DRILLBITS – August 2017
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Advocacy
IADC Statement on Hurricane Harvey
Hurricane Harvey has devastated the Houston area that IADC Headquarters calls home. This storm and the flooding aftermath are without precedence in the United States. We have heard from many of IADC’s Houston-based Members, who are safe despite varying degrees of personal loss and hardship. People have also shared heroic stories of volunteer efforts, as the Houston community unifies to work to rebuild our great city. At IADC, we are inspired by these efforts, and will work alongside our Members to do what we can to assist with the recovery efforts.
For those of you with offices in Houston, please share if your offices, rigs or other drilling equipment sustained damaged. We stand ready to help you in any way we are able.
To those Members not in Houston who wish to help, please consider donating to a local charity. For your consideration, below is a list of reputable institutions currently accepting donations:
To Help Children: The Texas Diaper Bank https://texasdiaperbank.networkforgood.com/projects/33717-change-a-life
To Help Animals: Houston SPCA http://www.houstonspca.org/give/ or SPCA of Texas https://www.spca.org/news_hurricane-harvey
To Help People with Medical Needs: Portlight http://www.portlight.org/home.html or Direct Relief USA https://www.directrelief.org/usa/
To Provide Food: Houston Food Bank http://houstonfoodbank.org/, Galveston Food Bank http://galvestoncountyfoodbank.org/, Food Bank of the Golden Crescent (Victoria) http://victoriafoodbank.org/ , Corpus Christi Food Bank http://foodbankcc.com/, Southeast Texas Food Bank (Beaumont) http://setxfoodbank.org/
To Help the Homeless: The Houston Coalition for the Homeless https://www.homelesshouston.org/take-action/donate/
Thank you in advance for your generosity and support.
Sincerely,
Jason McFarland
IADC President
Expanding Oil and Gas Access on OCS Important for Future Jobs, Economy
On 17 August IADC joined with other industry trades to comment on the Bureau of Ocean Energy Management’s request for information and comments on the 2019-2024 Outer Continental Shelf Oil and Gas Leasing Program.
“In 2015, the U.S. oil and natural gas industry supported more than 10.3 million jobs nationwide and made up more than 7.5% of GDP. It is with these numbers in mind that IADC, along with our industry association counterparts, supports the expansion of available drilling areas in the 5-year leasing plan,” said Jason McFarland, IADC President. “We urge Interior Secretary Zinke to expand access to available resources of the Outer Continental Shelf (OCS) in order to further solidify energy security for the U.S. and future job creation and revenue generation.”
More than 120 Congressional House Members, both Republicans and Democrats, submitted their own comments to Secretary Zinke, asking him to fully consider all OCS lands, including those that were excluded from the 2017-2022 program. “IADC stands with our elected officials in supporting a robust offshore leasing program that fully considers all areas of the OCS for oil and gas development,” said Mr. McFarland.
U.S. Expands Russia Sanctions
On 2 August, President Trump signed into law H.R.3364, which expanded the scope of sanctions against the Russian Federation, Iran and North Korea. One of the most significant provisions that pertains directly to the oil and gas industry is that the bill directs the Secretary of the Treasury to expand the scope of Treasury Directive 4 within 60 days. The expanded scope will apply to any sanctioned individual or entity with a controlling interest or a 33% or greater interest in any new deepwater, Arctic offshore or shale projects anywhere in the world. Details are still being discussed by the U.S. Treasury, including a definition of “controlling interest” along with additional entries to the Office of Foreign Assets Control’s sanctions list.
For more information, please contact Alan Spackman at alan.spackman@iadc.org.
U.S. Announces Sanctions Against Venezuela
U.S. President Trump recently signed an Executive Order which imposes new financial sanctions on certain Venezuelan entities.
In a statement, the U.S. Press Secretary noted, “The President’s new action prohibits dealings in new debt and equity issued by the government of Venezuela and its state oil company. It also prohibits dealings in certain existing bonds owned by the Venezuelan public sector, as well as dividend payments to the government of Venezuela.” The statement went on to note that, “the Treasury Department is issuing general licenses that allow for transactions that would otherwise be prohibited by the Executive Order. These include provisions allowing for a 30-day wind-down period; financing for most commercial trade, including the export and import of petroleum; transactions only involving Citgo; dealings in select existing Venezuelan debts; and the financing for humanitarian goods to Venezuela.”
To view the full statement from the U.S. Press Secretary, please visit the White House website.
IADC Joins Industry Associations to Comment on Marine Sanctuary Expansion
On 26 July, IADC joined with API, NOIA, IAGC, and the OOC to offer comments in response to the National Oceanic and Atmospheric Administration’s (NOAA) request for comments on designations and expansion of the National Marine Sanctuaries and Marine National Monuments.
