As a worldwide provider of services for both offshore and land operations, Petroleum Co-Ordinators Inc. (PCI) and its affiliates have been conquering new horizons in remote locations for close to 40 years.

MEETING MEXICO’S CHALLENGES

The dynamics of exploration and production are providing new challenges since the deregulation of Mexico’s energy sector. To expand its energy assets, Mexico has extended invitations to foreign investors, while lifting its strict state controls. On the other hand, the Mexican government has activated complex energy regulations that make compliance for foreign production companies increasingly difficult.

Many of PCI’s clients are finding Mexican oil and gas opportunities to be financially attractive, despite their inherent challenges, and are gearing up to invest in exploration and production in this part of the world. To invest successfully, they require the on-the-ground experience and knowledgeable services of a company that has proven its abilities to operate in new and challenging circumstances. As a result of its many years of remote location operations on frontier horizons, PCI can provide staff members and management who are well-versed in adapting to unfamiliar locations and cultures. These PCI teams have the prerequisite skills to minimize local obstacles of all sorts.

Shore-Based & Offshore Expertise. In effect, PCI has been delivering the total management of shore-based logistics and offshore rig facilities, computer reporting, health, safety, and environmental best practices and compliance for close to half a century. Additionally, PCI has assumed responsibility for complex logistical planning for the transportation of materials and personnel in Mexico’s new evolving oilfield business environment. PCI also has demonstrated its ability to execute operations utilizing technical services via expatriates along with Mexican nationals.

SPECIFIC CHALLENGES

PCI already has been engaged by oil & gas companies with drilling operations in Mexico. While working on site, the company has served as the client’s support team and liaison for offshore operations, onshore logistics, and in-country engineering and leadership. PCI has provided these services, while:

• Creating a business model to operate in compliance with Mexican labor, tax and immigration law, while complying with newly-created legislation of Hydrocarbons Labor and Revenue Law while honoring existing United States laws and tax treaties;
• Identifying how local authorities require paperwork and documentation to be delivered;
• Overcoming a limited mobilization start-up time;
• Understanding the variety of labor unions present in Mexico;
• Overcoming language barriers and cultural differences;
• Overcoming the challenge of executing complex operations; and
• Developing a technical team to execute client drilling and completion programs.

SOLUTION(S) & OUTCOMES

PCI’s essential solution to its clients' requests was to create a business model custom-designed especially for operations in Mexico. This model includes standards of compliance, transparency and execution relating to Mexico’s complex laws, while establishing PCI’s required presence and registration with Mexican authorities. The business model has been effective in meeting all client needs, while remaining proactive in mitigating risk in this ever-changing business and operational environment. PCI not only delivered, but exceeded its clients’ expectations, especially in the areas of performance, management, safety and environmental compliance.

The drilling projects in which PCI has participated have generated foreign capital investment in future drilling projects. To enhance PCI’s long-term presence in Mexico, it’s critical to continue educating local Mexican laborers while helping improve their use of current technology.

PCI brings only experienced superintendents to supervise operations and its teams. These managers each have as many as 40 years of experience working on rigs. To overcome language and cultural barriers, PCI’s team approach is to merge the local work ethic with our own. Our executives have delivered extraordinary success in merging cultures and bridging any language divides. Also important was PCI’S insight, quick decision-making and ability to plan ahead for unanticipated contingencies.

Note: Petroleum Co-Ordinators Mexico S. de R.L. de C.V. was created in 2016 to meet the demand of our clients operating in Mexico under the Hydrocarbon Revenue & Labor Laws. Our parent company, Petroleum Co-Ordinators, Inc., has a long history for its capabilities to operate globally, meeting the needs of our clients as they venture internationally seeking hydrocarbons. Mexico has been a country that has presented multiple obstacles. We pride ourselves in fulfilling our clients’ needs in providing local content and technical expertise. Petroleum Co-Ordinators Mexico S. de R.L. de C.V. technical expertise meets all requirements for localization plans, unions, and local Mexican laws and taxes. Our entity has processed & provided 100 plus Mexican nationals and 50+ US expatriates through 2016/2017.

ON AN AVERAGE DAY PCI LOGISTICS EXPERTS CO-ORDINATED THE MOVEMENT OF 60 FLIGHTS, 26 HELICOPTERS, AND APPROXIMATELY 300,000 POUNDS OF MATERIALS INTO THE JUNGLE OF PAPUA, NEW GUINEA FOR A MAJOR OIL COMPANY.

