At a Crossroads

At a Crossroads

February Insight

Jennifer Padgett, Business Development Manager

January 6, 2015
 

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With the dramatic drop in the the price of oil, we have seen two distinct reactions from the MWD service providers: First, as more active units are put on standby, we have seen customers focusing on refurbishing their existing fleets. This may entail repairs, extensive maintenance, parts swaps, and the like. This is certainly a logical response, and makes sense from the standpoint of reduced capital expenditures.

Another group of customers, however, are taking advantage of this momentary downturn to modernize their aging fleet with state-of-the-art MWD tools. This latter response obviously entails a major reinvestment.

Why would service providers take this ostensibly nonsensical strategy, you ask, especially in such a lean market?

We believe that it comes down to positioning. Undoubtedly, there will be winners and there will be losers coming out of this new pricing landscape. With over 70 independent MWD providers, we are bound to see some consolidation. Not even the multinational oilfield service companies are immune, as we have seen the likes of Baker Hughes taken over by Halliburton. Could a major be far behind—perhaps BP?

“Undoubtedly, there will be winners and there will be losers coming out of this new pricing landscape.”

Although oil may not return to the sub $100 level any time soon, the price will surely rebound as output from the U.S. declines. By mid-2015, many believe that domestic production will flatten then begin to drop. Assuming a 2-3 month period of market adjustment, the price per barrel will rise and perhaps stabilize by the end of Q4.

The question is: where does that leave your operation?

In a more aggressively priced atmosphere, operators will expect more for less. We are convinced that one way to differentiate your services and create a competitive advantage is to offer the data, reliability, and tools that only the next generation of MWD can provide.

Admittedly, “next generation” has a trendy marketing sound to it. The current generation of tools, however, have grown long in the tooth. Legacy technology, and the original 10-pin bus on which it is based, is almost three decades old! The platform has served the industry well, we all agree on that point, but it has also become a huge limiting factor as operators demand more measurements.

“The current generation of tools, however, have grown long in the tooth.”

The answer?

Featured in this new batch of February articles is a write-up on our all-new platform: TruCourseTM. You’ve heard the name, you’ve probably heard about some of its features, but this month we unveil our complete TruCourse product page and accompanying brochure. We invite you to find out for yourself why TruCourse is the platform of the future, designed from the ground-up to endure the harsh reality of this new drilling environment.

“Find out for yourself why we believe that TruCourse is the platform of the future…”

Yes, the industry is facing a major challenge, but it is only momentary. The innovative spirit of the independent market will prevail. With next-generation technology like TruCourse, we believe that we are doing our part to continue this revolution. Stay tuned for more.

 

 

Related Articles:

TruCourse Product Page

TruCourse Brochure (PDF)

Tolteq in 2015: A Bold Start to a New Year

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