Managing the Flow: Valves for the Upstream MarketTue, 02/20/2018 - 11:35
Q: How did Válvulas Worcester de México become one of Mexico’s most important valve OEMs?
A: This is a family-owned business my father started in 1963. We were the first company in Mexico to establish operations in both manufacturing and assembly of valves. In the beginning, we did not have our own facility but went to workshops to buy the steel, either forgings or castings, before carrying out all the machining outside. We then started doing all the assembly, testing and commercialization ourselves on a small scale.
Over time, we diversified not only into ball valves but valves in general, such as gate, glove and check valves. Our latest line of products is the butterfly valve. We believe this product will be in demand and our brand is known throughout Mexico, where we have around 55 percent of the market share for valves. Throughout the years, the Mexican mentality in this industry has changed. We all know that in Mexico, manual labor is relatively cheaper than in other regions like Canada, the US or Europe. In general, the mentality has been that manual valves were much easier to operate and much more economical as they could be operated by low-cost workers. Throughout the years, we have dedicated many resources to training and today automation is a big part of our business. We still do R&D and in 2018 we will launch some new designs and new valves. We are also thinking ahead to what might come for 2019.
Q: How is technological innovation impacting your way of doing business and building valves?
A: It is a unique opportunity. Companies have to innovate and part of that innovation is keeping up with changes in the different aspects of the business. We have to stay up-to-date on processes related to IoT and make our manufacturing processes more efficient with CNG equipment. Right now, we are not only competing with local manufacturers but against the world.
Q: In which part of the oil industry — upstream, midstream or downstream — are you seeing the most demand for your products?
A: We see a great deal of demand in the upstream sector for trunnion mounted ball valves. We have been making these bolted and welded valves for many years. The trunnion mounted ball valve is usually used on offshore platforms and accounts for a very high percentage of valves used when hydrocarbons are being pumped out of the reservoir.
Under these conditions, the valves must be trunnion mounted because the deeper the drilling the higher the pressure. There are also very high temperatures so these are the best valves to get the hydrocarbons out of the ground. Once the production is on the surface and the heavy gasses and oils are being processed, the size and diameter of the pipelines is reduced and more applications for other valves present themselves.
In midstream, our products are used with natural gas pipelines, such as the Los Ramones project and other investments as a result of the Energy Reform. Our distributors work hard to be included on the vendor lists of companies such as TransCanada.
Q: How do you distribute your valves?
A: We generally do not sell directly to clients; we have a network of 46 distributors in Mexico that all have the same price structure. This accounts for around 95 percent of the valves we sell. Part of the growth we have experienced to get to where we are today is through the efforts of our distributors. PEMEX and CFE are two entities that use our products, for example, but they do not buy directly from Válvulas Worcester.