Abstract

The role of the modern international service company is reviewed and the current business framework within which such companies operate in China is described. Examples of technical service operations in Chinese oilfields are given. Service equipment sales and the co-manufacture of equipment are discussed. Recommendations are made for the expansion of future interaction and cooperation with Chinese organizations.

SERVICE COMPANY FUNCTIONS

The conventional role of the international service company is to provide a full complement of services, equipment, personnel and technology within the area of their expertise to the operating oil and gas companies on a worldwide basis. A variety of important functions are performed during both the drilling of a well and throughout its producing lifetime, some of which are essential to the exploration, drilling or production operations, while others contribute significantly to improving the productivity and economic results for the operating companies.

Throughout the world the petroleum industry has come to depend upon the international service companies for the availability of such things as data acquisition and analysis for geophysical, geological and reservoir description purposes; well testing and evaluation of flow and pressure buildup data; cementing services; well logging; drilling fluids; well completion services including perforating, gravel packing, downhole tools and equipment; stimulation and production improvement services; and numerous other services, products and chemicals.

In the early days of the industry in North America and elsewhere, the operating companies at that time had to provide, in many cases, their own drilling and service equipment and personnel. As the industry expanded, service companies emerged that provided the necessary services on a more economical and practical basis, since they served an entire industry rather than just one company or one restricted area. Working in a competitive environment, they introduced new ideas and expanded the technological base of the industry. Such companies grew to become international in scope and were able to provide technical services at a more reasonable price due to their economy of scale and worldwide exposure. Experience in dealing with conditions, techniques and problems generated by working with hundreds of companies in numerous countries worldwide, led to the development of advanced materials, techniques and equipment which provided the operating companies the means by which they could drill, complete and produce their wells more effectively.

Technological advancements, improved data acquisition and modern transmission facilities have led the operating companies to request the service companies to provide increasing numbers of engineering recommendations, proposals, job plans and research studies. This includes requests for advice on improving the efficiency and reducing the cost of total service projects.

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