Avoiding Costly Mistakes in Deepwater Ventures

Q. What role will Nalco Champion play in the deepwater Trion project in terms of driving down costs and boosting productivity?

A: Trion is a great deepwater project but it will raise a lot of challenges, given that it is a little deeper than the average for these types of projects. Since we have the experience of working with other companies around the world in deepwater, we would like to get involved as soon as we can to help gauge what the needs will be.

Although we design chemical treatments rather than actual platforms, we can make suggestions for mechanical changes to mitigate future problems. An example has to do with the number of injection points needed on a platform. There have been cases when not enough injection points were included, leading to a company needing to decide whether they wanted to implement hydration inhibition or corrosion inhibition, rather than being able to have both. An injection point is not needed for every one of our product lines but to drive down CAPEX it is vital to get the number correct during the design phase. This is the type of problem we could help avoid on the Trion project.

Additionally, we can help assess risk on the Trion project through the many proprietary models that we work with and that are designed to use the limited information available at the beginning of a project and assign risk categories. Depending on the client, the terminology is different and Nalco Champion adapts to each one. We assess the risk of asphaltene inhibition, hydrate and corrosion inhibition.

Q: What were the highlights of the development of Nalco Champion’s current deepwater solutions?

A: Product quality has been a stumbling block for us in the past, especially as environments became more and more harsh. This includes capillary strings for floating platforms and subsea tiebacks used on very distinct and deep platforms, which have limited chemical delivery systems. If anything goes wrong, costly robots or submarines have to be sent underwater to fix it, so product quality is paramount. We have rigorous selection and testing processes for the chemicals we use, which involve stressing the chemical beyond what it would ever experience in an umbilical to observe how it reacts under different conditions. Sometimes chemicals precipitate under pressure or may fail when the temperature changes. Nalco Champions knows what can potentially plug a line due to mistakes made in the past. Our chemical solutions are not commodities but specialized and tailored answers to our customers’ needs.

Q: How will these deepwater solutions be tailored to the Mexican market?

A: We will treat Mexico the same as any other market in terms of product development and quality. For deepwater, we are designing a logistics chain to handle raw materials, carrying out cost analyses and working out how to localize solutions. A lot depends on which port is going to be used. Currently all eyes are on Tampico, so we are looking at how chemicals would be delivered there. All our chemicals are Sureflow+ certified, so they require extra attention and a special line of custody in place.

Q: Mexico’s shallow waters are increasingly producing heavier oil. How can Nalco Champion’s chemical solutions impact these conditions?

A: Nalco Champion treats a lot of heavy oil in Mexico so we are already familiar with it. De-emulsification is probably one of the biggest issues but we have confidence in our products and people to face this challenge. Another area we feel confident in is flow improvers.

Q: What are the most important results the company has delivered to PEMEX?

A: Of particular note is our de-emulsification project with PEMEX in the north, which is a challenging environment. 

We have consistently met PEMEX’s requirements despite changing streams, new drills and different system configurations. We have had this business for over 25 years so this is something we are very proud of. Another success has been our role in providing full improvement strategies and developing corrosion inhibition products for extremely sour fields. We also participated in some deepwater activity with Lakach, helping identify key requirements for that field’s development. We worked with PEMEX on cost analysis and other areas in deepwater, during which we both learned lessons. We believe PEMEX learned the lesson of involving a company like Nalco Champion earlier on in the process due to the CAPEX costs we can help them save.

Q: What makes the Nalco Champion business model unique and how do you apply it to solving client problems?

A: Nalco Champion brings global solutions to Mexico with a local support structure. We help our distribution partner in Mexico to diagnose problems and create solutions while it provides the service to the clients. This is unique because usually companies arrive in new markets with the intention of doing things how they usually do them or compare it to other countries. We have identified Mexico as a unique market so we provide a model that addresses the country’s specific needs.

We see Mexico as a great emerging market with many opportunities. The more it grows and as there form’s changes take root, we will want to be closer to the action. The natural progression will be to move our operations to the country.

Q: What are the differences between the specific needs of Mexico and other areas such as offshore West Africa?

A: The production problems faced by Mexico’s oil and gas industry are not necessarily what is unique about the market. Rather it comes from how the problems should be addressed and the related services needed. The formula is simply different here, especially compared to a market like West Africa where there may be labor unions, for example.

In Mexico, cultural acceptance poses more of a challenge because clients need to feel comfortable and trust that service can be delivered as promised before going ahead. Luckily, Nalco’s model has been in place for over 20 years so it is a well-oiled machine.

Q: What does the Energy Reform mean for Nalco Champion, given its long-standing presence in Mexico?

A: Even though things are changing in Mexico PEMEX remains our main client, so our core business has not changed so much since the Energy Reform. This is a chance for Nalco Champion to bring its global services to the country, since we already work with IOCs and other NOCs across the world. It is simply a new environment. We are excited about working with new players and continuing our work with PEMEX too.