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Choosing The Right Generator For Your Drilling Rig

There is a seemingly endless amount of drilling rigs and compatible generators. For each combination, there seems to be an equal amount of diverse and far-off oil fields to drill. Naturally, the mix-match nature of drilling rigs, drilling rig generators and oil fields can leave some of us in the industry, even seasoned experts, completely perplexed about which combination is best. I have found that regardless of whether a drilling rig generator is meant for more desolate conditions, or a fairly routine drilling location, you can never consider enough variables. This is primarily due to the fact that once you commence drilling, a number of things can happen to throw you for a loop, which most notably include environmental factors, varying terrain, and any other unforeseen circumstances.

The Essentials To Look For In The Right Drilling Rig Generator
Throughout my years in the industry I have come to realize that regardless of the job, conditions, or drilling rig, there are always a few common things an on-site generator should have. To give you a better idea of what I mean, here are the things I look for in a good on-site generator.

Adaptability: A reliable drilling rig generator is one that can prove itself in practically any situation, and under any circumstances. In other words, versatility is key when it comes to operating under varying environmental conditions, such as harsh heat, and other extreme weather.

Alternative Fuel Sources: Another useful quality that more modern and versatile drilling rig generators share is the ability to run off other fuel sources than just diesel. For the longest time diesel generators dominated the industry, however, more recent innovations have been made, allowing generators to run off alternative fuel sources like methane and natural gas.

Reliability: Drilling in the middle of nowhere can be ironic in that it is one of the most remote forms of work, yet it requires the most reliability in terms of power. If you and your team are hundreds of miles away from civilization and suddenly lose power, it can be catastrophic. For such reason, reliability in a generator is paramount.

Additional Things To Consider In A Generator
Whether it is a single diesel generator, or several natural gas generators, a reliable model must provide power in the most extreme conditions, and in the most remote locations. In addition to performing under pressure, a good generator will require little maintenance, and hopefully zero downtime. In terms of operating expenses, maintenance can be costly, and downtime in the field can be even more expensive. Regardless of extra initial cost, a quality generator that does not breakdown, or require much maintenance, is crucial to the success of drilling.

From my experience, one of the most underestimated traits of a quality drilling rig generator is toughness. Powering a drill site is a lot different than powering a municipality or similar facility. On the job, a generator must withstand unstable and rough terrain, as well as constantly being surrounded by dirt and debris.

Lastly, in the new age of strict regulatory standards, it is important to consider such performance aspects of a generator. In other words, if a generator is not performing properly, then it should either undergo necessary maintenance, or be replaced entirely in order to fulfill the regulations and requirements expected of it.

Conclusion
As high of expectations as I have for all the diesel and natural gas generators we sell at Worldwide Power Products, I am also absolutely amazed at how well they standup to harsh conditions and performance tests. A solid generator will never let you down under such conditions, and if it does, you need to find a better option.

The Growth In Argentina Is Exploding!

In a country emerging as a large oil and gas producer, there is undoubtedly a need for energy. In the case of Argentina, there is no difference. The country’s shale plays have tremendous potential for companies to expand, businesses to start-up, and for investors to prosper. At Worldwide Power Products, as a company, we are excited to be increasing our involvement in Latin American counties such as Argentina. We will provide diesel generators, engines, and many other types of power products to aid companies in tapping the shale plays scattered throughout Argentina’s basins.

In some ways you could say we are looking to fulfill Argentina’s demand for energy, and while we may only play a small role in that fulfillment, the large growth in population will definitely require further power generation to the region. In addition, major petroleum companies are expanding, resulting in a virtual explosion of oil drilling throughout the country, also requiring more readily available energy.

Argentinian Shale

Undoubtedly, the U.S. has had its fair share of recent shale plays, but Argentina is also becoming a noteworthy member of the shale community. So noteworthy in fact, Argentina has found itself third on a list — compiled by the U.S. Energy Information Administration — of countries with the most shale gas potential, behind only the U.S. and China. More specifically, the vast majority of shale oil reserves sit under the Neuquén Basin, which is located in Western Argentina, spanning much of the Rio Negro, La Pampa, and Mendoza provinces. Thus far, upwards of nearly 150 million barrels of oil and significant amounts of gas have been found leading a large number of people in the industry flocking to the area.

With such big oil potential in Argentina, it only makes sense that the various shale plays will need back up power generation. There could be all the oil in the world sitting in Argentina, but with no power to tap into it, there really is no point. This is where Worldwide Power Products comes in — providing natural gas generators and other essential power products to companies in the area.

Private Investors

Additionally, the country’s Ministry of Federal Planning has vamped up its enticement of foreign companies to tap into shale plays in Argentina. While some companies, such as Repsol, out of Spain, have been met with some government intervention, a lot still remains to be seen on how the government will react to the sudden shale boom in the country. There definitely seems to be mixed signals coming out of the Argentine government, with one cabinet member calling for the nationalization of YPF, one of the country’s largest oil and gas companies, thus potentially dramatically increasing the governments involvement with the country’s oil and gas production. It is uncertain weather this will actually happen or if it is merely an idea that will fail to find fruition with little or no resistance to drilling activities.

