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January/February

Contractors must deliver on performance

Critical D&C issues with Kjell Jacobsen, Seadrill By Jeremy Cresswell, contributing editor One of the drilling sector’s biggest headline grabbers is Seadrill, with its merger and acquisition activities and its $5.6 billion order book for new tonnage, with 11 rigs scheduled for delivery this year alone. Kjell Jacobsen is the CEO of Seadrill. DC: In a nutshell, what are the key issues that confront Seadrill, indeed the drilling sector today? Jacobsen: Clearly, our sector is growing very rapidly at the moment, and Seadrill is probably the player that’s growing fastest. In terms of key strategic issues for us, they are of course to build the organization and our competence so that we can actually deliver top performance to customers and ...

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Industry is primed for a breakthrough

Critical D&C issues with Rick Fontova, Enventure Rick Fontova is senior vice president for Enventure Global Technology. DC: From your perspective at Enventure, what do you see as the most critical issue facing the drilling and completion industry today? Fontova: Costs are skyrocketing. They’re actually increasing at a faster pace than the price of oil, and that has many of the major operators, especially those working in frontier areas, very concerned. In fact, many have started cutting back drilling programs. Although the industry is in a “boom,” we’re already starting to see the effects of astronomical costs, especially in drilling and completions. In order for the industry to continue at this pace, we must find a way to either drill ...

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Even above technology, industry must push training

Critical D&C issues with Pete Miller, National Oilwell Varco Pete Miller is chairman, president and CEO of National Oilwell Varco. DC: What do you see as the most critical issue facing the drilling and completion industry today? Miller: We’re in two worlds right now. On one hand we have the oil world. Oil price levels are significant, and that means there’s a tremendous demand internationally for oil drilling, whether it’s in the Middle East, South America, North Africa. On the other hand is the natural gas world, where prices are problematic. Going into the winter, the US is almost at record storage, and, by all appearances, it’s going to be a warm winter. For land drillers, the market is softening ...

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Newbuild start-ups to bring inevitable bumps

Critical D&C issues with Larry Dickerson, Diamond Offshore By Jerry Greenberg, contributing editor Larry Dickerson is president and chief operating officer of Diamond Offshore Drilling. DC: We are currently experiencing the longest and strongest up-cycle the offshore drilling industry has ever known. What is different about this cycle compared with the past? Dickerson: The temptation is always to say this cycle or that is different. To me, the most striking difference is the fact that, for the first time, the increase in oil prices has been driven by supply/demand fundamentals for the commodity. As we begin 2008, we are in uncharted territory because we will be entering the fifth year of this up-tick. We have never had a cycle as ...

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As reservoirs evolve, so do challenges

Critical D&C issues with Keith Morley, Weatherford Keith Morley is senior vice president well construction and operations support, chief safety officer for Weatherford International Ltd. DC: What do you see as the most critical issue facing the drilling and completion industry today and what can we do about it? Morley: Well, the second part is the tricky question. But I think it’s the changing dynamic of reservoirs we’re facing. Production from existing reservoirs is declining, and the quality of new reservoirs is decreasing. Aside from the Gulf of Mexico and West Africa, and excluding Russia and China, there haven’t been many new fields of truly significant size discovered in the past 10 years. Difficulty in replacing reserves is a big ...

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New oil environment, new contracting model

Critical D&C issues with Sverre Skogen, Hugh Mackay, AGR By Jeremy Cresswell, contributing editor AGR is one of a small but increasingly influential cadre of companies that have successfully built businesses around portfolio-based, packaged well construction management and related boutique services. Sverre Skogen is this Norwegian group’s CEO and Hugh Mackay is its business development director. DC: AGR laid its foundations in the North Sea and is becoming increasingly active globally, but how will this model work in other offshore provinces as they mature, small/mid-cap exploration and production companies gain ground and crude prices edge inexorably northward? Skogen: I am certain that our approach, where consortia of different small and mid-cap E&P companies are brought together to create credible back-to-back ...

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Recruiting talent is key challenge

Critical D&C issues with Rustom Mody, Baker Oil Tools Rustom Mody is director of technology for Baker Oil Tools. DC: From your perspective at Baker Oil Tools, what do you see as the most critical issue facing the drilling and completion industry today? Mody: Talent. In order to sustain growth in our industry, we need to recruit, hire and retain talented engineers – both recent graduates and those with experience. This is a real challenge because the negative perceptions of our industry created during the “hire and lay off” years are still prevalent, particularly among children of “baby boomers,” who witnessed what their parents endured. On top of that, the Internet and global business practices have spawned myriad new job ...

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Personnel is acute global challenge

Critical D&C issues with Dennis Smith, Nabors Dennis Smith is director of corporate development for Nabors Industries. DC: With E&P activity at one of its highest levels worldwide, what do you consider to be the greatest obstacle that drilling contractors and other companies are facing? Smith: I think the greatest obstacle continues to be people. I think it always has been and always will be the biggest obstacle. Whether you are talking about building rigs – skilled welders, electricians and pipe fitters – or whether you are talking about operations – roughnecks, drillers, rig managers – the higher the skill set required, the tougher it is to attract and retain good people. Even with the North American land markets flattening ...

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Raising recovery rate is industry imperative

Critical D&C issues with Vik Rao, Halliburton Vik Rao is senior vice president of technology for Halliburton. DC: What do you see as the most critical issue facing the drilling and completion industry today? Rao: I would say the biggest issue is simply meeting demand. Inability to meet demand is why prices are so high right now. Yes, there are other contributing factors from the downstream side, from speculation, from geopolitical instability, etc. But even accounting for those factors, the price is still high. For the first time in my 30-odd years in the industry, we are seriously talking about plateauing production, which was introduced by TOTAL CEO Christophe De Margerie. He basically said world production would plateau at 100 ...

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Safety focus is key amid personnel shortage

Critical D&C issues with Zuhair Al Hussain, Saudi Aramco Zuhair Al Hussain is general manager, drilling & workover for Saudi Aramco. DC: From your perspective at Saudi Aramco, what do you see as the most critical issue facing the drilling & completion industry today? Al Hussain: The most critical issue is safety. Shortage in manpower, coupled with a young and less experienced workforce is making the work environment fertile for accidents. We should put more focus and emphasis on safety training to instill safety behavior and build a safety culture. Another critical issue is downtime due to human error, equipment failure, borehole stability, fishing, side-tracking, etc. Downtime can be reduced by better tool design and training. A third critical issue ...

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