DRILLBITS – May 2017
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PGRA
U.S. Customs and Border Protection Withdraws Jones Act Modification Notice
On 10 May, the U.S. Customs and Border Protection (CBP) announced that it had withdrawn its proposed action relating to modifications and revision of the Jones Act rulings. In response, IADC President Jason McFarland issued the following statement:
“IADC is pleased with today’s CBP notice. The now-withdrawn proposal offered a new interpretation of decades-old customs rulings and created uncertainty by potentially reclassifying as “merchandise” much of the drilling equipment used in the U.S. Gulf of Mexico. IADC partnered with other industry associations to submit comments to CBP, along with a separate stand-alone comment letter because we believed that the proposed modifications would erect a significant obstacle to the work of offshore drilling contractors. Thus, we thank CBP for its careful consideration of all submitted comments and look forward to working with the agency as an educative resource on this matter and all others pertaining to the offshore drilling industry.
U.S. Senate Fails to Move Forward to Repeal BLM Rule on Methane Emissions
On 10 May, the U.S. Senate voted against a procedural measure to use the Congressional Review Act to repeal the Bureau of Land Management’s (BLM) methane emissions rule, “Waste Prevention, Production Subject to Royalties and Resource Conservation”. In response, IADC President Jason McFarland issued the following statement:
“IADC is disappointed with today’s Senate vote regarding BLM’s duplicative and costly methane emissions rule. Since the rule was first introduced in 2016, IADC, along with our industry partners, has argued that the regulation would have the unintended impact of fewer jobs, higher costs for consumers and less energy security and federal revenue. The truth of course is that natural gas is valuable and energy companies always prefer to capture it rather than flare it off. To further prove this belief, since 2005, emissions have declined by 38%, even as production has boomed, according to the Western Energy Alliance. This speaks to the commitment by industry to adhere to environmentally sound operations, even without excessive regulatory oversight. Today’s vote is disappointing, but industry looks now to Interior Secretary Zinke and his team to undo the duplicative and harmful aspects of this rule.”
IADC Praises Selection of Scott A. Angelle as BSEE Director
Interior Secretary Ryan Zinke recently announced his selection of Scott A. Angelle to head the Bureau of Safety and Environmental Enforcement (BSEE). In response, IADC President Jason McFarland issued the following statement:
“IADC is pleased with the selection of Scott A. Angelle to lead BSEE. His reputation as a tough defender of offshore safety and his commitment to cultivating the natural resources of the U.S., make him an ideal director for BSEE. IADC looks forward to working with Director Angelle on a wide variety of issues that affect drilling contractor operations, most importantly on the Bureau’s Well Control Rule, which IADC and other industry groups have consistently argued is flawed and requires significant changes to be effective.”
IADC Hosts “Offshore Drilling Rigs 101” Educational Event on Capitol Hill
On 25 May, IADC hosted an educational event for Capitol Hill staffers entitled, “IADC Offshore Drilling Rigs 101”. Several offshore IADC members led a discussion on the role of drilling contractors in the well construction process and presented safety data, along with the latest in high-tech drilling rigs during the event.
IADC members who participated included:
Brady Long, Senior Vice President and General Counsel; Transocean Ltd.
Chris Johnston, Vice President of North and South America; ENSCO plc.
James Sanislow, Vice President and Chief Compliance Officer; Noble Drilling Services Inc.
Lyndol Dew, Senior Vice President of Worldwide Operations; Diamond Offshore Drilling Inc.
Michael Lawson, Vice President, Health, Safety, Environment and Training/Competency; Rowan Companies
Along with the educational event, offshore members met with U.S. Environmental Protection Agency (EPA) Administrator Scott Pruitt, along with several Senators and Members of Congress representing Mississippi, Texas, Georgia, North Carolina, Louisiana, Virginia, New Jersey, Florida, Alaska and Alabama.
IADC Members Meet with Senator Heidi Heitkamp of North Dakota
On 12 May, several Houston-based members of IADC met with U.S. Senator Heidi Heitkamp of North Dakota to discuss issues of interest to the U.S. oil and gas industry.
From Left: Bob Warren, IADC; Jason McFarland, IADC; Jim Rocco, IADC; Tony Seeliger, Pacific Drilling; Mike Lawson, Rowan; Mike Bowie, GE Oil & Gas; Lyndol Dew, Diamond Offshore Drilling; Senator Heitkamp; Paul Mosvold, Scandrill, Inc.; Mike Garvin, Patterson-UTI Drilling Company; Mike Holcomb, Patterson-UTI; Mike Drickamer, Patterson-UTI Drilling Company; Hilary Burden, Patterson-UTI Drilling Company.