In the letter, the Associations noted that its’ members have significant interest in ensuring future opportunities for offshore oil and natural gas exploration are not unduly restricted by expanding sanctuaries to include new geographic areas for which expansion is not necessary, or with boundaries in excess of those needed to protect appropriate areas. It also advocated for a regulatory environment where all agencies responsible for protection and use of the marine environment work together collaboratively to create straightforward, clear and consistent requirements.
The full text of the letter can be found on the IADC Advocacy webpage.
Washington D.C. Updates
Congress was in recess for the month of August. Upon their return to Washington D.C., Congress will have a busy schedule with Disaster Recovery and Appropriations spending bills as top priorities.
INDUSTRY NEWS
Oil & Gas UK Releases Updated Guidelines on Competency for Wells Personnel, Wells Examiners
Oil & Gas UK recently announced the release of three updated guidance documents which address the assessment, management and development of competency for well personnel and their teams and the competence of well examiners.
The new publications include:
- Guidelines for Well Operators on Competency of Well Examiners (Issue 2)
- Guidelines on Competency for Wells Personnel (Issue 2)
- Guidelines for Well Operators on Well Examination (Issue 2)
All of the documents are available via Oil & Gas UK’s website.
API STD 2CCU, Offshore Cargo Carrying Units, First Edition, Now Available
API 2CCU, Offshore Cargo Carrying Units, First Edition, is now available via the API website. API 2CCU defines the design, material, manufacture, inspection, repair, maintenance and marking requirements for offshore cargo carrying units (CCU) and lifting sets, to include dry-goods boxes, baskets, and other skids designed to move equipment and goods offshore with maximum gross weight up to 70,000 kg.
This standard applies to cargo carrying units (CCUs) specifically designed for repetitive use in the transport of goods and equipment to, from, or between fixed and/or floating offshore installations, ships and or shore-based operations. This standard outlines the criteria for the design, manufacturing, inspection, testing and marking of CCUs, and takes into account the dynamic lifting and impact forces that can occur when handling such equipment in open seas.
API 2CCU can be purchased on API’s website.
National Academies to Host Roundtable on Unconventional Hydrocarbon Development
The National Academies of Sciences, Engineering and Medicine will host a free Roundtable on Unconventional Hydrocarbon Development on 2-3 October in Washington, D.C.
The workshop will explore the unique features of operating in the U.S. offshore environment, including well completion and stimulation technologies, environmental considerations and concerns, and health and safety management. Speakers will include representatives from government, industry, academic and non-profit sectors. Participants will examine technical, environmental and regulatory challenges and opportunities.
For more information and to register for the roundtable workshop, please visit the National Academies website.
Norway’s Petroleum Safety Authority Issues New Guidance on Barrier Management
Norway’s Petroleum Safety Authority (PSA) recently issued a new guidance in the form of the Barrier Memorandum 2017, which addresses principles for barrier management in Norway.
The memorandum, first issued in 2011 and updated in 2013 and now 2017, aims to provide information about the basis of barrier management and clarifies the interaction between technical, operational and organizational barrier elements.
The memorandum can be accessed via the Petroleum Safety Authority.
API Standard 64, Diverter Equipment Systems, Now Available
API recently announced the availability of API Standard 64, Diverter Equipment Systems, Third Edition. The standard is intended to provide information on the design, manufacture, quality control, installation, maintenance and testing of diverter system, and associated components. The diverter system provides a flow control system to direct controlled or uncontrolled wellbore fluids away from the immediate drilling area for the safety of personnel and equipment.
API Standard 64 can be purchased via the API website.
NIST Releases Security and Privacy Controls for Information Systems and Organizations Draft
The National Institute of Standards and Technology (NIST) recently released a draft of Special Publication 800-53, Revision 5, Security and Privacy Controls for Information Systems and Organizations.
The publications contains a comprehensive catalog of technical and nontechnical security and privacy controls. The controls can support a variety of specialty applications including the Risk Management Framework, Cybersecurity Framework, and Systems Engineering Processes used for developing systems, products, components and services and for protecting organizations, systems and individuals.
The draft publication can be accessed via the NIST website.
ACCREDITATION
IADC WellSharp Now Available in Arabic
The online exam for IADC’s well control training and assessment program, WellSharp, is now available in Arabic. The Arabic translation is now available to all training providers. The exam was previously translated into Portuguese and Spanish, and it will also be available in Mandarin later this year.
WellSharp, introduced in 2015, is a rigorous well control training and assessment program that offers content on prevention, situational awareness, barriers, barrier management, and risk awareness and management. It encourages blended learning to enhance the quality and value of the training, with required independently proctored electronic knowledge assessments and enhanced simulator exercises.
For more information about WellSharp, please visit the IADC Website.
