Artifi Cial Lift Techbook 2
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2 018 Artifi cial Lift Techbook A supplement to All the brands you know and love. Now part of Apergy. We’re the same iconic companies we’ve always been. So you get the same service you’ve always had. But now we’re part of an independent, publicly owned wellsite services organization. Apergy. Operating under four industry-leading divisions emerging from Dover Energy, in Apergy Artificial Lift, you benefit from a network with 440 years of expertise in total wellsite management. Visit Apergy.com – great brands. One great big name. Apergy-8x10.5 inches ad-01June18-aw.indd 1 01/06/2018 15:46 Hart Energy’s Techbook Series The 2018 Artificial Lift Techbook is the 16th in a series of techbooks in which Hart Energy will provide comprehensive coverage of effective and emerging technologies in the oil and gas industry. Each techbook includes a market overview, a sample of key technology providers, case studies of field applica- tions and exclusive analysis of industry trends relative to specific technologies. To learn more about E&P technology trends, visit EPmag.com. Artificial Lift The 2018 Techbook A supplement to E&P Table of Contents HART ENERGY 1616 S. Voss, Suite 1000 | Houston, Texas 77057 Tel: +1 (713) 260-6400 | Fax: +1 (713) 840-8585 OVERVIEW hartenergy.com Artificial Lift Market on the Move 2 Companies seek artificial lift technologies and innovations Group Managing Editor, Print Media JO ANN DAVY that can handle a wide array of operating environments. Executive Editor JENNIFER PRESLEY Chief Technical Director RICHARD MASON Associate Editor BRIAN WALZEL KEY PLAYERS Associate Managing Editor ARIANA BENAVIDEZ Maximizing Production with Artificial Lift and 4 Assistant Editor ALEXA WEST Automation These key players have mastered the art of recovering more production via artificial lift. Contributing Editors JOSE LEON ARAUJO STEPHEN FAUX GRAHAM MAKIN JENNIFER PALLANICH TECHNOLOGY The Future is Near YAHYA SARAWAQ 24 Artificial lift technology continues to mature on all fronts as BLAKE WRIGHT contractors target the sweet spots. LARA ZSOHAR Group Managing Editor, Digital News Group LEN VERMILLION TECHNOLOGY SHOWCASE Technologies to Optimize Well Performance 34 Operators depend on reliable and innovative products and Corporate Art Director ALEXA SANDERS services to maximize the well production life cycle. Marketing Art Director MELISSA RITCHIE Senior Graphic Designer MAX GUILLORY Production Manager SHARON COCHRAN CASE STUDIES Vice President, Marketing GREG SALERNO Improving ESP Installs by Removing the Rig For additional copies of this publication, Coiled tubing-deployed ESP system allows for faster and safer contact Customer Service +1 (713) 260-6442. installations in wells both onshore and off. 40 Senior Vice President , Media RUSSELL LAAS Publisher, Gas Lift in the Digital Oil Field Oil and Gas Investor KEVIN HOLMES Digital intelligent artificial lift system creates a paradigm shift Publisher, in gas-lift operations. 43 Midstream Business DARRIN WEST Optimizing Artificial Lift 24/7 surveillance service captures, interprets and recommends action to boost performance. 46 Vice President , Editorial Director PEGGY WILLIAMS Chief Financial Officer CHRIS ARNDT Chief Executive Officer RICHARD A. EICHLER On the cover: Beam pumps at work producing oil from southeastern New Mexico’s Delaware Hart Energy © 2018 Basin. (Photo by Jennifer Presley, Hart Energy) EPmag.com | July 2018 | 1 ARTIFICIAL LIFT: OVERVIEW Artificial Lift Market On the Move Companies seek artificial lift technologies and innovations that can handle a wide array of operating environments. By Jennifer Pallanich Contributing Editor s the oil and gas industry continues recovering mation Technology. “It seems there’s a trend back to from the most recent bust cycle, the artificial financial discipline and operating within cash flow.” Alift segment is finally beginning to climb out Stability in oil pricing is having another effect, of its slump. Because artificial lift equipment typi- he said. cally is not purchased until a well is completed—or “A lot of the operators are getting back to taking much later—the sector’s recovery has lagged behind care of their wells. There’s more maintenance and other oilfield services. repairs. Well servicing activity is starting to pick up According to Dimitar Kostadinov, a senior ana- slightly and is projected to pick up some more here lyst with McKinsey Energy Insights, the artificial lift in the balance of this year,” Mahoney said. market has been improving with the recent rise in When it comes to artificial lift in unconventional well completions. The firm expects the artificial lift plays, he noted there seems to be a move toward pro- sector to be strong in 2018 and to turn in even stron- viding lift earlier in a well’s life. ger results in 2019 due to completions of new wells. “It’s driving more activity on the gas-lift, electric Kostadinov does not, however, believe pricing will submersible pumps and, in some cases, the hydraulic recover to