Washington D.C. Updates
Administration:
After the President’s “America-First Offshore Energy Strategy” Executive Order (EO) was issued in late April, Interior Secretary Zinke issued Secretarial orders 3350 and 3351. Order 3350 implements the President’s EO by issuing a strategy for re-evaluating BOEM’s five-year OCS leasing program, aka the five-year plan, BSEE’s final rule on Oil and Gas Sulfur Operations in the Outer Continental Shelf-Blowout Preventer Systems and Well Control, and expediting consideration of permits for seismic surveys, among other things. Order 3351 establishes a new position at the Department of Interior – Counselor to the Secretary for Energy Policy, to ensure deliberate and active coordination of energy policy in the Department. IADC senior leadership and offshore members participating in the Washington, D.C. fly-in met the new Counselor – Vincent Devito – to discuss issues of importance to offshore drilling contractors.
Congress:
The House of Representatives passed H.R. 1628, the American Health Care Act, which repeals and replaces the Affordable Health Care Act (aka Obamacare). That legislation has been sent to the U.S. Senate for consideration. The House Way and Means Committee also began hearings on tax reform, most notably, they held a hearing on the Border Adjustment Tax.
The U.S. Senate processed about a dozen various nominations during the month of May.
INDUSTRY NEWS
IADC Signs MOU for Collaboration with Brazil’s IBP
On 4 May in Houston, IADC and the Brazil Institute of Petroleum, Gas and Biofuels (IBP) signed a memorandum of understanding (MOU), which establishes a framework through which the organizations will cooperate and collaborate to foster education and communication within the upstream oil and gas industry in Brazil.
The MOU was signed by IADC President Jason McFarland and Milton Costa Filho, IBP Secretary-General during the 2017 Offshore Technology Conference.
Mr. Costa noted that, “What we hope to achieve with the MOU is to increase the knowledge and the drilling technical capability in Brazil. Brazil has huge reserves and huge potential. We need to match the interest of investors with the interest of the country in developing the reserves, and the logical next steps will be development activities, including drilling. Another important point that we want to achieve is to increase the safety of our operations. The more we develop programs together with IADC, we can improve the safe operations of this industry.”
IBP Secretary-General Milton Costa Filho (left) and IADC President Jason McFarland sign the MOU on 4 May.
NEW WCI BOARD MEMBERS NAMED
Two new members have been named to the Well Control Institute Board of Directors. Steve Brady, Senior VP – Eastern Hemisphere for Ensco plc. and current IADC Vice-Chairman, was named to fill the contractor vacancy created when Lyndol Dew of Diamond Offshore was confirmed as WCI Chairman. Additionally, Eric Daflon, Vice President – Drilling & Wells for Total S.A., was appointed to fill an operator position previously filled by Dawood Al-Dawood of Saudi Aramco. These new Board members have been approved by IADC’s Executive Committee and also by the full WCI Board.
WCI operates under the auspices of IADC to ensure that operators, contractors, equipment manufacturers, and service providers have a forum to provide oversight and leadership on key well control initiatives. The WCI Board brings together drilling industry leaders from all sectors of the industry to develop comprehensive solutions needed to significantly improve well control performance worldwide.
Missouri University of Science and Technology Students Visit IADC
On 3 May, students from Missouri University of Science and Technology visited IADC’s Houston office. The students had an opportunity to speak with IADC leadership to gain a better understanding of the association’s role in the drilling industry and how students can become involved in the future of the organization.
Missouri University of Science and Technology students. From left: Usama bin Rehman, Connor Kirtley, Alyssa Snider, Elizabeth Sotolongo and Colin Woolums.
Drilling Systems Automation Roadmap – Industry Update
The Drilling Systems Automation (DSA) Roadmap Industry initiative began in 2013 to describe the anticipated path of drilling systems automation to 2025. Led by John de Wardt as Program Manager, it has a strong steering committee of 16 experts covering a broad range of knowledge including rig design, human systems integration, modeling, robotics, sensors, data transmission, systems engineering including a portfolio of brand name companies. This first of a kind drilling initiative was initially an all-volunteer program and has gathered input from some 50 industry experts.
The DSA Roadmap has discovered some key aspects that will impact the uptake of Drilling Systems Automation. There are many forks in the road ahead opening the debate as to which route the drilling industry will take. Will interoperability prevail over proprietary systems or vice versa, will downhole to surface telemetry data rates rise or continue as a dichotomy between mud pulse and similar systems versus hard wire, will the industry adopt an industry Reference Architecture to enable interoperability and finally, will asset replacement occur or will the previous designs prevail as the basis for automation. A section of the roadmap is devoted to articulating the value proposition of each, which so far seems to have eluded the industry in terms of a comprehensive application of automation.