IADC COMMITTEES
IADC Cybersecurity Subcommittee Drafting Guidelines
The IADC ART Cybersecurity Subcommittee is in full swing drafting five additional guidelines following the guidelines published last year on Assessing and Managing Cybersecurity Risk for Drilling Assets. The five additional guidelines under development are as follows and due to be completed by the end of 2017.
- Guidelines for Minimum Cybersecurity Requirements for Drilling Assets
- Guidelines for Network Segmentation
- Cybersecurity training v1.0
- Guidelines for hardening of control systems focusing on existing drilling assets (to include patching)
- Guidelines for security monitoring and audit
Please join the Subcommittee at the next meeting to participate in or learn more about the progress of the guidelines. The focus of the next subcommittee meeting is to review the guidelines for Minimum Cybersecurity Requirements for Drilling Assets. The next IADC ART Cybersecurity Subcommittee meeting will be at 9 am on 14 September 2017 at IADC headquarters in Houston. If you plan to attend, please register online at the IADC website.
Call for Abstracts for IADC Spark Tank on 6 December: Meet the Sharks!
The IADC Advanced Rig Technology Committee has issued a call for abstracts for the ART Spark Tank, scheduled for 0900-1130 on Wednesday, 6 December, at IADC headquarters in Houston, Texas. The deadline for abstracts is Friday, 27 October.
The IADC ART Spark Tank is a strong opportunity to provide technology entrepreneurs a new opportunity to pitch their products and ideas to a panel of drilling contractors and operators (“Sharks”).
IADC ART welcomes abstracts on any new technology that will improve efficiency or safety in well construction. The purpose is to provide insights (“Sparks”) to technology developers into what matters to those they are innovating for. There is sometimes a vast disconnect between a good idea and a great product, and this series will attempt to close that gap in a good-natured, productive manner. Caveat: This forum is not designed to generate investments in the product or service.
Each Spark Tank presentation should last no more than 15 minutes, which will allow the Sharks to ask questions and give feedback on just how great (or not!) they think the product is.
Rules of engagement:
The ART Spark Tank is designed to allow technology entrepreneurs the opportunity to pitch products or ideas to a panel of experts comprising both drilling contractors and operators. The Spark Tank is envisioned as a forum to “spark” new thinking. The Spark Tank will be moderated by an officer of the Advanced Rig Technology Committee.
Format:
Thirty minutes are allotted for each topic. Each presenter will have 15 minutes to speak. Please be as brief and concise as possible.
Panelists will then use the remaining 15 minutes for questions and comments. Questions and comments will be candid.
Please be polite and allow others to complete their thoughts before speaking.
Investment:
The Spark Tank is not a vehicle to seek investment for an idea or products, though “order of magnitude” estimate of development cost is acceptable.
Click here to submit your abstract.
“What Does ‘Prepared for MPD’ Mean?” asks September IADC DEC Tech Forum
The 19 September IADC Drilling Engineers Committee Technology Forum will feature panels and presentations aimed at shedding light on what being prepared for MPD means. The event is hosted by Weatherford (11909 Spencer Road, Houston, TX 77041).
The September event will kick with a presentation by Fred Brink of BSEE on how the new well control rules impact MPD operations in the GOM. This is followed by a panel discussion featuring operators, contractors, and service companies determined to define the MPD-prepared rig. The tech forum will conclude with a presentation of a specific approach to MPD.
The tech forum will run from 0800-noon, and includes lunch.
To register, visit the IADC DEC Tech Forum page on IADC’s website.
In addition, papers from the 14 June DEC Tech Forum “Making Data Actionable” are now available at IADC’s website.
For more information about the IADC DEC, contact mike.killalea@iadc.org.
INDUSTRY RESOURCES
IADC to Host Inaugural Shale Energy Workshop in September
In conjunction with the IADC Permian Basin Chapter, IADC will host a Shale Energy Workshop in Midland, Texas on 13 September.
Shale oil and gas has transformed the energy landscape in the U.S. and while drilling growth has slowed in other markets, the Permian Basin continues to be a leader. The workshop will explore issues affecting the onshore drilling industry, with presentations on safety and training, cutting edge technology, market outlook and operator outlook. Additionally, the workshop will feature a panel discussion on regulatory and industry affairs, with a presentation from Texas Railroad Commissioner Wayne Christian.
For more information and to register, please visit the IADC Events website.
Virtual Panel Discussion on Permian D&C Challenges Now Available
The heads of drilling and completion for two of the largest operators in the Permian Basin will discuss their companies’ challenges, innovations and goals in this prolific region during a virtual panel discussion sponsored by DrillingContractor.org.
The VPD first aired on Wednesday, 6 September and is now available for viewing on DrillingContractor.org
Panelists for this webcast, “Drilling & Completion in the Permian Basin Today”, are:
- Rodney Littleton, VP, Drilling and Completions, Southern Wolfcamp Asset Team, Pioneer Natural Resources;
- John Willis, Chief – Drilling, Occidental Oil & Gas Corp;
- Mike Killalea, Group VP/Publisher, IADC (moderator).
