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Interview

Marco A Moreno, Director of Drilling, Grupo R Exploración Marina (GREMSA), Mexico

One of the senior directors of Mexico’s leading deepwater drilling contractor sheds light on the highly anticipated forthcoming boom in offshore drilling. He discusses human capital sourcing and retention challenges, and speaks about the sorts of technology needed to unlock some of Mexico’s most complex fields.

Could you please give our international readers a brief insight into the history of the consortium ‘Grupo R’ and explain how ‘Grupo R Exploración Marina (GREMSA)’ fits into the mix?

GREMSA is one of a number of companies that constitute the wholly Mexican owned consortium ‘Grupo R’ which was founded back in 1960 and has since contributed significantly to the development of Mexico’s energy sector by supporting the government entities Pemex and CFE. We have always prided ourselves on harnessing the latest cutting edge technology whether in our deployment of self-elevating drilling units during the 1990s or our use of semi-submersible dynamic position units today.

The Gulf of Mexico possesses significant deepwater and ultra-deepwater reserves and yet exploration of these potentially very productive fields is still in its infancy. GREMSA using its 6th generation semi-submersible, Centenario, enjoys the distinction of being the first company to commence deepwater drilling in the Mexican sector in the form of the Piklis-1 well in 2010 for Pemex.

As one of Mexico’s leading offshore drilling contractors, one of your key offerings is the strength of your deepwater fleet of semi-submersibles. Can you summarise the capabilities of your much prized deep water assets: Centenario, Bicentenario, and La Muralla IV?

Each of these semi-submersibles has the distinctive capability of being able to drill in ultra-deep waters of up to 10,000 feet. This is vital to Grupo R’s market positioning and service offering because only four such units are drilling for Pemex. This affords us a considerable advantage when bidding for projects in some of the deeper waters and is one of the primary factors in allowing us to establish a good position as the main drilling contractor in Mexico for such types of plays.

The experience acquired by Grupo R using the Centenario, Bicentenario and La Muralla IV has also proved very useful in enabling us to consolidate and reaffirm our position. Having to date drilled 14 offshore wells in waters of depths of up to 9,600 feet, we now maintain an unparalleled track-record in the region. We are also proud to point out that the semi-submersible Centenario crew has been in operation for over two years with zero incidences of loss of time (LOT).

There are other aspects in which we have been a first mover. The Centenario offshore drilling unit is actually the first unit of its type to be assigned the SEMARNAT Clean Industry Certificate. This could again be a decisive factor in winning contracts as the soon-to-be liberalized Mexican energy sector becomes more exposed to international norms on clean development.

Another of the hallmarks of GREMSA is the caliber of its skilled personnel. How are you managing to source your human capital and to retain that talent?

Human capital represents quite a challenge for us because there are actually not many technicians out there than have the necessary know-how to operate the latest generation units. Unlike traditional practices, the new equipment entails using joysticks and a whole array of remote and automatic equipment, so there is intense competition for technicians that are well versed in the latest operating methods.

To develop the required skills, engineers need to undergo special course tuition and train on simulators that, more often than not, only the manufacturers and fabricators of the new drilling rigs possess, which means sending our technicians and personnel from around the world to where these simulators are located.

To date, there are around 30 new semisubmersible drilling units under construction and in excess of 100 self-elevating drilling units also in the pipeline which means there’s going to much more activity in our main market segment. Consequently more expert personnel will be required to integrate the crews for the new units.

The competition to hire and keep the skilled personnel to operate the new generation of drill units is a problem that all the companies will face. Grupo R is hiring new engineers to be trained and is implementing conditions of work and professional development opportunities that will enable us to retain expertise within our Group.

How will the forthcoming energy reforms alter the way GREMSA does business? How does the company expect to reposition itself in the light of changes to the rules of the game?

One of the immediate effects produced by the energy reform will be to open up the scope of activities available to private companies and that should translate into much greater levels of participation in all areas of energy production. We are preparing for a new boom in offshore drilling and expect the competition of deep water and ultra-deep water to be intense.

Any company aspiring to compete in our market niche will need to obtain substantial financial backing, the most modern equipment, state-of-the-art technology and most importantly a crew personnel with enough experience to operate both efficiently and securely. They will also need to achieve compliance with new CNH regulations that are likely to be fairly stringent.

At GREMSA, we are confident that we are ready to cater to the needs of incoming clients and at the same time feel well prepared for taking on any additional competition. After all, the contracts we have been awarded to date have been international open bids, where we have consistently outperformed global competition. We have the technological assets, the trained personnel and the local knowledge of Mexican regulations and norms that will apply, besides the international regulations. We are also ISO accredited and our certification on HSE is already well above the standard requirements.

Nevertheless, the post-reform context will necessitate a shift in mentality. We will also have to get used to taking more risks and injecting more capital investment so as to remain at the head of the technological curve.

You mentioned that GREMSA will have to take on greater risk and invest more heavily. Which areas should additional investment target? And what are the strategic priorities for the company going forward?

GREMSA benefits from an excellent financial record with the banks, so there might well be the possibility of acquiring some other companies in the coming years.

Starting in 2015 Grupo R expects the delivery of the first of five self-elevating offshore drilling units that we have commissioned and are currently at the construction phase.

We will continue to maintain and upgrade our equipment  certifications,  the ISO certification and  the SEMARNAT clean industry certification which are in process for our other semisubmersible units.  We don’t envisage dramatic leaps in technology in the near term as there are ample deep water reserves to explore that we can already reach with the current generation equipment, but still there are always incremental improvements that can be made.

To read more articles and interviews on Mexico, and to download the latest free report on the country, click here.

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