Aligning Human Talent and Drilling Technology

The appointment of Tony Petrello as CEO of Nabors two years ago brought substantial changes to the company’s strategy. After offloading noncore business activities, Petrello decided to reorient the company into two separate areas: Completion & Production and Drilling & Rig Services. The Drilling & Rig Services division presently operates in Mexico and Nabors is planning to expand its Production & Services portfolio across the region in the near future. This segment will encompass coiled tubing operations, pumping and pressure services, directional drilling, stimulation, and fracking. César Vera, Mexico Area Manager of Nabors, believes that even though the US gas boom has not had a negative impact on the company’s Mexican operations, it made Nabors question the direction it wanted to take. While the detonation of the gas market has limited the number of rigs Nabors could bring to Mexico, it is more active than ever on the US side of the border, where it is obtaining meaningful expertise that will add value to the Mexican shale gas opportunities once these open up.

Nabors’s competitive advantage lies in the vast experience the company has gained in the market. Vera claims competitors have not been able to fully replicate the company’s rig technology. “Nabors’ onshore rigs are easy to disassemble and move, but our main asset for onshore drilling is the human talent operating our rigs and our ability to move these in ten days. To date, none of our competitors have been able to match this deadline,” says Vera. Nabors is confident that its offshore rigs also distinguish themselves, as they are able to be assembled and dissembled without the need for an external crane. “We require 21 to 35 days to move a rig offshore. Our downtime is well below 1%, while PEMEX contracts allow for up to 3% downtime,” details Vera. “We strive to optimize the alignment between human talent and the objectives of the contracts, while the high efficiency of our workforce allows Nabors to operate with a smaller pool of employees than other companies in the sector.”

In Mexico, Nabors has limited its product offering to the MASE and the Super Sundowner rigs. “We are building two new rigs that will have a larger capacity than MASE. These will be brought into Mexico once we secure a contract with PEMEX,” Vera comments. Nabors has received requests for more rigs, but the company is moving forward one step at a time as it does not want to grow rapidly, only to compromise on quality and performance. The Super Sundowner possesses the technology that first opened up the Mexican market to Nabors. These state-of-the-art platform workover rigs can be easily converted to light drilling mode as they come equipped with portable top drives and expanded mud systems. Super Sundowner rigs are also well-known for maximizing rig horsepower in a minimal amount of space. A bootstrap self-erecting design mast allows for rig up and rig down movements on platforms without external cranes, saving operators costs associated with crane vessels or extra crane barge rentals. “PEMEX already has three Super Sundowners operating in the Gulf of Mexico, although the company requested five. We cannot cover the demand at the moment because our rigs are being used in the US. PEMEX has requested MASE rigs as an alternative,” comments Vera. On the onshore side, the company is running the third field trial for a Nabors solution called Non Stop Driller. This technology allows users to reduce connection times without interrupting the connections on underbalanced or managed pressure drilling, which normally occurs in depleted zones, generally located in the south of Mexico.

Nabors’ commitment to high performance is supported by a steady investment in technology and innovation. “Nabors is one of a handful of companies actively using and developing advanced software to improve drilling efficiency, and we hope that programs such as DRILLSMART, ROCKIT, and REVIT, which have been shown to reduce drilling time by up to 35%, will be inserted into future contracts,” says Vera. “We look forward to entering a tender where companies are welcome to bring such technologies with them. We offer the advantage of knowing that these advances in software will work on our rigs.”

Mexico is likely to see more of Nabors’ rigs and other products in the future, especially since the company has entered into a strategic partnership agreement with PEMEX’s Drilling Division. “We have been in discussions with PEMEX regarding possible collaboration through an integrated approach or a strategic partnership,” says Vera. “PEMEX already possesses great knowledge of field operations, leaving Nabors to focus more on planning, performance and accountability.” Nabors has made long-term business plans for Mexico because the country continues unveiling new potential. “Mexico is our second largest market globally and unless the situation in Venezuela drastically changes, it should remain that way for some time to come,” concludes Vera.