COMPREHENSIVE CHALLENGES

When not dressed in native garb to celebrate local festivals, the New Guinea natives worked side-by-side with PCI personnel. Hired initially by a major oil company for a six-month contract to start-up and manage a transportation logistics base, PCI ultimately spent eight years at this remote location.

Beginning with the unanticipated assignment of designing an air information tower, the logistical challenges encountered by PCI Drill Techs and management personnel increased exponentially over time. One of the first significant challenges was the relocation of a new base 35 miles into the jungle, followed by the construction of administration and headquarters facilities, along with a 147-mile pipeline, an offshore staging facility and a small refinery.

Further complicating the challenge was the fact that all rig sites were located in mountains inaccessible by road or water, requiring the use of helicopters exclusively. During the duration of the construction phase, PCI was responsible for designing the most cost effective methods of coordinating and moving massive amounts of materials into the jungle to support human life, rig operations, and construction. During the least busy times, PCI arranged for the transportation of well over 800 people per month.

SOLUTION(S) & OUTCOMES

PCI’s innovative logistics reduced the time required for helicopters to land, off-load, refuel, and become airborne again to an unprecedented 8-10 minutes; this accomplishment was one essential element that contributed to the overall time and cost objectives of the operating oil company. With PCI assistance, all construction projects were brought in under budget on the precise day that had been targeted!

Not many locations in the world were more logistically challenging than Kazakhstan.

COMPREHENSIVE CHALLENGES

PCI originally was contracted by a major oil company to coordinate, warehouse and dispatch all materials that supplied three land rigs. Obstacles needing to be overcome were significant. Environmentally, temperatures plummeted well below freezing or escalated as high as 130 degrees. In addition, little to no infrastructure was in place, necessitating the widening of bridges and rebuilding of a rail system.

The most unusual challenge to this assignment was the type of equipment made available for transportation. When the drilling operation first was taken over from the Russians, operations had to ‘make do’. Consequently, PCI mobilized old missile trucks and other ex-military equipment to supply the rigs until more modern and better suited vehicles became available. (PCI eventually handled the management and maintenance of 65 assorted vehicles, ranging from cars and trucks to tankers.) In addition to supplying the rigs, PCI also planned and implemented the logistics of transporting materials required for the construction of a $100 million new plant – which was completed and started-up within a grueling 12-month period. Much of the equipment for the plant arrived by barge on the Volga from approximately 18 different countries, while materials required by the rigs often originated in England and were shipped via France to Hungary, where the were brought to Kazakhstan by truck and rail. Comprehensively, this was a complicated logistical trail to plan and administrate.

SOLUTION(S) & OUTCOMES

PCI’s understanding of complex environments and within safety first confinement that ‘make do’ mentality to get the job done is what sets PCI apart. With PCI’s forward thinking and proactive mentality, there is no project too complex for PCI highly experienced team to overcome.

PCI achieves lowest world-wide logistics cost for major operating company.

OPERATIONAL LIMITATIONS:

When PCI was engaged to participate in planning the logistics operations of a major oil company, operating in the western part of Lake Maracaibo, Venezuela, a great deal of innovative scheduling was necessary. To start, 11 percent of the cost of drilling a well was being spent on logistics alone.

To accomplish this objective, PCI was given only two supply vessels to accommodate all the needs of three rigs. Subsequently, a main production platform was added, as well as a lift boat for workovers and completions and a toll-tech communications platform requiring water and fuel. Consequently, PCI has become challenged further to supply what is now six facilities, using the same two boats it has been relying on all along.

Before this sophisticated planning was put into place, an average of 75 unscheduled boat runs per month were being made. Not only was this inefficient, but unscheduled runs also jeopardized safety. Furthermore, PCI coordinates the transportation of approximately 750 people to and from rigs each month.

SOLUTION(S) & OUTCOMES

PCI was able to reduce the 11 percent cost of drilling a well to 7.9 percent of the total cost! This achievement was noted as the lowest logistics costs that this major operating company experienced worldwide during the late 1990’s. Today, under PCI’s management, unscheduled shipments and boat runs are minimized to no more than 15 per month. In addition, PCI is not logging any non-productive time incidents, while concurrently meeting all of the oil company’s safety guidelines.