IN PLAY: A Bakken-Specific Merger

Allied Wireline Service LLC opened a Dickinson, N.D.-based office in 2013.
By The Bakken Magazine Staff | April 30, 2014

Allied Wireline Service LLC opened a Dickinson, N.D.-based office in 2013. Through the acquisition of Pennsylvania-based Horizontal Wireline Services LLC, Allied has made the necessary steps to become a serious Bakken service provider, says Peter Brink, chief financial officer for Allied. The merger displays the demand for Bakken oilfield service providers to offer as many technologies and services as possible. In Allied's case, it meant uniting service providers from resource plays operating outside the Bakken. The reason for merging wasn't about offering a new technology, however, says Brink, service providers need to fit the mold of the one-stop shop.

For Allied and Horizontal, both formed in 2010, the combined business offerings will not bring new services to the Bakken. “It is really just more about being able to do things better and faster than we were able to do on a standalone basis,” he said.

Through the merger, Allied will now provide a full suite of wireline services in the Bakken, including open- and closed-hole logging, completion services, perforations and reservoir analytics. According to Brink, the completion services provided by Horizontal were in high demand in other shale plays. Horizontal’s completion capabilities will make Allied’s Bakken service offerings more robust, according to Brink, a necessity to establishing itself as an independent provider capable of delivering the same level of service and technology as the larger, global entities operating in the unconventional oil resource industry. “The market hasn’t seen some of the sophisticated tools we have outside of the major oilfield service companies,” Brink said.

 “Our base [Bakken customers] is relatively new. We just got established in late 2013. We are in startup mode, but with the combined horsepower we have now, we can grow more quickly than we could have otherwise,” Brink says.

One of the main advantages of the merger will be Allied’s access to Horizontal’s personnel and its expertise at completion services. On the logging services side, Allied has already established its capabilities. When the company formed in 2010, it formed a relationship with GE Oil & Gas to use GE’s technology and know-how. The strategic partnership with GE allows Allied to use tools designed to be shorter and lighter than other tools, qualities that reduce the need for drilling teams to go as deep into the formation of interest and allow the operating team to reach bottom quicker.

For cased hole logging applications, Allied can now perform several of the same services as the larger companies, including: cement evaluations, casing evaluations through magnetic thickness tools and multiple-arm calipers, compressed and pulsed neutron tests, multi-array sonic testing and production logging.

“Obviously there is tremendous opportunity on the completion side,” Brink said. But, while the addition of Horizontal’s completion abilities is exciting for Brink and the Allied team,“there is also a continued opportunity for logging and reservoir analytics,” he added. The opportunity for logging and reservoir analytics stems from current and pending regulations that already do or will require operators to track cement pumped into the well for casing. And, although operators in the Bakken have completed over 6,000 Bakken wells and compiled historic-levels of data and core samples, most continue to core wells in an effort to maintain the ability to perform data analysis on future wells.

Although the merger is relatively new, Brink says the two companies are already looking for best practices and strategies used by each that can be applied to the Bakken. “We expect this thing to be a very successful combination,” he said. “It positions us as a leading independent wireline company.”