Among the week's top news is ExxonMobil's announcement that it would buy reserve-rich, Ft. Worth, Tex.-based XTO Energy for the equivalent of US $41 billion in an all-stock transaction. XTO holds about 45 tcf in unconventional resources, primarily North American natural gas, so ExMob is apparently betting big on the play concepts and the natural gas markets. Will this level of investment be a game-changer for the service companies? Many of today's hot unconventional plays have been developed by smaller, regional oil companies that developed into niche players. Working in a single field, or small group of fields, small-to-medium independents have had to operate with different constraints than majors with deeper pockets. A small company will necessarily make different decisions regarding cost-effective development. Scale of development, local availability, and cash flow may dictate supplier choices. Doug Sheridan, at EnergyPoint Research Inc. in Houston, told E&P there will be winners and losers as companies consolidate. He believes the larger E&P companies will gravitate toward suppliers with strong health, safety, and environmental (HSE) records, low-levels of non-productive time (NPT), high reliability, and job quality -- and not necessarily rock-bottom invoices. Sheridan says larger-cap customers [such as ExMob] tend to prefer higher levels of service and professionalism, specifically flexibility and responsiveness to customer needs and accountability in solving problems and disputes. EnergyPoint's research showed that major operators favored suppliers that invest in their people, emphasize and reward their staff's communication and interpersonal skills, and work to develop and maintain strong professional relationships with client companies. Sheridan cited two drilling contractors: Helmerich & Payne (HP) and Parker Drilling (PKD) as companies that are best-positioned to benefit from large operator buyouts. Among the oilfield service companies and equipment suppliers, Sheridan thinks Smith International (SII), Dril-Quip (DRQ), and M-I SWACO (jointly owned by Smith Intl. and Schlumberger) are most likely to pick up additional market share. ExxonMobil CEO Rex Tillerson said the company would use XTO's gas shale expertise to develop similar plays in Europe, where it holds nearly 3 million acres of shale leases. Fields in Poland, Hungary, and Germany are well-positioned to produce into a gas-hungry European market. Local suppliers that make shrewd decisions in developing additional infrastructure may be able to secure significant business with XOM and other majors.
How Much is a Digital Twin Worth?
2023-01-17 - HUVRdata and VEERUM partnered to engineer digital twin technology that contextualizes inspection data in virtual facilities and asset models.
Innovation at Forefront of 2023 SPE HyFrac Conference
2023-02-03 - Engineers from different corporations gathered during the HFTC Plenary Session to discuss different approaches to fracking, including the benefits of fiber optics and geothermal fracking.
Testing the Waters: New Tech Aims to Clean Oilfield's Produced H2O
2023-01-23 - From nanoparticles to air bubbles, the University of Texas Permian Basin’s Texas Water and Energy Institute is analyzing data to potentially find a home for water produced during oil production.
Bakken EOR Trial Increased Output by 25%
2023-01-10 - Liberty Resources' pilot project shows alternating produced gas with water/surfactant EOR mix boosts production and cuts costs in the Bakken Shale.
Raising the Bar for ROV Operator Performance by Lowering the Bar for Entry
2023-01-31 - Technology companies Greensea and Blue Ring’s partnership helps ROV operators become situationally aware without having to “context switch” from task to task.