The IADC Drilling Engineering Committee endorsed the funding of a Joint Industry Project (JIP) to accelerate delivery of the Phase II Stage I draft report. This 247-page document was presented to the 10 JIP funders in early April at a seminar in Houston. The funders positive feedback opened the door to the next stage of the DSA Roadmap report which will become the first issued to the industry.
IADC is organizing a 2-day workshop in Houston on 17-18 January 2018 to enable industry feedback on the contents of this DSA Roadmap prior to public release. The work to prepare for, plan and facilitate this workshop requires funding under a JIP 2. This JIP 2 offers new funders the unique opportunity to access the full current version of the DSA Roadmap for their organization, giving them access to this valuable knowledge long before competitors, clients and suppliers. IADC Workshop participant will have limited access to the DSA Roadmap until public release. Information on the roadmap team, process, and all other details is available at www.dsaroadmap.org
IADC South Central Asia Chapter Hosts Safety Workshop
On 25 March, the IADC South Central Asia Chapter hosted a Hand & Finger Safety Workshop in Agartala, India.
The workshop was organized to bring awareness to hand and finger injuries, which according to IADC Incident Statistics Report data, comprise more than 43 percent of all recordable incidents on drilling rigs. Those who attended the conference were divided into 9 groups and each was given a safety case to examine to determine key preventative measures.
From Left: Suresh Mehra; Mike DuBose, IADC; V.P. Mahawar; S.C. Soni
“Examining Gateway, IADC’s Training Program for New Employees” Topic for Next Virtual Panel Discussion
Drilling Contractor Magazine will host a Virtual Panel Discussion (VPD), “Examining Gateway, IADC’s Training Program for New Employees”, on 27 June. The pre-recorded VPD will feature a discussion by three seasoned drilling-industry learning and development professionals.
The drilling industry faces a unique challenge today when it comes to recruiting the right people for the right roles, just as the industry is beginning to recover. Demand for workers with a higher level of technical skills is increasing, just as an entire generation of veteran employees retires. The modern drilling workforce must train to fill these roles, as well as develop the next generation of operations and technology.
IADC’s Gateway program brings together industry and educational institutions to strengthen industry’s ability not only to find new employees, but to ensure that those people are prepared for life on a rig, can contribute to safety culture, and will achieve competence quickly
Presenters for this VPD include Pamela Wakefield, Director of Training, Patterson-UTI; Linda Head, Associate Vice Chancellor of Workforce Education and Corporate Sponsorship, Lone Star College; and Brooke Polk, Director – Program Development & Technology, IADC. The discussion will be moderated by Mike Killalea, Group VP/Publisher, IADC and DrillingContractor.org.
To pre-register for the VPD, please visit the DrillingContractor.org website.
IADC Riding Team Completes First Ride
In early May, the IADC Riding Team participated in the BP MS 150, biking from Houston to Austin in two days in support of finding a cure for MS.
From Left: Mark Denkowski, IADC; Jim Rocco, IADC; Casey Billman, Austin-based technology company; Jaime Brito, Consultant; Storri Wild, H&P; Andrew Gordon; Scott Gordon, Helmerich & Payne.
ONG-ISAC Provides Update
In 2016, much of the oil and gas industry, like other major industries, observed an uptick in cyber threats, ranging from ransomware to remote access Trojans. In response, The Oil and Natural Gas Information Sharing and Analysis Center (ONG-ISAC), a non-profit, was created by the oil and gas industry to support its members through the analysis and exchange of cyber threat intelligence for mutual defense. Its dozens of members, which include IADC, include some of the largest multinational companies in the world, as well as small and medium enterprises committed to security.
Last year, ONG-ISAC shared more than 1,450 ONG-specific alerts and vulnerability advisories. Information passing through ONG-ISAC ranged from advanced persistent threats, targeted attacks and sandbox results on malware packages, to thefts by regional organized crime and activities of global terrorist groups. The ONG-ISAC’s sources include submissions by members, government agencies and other trusted partners, and it functions as a “neighborhood watch” for the oil and gas industry, saving companies on security cleanup and preventing loss of IP and financial details.
As malicious actors increasingly share information on the dark web, so too should members of the industry.
To learn more about ONG-ISAC activities, please contact Matt Windt at info@ongisac.org
OSHA to Host Safe+Sound Week
The week of June 12-18, the Occupational Safety and Health Administration (OSHA) will host it’s inaugural Safe+Sound Week to raise awareness and understanding of the value of safety and health programs in the workplace.
Organizations of any size in any industry are encouraged to participate. Via it’s website, OSHA has offered examples of potential activities and tools to help companies plan Safe+Sound Week activities.
