1. Bob
Oil & Gas

2. History of Drilling Cable Tool Drilling Rotary Drilling
Offshore Drilling
Directional Drilling
Bob
Cable Tool Drilling: the drill bit is suspended in the hole by a rope or cable. Operated by a steam engine, the cable and attached bit are raised and then allowed to drop. This up and down motion is repeated again and again. Each time the bit drops it hits the bottom of the hole and pierces the rock.
The rotary drilling system that circulates fluid to remove the rock cuttings was successfully used in Corsicana, Texas where drillers searching for water discovered oil. Rotary drilling operates by pressing the teeth of the drill bit firmly against the rock and turning, or rotating it. Simultaneously, a fluid, usually a liquid including clay and water called drilling mud, is forced out of special openings in the bit at high velocity. This forces the mud and rock cuttings away from the drill bit and back up to the surface.
Using a rotary system on January 10, 1901 at a depth of 1,139 feet, what is now known as the Lucas Gusher blew oil over 150 feet in the air at a rate of 100,000 barrels of oil a day. It took nine days before the well was brought under control. Spindletop was the largest gusher the world had ever seen and catapulted Beaumont into a boomtown. Beaumont's population of 10,000 tripled in three months and eventually rose to 50,000. Speculation led land prices to increase rapidly. By the end of 1902 over 600 companies were formed, including ExxonMobil and Texaco, and 285 active wells were in operation.
In the rush to develop Spindletop, Howard Hughes, Sr. patented a two-cone rotary rock drill bit that revolutionized drilling. It was unlikely that he actually invented the bit, but his law training helped him understand that the patent was the most important part of the financial life of any invention. This design has been improved over the years but remains the most widely used system today.
Some time in the early 1920's, logs began being kept by drillers. These driller logs recorded the depth, kind of rocks, fluids, and anything else of interest that occurs while drilling the well. This type of information was useful when compared with nearby wells to interpret the subsurface geology. More useful are cores and mud logs. A core is a cylindrical cut of a formation while a mud log is a record of the drilling mud which includes a description of the drill cuttings that are brought to the surface in the drilling mud.
The earliest form of submersible rig was a posted barge. It consisted of a barge with several steel posts attached and anchored. A deck was laid across the top of the posts, and the drilling equipment was installed on the deck. Continuing exploration to further offshore drilling in deeper waters resulted in new submersible designs. The Jackup rig made it possible to drill in waters up to 350 feet with a few operable in up to 600 feet. Jackups are bottom-supported rigs that can be either column- or truss-supported. Today the most common type of offshore rig is the steel-jacket platform. This consists of the jacket, which is a tall vertical section manufactured from tubular steel. The steel jacket is pinned to the ocean floor using driven piles. Additional sections of tubular steel are placed on top of each other. Above the water level are quarters for the drilling crew and the drilling rig. This system has been used to drill wells in up to 1,000 feet of water.
Directional drilling techniques were employed in the 1970's. Normally wells are drilled vertically; however, there are many occasions when it is helpful to be able to drill at an angle. Directional wells are drilled straight to a predetermined level and then gradually curved. By changing the direction of the drill bit in small increments of no more than 2 to 3 degrees at a time, it is possible to drill many wells into a reservoir from a single offshore platform. Directional wells may also be deflected from a shoreline to reach a reservoir under nearby water. In addition, directional wells are very useful in avoiding fault lines, which can cause hole problems, as well as in instances where it is undesirable to set a rig in a given spot because of an obstruction or for environmental reasons.

3. Production
Production is the process of extracting petroleum from the underground reservoir and bringing it to the surface to be separated into gases and fluids that can be sold to refineries
Bob
Production is the process of extracting petroleum from the underground reservoir and bringing it to the surface to be separated into gases and fluids that can be sold to refineries. Production begins with a high level of production and decreases through time until the well is ultimately plugged and abandoned. This decrease in production is a natural result of the inevitable decline in original pressure within the reservoir. The time period for commercial production and the rate of production depends on the reservoir
Initially an oil reservoir is in primary recovery. Gaseous fuels, natural gas or water are usually present, and supply the needed pressure. Depending on the reservoir, once the natural flow ceases, the reservoir will have yielded only 15 to 70 percent of the total volume of the oil it contains. The rest is trapped in unconnected rock pockets or is bound to the rock and refuses to migrate toward the wellbore.
Petroleum engineers have developed a number of ways to help the reluctant oil migrate to the wellbore. The most common approach is to drill adjacent wells and use them to inject water into the reservoir to force the oil to move toward the production wells. Another is to inject gas into adjacent wells to maintain reservoir pressure or to enhance gravity drainage. Both approaches are referred to as secondary recovery processes. Even after secondary recovery steps have been taken, as much as 50 percent of the oil in the reservoir will remain. Tertiary oil recovery reduces the oil's viscosity to increase oil production.