The panelists discuss their companies’ goals and scope of drilling/completion operations in the Permian Basin, as well as challenges and lessons learned.
Technical innovations to bring production on stream more quickly and to use water smarter are also part of the conversation, as well as issues centering on infrastructure, people, and service/manufacturing quality.
To view the VPD, click here.
For more information on “Drilling and Completion in the Permian Basin Today”, contact Mike Killalea, mike.killalea@iadc.org.
Updated IADC Federal Regulatory Summary for Offshore Operations Now Available
On 25 July, IADC issued an updated edition of the Federal Regulatory Actions Impacting Offshore Drilling Contractors. Released semi-annually, the report details federal regulatory actions that could impact offshore drilling activities.
The report reflects regulatory activities announced in the Federal Register or other available sources through June 2017.
The full report can be accessed via the IADC Advocacy webpage.
Everyday Hydrocarbon Products Showcased in Drilling Matters
New modules on IADC’s DrillingMatters.org provides details the myriad products both trivial and critical that are based on hydrocarbons, and showcasing the industry’s solid environmental record. In addition, DrillingMatters.org now features an improved interactive drilling rig, allowing users to point and click and learn more about key drilling components. Also, a new glossary provides definitions for a plethora of industry terms.
“More than a Fuel” shows that from the food we eat, to the clothes on our backs, to cosmetics and skin care products, soaps and detergents, life-saving medical equipment and pharmaceuticals, building materials, toys and packaging materials, thousands of the products we use and depend on every day are made from hydrocarbons.
Drilling Matters’ new Interactive Rig Tour uses narrated video clips to explain the basics of key rig systems.
Finally, Drilling Matters’ new glossary describes equipment and will help educate industry newcomers about the meaning of numerous industry terms. Graphics, narrations and videos are planned for the glossary.
Drilling Matters is a web-based, modular and interactive website designed to dispel myths and correct misconceptions about the petroleum industry. DrillingMatters.org now comprises modules discussing drilling equipment, drilling people and companies, the value of hydrocarbons, energy poverty, and more.
For more information, contact mike.killalea@iadc.org
Drilling Matters: Spread the Word.
IADC Incident Statistics Program 2017 Q1 Data Available
The 2017 IADC Incident Statistics Program Q1 Year to Date Summary Report is now available via the IADC website. The 5 year LTI/RCRD Frequency rate has also been updated and published.
Participation in the IADC ISP is voluntary and open to all drilling contractors and well servicing companies engaged in oil and gas and well drilling. However, a company must participate in the IADC ISP program and be a member of IADC in order to qualify for rig/unit recognition. The ISP has tracked safety and accident information for the drilling industry since 1962. Data are compiled separately for land and offshore operations and for seven geographic regions – U.S., Europe, Canada, Central and South America, Africa, the Middle East and Asia Pacific.
To learn how your company can participate in the ISP, please visit the Incident Statistics Report page on the IADC website. Questions can be emailed to isp@iadc.org.
IADC Lexicon Featured Term for July 2017
The IADC Lexicon (IADCLexicon.org) is a compendium of upstream-related terms, which, unlike conventional glossaries, are official definitions drawn from legislation, regulation and regulatory guidance, standards (global, national and regional), and IADC guidelines. Terms often have multiple definitions from different sources.
This month’s Featured Term is:
“C” Class Divisions (Source: IMO Resolution MSC.99(73), amendments to the International Convention for the Safety of Life at Sea, 1974, as amended, 5 December 2000, International Maritime Organization):
“C” class division are constructed of approved non-combustible materials. They need meet neither requirements relative to the passage of smoke and flame nor limitations relative to the temperature rise. Combustible veneers are permitted provided they meet the requirements of this chapter… (click the link to read the full definition on the IADC Lexicon.)
Accreditation Updates
RigPASS
WellSharp
DIT
Safety Alerts
For the latest safety alerts, visit www.iadc.org/safety-alerts
Alert 17-3: LTI – Hot Water Scald
Alert 15-4: Drill Pipe Screen Lodging in Top Drive Results in Near Hit
Upcoming Events
Rigs Receive ISP Certificates
For certificates received since last LTI (in years):
New IADC Members
IADC welcomes 14 new members:
DRILLBITS Volume 27, Number 8
Andy Hendricks, Chairman • Jason McFarland, President • Amy Rose, Editor
All listed phone extensions are for IADC’s Houston headquarters,
+1/713-292-1945. Fax +1/713-292-1946.
Send comments/questions to Amy Rose at amy.rose@iadc.org.
To subscribe to Drill Bits, go to www.iadc.org/drillbits.
To change/cancel a Drill Bits subscription, send an e-mail message to
IADC Director – Membership Sharon Thorpe at sharon.thorpe@iadc.org.