Alan Brodie – Middle East Region Manager, PTC, UAE
The Middle East Region Manager of PTC, a highly innovative Norwegian company in well integrity management, provides an update of how business is progressing for them in the Middle East.
It has been a full year since we have interviewed you last time. What has been achieved since then?
“Potential clients in the Middle East typically first want to test the technology we have to offer, and often want to know it has been used elsewhere in the region. Only after successfully proving the technology and being able to demonstrate a regional track record does the real demand start.”
Since our last interview at the beginning of 2016, despite the challenging market conditions, we have actually achieved significant business growth in the region.
As impressive as that may sound, to be fair, it is simply the accumulation of a number of years of work that has started paying off now. Potential clients in the Middle East typically first want to test the technology we have to offer, and often want to know it has been used elsewhere in the region. Only after successfully proving the technology and being able to demonstrate a regional track record does the real demand start.
Over the past two years the trial phases have come to an end and we are now moving from offering a technology which is being tested to offering a technology which is accepted in the region.
At the same time we are increasing our regional footprint. We recently opened a sales office in Saudi Arabia, and are optimistic that new business will follow soon, and we have also recenty made our first sales in Oman.
All of this has come at an important time, since growth in the other markets we serve has slowed (due to the low oil price) over recent years. As a result the Middle East region is now contributing approximately 30 percent of our global business revenues.
Why did you choose the UAE as your regional hub?
Before entering the region, we scrutinized the various countries and assessed which would serve best as hub and platform for entering the region. The UAE clearly separated itself for its ease of doing business. It also offers an excellent transport links for easy access to all of the neighbouring countries. This is important to me personally as I spend a lot of time travelling outside of the UAE.
The importance of managing well integrity was also high on the agenda of the ADNOC group companies, and as a result we anticipated there could be a strong demand for our unique technologies here.
Could you please provide us with an overview of the main demand you are serving today?
In this region we are currently mainly serving the demand for Well Integrity Management technologies. Looking forwards (as a number of onging projects mature) we also expect to be delivering our unique gas lift (production enhancement) technologies.
Well Integrity Management is a particularly interesting market for us. Its profile and importance to oil and gas producing companies, has grown rapidly in recent years, following a number of high profile incidents. As a result there is an increased focus on ensuring all wells have reliable well integrity in place throughout their construction and producing lifecycle. There is also an increased focus on assuring the reliability and availability (acquisition frequency) of the data used to monitor well integrity.
We offer unique technologies in both of these respects. These technologies significantly reduce the risks, which in the absence of a practicable solution to address them, have historically been accepted. They also provide much more reliable well integrity data.
Interestingly, many OPCOs are also moving towards so called ‘i-field’ or ‘digital oilfield’ implementations, where an enormous amount of real time well (including integrity data) and production facilities data, is now continuously streamed from the field to the office locations.
Historically much of this data was manually gathered and in most cases the increased data comes without compromise. However, specifically with regard to the data gathered to monitor well integrity (annulus pressure data), a potentially dangerous ‘blind spot’ has been introduced. This is because the traditional annulus pressure measurement device, which was historically only exposed to well pressure for short periods (when being manually read) is now permanently exposed to any pressure that may exist in the well. Typically these devices are relatively flimsy, and become the new ‘weak link’ in the wells ‘barrier envelope’. So despite improving well integrity data frequency, the integrity of wells in these ‘digital oilfield’ implementations is often significantly degraded.
The technology we offer addresses this ‘blind spot’, so looking forwards, as real time integrity data acquisition becomes the norm, we see the market for our technology growing rapidly.
The other major challenge we are now delivering solutions for in the region is the large proportion of active wells, where integrity problems have been identified. Almost all OPCOs have a long list of such wells, which are either closed awaiting repair, or in some cases awaiting abandonment. In other cases some wells are flowed ‘under dispensation’ (recognizing and accepting the increased risk they pose) while awaiting repair.
The technology we are delivering can autonomously manage these well integrity challenges, by monitoring and automatically maintaining the unplanned pressures below critical levels. This means wells that would previously have required to be closed in, can continue to be produced while awaiting repair. In other cases, the reliance on the increased level of manual intervention on wells flowing ‘under dispensation’ can be significantly reduced.
Does this improved integrity come at a cost ?
It is clear that the Oil and Gas Producing Companies are more aware today than ever before, that well integrity cannot be considered as an area where cost cutting is wise. The cost of getting it wrong is potentially so high that the company’s existence can be put in question. I cannot think of an oil company saying that they will consider trading off integrity for the sake of reducing costs and or increasing profits.
Indeed, it is especially nice to hear our clients tell us that as a result of implementing our technology, not only have they improved well integrity but they have also saved costs or accelerated production. We have numerous examples of this. In some cases, surface pipework costs have been significantly reduced. In other cases the number of required well interventions can be reduced. In another case, because the implementation of our technology allowed wells to continue to be produced during nearby SIMOPs, it was estimated that an extra 15 million bbls of oil production could be delivered during the field start up years.
You have said earlier that you compete with some of the industrys biggest names. Given the size of these companies, how do you set yourself apart and successfully compete with them?
The primary factor that allows us to compete successfully with these multinational companies is quite simply by having the better technology.
We cannot compete in marketing as we simply do not have the budget, we cannot compete in the geographical reach of these companies, and we have not established our brand to the extent that we have the same globally recognised reputation—that’s a fact! But, our technology is better—also a fact! Often, clients do not know us, but of course they know the big brand. So, our job is to engage them and explain the benefits our technology delivers.
Knowing our main competitive advantage is our technology, we are committed to keep innovating and responding to our client needs, with tailor made solutions of how to do things better.
Finally its about service. We have a great team, all of whom know the importance of customer service, and know that the service we offer also has to be better than that offered by the competition. From the first minute we are approached by a client until the job is done, we all work hard to communicate and deliver professionally and promptly. The aim is to make sure the customer enjoys their interactions with us, always wants to work with us again, and is happy to recommend us to others.
So far it seems to be working!