4. Bakken Formation
The U.S. Geological Survey (USGS) calls the Bakken shale foundation, stretching across 200,000 square miles, the largest continuous oil accumulation it has ever seen. Oil was first discovered there in 1951, but it hasn't been accessible until now.
The oil rock is located between layers of Shale nearly two miles underground
Considered a marginal resource just a few years ago, new technology transformed the area into prolific oil and gas producer
Bob

5. Bakken Formation
In particular, the most important driver has been the hydraulic fracturing or fracking.
Fracking is the process by which water, sand and chemicals are pumped down holes using high pressure to flush out Shale gas and oil trapped in the rock pockets.
Fracking, also called horizontal drilling coupled with multi-stage hydraulic fracturing - is a relatively new process of natural gas extraction.
Bob

6. North Dakota’s Oil Boom
A quiet boom has been slowly taking place in the westernmost corner of North Dakota -- one that is starting to resemble the size and scale of the 1849 gold rush.
By using the new drilling technology called hydraulic fracturing, or fracking, they could tap into the estimated 170 billion barrels of crude oil that sat beneath the ground in the Bakken shale foundation.
The USGS estimates the U.S. will be able to recover 7.4 billion barrels of oil from the region and 6.7 trillion cubic feet of natural gas. So far, only about 250 million barrels of oil have been recovered.
The region now accounts for 42% of the growth in U.S. oil production in recent years.

7. North Dakota’s Oil Boom
Oil production has risen more than 600%
North Dakota's oil production has increased from 36 million barrels in 2005 to 237 million in 2012.
There are now 8,360 active wells in the state, producing 783,000 barrels of oil a day.
The state has gone from the No. 8 oil-producing state to No. 2 in just seven years.

8. North Dakota’s Oil Boom
Each new well costs $10 million
A new well costs about $10 million to build in the Bakken region -- about $3 million more than in other U.S. oil-producing regions like Texas.
Each well is expected to generate
$20 million in profits
$4.4 million in taxes
$1.6 million in salaries and wages
$7.6 million in royalties

9. North Dakota’s Oil Boom
Other cool facts

10. Oil & Gas: A Big, Broad Business
The oil and gas industry can be broadly classified into three segments.
The upstream segment comprises exploration and production (E&P)
The downstream segment includes refining and marketing (R&M).
In between, the midstream segment includes the transportation, storage, and trading.
Over 281,760 oil company listings exist
Dave
The exploration and production segment is capital intensive, soaking up 70 percent of total investment. The activity is also riddled with uncertainty with the number of failures outstripping the number of successful finds. 
The downstream segment, meanwhile, is a relatively safer business with operating efficiency and energy consumption governing profitability.

11. Supply Chain Machine Shops Steel Mills Master Dist Service Centers
End User
Parts Supplier
Dave
Service Supplier

12. Oil & Gas Grades
ESP Specialty Steel is a leading distributor of stainless bar to Service Centers supporting the Oil and Gas Industry. We have been providing stainless bar to the Oil and Gas industry for over 20 years. Our success is due to 3 key factors:
Our mill sources are widely accepted by O.E.M.s
Industry knowledge and expertise
Our large oilfield specific inventory
Dave

13. Oil & Gas You HAVE to be alert to the customer specs
E.g. 30 to 40 customer specs out there
E.g. New spec by Cameron and a new unique tempering temp requirement
Some grade specific examples
17-4 DBH 40 ksi min tensile
420 Mod: UT requirements (trends, bar vs tube)
We already provide feedback to your corp folks your specs
Dave

14. End Use Applications

15. For parts used in hydrogen sulfide
410 QDT
Valves, valve components, valve bodies, bonnets, end and outlet connections, fasteners, and valve seat facings
Bearings
Bushings
Pump shafts
For parts used in hydrogen sulfide

