Driving Product Reliability and Service Quality in the Oil Service Industry

Transcription

1 Driving Product Reliability and Service Quality in the Oil Service Industry June 14, 2012 Randolph Phillips Vice President, Enterprise Reliability

2 Randolph Phillips Hopeful Takeaways VP of Reliability at Baker Hughes responsible for the Corporate Reliability Program across all product lines and services. In 2006, joined Baker Hughes as the VP of Reliability and Quality for the INTEQ Division of Baker Hughes. 1. Reliability, Quality and Risk Management Challenges facing the Oil & Gas industry now..... and going forward Prior to that, 22 years at General Electric with Aircraft Engines, Aerospace, Transportation and Energy Divisions. Served on faculty at Villanova University where he also received his BS Electrical Engineering. Received MS and PhD in Electrical Engineering form the University of Illinois. 2. What the Community of Reliability and Quality professionals can do to support this industry 2 3 Baker Hughes Customers FY2011 Revenues: > $20 billion Hughes Christensen INTEQ ~ employees Facilities in > 72 countries Operates in > 90 countries Baker Hughes Drilling Fluids Baker Atlas Baker Oil Tools USE TO BE: 8 INPENNT PRODUCT LINE BASED P&Ls. Centrilift Baker Petrolite NOW: 9 P&L REGIONS SELLING ACROSS PRODUCT LINES. BJ Services 5

3 Competitors Energy Demand Global Oil Field Services (OFS) Market TAM for BHI Portfolio: Up 16% YOY Market Share $400,000 $350,000 Millions 13% 42% 13% 10% 8% 4% 4% 6% Pressure Pumping Offshore Drilling Off. Construction Land Drilling OCTG Geophysical Wireline Others $300,000 $250,000 $200,000 $150,000 $100,000 $50,000 $ ~$340B TAM ~$140B Market 8 Source: Spears & Associates Oilfield Market Report, Oct Baker Hughes Incorporated. All Rights Reserved.

4 6/28/2012 Drilling Systems Technology Advancements... OnTrak BM Drilling Fluids AutoTrak G3 Pressure Resistivity Directional Azimuthal Gamma + image Vibration & Stick-Slip Bi-directional Communications & Power Module Drilling Optimization LithoTrak SoundTrak TesTrak Directional Drilling Density + image Caliper Porosity Compressional & Shear acoustic Formation Pressure & mobility Drill Bits ~ runs per year Miles of wire. Sensors. PCBs. Connectors. Seals. Etc. 10 Directional Drilling From standard well profiles Directional Drilling To advanced well designs miles long True Vertical Depth (m) 30 inch inch X-23 Y2H TD 7,076M MD X-23 Y3H TD 7,230M MD X-23 Y1HT4 TD 4,513m MD inch X-23 Y1HT inch X-23 Y1HT2 Wellpath X-23 Y1HT4 Wellpath X-23 Y2H Wellpath X-23 Y3H Wellpath

5 Wire Line Systems Completion Systems Fluid Sampling Pumping Services Integrated Formation Evaluation Sand Control Completions Multilateral Systems Expandable Completions Wire line Logging Logging While Drilling Perforating ~ per year /28/2012 6/28/2012 Pressure Pumping Oilfield Chemicals Progressing Cavity Pumps Workover Services Fishing Services Electric Submersible Pump Systems Production Logging ~ active ~ 8000 installs per year 6/28/2012 Intelligent Well Systems ~ per year Production Systems 16 Flawless Execution Coring 17

6 Cumulative Annual Growth Rates C&P D&E PP The Role of Reliability and Quality: Part 1 Performance Risk Management 10,000 on-rig failures per year (BH only) Non Productive Time (NPT) ~ Downtime TAM $B Cost to Operators ~ $6B (all SC) Cost to BHI ~ $1B CoF/CoPQ/CoQ 19 Rig Costs: NPT Means Rigs not being utilized Challenge #1 What Can the Reliability and Quality professional do to help reduce on-rig failures and reduce NPT & CoF? Many off-shore rig day rates are over $1M / day 20 Rigzone.com 21

