Utilizing Original Equipment Manufacturers to Reduce HSE Risk in Field Operations

Abstract

Abstract With an estimated 152,000 jobs lost in the oilfield service sector since mid-2014 and the anticipated recovery of the industry in 2017-2018; is the industry ready for an interdependent culture between service companies and original equipment manufacturers (OEM) to reduce the bullwhip effect of rapid on boarding? The workforce of 2017 is much leaner and more specialized with both OEMs and service companies retaining the best and brightest. A rapid increase in rig count driven by higher oil prices will trigger hiring by both OEMs and service companies. What if each focused on where they deliver the most value: service companies in field operations and OEMs in building and maintaining the equipment? Total recordable incident rate is a key driver in supplier selection and industry data shows the incident rate is directly correlated to years of service. Given a long enough time horizon, a zero-accident rate could be achieved across both equipment maintenance and field operations. What if service companies could focus on just field operations? Could zero be achieved faster? Could a more intimate relationship between the OEM and service company lower the overall cost of operations by reducing errors and extending the life of the equipment? Profit at the cost of safety and over hiring as demand for equipment and services increases will be key to the success of both OEMs and service companies. This paper will explore an alternative to "the way we always did it." The three main aspects this paper will focus on are: Historical HSE statistics associated with boom and bust cycles, training for the next boom, and a new business model where OEMs take on a more proactive approach to the safety of the equipment they provide. We will explore the correlation of employees with less than twelve months of experience and accident rates, which has been observed during previous downturns. Competency on the maintenance of equipment is historically achieved through hands on learning: will the trained employees that were laid off return? The traditional teaching employed by OEMs will be explored and we will highlight that a better method is possible. And finally, a new business model that ties in all safety and training will be presented as we prepare for the next cycle.