16. 17-4 DBH Oil field valves Shafts Pump shafts Pump Impeller Shafts
High strength shafts
Gears
Drive components (drive trains) for the drill bit within the drill string (down hole motors)

17. 420 Mod
Wellhead equipment (the component at the surface of an oil or gas well that provides the structural and pressure-containing interface for the drilling and production equipment)
Christmas trees (an assembly of valves, spools and fittings used for an oil and gas well)
Typically used for completion equipment, structural and pressure containing oil tool parts and members
For parts used in CO2 environments, low hydrogen sulfide levels

18. Your Play in This Market
Target the above ground end use products. An A to Z listing
Actuators (SIC 3593)
Blowout Preventers (SIC 3533)
Compressors (SIC 3563)
Drilling Equipment (SIC 3533)
Environmental Systems (SIC 3823,3829)
Bob

19. Your Play in This Market
Target the above ground products. An A to Z listing
Flanges (SIC 3494)
Gauges (SIC 3824,3829)
Heat Exchangers (SIC 3443)
Instrumentation (SIC 3829)
Joints (SIC 3441)
Manifolds (SIC 3498)
Pump and Pumping Equipment (SIC 3561,3594)
Bob

20. Your Play in This Market
Target the above ground products. An A to Z listing
Drilling Riser (SIC 1311)
Separators (SIC 3569)
Tanks (SIC 3795,1389)
Valves (SIC 3494)
Winches (SIC 3531, 5084)
Bob

21. Energy is not an option. Fossil fuels supply over 86% of the world's energy. An abundant supply of oil and natural gas remains vital in helping us and the industrialized countries of the world maintain and establish a way of life.

22. Fracking Explained
In particular, the most important driver has been the hydraulic fracturing or fracking.
Fracking is the process by which water, sand and chemicals are pumped down holes using high pressure to flush out Shale gas and oil trapped in the rock pockets.
Fracking, also called horizontal drilling coupled with multi-stage hydraulic fracturing - is a relatively new process of natural gas extraction.

23. Fracking Explained Here's a step-by-step look:
A well is drilled vertically to the desired depth, then turns ninety degrees and continues horizontally for several thousand feet into the shale believed to contain the trapped natural gas.
A mix of water, sand, and various chemicals is pumped into the well at high pressure in order to create fissures in the shale through which the gas can escape.
Natural gas escapes through the fissures and is drawn back up the well to the surface, where it is processed, refined, and shipped to market.
Wastewater (also called "flowback water" or "produced water") returns to the surface after the fracking process is completed.

24. Fracking Explained
Fracking is fundamentally different than traditional gas extraction methods
Fracking wells go thousands of feet deeper than traditional natural gas wells.
Fracking requires between two and five million gallons of local freshwater per well - up to 100 times more than traditional extraction methods.
Fracking utilizes "fracking fluid," a mix of water, sand, and a cocktail of toxic chemicals. While companies performing fracking have resisted disclosure of the exact contents of the fracking fluid by claiming that this information is proprietary, studies of fracking waste indicate that the fluid contains: formaldehyde, acetic acids, citric acids, and boric acids, among hundreds of other chemical contaminants.

25. Fracking Explained
A You Tube video from Marathon Oil that explains hydraulic fracturing or fracking

26. ESP’s Role with Service Center
A Simple Role for ESP to Play
Let us fill the holes
Let us be your inventory holder for ‘C’ and ‘D’ items
On stock specials or non stock items, let us be your supplier.
We provide saw cutting services
We provide end to end service
Joint Account Plan
Let us fill the holes you get in ‘A’ and ‘B’ items
Let us be your inventory holder for ‘C’ and ‘D’ items
On stock specials or non stock items, let us be your supplier. These are items you hold special for your customer
We provide saw cutting services to
improve delivery lead time
eliminating extra handling
eliminate slow moving drops
We provide end to end service by
responding to quotes on a timely basis;
providing order acknowledgement, MTR’s and packing slips via ahead of receipt;
loading your trucks in an efficient and timely manner
We will create a plan to jointly approve and work on, creating commitment on both sides

31. Shale Play in US Market
Bob

32. The Hottest North American Shale Play
Bob

33. Online Resources
Bob