Charlie Sinclair – Middle East Region Managing Director, Interwell, Abu Dhabi
Interwell’s Middle East Managing Director shares how the company’s innovative technologies are creating an ever-growing market in the region through its range of downhole, high tech, flow control devices. A world-class supplier of downhole products and solutions for well barrier and well integrity requirements, Interwell is rapidly becoming the market leader for water and gas shut-off applications, deep set barriers, niche completion products and plug and abandonment solutions.
Please introduce the organization to our readers and your involvement in the UAE and the region.
The organization is a Norwegian company that has 14 official offices around the world and is involved in various small and large-scale projects for downhole well maintenance and integrity services. We take on well challenges to ensure enhanced oil and gas recovery from new ‘greenfield’ to mature assets for global upstream energy companies. From the construction phase of a well right through to the plug and abandonment (P&A) stage, we have innovative solutions for the client’s unique challenges. Interwell’s technology is designed for reservoir and flow assurance applications, shallow and deep-set well barriers, well integrity groundbreaking P&A solutions, and special niche completion products.
Interwell was first introduced to the Middle East in 1998 in Saudi Arabia, but officially opened its doors in 2010 (as Interwell Middle East fze) when it became an independent entity in Dubai, the regional office for our various operations across the region. The organization was a lot leaner then but has expanded regionally; we now have some 22 employees in Saudi Arabia alone. We also have satellite operations that have allowed the company to expand around the region and globally. For example, we are now seeking out business in India, as well as Kuwait, Pakistan and Kurdistan. Interwell is also considering projects in arguably less stable markets, such as Egypt and Iraq, but the security of our personnel in these areas will be of primary importance, prior to any entry into those countries.
What services are most in demand from your regional customers?
Our mission is to be number one in well intervention. Other majors (e.g. Schlumberger, Baker Hughes, and Halliburton) cover a range of services such as completion, cementing, LWD, MWD and testing, which sometimes can put us at a disadvantage commercially, because the larger service companies can offer a variety of services while we remain centered on well intervention products and services. Currently Interwell offers a range of medium expansion plugs, high expansion plugs, high-pressure, and high-temperature plugs and straddles to our clients around the region. We are able to offer these downhole devices for well maintenance and integrity by offering high-tech tools. As such, the client instead of having to pull their completion and recomplete their well, which can be very expensive, can find a solution with Interwell, such as straddle solutions, to give the completion greater longevity.
What exciting projects does Interwell have in the pipeline?
Interwell is currently involved in a rig-less deployed ‘revolutionary’ plug and abandonment (P&A) project in Norway which, in my humble opinion, will be a major ‘game changer’ for the industry. Decommissioning is now an ever increasing request from clients all around the world. Due to this demand for offshore oil wells we have developed a system of P&A. After years of encouraging R&D, we are now taking the next step towards a final solution we can offer to the industry and will ensure that those abandoned wells are and remain fully secure from an environmental standpoint. Prices for decommissioning, in some cases, can cost upwards of USD 50 million and we are in the process of testing this system so that it can be deployed on slickline; saving immeasurable associated costs to the end user. This type of technology will be especially interesting for clients involved in the high dollar deep water offshore projects in environmentally sensitive areas, such as the North Sea and the Gulf of Mexico.
The development and qualification project is progressing with an objective to commercialize the groundbreaking P&A solution for the Oil & Gas industry by the start of 2017.
How has the current slump in oil prices affected the way your business operates in the region?
This is a difficult challenge for us. For instance, in Qatar, one of the major players there made a decision to cut costs by 20 percent across the board, from drilling to intervention to well services. These cost-cutting measures also included the cessation of third-party contract work; when oil prices started to tumble. As we were working for them through a third-party supplier at the time, this impacted Interwell negatively, despite, I hasten to add, a track record of flawless work for the client.
The lesson learned being: move forward to obtain direct contracts where at all possible.
This is particularly important given that Norwegian technology and companies often price at a premium. The level of innovation and skill justifies this, as our technologies are industry leading, but in this climate, pricing is becoming a greater consideration in the marketplace.
Interwell has managed to differentiate itself from other full-service competitors, how is this evident in the Middle East region?
Interwell offers tailor-made intervention solutions. We have a portfolio of standard solutions that we can adapt or tailor to achieve specific functions or solve specific problems according to our clients’ needs. This is something that the major service companies would not be well placed to do easily due to various factors. On the contrary, this is the type of market that Interwell are happy to play in to come up with unique tools and/or solutions for our clients.
A lot of the wells here are aging and in tertiary recovery stage, which means that their downhole geometry can often be compromised due to various issues. Any sort of corrosion or change to the IDs will create a challenge to the overall ability to ‘maintain’ the downhole completion. Most service companies have a standard suite of equipment like flow control devices, but our unique functionality is to offer the client greater expansion, which allows our tools to pass restrictions and compromised IDs* that our competitors could not necessarily achieve.
What unique technologies has Interwell brought to the local market?
Interwell is proud of the unique technology we are able to offer to our clients around the globe. Locally in Abu Dhabi, we developed a unique system for carrying a safety valve downhole and setting it in the damaged flow profile of the original Tubing Mounted Safety valve. The safety valve in any completion is the ‘heart’ of the string and the most critical component in its design. A candidate well was chosen by the end user and Interwell was asked to design a specific IVC (carrier) to be deployed along with their Safety Valve of choice and set downhole in the profile. I am happy to report that the job was a 100% success and we believe that there will be further candidates in the near future for this unique solution.
How have you adapted Interwell’s strategy to the local oil and gas culture environment in the UAE?
I have been in this region for over 21 years. I enjoy working here, and particularly my function within Interwell Middle East fze. However, experience has taught me one crucial lesson, through these past years: “if you cannot stand the heat, get out of the kitchen”, as one famous US President once noted. The industry here is in part dominated by the NOCs. You have to work hard to make sure you serve their needs. I have found that if you show willingness to serve the clients in this region they will in turn show you the respect to work alongside you too. This area is all about creating relationships and understanding their needs. My management and I communicate frequently to ensure that our strategy aligns with the vision of the UAE and the NOCs doing business here. Currently, the climate is focused on cost-reductions, which is understandable because of the global oil price crisis. I pride myself in having very good relationships with all the NOCs in the region, due to my time with my family spent in and around the Middle East.
The only viable response for all service companies currently is to price ourselves cost effectively and competitively to ensure our market stays intact.