Luis Ferrán
Director General
The Mudlogging Company

Relevance of Mud Logging for Risk Reduction

Wed, 01/22/2014 - 10:25

With the winds of change blowing across the Mexican oil and gas industry, Luis Ferrán Arroyo, Director General of The Mudlogging Company, knew that his company had to renovate itself in order to continue being a leading provider of mud logging services. “Starting in 2012, we began diversifying our portfolio of clients to include private operators, such as Petrofac or Tecpetrol,” says Ferrán Arroyo. He expects PEMEX to follow in the footsteps of Petrobras and Statoil, which continued to be the leading operators even after the oil industries in their countries were liberalized. “Whether PEMEX operates on its own or in association with other companies, it will continue to be the main operator in the country,” he says. “However, we are aware that the private component of our client portfolio will continue growing in importance.”

Ferrán Arroyo continues to look at ways to improve The Mudlogging Company by adapting the company’s strategy to the new industry dynamics. “During 2013, we renovated the company. Most of the contracts we had with PEMEX expired last year, so we knew we needed to update our technology, our alliances with different companies, the level of knowledge of our personnel, our links with public and private universities, and our marketing strategies all at the same time,” he reveals. Doing this won The Mudlogging Company another PEMEX contract, a larger one than the previous ones it had been awarded. “The contracts we had previously won with PEMEX were regional, based on PEMEX E&P’s regions. This new contract is a national offshore contract that expires in December 2015.” Under this contract, The Mudlogging Company is looking to implement new technologies and train its personnel to enhance the interaction with universities.

Through its renovation process, The Mudlogging Company has made sure that its technological prowess is up to date. “The technological improvements in mud logging in the past few years have matched advances in electronic transmission and information technology. We have evolved from delivering our results on paper with a one-day delay to real-time acquisition and transmission of log records,” Ferrán Arroyo explains. “This way, our clients can see what is happening in the well, all while we are still logging and recording that data, enabling them to make informed decisions quicker. We strive to deliver every piece of information in real-time to where the client needs it. In the case of PEMEX, the information is sent directly to its ‘war rooms’, where managers and directors analyze it for decision-making purposes. Other clients based internationally prefer to have that information displayed in mobile devices such as tablets and phones. We follow the clients’ preferences and deliver real-time information to their preferred display device.”

This sets up Ferrán Arroyo to explain why mud logging is still viewed as essential, and the differences it holds over other technologies. “Seismic data will give you information about a subsurface block in three dimensions and data on the behavior of the rocks, plays, and geological systems on a regional basis. It is the final product of an interpretation process that is used to decide where to drill a well. Mud logging is a service that occurs inside the well, and requires tools to get information from the wellhead and transmit it to the client. The information we provide is real-time data when drilling wells,” he explains. “This information streamlines the decision-making process and helps to ensure important reservoirs and opportunities to drill are not being missed.”

Mud logging’s relevance for PEMEX continues to show in the delineation stage of the exploration process. Given the nature of the information it provides, mud logging has carved itself a well-established niche in between other exploration techniques. “PEMEX will continue to log strategic wells, both onshore and offshore, as it did with for recently discovered Navegante field,” says Ferrán Arroyo. As SENER decides on PEMEX’s Round Zero proposal, he believes that the company will be awarded with those fields that bring the highest revenue at the lowest cost, and where its teams have the most knowledge and expertise. Based on this prediction, The Mudlogging Company is already targeting the fields in Burgos, Poza Rica, Veracruz, and Villahermosa for additional exploration operations, given its experience there. Ferrán Arroyo also believes that the areas that get tendered to other companies will certainly provide his company with more opportunities to prove its worth.