To learn more about how your company can participate, and to view Safe+Sound events already planned, visit the OSHA 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 Launches Accreditation Program for Rigger and Crane Operator Training
IADC recently launched the Crane-Rigger Training and Assessment accreditation program, which offers a training standard that aligns with similar international standards while offering the support and credibility of accreditation. Included in the new program are curricula for basic rigging and crane operation.
The program was developed by members of IADC’s Workforce Development Committee, comprising representatives from drilling contractors, operators, training providers and other stakeholder companies.
The goal of IADC’s Crane-Rigger Training and Assessment is to provide a robust program through which training providers can be accredited and audited, which will lead to safer operations. The program is a globally-minded, affordable accreditation which aligns with, and surpasses, the API RP 2D standard.
Crane and rigging experts worked collaboratively with IADC to develop curricula and delivery requirements for the new program, which includes the following:
- Requirements for practical exercises, hardware, and equipment
- Resources to facilitate the standardization of content delivery
- Instructor qualification and assessment requirements
- Standardized skills assessments
- Criteria for content and delivery of knowledge assessments
- Content applicable to both onshore and offshore operations
- A framework for offering consistent, verifiable quality of training
- Crane operations coursework that can be customized by crane type (i.e., mechanical and non-mechanical crane types)
“Development of this program was a long process involving dozens of stakeholders who each brought to the table a unique perspective in rigging and crane operations, both onshore and offshore,” said Patty Tydings, IADC’s Competence and Workforce Development Specialist. “Members of IADC’s Workforce Development Committee serve as the program’s ultimate decision-makers to ensure that the training modules and performance objectives are appropriate and comprehensive and that the accreditation criteria promote quality and consistency.”
For more information about the IADC Crane-Rigger Training and Assessment accreditation program, please email crane-rigger@iadc.org.
IADC COMMITTEES
IADC DEC Committee to Host Technology Forum
The IADC DEC Committee will host a Technology Forum on 14 June in Houston, “Making Data Actionable: Operators Perspective”.
Contemporary hydrocarbon drilling operations generate numerous streams of data in various formats. These data streams might be generated by the operator, drilling contractor, service companies or equipment manufacturers. Today’s driller is challenged to prioritize data sources, convert data to useful information and take appropriate actions to maximize drilling productivity, maintain well integrity and protect personnel, property and the environment. The ability acquire and interpret data in real time is playing an increasingly significant role in maximizing asset ROI.
To avoid “boiling the ocean”, the committee has adopted the operator perspective, with a view that improving cost and efficiency is beneficial for all industry stakeholders.
The presentations selected for this IADC DEC Technology Forum will discuss the acquisition and interpretation of data streams to maintain safety, reduce costs, improve drilling efficiency and manage well integrity during the well construction process.
Those who wish to attend, must pre-register. To register, please visit the IADC website.
IADC ART Committee Spark Tank Call for Abstracts
The IADC Advanced Rig Technology Committee has issued a call for abstracts for the ART Spark Tank, scheduled for Wednesday, 2 August. The deadline for abstracts is Friday, 30 June.
The IADC ART Spark Tank is an opportunity to provide technology entrepreneurs a new opportunity to pitch their products and ideas to a panel of drilling contractors and operators (“Sharks”).
The IADC ART Committee 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.
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.
Complete the form here to submit your abstract.
INDUSTRY RESOURCES
Editorial Preview: July/August Drilling Contractor Magazine
The July/August 2017 issue of DC is our second Innovating While Drilling (IWD) issue of the year, with a strong focus on downhole innovations, including rotary steerable systems and drilling fluids. Other topics to be featured are:
*North Sea and Europe
*Asset Integrity and Reliability
*Well Control
*Sand Control
For more information about DC, please visit www.drillingcontractor.org.
IADC Incident Statistics Report Q4 Data Available
The 2016 IADC Incident Statistics Report Q4 Year to Date Summary Report is now available via the IADC website.
105 companies participate in the ISP Program; 35 of which operate on U.S. Land. Participation in the ISP is voluntary and open to all drilling contractors and well servicing companies engaged in oil and gas well drilling. However, a company must participate in the IADC ISP Program & 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 – US, Europe, Canada, Central and South America, Africa, the Middle East and Asia Pacific.
To learn how your company can participate in ISP, please visit the Incident Statistics Report page on the IADC website. Questions can be emailed to isp@iadc.org.
Introducing the IADC Lexicon “Featured Term”
This month, we are launching the IADC Lexicon “Featured Term”. The IADC Lexicon 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 “Zombie” (Source: ISO): Computer containing hidden software that enables the machine to be controlled remotely… (click to read full definition http://www.iadclexicon.org/zombie/)
Accreditation Updates
RigPASS
WellSharp
DIT
Competence
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 13 new members:
DRILLBITS Volume 27, Number 5
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.