With revenues dropping by more than 50% for a majority of upstream companies, the focus for the industry is gradually shifting from high exploration activities to operational efficiency in all aspects of the industry’s value chain. While production and drilling activities have seen an uptake in new technologies in sensors and data analytics, the industry’s manufacturing is finally looking to one of the biggest disrupters of the modern day, 3-D printing.
Three-dimensional printing at its core is a tool for efficient manufacturing that reduces material wastage and the overall steps required in the manufacturing cycle. The technology also enables the option of lightweighting parts by printing them with materials such as polyether ether ketone and carbon fiber over steel and aluminium. However, it is important to establish that the technology does not displace existing subtractive manufacturing techniques. Three-dimensional printing offers a new alternative next to computer numeric control machining or injection molding at the manufacturer’s disposal.
The 3-D printing industry already is a $3.5 billion market, growing at a 15% compound annual growth rate. However, the oil and gas segment (represented as “other” in Figure 1) is still relatively small in comparison to the aerospace, automotive and medical segments.
The oil and gas industry has speculated about the application of 3-D printing for quite some time, with suggestions ranging from drillbits and perforated pup joints to complex pump housings and heat exchangers. However, the technology has yet to integrate into the industry’s manufacturing completely. Two primary reasons for the slow adoption are a lack of focus on cost reduction tools up until recently and a proper framework for identifying parts or use cases that are appropriate for printing. The present guiding principle for selecting printable parts in the industry is the “high complexity/low units” practice that focuses on parts with complex geometries produced in small volumes.
Developing the right framework
The high complexity/low units practice alone does not account for the oil and gas industry’s complex supply chain, nor does it establish the business case for printing these use cases and consider the maturity of the existing 3-D printing technology. It is important to analyze if printing a particular use case is beneficial and address whether the existing 3-D printing technology is indeed capable of producing it. Encompassing the above-discussed criteria, Lux Research developed a methodology to score the use cases on scales of one to five using two comprehensive metrics: value and suitability.
Lux scored 12 use cases from different segments of the oil and gas industry to identify the most lucrative use cases for 3-D printing. These use cases included applications or ideas speculated in the industry as well as proven applications already in field use.
While all of the four discussed proven use cases were forthcoming, two speculative use cases that also appeared in this quadrant were sand control screens and pipeline pigs. All of the use cases ranked here are perfect examples of the type of parts the industry should consider printing. Three-dimensional printing these use cases leads to significant material savings, and the incumbent printing technology is capable of producing them in the required lead times.
Use cases such as drillbits and liner hanger spikes hold high potential. Printing these parts leads to significant material savings; however, the existing 3-D printing technology is not mature yet for these applications. While the 3-D printing industry is still perfecting metal printing on pre-machined tubular components for creating spikes, availability of materials such as tungsten carbide for the drillbits is still an issue.
Three-dimensional printing does not offer much value for applications similar to V-packing adapters and O-rings. The industry uses incumbent techniques such as molding and extrusion for efficient production of these parts with minimal material wastage. Analysis of such use cases highlights the important takeaway that not every part is a good fit for 3-D printing, and different manufacturing techniques will work in tandem in the future.
A three-pronged approach for 3-D printing adoption
Looking ahead, as the interest for 3-D printing in the oil and gas industry grows, its successful adoption will require a three-pronged approach of internal conceptualization, partnerships and infrastructure.
- Internal conceptualization: Developing a framework for identifying lucrative use cases is the first step toward adoption. Companies should develop methodologies and filter out use cases appropriate for 3-D printing. The eventual success of use cases identified through such frameworks will pave the way for printing of more critical parts in the future;
- Partnerships: For the technology’s adoption in the short term, the oil and gas industry should look toward working with innovative 3-D printing startups for overcoming technological barriers they are likely to come across. Lux Research identified three such startups from its global coverage of more than 10,000 startups: Arevo, Questek Innovations and Nanosteel; and
- Infrastructure: For the long-term adoption of 3-D printing, however, the oil and gas industry will need to invest in infrastructure conducive for 3-D printing and build industrial collaborations as seen in the aviation and automotive industries. Companies should look into GE’s successful adoption of 3-D printing. GE has established research centers for additive manufacturing worldwide and has grown its 3-D printing facilities by acquiring companies such as Morris Technologies, Arcam AB and SLM Solutions Group AG. The oil and gas industry also should consider collaborations with major industrial players. A recent example is the joint venture between Michelin and Fives for developing metal 3-D printers.
The industry can no longer afford excessive wastages and operational costs, be it in the field or in the manufacturing yard. Despite adopting lean manufacturing in its supply chain, the industry continues to struggle with as much as 70% of material wasted in fabrication of highly complex geometries. Identifying the right set of applications for 3-D printing remains one of the biggest hurdles for the technology’s adoption. Lux Research’s methodology for filtering out various speculated applications concluded that parts such as sand control screens and drillbits were lucrative, while printing applications such as O-rings and V-packing adapters were not profitable. To bring these ideas into reality, the industry should look toward novel 3-D printing startups for collaboration in the near term and invest in additive manufacturing facilities with an eye for the future.
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