10 |
Oilfield Technology
December
2014
Special reports
A digest of recent reports on Energy Global, read the full articles online
from energyglobal.com
Oil and gas industry sees
growth inM&As
McKinsey has released a new report based on a
surveywhich has found that joint ventures and
mergers and acquisitions (M&A) are both posed to
grow in the coming years as interest in corporate
partnership develops. 68%of respondents to the
survey on the subject said that they expect their
companies’ joint venture activity to increase over
the next five year and 59%expect M&A increases.
The consultancy has also noted that the
more experience companies havewith joint
ventures, themore likely they are to use them.
Approximately 90%of respondents at companies
with over six in operation said that joint ventures
are either frequently or occasionally considered
as serious alternatives toM&As, comparedwith
only 40% fromcompanieswho have none at all
in action.
Despite the initially positive feedback there
is scope for improvement. Most executives
who responded to the survey said that their
companies lack consistentmanagement
practices fromone venture to the next. Even
companieswith themost active joint ventures
tend tomanage their partnerships individually.
Also, a few respondents reported the use of
standardised resources, such as playbooks,
that enable consistency and the sharing of best
practices. Little consensuswas found on theway
tomeasure joint venture performance andmany
are divided over what success actuallymeans. As
an exampleMcKinsey has highlightedmeeting
revenue targets as awidely acknowledged
importantmeasure of success, however keeping
to the expected timeline for keymilestones
is not.
FULLVERSION
GOTO
A new Cutter Index for better
selection
NOV’s ReedHycalog™Helios™ Inferno™PDC cutters
are engineered to provide increased performance
in specific applications. The primary goal in
developing the Inferno cutter rangewas to define
the principal failure criteria for each application
and engineer a cutter with the precise properties
to overcome these, to improve performance under
these conditions. By understanding the exact
failuremechanisms of different applications and
formation types, NOV has created the Cutter Index,
which allows the ideal cutter variant to be selected
for the particular conditions.
The Index ranks cutter technology according
to its resistance to the three primary failure
mechanisms formost applications: thermal
degradation, abrasion and impact damage.
Until recently, drill bit providers have sought to
create the best overall cutter by balancing these
resistances, with the expectation that their cutters
would performaswell in one application as the
next. Although the industry attempts to create a
single optimal cutter, inmany cases enhancing
certain characteristics at the expense of otherswill
provide the ideal cutter for the application.
This Cutter Index systemensures that the
characteristics of each cutter used are ideally
matched to the needs of the application.
One example is an 8¾ in. six‑bladed design that
was able to drill two consecutive single‑run vertical
wells averagingmore than 8000 ft. The failure
mechanismswere identified as both thermal and
abrasive, and using the Cutter Index, the cutter
propertieswerematched to the application. This
provided a 22% increase in the distance drilled
whilemaintaining all directional objectives.
FULLVERSION
GOTO
WoodMackenzie comments
onOPEC’s decision
OPEC held its biannual meeting in Vienna on
27November 2014, and has retained the current
production ceiling of 30million bpd.
Ann‑LouiseHittle, Head of MacroOils
Research for WoodMackenzie, commented: “Oil
prices have declined by approximately 36%since
June 2014, due to aweakening demand outlook
in China and Europe combinedwith steady
growth inUS oil production levels clearly puts the
outlook for oil demand growth as the continued
focus of crude oil pricing and, in its absence, tight
oil breakeven economics.”
WoodMackenzie’s assessement of the
implications of OPEC’s decision include:
Ì
Ì
Total world oil supply in 2015will continue
to outpace oil demand growth as has been
the case recently in 2014. Further downward
revisions in 2015will intensify the need to cut
back supply growth.
Ì
Ì
TheOPECmeeting left the group’s production
ceiling unchanged at 30million bpd, This
means oil prices, as has already happened,
are under downward pressure to slow the rate
of supply growth.
Ì
Ì
The lower oil priceswill be painful for
OPEC countries such as Iran and Venezuela
both of which have high fiscal breakeven
priceswell over US$ 100/bbl.
Ì
Ì
Disruption tomarket order will bemonitored:
renewedweakening in the oil price could
trigger an extraordinary OPECmeeting in
Q1, 2015. For now, OPEC producers such as
Saudi Arabia appear comfortablewith letting
non‑OPEC producers face the prospect of
losingmarket share.
FULLVERSION
GOTO
SPECIAL REPORTS
on Energy Global
A vast array of informative, on‑topic articles
covering all aspects of the upstream,
midstream and downstream energy sectors.
To read more, please visit
/news/special‑reports
Get the free mobile app at
http:/ / gettag.mobi
