Serial production of Measurement- While-Drilling (MWD) systems with dual (electromagnetic (EM) & mud-pulse (MP))

1. Serial production of Measurement- While-Drilling (MWD) systems with dual (electromagnetic (EM) & mud-pulse (MP)) data

Import Substitution
SERIAL
PRODUCTION
DRILLING
(MWD)
OF
MEASUREMENT-
SYSTEMS
WITH
WHILEDUAL
(ELECTROMAGNETIC (EM) & MUD-PULSE (MP)) DATA
TRANSMISSION FOR HORIZONTAL WELLS DRILLING
(INCLUDING
NAVIGATION
CONTROL EQUIPMENT)
R&P ENTERPRISE «OPK»
RUSSIA 2017
AND
DRILLING
PROCESS

2. ABSTRACT

• Σ
$15 million
• T
3 years
• NPV
$45 million
• Profit $63 million
What’s new:
60%
30%
MWD Market share
Hard-to-Recover reserves in
Russia
20%
Horizontal Drilling
FEC 2013
Total number of drilled 20 840
тмп including 4 329 тмп
horizontal ones
• Dual data transmission (EM and MP)
• Gyro inclinometer
2
• Drilling process remote control

3. challenges facing the oil & gas industry

CHALLENGES FACING THE OIL &
GAS INDUSTRY
Problems
A need to develop hard-to-recover resources
and marginal fields
High drilling costs due to complexity of oil
production
Hard-to-Recover hydrocarbon resources and Recovery Rate
in Russia
Hard-to-Recover resources,%
Inefficient exploration and production, low
recovery rate of hydrocarbon reserves – less
than 30%
Depreciation of drilling equipment
Recovery Rate
52
44
44
39
37
32
28
Solutions
14
16
20
48
50
52
17
15
17
55
56
58
18
19
20
35
29
22
Horizontal drilling will allow to significantly
8
increase production and recovery rate of
hydrocarbon reserves
1961 1966 1971 1976 1981 1986 1991 1996 2001 2006 2007 2009 2011
Hard-to-Recover resources development
Import Substitution
3

4. Market potential

MARKET POTENTIAL
3000
2699,9 2692,6
2500
2235,1
2000
1464,4 1552,1
1500
1000
750,6
954,3
1223 1189
Horizontal Drilling today:
1792,3
1649,5
20% in Russia
1387,3
vs.
80% Outside of Russia
500
out of total number of drilling wells
0
Horizontal Drilling in Russia, 2002-2013 thous.m.
Successful Horizontal wells drilling is not possible without MWD/LWD systems
and advanced drilling process control equipment
Market Valuation :
Market Demand – 1000 sets
Actual Market of MWD systems in Russia – 450-500 sets/year*
Sales Target - from 30 sets in 1st quarter of 2018 to 235 sets in 2020
with annual revenue > $ 49,8 billion
4

5. Our horizontal drilling equipment includes:

OUR HORIZONTAL DRILLING EQUIPMENT
INCLUDES:
• EM & MP MWD (dual data transmission)
• Gyro inclinometer
• Geophysical survey Modules
• Drilling Process Control Complex “Volga” (hardware & software)
5
Currently, there are no analogous of MWD systems with dual data transmission

6. method

6
METHOD

7. Competitive advantage

COMPETITIVE
ADVANTAGE
7
• High reliability data transmission and 2
times more data (thanks to dual data
transmission, EM+MP)
• Unified design of MWD system enables to
operate in all range of diameters from 3 ½
in. to 9 ½ in., displacing body frames
• Gyro inclinometer excludes the impact of
magnetic masses of drilling tool, casing
(during sidetracking), neighboring cased
borehole on the measurement of azimuth
that increases drilling accuracy
• Small length and structural flexibility
enables drilling with high deviation intensity
(to 1°/m) and prevents sticking of
bottomhole assembly
• Drilling process control complex with
self-learning element allows to optimize
well construction

8. Competition analysis

COMPETITION ANALYSIS
Foreign manufactures:
• Schlumberger
• Baker Hughes
• Weatherford International
• Halliburton
Number of MWD systems in operation in
Russia, %
Imported MWD
33%
Mud-Pulse MWD
Price $1-5 million (MWD - LWD)
67%
Local MWD
8
R&P SAGOR
Dual data transmisison (EM + MP)
Price < 1,5-2 times, than imported ones
$1-5 million (MWD – LWD)

9. PROJECT execution STAGE

PROJECT EXECUTION STAGE
TODAY:
• R&D of Dual MWD (EM+MP) key units has been carried out. Design
Documentation of EM MWD (downhole section) has been developed.
• R&D of “Volga” complex (hardware) has been carried out an adjusted to
work with MWD; 60% of the software has been completed
More than 100 patents on design, key elements and software has been
obtained
The following projects have been realized and bring profit:
• MWD with EM data transmission
• Drilling process control complex “Volga”
Well Sand Screens
9

10. FUNDING and IMPLEMENTATION

FUNDING AND
IMPLEMENTATION
$ 10,1 million
2nd stage of
investment
$ 4,9 million .
1st stage of
investments
Loan Repayment
Start
Loan is paid off
25 months
2018
Design
Development
of Electronic
Devices
Q II
Q III
Q IV
QI
Prototype
Development
and in Well
Testing
Q II
2020
Q III
Pilot Production
Q IV
Serial
production
Independent
Elements
Sale’s Start
10
QI
2019

11. Investments structure

INVESTMENTS STRUCTURE
Investments structure
Purchasing, assembly and
adjustment of the equipment
2,7
18%
1,35
9%
4,5
30%
Total investments $15 million
Costs of raw materials, subs,
technological gear production,
serial production setup
Operational Costs
11
6,45
43%
Office and Production Facility
Rental, Labs

12. R&P ENTERPRISE «OPK»

R&P
ENTERPRISE
«OPK»
[email protected]
RUSSIA 2017
+7(831) 295-50-61, 295-50-60