In a ‘slow to adapt to change’ industry, operators are now forced to find more innovative approaches to be more efficient. Major companies are managing to survive by increasingly using techniques traditionally more common to manufacturing plants than to oilfields. Over the decades, innovations such as the Pason screen, diamond bits, MWD’s and many others, have and are still yielding satisfactory results. Some are now implementing computer controlled pump systems that turn on and off pumps to reduce fuel consumption. Unfortunately, many companies do not have the resources to purchase new or more powerful drilling equipment to aid in their efforts to reduce cost.
The focus has always been on the mechanics, and more recently, software. However, over the past century there is one tool that has received very little faith in the industry. Once thought not powerful enough to make any considerable contribution and be cost effective in savings …drilling fluids. Oil drillers knew this from the beginning and as demand increased, an evolution began. Although there have been many breakthroughs to address issues with cuttings, formation pressures, wellbore stability, formation damage, etc. extreme friction reduction has eluded the best geotechnical engineers, until now.
Why is this important? Over seventy percent of all energy that is delivered by a drilling rig and its surface and downhole equipment to a drill well is lost through friction. Torque, drag, hook load affect operational efficiencies, hindering performance from the drill bit, all the way up the drill string to the mechanical surface equipment, and we all know that if left unmitigated can bring the drilling process to a halt causing hundreds of thousands if not millions in cost. There are many that say that lubrication can never be so powerful, and that even if a drilling fluid can reduce extreme friction, how does that translate in savings in a typical operation and by how much?
Innovation usually comes from outside an industry
Over twenty years ago, innovation in lubrication made its way to a different industry where the demands are extreme – motorsports. Drag racing takes the fastest-accelerating machines in the world down a quarter mile track at speeds over 330mph in less than 5 seconds. They are equipped with 10,000 horsepower 500 cubic inch power plants using nitro methane as fuel. These extreme machines were no stranger to abuse. As new records were set and broken, parts needed better protection. A single billet crankshaft would only get two runs at a whopping $4,000 each.
After extensive laboratory trials, this was the perfect venue to test a new lubrication technology that was not only designed with an extremely dense film strength, but also do something never thought possible, bond to metal. By polarizing the molecular structure of the oil, and using the flowing properties of the engine oil to reach its critical destination, something amazing was achieved and the coefficient of friction was dramatically reduced.
A bench test using a triple cross axis friction machine, which is typically used in laboratories to test film strength of oils and lubricants, was used to confirm these findings. Under direct metal to metal contact, the maximum pressure achieved by most lubricants is 4,000psi but this technology was able to withstand more than 200,000psi. The $4,000 single billet crankshaft that would only get two runs was able to achieve 22 runs before it was discarded, and it took only a few quarts of this new lubrication technology. This result also extended to other components in the engine saving tens of thousands of dollars.
These results quickly spread to other applications in motorsports, heavy industrial machining, military applications as well as NASA. It spawned a new series of lubricants and greases to meet the demands of maximum protection and performance.
“You have to keep your focus on finding new and innovative solutions,” says Bruce Tocher, manager for shale oil and gas research at the Norwegian energy company Statoil ASA. “You need those solutions more than ever.”
Lube is Lube … Not anymore!
Fast forward to the present where an even more extreme environment called for its use, oil drilling. Head to head laboratory tests were conducted against current muds, and competitive lubricants at the request of major oil companies. Not only did this technology turn ordinary muds into Super Muds, but it attained better results against competitors in coefficient of friction reduction at a lower concentration. Three times lower, which means much more power for much less product.
The real tests are in the field, and after 700 wells, these are typical results being reported by operators in North Dakota, Texas, Oklahoma and California:
It’s no longer theoretical. And no longer is the industry saying “Lube is lube!” Even better, this technology is plant based and biodegradable. How can this help in your multi-million dollar operation? How can this reduce your breakeven cost? How many jobs can this create? It’s the innovative cost-saving solution that was never thought possible.
Lubrication Technology has finally caught up with the oil & gas drilling industry and is sowing seeds for the next boom. Operators now have the advantage of using what many call “the best secret in the world” in oil drilling. “If we make the right calls in 2016, it’s going to define the next decade,” Torgrim Reitan, Statoil’s Houston-based executive vice president for U.S. operations.
Josh Munoz – Marketing Director
Krauss, C. (2015, 5 11). Drillers Answer Low Oil Prices With Cost-Saving Innovations. Drillers Answer Low Oil Prices With Cost-Saving Innovations, pp. 1-4. Retrieved from http://www.nytimes.com/2015/05/12/business/energy-environment/drillers-answer-low-oil-prices-with-cost-saving-innovations.html?_r=0
Reed, J. (2016, January 27). The Oil Price Crash Has Put Almost 300,000 Texans Out Of Work, Ingham Says. p. 1. Retrieved from http://oilpro.com/post/21875/60000-layoffs-texas-og-since-downturn-began-economist-says
Rich, G. (2016, May 26). Oil Near $50, But Drilling, Completions Won’t Ramp Up Yet. p. 1. Retrieved from http://www.investors.com/news/oil-topped-50-but-drilling-and-completion-wont-ramp-up-just-yet/