pre-2015 levels. lift area. We’re seeing more activity and good growth One reason is because beam pumping units and rates in those areas,” Mahoney said. “You have some gas-lift technologies have been largely commoditized of the shorter laterals from earlier unconventionals but also because international players have aggres- work in 2013 and 2014 starting to mature, and the sively entered the local market to put pressure on production rates have declined to a point where some prices, according to McKinsey. decisions on a change of technology is afoot, convert- Operators changed the way they bought artificial ing to the tried and true reciprocating rod lift arena.” lift equipment during the downturn. In the past they According to Kostadinov, the last few years have preordered units and even paid extra for access to shown some changes in the preferred technology used manufacturing capacity for beam pumping units in artificial lift, with operators installing more gas and electric submersible pumps (ESPs), according lift at the expense of ESPs and some higher capacity to Kostadinov. Now the operators are tending to beam pumping units. The cost of installing gas lift contract for the units much closer to the expected is lower than other technologies, associated gas pro- installation date. The shift minimizes inventory and duction is abundant and compressors can be rented improves cash flow. The company said if such an to spread the cost over time. McKinsey noted some approach continues, artificial lift procurement will Permian-focused independents have entirely shifted be more of a spot market than a bulk market. to gas lift for their newly completed wells. “It’s been an interesting journey since the down- The last year has shown a resurgence in ESP use, turn and the commodity price change,” said Paul boosted by rental offerings, according to the company. Mahoney, president of Apergy Production and Auto- Beam pumping units have been pushed back in the 2 | July 2018 | hartenergy.com ARTIFICIAL LIFT: OVERVIEW Beam pumps, like these located alongside the salt flats just outside of Carlsbad, N.M., on the road to Jal, are a popular form of artificial lift in many basins. (Photo by Jennifer Presley) pecking order for new wells in the Permian but remain Mahoney added. “There’s no silver bullet, but a com- popular in other basins. pany like ours is working on four or five major new things to support the industry.” Drive for innovation According to Kostadinov, oilfield services compa- Operators are favoring automation and remote nies have gradually raised the overall quality of their monitoring systems in an effort to improve effi- artificial lift offerings, incrementally improving gas ciency. Operators are clamoring for technologies handling and lifting liquids from deeper laterals. The that can widen the operating envelop for artificial overall resistance of pumps and related equipment lift, Mahoney said. also has improved. The modularization of artificial “There’s been a renewed emphasis on developing lift, especially ESPs, has resulted in less rig time and technology that helps the operator with the wider lower installation costs, with equipment coming in operating range in downhole conditions. That’s get- fewer parts and also preloaded with consumables ting more and more prominent,” he noted. like oil, he added. Conditions include declining production rates as One of the existing challenges in artificial lift is well as handling large amounts of gas, solids and sand. access to people and parts, which is crucial for sup- The biggest push is around automation and analyt- porting customers. Education also can be helpful, ics with the goal of monitoring wells, analyzing data Mahoney said. The company’s Artificial Lift Academy to extend equipment life, predicting failure patterns offers more than 50 courses to help train industry and fieldwide production management, he added. personnel on artificial lift technologies, engineering “We’re trying to marry our installation base, our tools and digital technologies. application knowledge and collaboration with cus- “Some operators know the guidebook or playbook tomers to bring digital automation capability to the they want to exercise for artificial lift and … a good market that drives outcomes and better decision-mak- percentage of customers don’t know what their play- ing for the operator,” Mahoney said. “We’re working book is and they’re looking to companies like ours to on new product development to extend the ranges be able to provide that guidebook for them [and] what and handle adverse downhole conditions.” makes sense over the life of the well,” Mahoney said. Apergy’s efforts target a combination of extending While the market for artificial lift equipment has existing technologies and developing completely new been a difficult one in the most recent downturn, industry technologies. Mahoney is optimistic about the sector’s future. “We have some things in the early ideation stage “Artificial lift will always be needed,” with preliminary engineering work going on,” Mahoney said.