South America ... Activity Everywhere

GEO enjoyed a productive three days in Rio last week at the Next Generation Oil and Gas Latin America event.  Lots of influential operator representatives were present, and most were very up-beat about activity levels in the region.  From Mexico to Ecuador to Argentina, we were overwhelmed by the number of opportunities and the enthusiasm for our technologies ... plenty of follow-up travel coming up!  Thanks to all those executives who spent time in conversation with the GEO representatives.

Two of the most common misconceptions that we run into during our global travels are: (1) that advanced perforating technology is too expensive for all but the most prolific wells, and (2) that we expect to sweep all the current products from the market. 

Part (1) is absolutely not true because a relatively modest amount of incremental production - or reduction in lifting cost - pays for a LOT of advanced perforating.  Simple economic examples available on request.  Nonetheless, prolific wells are great candidates for reperforation!  Although most operators prefer to leave them alone for fear they won't come back online as strong as when they were shut in (largely an urban myth, in GEO's opinion), even a modest improvement in productivity will translate to many barrels or cubic feet,  and a handsome return on investment.

Part (2) is a nice thought, but entirely unrealistic.  Products of any nature must be applied where they make technical and economic sense.  Many wells can be satisfactorily perforated with standard products and do not merit the application of more advanced systems.  As Pareto would have it, 80% of the potential gains from new technology are likely to come from 20% of the potential applications.  GEO expects its flagship product lines (RaZor® and CONNEX®) to displace standard offerings in those wells, and to become the go-to solution when the incremental investment is returned multi-fold in added value.  GEO representatives will be happy to discuss your perforating activities and recommend when and where advanced technology might unlock significant value.

Hydraulic Fracturing Technology Conference ... Where's Perforating?

SPE's HFTC kicked off today at the Woodlands Waterway Marriott, with over 1,000 pre-registered attendees.  Quite a contrast to the poorly attended show a couple of years ago when times were tough!

Not surprisingly, the shale fracturing session drew a massive crowd, prompting the organizers to make real-time changes to the room layout (kudos to SPE and Marriott staff for efficiently dealing with the overflow!)

Unfortunately - but not surprisingly - perforating barely garnered a mention during the presentations attended by GEO.  Having had our abstract rejected, we already knew that perforating wasn't a hot topic in the program committee's mind.  Nevertheless, the omission of perforating from more than one list of "critical factors" influencing frac performance and effectiveness was a sobering reminder of the industry eduction task ahead of us!  If you haven't yet seen the light and realized that perforations play a crucial role in fracture stimulation, please give us a call!

One piece of good news:  two presenters and several attendees with whom we conversed in the hallways and exhibition confirmed that plug-and-perf completion techniques are still preferred by many operators.  The operational efficiency gains afforded by packers-and-sleeves systems are great for short-term gain, but their impact on stimulated reservoir volume (SRV) and ultimate recovery (EUR) remain questionable.  There are also a raft of horror stories about what can happen when the valves fail to open, or the ball seat shears, or the packers fail to hold, or ... well, you get the idea!  Note to self:  make a point of compiling these risks somewhere for operators' reference when considering techniques other than plug and perf.

Good to see a number of old friends - and make a few new ones - at the conference.  Let's see what day 2 brings...

Welcome to the GEODynamics, Inc. blog!

23 Jan 2011 ... GEODynamics has officially embraced social media! 
Welcome to our new blog, where we will post our latest and greatest news - as well as thoughts, comments and questions related to perforating, completions, and wider E&P issues.
We look forward to your comments and suggestions!