Antonio Hernández
Director General
Codinamex
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View from the Top

Innovation Tackles Treatment Issues for Problematic Crude

Wed, 01/21/2015 - 14:04

Q: How did Codinamex become involved in the oil and gas industry?

A: A few years back, we analyzed the sectors we should bet on and we decided to opt for the energy and automotive industries because of their impact on the Mexican economy. As part of our activity in the energy industry, we set our eye on PEMEX and began developing crude separation systems. One of the main challenges with Mexican crude is its high levels of salt and water. These two parameters are crucial when selling crude oil because the salt and water levels have to be within a set range in order to meet export requirements. Otherwise, the commercializing company is penalized because the oil has to be treated. Right now, light crude oil production is falling in Mexico. Conversely, the production of heavy oil with high salinity and water content is on the rise. Our interest in this area led us to do research and develop systems that could address this situation. About three years ago, we developed a unique crude treatment system, for which we want to expand our market presence at gigantic steps.

Q: Considering how new and innovative the company’s crude treatment system is, how did Codinamex get its first contract with PEMEX?

A: A procedure needs to be followed in order to work with PEMEX. After our first approach, our product had to undergo several technological tests to prove its benefits. In addition to eliminating excess humidity and salinity, our desalination process reduces time and costs. Since our product can reduce the time needed to treat crude, it can also decrease the human resources required. Initially, our systems were used in fields in the South region, but as the use of our equipment becomes widespread, our objective will be to cover other geographical areas, in Mexico and abroad.

Q: What makes Codinamex’s patented systems for treating crude unique?

A: Codinamex has four main processes that were all created to provide solutions to our clients. Initially, we developed a dehydration and desalination procedure that resulted in our first patent. We then came up with a second system to recover contaminated hydrocarbons, responding to a common need in mature fields where wells are several years old and require constant stimulation. Stimulation fluids cause losses in hydrocarbon production. In these cases, PEMEX turns to deferred production, which consists of extracting the hydrocarbons, sending them to a second well, and recovering them 15-20 years later. Our systems allow recovering the hydrocarbons immediately, which means the cost is not affected. The third solution concerns gas lift through a pneumatic pump system that enables the separation of oil, gas, and water, injecting the latter back into the reservoir. Nitrogen is not used in the pumping process, so the system prevents the spending of resources on this gas and avoids the contamination it produces, reducing the effect of its heating power. Finally, our system makes it possible to separate crude and place it in a duct through backpressure. In general terms, Codinamex has developed practical solutions that benefit our clients’ operation, thus increasing their revenues.

Q: How do you expect the Energy Reform to lead to more demand for your crude treatment systems?

A: The Energy Reform opens the door to different business schemes. We want to create associations with other companies. Even though this was possible even before the passing of the Energy Reform, nowadays, we can work in a way that is more practical for both parties and think about win-win business transactions. In addition, the opening of the industry will welcome private actors to whom we can also offer our services. Finally, Codinamex offers cost reductions in a low oil price environment. For this reason, we are convinced that our niche market will grow. For example, a dehydration and desalination plant with a 10,000b/d capacity occupies an area of 1,200m2 with the PEMEX equipment used today. However, our systems with the same capacity would only use 363m2.. PEMEX’s desalination and dehydration processes take around 17 hours, while our desalination system takes ten minutes. Additionally, when stimulating a well, we can also separate the crude, treat the water, and even take advantage of the byproduct gas or injected chemicals for later use. The client does not need to hire any additional services from another supplier because Codinamex covers the entire production cycle. Another advantage is that our plants can be operated by two people that do not necessarily have to be at the separation and desalination equipment, as they can work remotely using computers.