Service Providers Adapt to Industry Changes
Authors: Hogan Michael 
Published: February 2015

Competition for the award of service contracts in the oil field always has been fierce, but the criteria for gaining and maintaining the confidence of operators are changing. Service quality on a well-by-well basis is still important and will remain so, but the definition of outstanding performance has enlarged considerably. Successful operations do not start on the spud date—they arise from collaboration between the service provider and the operator, beginning with project planning and carried on throughout the well-construction process.

Service companies have concentrated on producing the new technologies that operators need to meet operational challenges. An unusual number of breakthroughs have occurred in the last few years that have made it possible to drill in areas that were once almost completely off limits operationally and economically. These technical successes help exploit new and marginal reserves without budget-breaking expenditures. These breakthrough products and services are not just commodity items that get the well down. In our fluids division, most—if not all—of the advanced technologies significantly improve wellbore quality and extend the life of the well. Service providers are living up to a commitment to help operators cut costs while achieving top drilling performance, and operators should consider the real economic value represented by such breakthroughs when they come to the bargaining table.

The need to minimize environmental impact also has influenced product development. Our industry is seeing an increase in positive engagement with governments and regulatory agencies. Understanding their concerns allows us to design materials and procedures that safeguard natural resources and communities. The industry has done a good job of showing the public the precautions it has taken on behalf of the environment. Not too long ago, many people believed that drilling performance had to be sacrificed to achieve environmental compliance, but that perception is being left behind. Safety and environmental protection are the bywords for oilfield operations anywhere in the world.

High-performance systems and technologies can be used safely at just about any drilling location in the world, but getting the most from these new technologies takes a new approach. Service companies have to foster cross-discipline collaboration among their various functions. The best results come from clear alignment of goals and proper job design, in which the various teams involved share best practices, sophisticated modeling software, lab capabilities, and field expertise. That is what it takes to make sure conditions are optimal for the operation at hand.

For example, good drilling practices executed by drilling fluids and directional drilling personnel make it possible to run casing to bottom with minimal flat time. Further, the conditions of the drilling fluid and the wellbore have a huge impact on the success of the primary cement job for that casing string. This cross-discipline approach has to go one step further at times—a service provider may be working alongside a competitor. Even then, our objectives remain the same: reduce costs, minimize nonproductive time, and increase the productive life of the well. When we succeed at that, no matter the circumstances, service providers earn the confidence of operators.