Field-Driven Upgrading

FROM ISSUE FOUR: For modern-day energy service providers competing for the biggest clients in the hottest plays, the push for the next best thing is a constant—and a requirement
By Luke Geiver | June 18, 2018

Tim Wallace believes the shale energy services industry is on a path to make better use of data to improve performance, much like artificial intelligence applications with predictive analytics and IBM’s Watson computer. Wallace, who served as president of completion services for C&J Energy Services and recently transitioned to president of strategic planning, notes that his company has been steadily implementing technological improvements that enable predictive analytics to improve performance. In an ever-changing industry, knowing when technology upgrades are needed (or when equipment will require downtime) to support efficient and quality execution is critical to being competitive in the shale world. C&J, based in Houston, is all too aware of this necessity. Currently active in all major shale plays in the continental U.S., C&J has executed an aggressive growth strategy, both organically and through multiple acquisitions and other strategic transactions, domestically and internationally, to transform into an industry powerhouse.

After enduring difficult conditions during the historic industry downturn that ultimately resulted in a management change and Chapter 11 financial restructuring, C&J is one of several energy service firms that have reinvigorated their presence in the new well- focused services sector with improved offerings and a strong focus on constant and continuous improvement. Wallace and his team have honed their approach to thriving as a modern-day shale service provider to operators in multiple basins. For them, it’s all about combining field-driven technology enhancements with premium service—and, like Watson, an element of predictability. We spoke with the C&J team to find out what it takes to succeed with a business that is linked to the price of oil, requires anticipating evolving client needs and, as Wallace says, “is intense and hard on equipment.”

See the Whole Picture
The major strength of C&J, Wallace believes, is its broad focus. “We’re active across different parts of the well life cycle,” Wallace says. “We offer a very broad base of services. I like that model.”

C&J operates in three reporting segments led by a president of completions services, well construction, well support and interventions services. In addition to the multi-leader focus, the company relies on a research and technology (R&T) team, based in Houston with a state-of-the-art facility, that helps create solutions to problems that arise in the field. “We can be very responsive to industry trends and customer needs because of our R&T capabilities,” says John Swift, C&J’s director of marketing.

“We have the luxury of using expertise across multiple product lines. It makes it easier to have an integrated approach to completions,” Wallace says, adding that his team can bring a total engineering package to the well. “We know this is important to the operator.”

During a time when the term “enhanced completion” dominates the list of buzz terms used in investor calls or E&P presentations, Wallace says C&J’s whole-picture approach enables C&J to deliver to its customers new products designed to bring better performance or efficiency to the completions process at a quicker and more-effective rate. Energy service firms looking to evolve with the industry must constantly look to the future. As Wallace and Swift both explain, it is not enough to simply be a dependable, quality-driven service provider.

The demand for new technology and need for efficient operations are the drivers behind Wallace’s belief in predictive analytics. In the near term, he believes C&J will be able to predict when equipment is about to require downtime and maintenance. Knowing in advance is a variable that can save operators money while adding revenue for service providers. “We’re looking to do that with our frack equipment,” he says. “We want to predict when it’s likely to fail and stay on top of preventive maintenance to avoid any unplanned downtime.”
 
Preparing for The Future
With predictive capabilities for pressure pumping units in the works, C&J is also working on several other tech upgrades, offerings and workforce strategies. The company now offers the trademarked LateralScience process, an engineered completion modeling service that relies on drilling data to create a hardness profile for the rock along the entire lateral wellbore. Their new trademarked GameChanger perforating system, developed by an in-house team of engineers, features a semi disposable gun assembly designed to eliminate the misruns and resulting NPT associated with traditional gun systems. And, as more operators are working to reduce their carbon footprints, C&J has announced new technology that reduces fuel consumption at the wellsite.

C&J has 16 horizontal (or horizontal equivalent) hydraulic fracturing fleets deployed in the field now. By the end of 2018, the current plan is to roll out at least three more fleets, with another two fleets expected to come to market in late 2018 or early 2019. Wallace is optimistic about the industry in general and says C&J’s new well businesses are growing across every major U.S. basin.

Working in conjunction with the R&T team, Wallace says alleviating industry challenges starts in two main areas: perforating misruns and blending problems. These two areas—that is, when the perforating guns are run to perform downhole perforations, and the frack blending process used to mix sand with water—pose a high risk of giving operators headaches and causing downtime. “We are working on some big improvements in each area,” Wallace says.

Along with wellsite operational challenges, both Wallace and Swift say there are still personnel and hiring hurdles in the sector. Although they say they’ve had success in staying ahead of shortages, both recognize the challenge is significant, it’s real, and it requires constant attention. Like C&J’s in-development projects for new technologies, they were unwilling to fully divulge the strategies used by C&J to maintain the proper workforce, indicating only that one area that has provided success is C&J’s support of our military veterans.

In general, the number of stages and perforation clusters used by operators in most wells in U.S. basins is only going higher, Wallace says. He believes laterals will only continue to get longer as new coiled-tubing options enable engineers to reach further distances in the quest to optimize recovery. C&J is working on new technology in this area as well.

“It’s amazing how much technology has grown and advanced,” Wallace says. For modern-day energy service firms that are competing for the largest clients in the biggest and most competitive shale plays, it is now a requirement of existence to emphasize a look to the future, both Wallace and Swift say. New technology and approaches “have pushed service companies like us to keep looking for breakthroughs in how to do things better on multiple levels,” Wallace says. “It is, and I believe will continue to be, fun to watch and participate in this dynamic industry.”

Author: Luke Geiver
Editor, North American Shale magazine
701-738-4944
lgeiver@bbiinternational.com