Weatherford embraces digitalisation and localisation to service GCC customers

Weatherford Frederico Justus Headshot Photo 1Like the oil price, one of the largest oilfield services firms Weatherford has seen ups and downs in its global business. As the company undergoes restructuring to focus on its core strength such as oilfield services, Eastern Hemisphere president Frederico Justus is confident about the company’s future in the GCC

A new report by Wood Mackenzie has revealed that the global oil and gas industry prospects look good this year as profits have returned. Many attribute this to the disruptive technology that the sector has adopted after the downturn five years ago.

In these last few years, Weatherford has pursued the digital path to strengthen both the company and the oil and gas industry in order to boost profitability. The company sold most of its non-core assets in the last two years and now focuses on drilling equipment and digitalisation. The latest of the many new tools include an intelligent managed pressure drilling system. These tools require a significant amount of investment.

Particularly in the GCC, the company has seen a lot of initiatives and incentive with regards to technological growth, which encourages the company to widen its market in the region.

Justus said, “After the oil price crash in 2014, Weatherford solely focussed on developing new technologies that are efficiency, cost and time-oriented. The technologies that we invested in are now commercial. In the GCC countries, there is a lot of emphasis on optimising the OPEX requirement, which our tools help.”

Giving more insight into the relationship between technology and the region, Justus spoke about the Weatherford technologies that have gained a lot of traction in the Middle East recently, owing to the CAPEX benefits they offer.

TECH TALK

During ADIPEC 2018, Weatherford released its VERO Automation Connected Integrity. It is a disruptive technology that can reduce the risk to ground personnel in oil rigs.

“This technology gained a lot of traction from our Middle East clients because of the emphasis the region gives to the HSE standards,” Justus affirmed. Another technology that has strong leverage is TR1P, the world’s first remote-activated, single-trip deepwater completion system.

Costs continue to dominate business decisions everywhere. “High rig costs drive the need for reduced trips in hole, particularly in deepwater environments. The ability to perform multiple operations in less time and with fewer equipment and personnel requirements sets the stage for tangible benefits. By enabling you to install the upper and lower completion in just one trip, the system simplifies your operations and reduces your completion installations times by as much as 60 per cent.”

On the production side, Weatherford’s new optimisation platform ForeSite monitors real-time data and generates intelligent alerts on a screen when it detects significant changes in set points in pumps. Controls can then be managed to avoid downtime, Justus added.

Add to that is a new rotary steerable system Magnus launched in the region for more efficient horizontal and vertical drillings. “We are seeing double-digit growth in the Middle East, and Magnus RSS features certain differentiations over other systems that are going to help us grow our market share and be more efficient on wells. It is a complete performance drilling package that helps you to sustain drilling, stay on plan, and reduce well construction costs.”

Weatherford is also working on integrated projects in the Middle East, which helps it deploy its own technologies on-field. “We want to go from being an energy company which provides technological solutions to a technology solutions provider for energy companies.”

With digitalisation fuelling the profitability of the oil and gas sector, the oilfield services company is collaborating with tech giants IBM and Google on digital technologies such as the Internet of Things, Cloud Computing and Advanced Analytics to improve well production.

LOCAL CONNECT

The GCC states are ardently pushing for ‘nationalisation’ to nurture international partnerships for improving knowledge transfer and increased job opportunities for the local talent.

There is a lot of momentum about the In-Country Value (ICV) by ADNOC, the push for In Kingdom Total Value Add (IKTVA) in Saudi Arabia, as well as the ‘Omanisation’ and ‘Kuwaitisation’ focus.

And the global company is an ardent believer in localisation. Justus maintains that the Middle East is one of the earliest adapters of technologies that debut worldwide and it is not different for Weatherford.

“Some of the technologies that I am talking about were first deployed in the GCC countries. The first-ever demonstration of VERO was in Abu Dhabi in November 2018. This shows our commitment to the region. We bring to the region what lasts and what is best. So we are trying a more holistic way to align the company towards the GCC needs, employing the people and training them here.”

The region is also one first adopter of the managed pressure drilling (MPD) system that allows onshore and offshore drilling in a safe way to avoid losses and blowout.

At the heart of localisation is training. Justus confirms that one of Weatherford’s biggest training and technology centres in the world is in Mussafah, on the outskirts of Abu Dhabi, which is right now the training hub for the Eastern Hemisphere.

“There is a huge focus to align the new technological offerings in the region as well as training the clients on how to use the tools and deploy them in the field.”

So is localisation both an opportunity and a challenge for Weatherford? Yes, localisation is both the biggest challenge and the biggest opportunity in the region, Justus believes.

“Our clients here have set very aggressive targets – Saudi Aramco’s IKTVA 70 per cent local production by 2021 and 30 per cent exports by that time to develop their supply chain. Even in the UAE, the Emiratisation and the ICV programme is gaining ground with the government is pushing for more local content.

“We have been partnering with Omani operators like Petroleum Development of Oman (PDO) and Occidental Petroleum to provide technology to enable production. We have a big project in Kuwait with Kuwait Oil Company to install pumps in their new production facility for heavy oil. We also have collaboration centres in Kuwait in conjunction with KOC for production facilities.”

WORKER WELL-BEING

To err is human. Even with safety guides and certifications, rigs fatalities are not uncommon. Justus says that this can be alleviated by simply reducing exposure to the ‘red zones’ in the rig area. Weatherford is constantly developing tools and software to minimise risks. StabMaster is one such automated system that transfers pipes in the rigs without human involvement. “We have a Saudi Arabian client deploying that technology because safety is a priority for them and they are installing them as a standard on all its rigs.”

Again, VERO’s conventional system automates the final makeup and evaluation of pipe connections on land and water rigs. The conventional system reduces human input and physical work to enhance safety. Because offshore rigs are more expensive, efficiency is vital to the project.

GAS DEVELOPMENT

The adoption of ‘green’ agenda and sustainability in the Middle East has led to the development of additional gas pockets in the region.

Justus mentions that gas projects in the region look encouraging. Weatherford has some gas-specific technologies that help its clients develop the wells and be more efficient. “Gas wells are highly pressurised. Weatherford’s VZero technology seals the wells better in high pressure. This sealing allows the clients to deploy those tools in gas wells that have higher pressure. This tool is popular in the Middle East.”

As Saudi Arabia focuses on unconventional gas activity, Weatherford is also shifting towards offering related services. A leader in well production technology in the US for unconventionals, Weatherford now has several projects related in the kingdom to enable that production.

Even as there is a big push towards sustainability, oil and gas will continue to dominate the energy matrix for years to come. And with that thought, Justus is very confident that Weatherford will continue to grow and thrive in the region.

Alain Charles Publishing, University House, 11-13 Lower Grosvenor Place, London, SW1W 0EX, UK
T: +44 20 7834 7676, F: +44 20 7973 0076, W: www.alaincharles.com

twn Are you sure that you want to switch to desktop version?