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Overseas drilling services explore the mode of renting drilling rigs

Overseas drilling services explore the mode of renting drilling rigs

  • Categories:Company news
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  • Time of issue:2021-04-26 11:50
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(Summary description)In Bolivia, Jianghan Petroleum Engineering Company broke the traditional mode of serving the owners with their own drilling rigs, renting the owners' drilling rigs and providing them with overall supporting services.

Overseas drilling services explore the mode of renting drilling rigs

(Summary description)In Bolivia, Jianghan Petroleum Engineering Company broke the traditional mode of serving the owners with their own drilling rigs, renting the owners' drilling rigs and providing them with overall supporting services.

  • Categories:Company news
  • Author:
  • Origin:
  • Time of issue:2021-04-26 11:50
  • Views:
Information

In Bolivia, Jianghan Petroleum Engineering Company broke the traditional mode of serving the owners with their own drilling rigs, renting the owners' drilling rigs and providing them with overall supporting services. Experts pointed out that although the advantages of this cooperation model are obvious, it is not easy to replicate and promote.

For a long time, most domestic oil engineering companies have brought their own drilling rigs to participate in overseas market competition, but Sinopec Jianghan Petroleum Engineering Company's innovative move has broken this traditional model.

Borrow chicken to lay eggs

On February 12, Jianghan Petroleum Engineering Company successfully won the bid for 3 drilling rig leasing projects of Bolivian National Petroleum Company. According to the agreement, during the contract period, Jianghan Petroleum Engineering Company leased three drilling rigs from Bolivian National Petroleum Company and provided overall drilling construction services including drilling rig operation, maintenance, spare parts supply, and construction organization.

Regarding this cooperation model, an expert who has been in the overseas petroleum engineering market for nearly 20 years said: “I have heard of domestic companies renting drilling equipment to foreign companies, and domestic companies renting small drilling equipment overseas. Equipment, but it is the first time I heard about the leasing of drilling rigs from the owners and providing supporting services for them.” Undoubtedly, this model is an important step for petroleum engineering companies in adjusting their operating structure.

Luo Kailin, manager of the overseas cooperation company of Jianghan Petroleum Engineering Company, likened this cooperation method to "borrowing chickens to lay eggs." So, what are the market advantages of this cooperation model? How to replicate? What are the operating risks in actual operation? In this regard, the reporter interviewed relevant industry insiders.

kill three birds with one stone

"Reduce the pre-operational asset occupation of the project" and "reduce the risk of overseas operations" are the two main factors that attracted Luo Kailin, manager of Jianghan Engineering's overseas cooperation company, to participate in this bid. He calculated the account for the reporter: "Compared with the traditional model, this model can save 300 million yuan only in the initial asset occupation. If you then calculate the equipment transportation fees, tariffs, and value-added tax that you need to pay when you bring your own equipment. Go in and save even more."

A senior financial expert in the industry also pointed out that today's overseas drilling service market is fiercely competitive, and the drilling market is a high-input industry. Many domestic companies need to advance large amounts of funds in order to compete for engineering projects, which has caused the contradiction of funding gaps to become increasingly prominent. The practice of "borrowing chickens to lay eggs" can effectively alleviate this contradiction.

In recent years, many overseas petroleum engineering service projects of PetroChina and Sinopec have been suspended due to local political turmoil, and the equipment they brought out have been thrown overseas as a result, and huge investment has been "washed up". In addition, due to many factors, the self-contained equipment may be stopped for several months or even a year from time to time. However, the service model of renting the owner's own drilling rig can effectively avoid these risks.

"This kind of cooperation is more conducive to us in handling the relationship with the owner. To put it bluntly, the owner must ensure that the equipment they purchase is working. We also use this method to establish a cooperative relationship with the owner first, and when we work together later We will definitely give priority to us." Yuan Xiangcheng, the Bolivian project manager of Jianghan Engineering, combined his years of work experience and added the third benefit of the "borrow chickens and eggs" model.

As a large natural gas exporter in South America, Bolivia's oil and gas exploration business has developed rapidly. Yuan Xiangcheng introduced: "In 2009, Bolivia had 10 drilling rigs, and this year, the number of drilling rigs in the country will reach at least 20. Undoubtedly, the practice of'borrowing chickens to lay eggs' has provided us with new business ideas for expanding the Bolivian market."

difficult to copy

The drilling management staff of International Petroleum Engineering Corporation believes: "The key to copying this cooperation model is to win the full trust of the owner. Otherwise, the owner will not rashly lease you a drilling rig worth hundreds of millions of dollars, nor will it maintain the rig. Maintenance, spare parts supply, etc. are entrusted to you."

By combing through more than two years of cooperation experience between Jianghan Engineering and Bolivian National Petroleum Corporation, it may be possible to have a deeper understanding of the key to successfully replicating the "borrow chickens and eggs" model. In 2011, the SINOPEC164 drilling team of Jianghan Engineering, as the first construction team of Sinopec to enter the Bolivian market, began to cooperate with the Bolivian National Petroleum Company. In the past two years, they have won the trust of Bolivian National Petroleum Corporation by virtue of good service quality. In 2013, it renewed the service contract with the owner by virtue of its excellent construction quality.

"Only with good management, good operation, and good service, can the owner choose us to operate the drilling rig." Yuan Xiangcheng said.

It can also be seen that this cooperation model is only applicable to those companies that have successfully entered the overseas market and have a basis for cooperation with Party A, and not applicable to those companies that have not yet or just entered a certain overseas block.

A senior manager of international petroleum engineering pointed out: "Opening up the market and building trust still depends on the traditional model, and we must rely on our own drilling rigs to show our financial strength and technical level. Because from the beginning of the bidding, Party A will use our own The number of drilling rigs is used to evaluate our qualifications. On the basis of mutual trust, we can try the model of'borrowing chickens to lay eggs' to open up the market."

Regarding the risks that need to be avoided in the "borrowing chickens and laying eggs" model, Li Zhanying, deputy director of the drilling division of the Petroleum Engineering Company, analyzed: "This model sounds like a transaction with no capital and three birds with one stone, but if the equipment is used improperly, Over-expenditure on maintenance and maintenance costs may not be as high as the profit of owning a drilling rig. Therefore, to adopt this model, one is to negotiate the lease cost with the owner; the other is to straighten out the production chain and calculate the time difference to ensure that the equipment is in the lease period. There is work to do and money to make."

In fact, whether it is for Jianghan Engineering or other domestic petroleum engineering technology service companies, the service model of "borrowing chickens and laying eggs" is a new attempt. The advantages and disadvantages need to be further summarized in practice.

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