For private investors, the best way to get in on Argentina’s shale action is to put your money in a company like Apache. In just the last six or seven years, the company has transformed into one of the major oil and gas companies in the country. In fact, it is currently the fifth largest with involvement in over 30 oil fields spanning nearly four million Argentine acres and four of the country’s basins.

Just as remote areas of the U.S. have recently seen a boom in shale drilling, similar desolate areas of Argentina have been experiencing a similar boom. Oil and gas companies have been setting up shop in all the major shale basins throughout the country and private investors have been jockeying to invest in companies faced with the least amount of government resistance. Undoubtedly, it will be fun to see how the region develops, but I guess we will just have to wait and see how it all plays out.

Shale Flares Heat Up Natural Gas Production, But Not For Long

Tension between the Environmental Protection Agency (EPA) and the oil industry is decreasing as air emissions and flares from shale oil reserves come under regulation. While the EPA gives companies until January of 2015 to fully comply with the new regulations, gas and oil companies have to start changing their ways now to meet that target, especially regarding flares. The regulations are expected to cut emissions that harm air quality by 90 percent, per the Washington Post.

Why Flaring Happens

A byproduct of increased production to meet the increased demand for NG, flares allow dangerous gases to burn off. These occur when there is a lack of storage space for produced gas. The flares allow equipment to keep up with the flow of gas, and get released through pressurized valves in the equipment. Not only does flaring release methane and other gases into the air, it wastes energy to the tune of $100 billion of unused gas a year, according to Reuters.  The shale reserves fueled unprecedented expansion of America’s gas production, but the infrastructure that allows gas to be captured and stored before flaring hasn’t grown as fast. The result: Industry waste, energy lost, missed growth opportunities, and environmental concern. The World Bank estimates that gas emitted in flares is roughly equal to the annual energy consumption of France, about 360 tons of CO2, again per Reuters.

Green Solutions

Complying with EPA regulations is good for public opinion and for profits, as the wasted fuel can be used — thereby saving costs at gas production sites — or sold. How can companies cut down on flaring to get on the right side of the EPA regulation? For example, plants could turn the gas flares into power, cutting down on energy consumption and fuel waste. Ways to comply include:

  • Installing pollution-control equipment: Many of the newer wells are already capped with pollution-controlling equipment to cap flares. Existing gas production sites can be retrofitted with these measures to cut flares. So-called green completions are mandatory after 2015 and voluntary beforehand.
  • Implementing Technologies to Reuse the Gas: Escaped gas can be piped back into the ground and used to push more gas toward the surface, increasing production, per GE. Escaped gas can also be stored and used as fuel with compressor technologies. GE is now doing this in Qatar.
  • Decreasing Isolation: Flares often occur when captured gas cannot be put into the pipeline. Extending pipelines gives remote sites storage access and prevents flares.

Are you inspired by the cost savings of reusing produced gas? What’s your plan to green for 2015?

-Mark

Eurozone and the US Economy

In an election year, news coverage focuses mostly on local and national politics so it can be hard to follow world news. Since the 2008 financial crisis, however, smaller European countries including Greece and Ireland, as well as major Euro players like Spain and Italy have been struggling to stay afloat. Now the Eurozone is teetering on the edge of collapse with countries like Greece threatening to leave and revert to their old currency. What is happening on the global stage and what effect does it have on U.S. gas and oil price?

Recently, the BBC reports that the Eurozone agreed to a deal that relaxed strict European lending laws that have made it so hard for struggling countries to get back on track. These measures should help Italy, Spain, and Greece; however, some experts worry that Greece is only postponing a decision to leave the Eurozone. By and large, though, this spells good news for Europe and global stock markets. Markets rose after the deal was reported.

While Europe seems to be getting a handle on finances, its countries are a bit stuck in the mud, so to speak, when it comes to growth. This means less U.S. trade and a sluggish American economy because Europe’s our largest trading power. Other ways Europe affects our economy:

  • U.S. banks invest in European banks
  • Stagnant European market spells reduced profit for American companies
  • Stocks and money markets are losing value

As the U.S. recovers financially, chaos in Europe could lead America back into recession. Financial drama on the global stage makes everyone nervous because it hits close to home. There’s another way the Eurozone crisis can affect Americans: Oil prices that impact everything from the gas in your car to the cost of the diesel fuel for the generator that can power your AC in a summer brownout.

After this great deal hammered out in Europe, oil prices stopped their 90-day downward slide and rose over 9%. At the same time, gas prices hit a 6-month low. Sanctions on Iranian oil and a tanker leak in the North Sea mean oil supply will be limited for some time. Will oil and diesel prices climb higher? Are you prepared to foot the bill if they do?

Let’s face it: Summer is a time of high energy demand. When the grid overloads, hurricanes loom large, or storms knock out power lines, generators can keep your company operating and power that much-needed AC. Natural gas generators cost less to operate than diesel generators. With oil prices climbing and European instability having the potential to make or break the cost of diesel, which type of fuel do you want to be putting in your generator?

-Mark