7 The Role of Reliability and Quality: Part 2 HS&E Risk Management Top Oil & Gas Spill Issues Since Macondo Explosion in Gulf of Mexico in 2010 changed Regulatory Requirements for Operators and Service Companies.... in the Gulf of Mexico and WW Nigeria December 21, 2011 France December 16, 2011 Brazil November 7, 2011 UK August 10, 2011 US July 1, 2011 China June 4, 2011 Canada April 29, 2011 India January 21, 2011 Italy January 11, 2011 India August 7, 2010 US July 27, 2010 US July 26, 2010 China July 16, 2010 Egypt June 16, 2010 US Jun 11, 2010 US May 25, 2010 Singapore May 25, 2010 Nigeria May 1, 2010 US (GoM) April 20, 2010 Increased Visibility Increased Financial Accountability The Role of Reliability and Quality: Part 2 HS&E Risk Management Regulatory Agencies Raising the bar on standards that further mitigate HS&E risks o Training & Competency Assurance o Traceability o Standard Operation Procedures o Risk Management Program for Products and Services Challenge #2 What Can the Reliability and Quality professional do to identify and reduce HS&E events on-rig/downhole? FMEA IOCs and NOCs Driving country specific standards into their own Supplier Qualification Specs Bow-Tie 24 25

8 Mitigating Risks Across the Product Life Cycle Focus of New Standards Operations Reliability Pre Macondo Little Oversight or Standards Post Macondo Regulatory Mandate Where failures come from? Reliability Risk Mitigation Processes 50% 10% 40% DFMEA Design For Reliability Reliability Testing Manufacturing QA/QC/L6σ DFM Supplier QA/QC Training & Competency Standard Operating Procedures PFMEAs QMS/ Audit Program FRACAS RCA/Life Data Analysis Mission Data Customer Training & Competency Standard Operating Procedures (SOP) Centralized OS & QMS Material Traceability Product and Service Risk Assessments (PFMEA) 27 Where Are We Today? Regulatory Initiatives focusing on Operations: People that execute Oil Field Services On-rig or in Repair Centers What s Next? More Oversight upstream Supply Chain Design Aerospace? How Do We Address Our Challenges? What can the R&Q professional do to reduce onrig/downhole HS&E events? Data Driven Risk Management Program on Critical Services Reliability & HS&E become one! What Can the R&Q professional do to reduce on-rig NPT failures? ROI models for NPT and CoF/CoQ reduction investments Design for Reliability and Supply Chain Quality Management Execute Existing Best Practices 28 29

9 Risk Management Process Phase 1: Services Risk Matrix Based on SME Estimates on S and O Leadership Challenges: Required Investments 10 PP PS PP PP PP PP PS Quality Field Data. What failed? Why? Mission Profile? Who Owns? World Class RCA and FRACAS Hold Design, Supply Chain and Operations leaders accountable to results. PS PS Supplier Reliability Assurance Severity Design for Reliability Execute. No short cuts. FMEA Strategy: All Services Maintain as Controlled Documents 1 1 Likelihood/Occurrence Reliability Labs and Test Equipment What this means to the R&Q Professionals From R&Q Engineers.... to Product & Service Risk Managers Broaden your horizons!! Understand Performance and HS&E risks across all O&G Product Life Cycle functions (Design, Supply Chain, Operations) For Certain Critical Services (P f < 10-6 ) Field Data Capture Requirements You are the experts! What field data is needed? Be Business Leaders! Develop credible CoF/COQ/CoPQ models with Finance ~ 1B$ opportunity! 33

10 Summary Oil & Gas Industry is going through a Risk Management and Service Quality Revolution 1. Standards which have been driving Aerospace, Aviation, Medical Systems and Automotive will become requirements for certain Critical O&G Services 2. Operators and Service Companies must invest now in a Products & Services Reliability & Risk Management Strategy Compliance Minimize liability/reduce insurance premiums Improved Contribution Margins 3. 3 rd Party Initiatives API Task Group on Product Life Cycle Management SPE Forum of Reliability in the Oil & Gas Industry 34