Alberta firm delivers automated well service rigs to Oman in logistical success
On the surface, it seems simple: a prospective client is interested in hiring a company to provide a product. The company meets with the client to understand what their needs are, a product selection is made, and the product is constructed and delivered. But in reality, delivering on any contract is complicated, particularly when the client is on the opposite side of the globe, in the Sultanate of Oman, and the products are three of the world’s most advanced, automated well service rigs.
High River, Alberta-based Highwood Equipment Technologies Inc. (Highwood) has authored a recession-busting story—growing its business and landing new clients during a global pandemic, in a time of massive layoffs, supply-chain constraints, a dearth of technical staff, and drastically reduced spending in Canada’s oil patch.
Technical details. In collaboration with Al Shawamikh Oil Services (AOS) and Petroleum Development Oman (PDO), Highwood developed a complete well service rig system that strikes the balance between operational cost, speed and safety. The automated rigs are ergonomically designed and minimize manual labor, eliminating the need to expose crews to extreme working conditions. Highwood custom-designed, procured, fabricated and assembled the units in record time.
The contract was signed in January 2021, and the first two rigs were shipped by air to Oman in June. The third, which was shipped overseas, arrived in November. The rigs are all 600-hp, 150-ton doubles that can drill, complete, workover and service wells. They are highly automated and high-efficiency, which improves productivity, lowers operating costs, and helps customers meet environmental, social, and governance (ESG) requirements. Key technical innovations include an integrated system with a cyber chair, top drive system, automated catwalk, and automated pipe handling. Crews are safer, because they are no longer required to do the more dangerous jobs normally done manually on a rig.
To close the deal, Highwood also needed to have ICV (In-Country Value) in Oman, so the company opened its international office in Muscat, along with manufacturing and assembly facilities, completing 25% of the project’s value in Oman. Highwood also hired 75% of their Omani staff locally and began an intensive operations training program with their new staff, Fig. 1. Oman also has significant compliance requirements in place for foreign companies, so key executives from Highwood traveled there and worked with PDO to resolve various issues and pave the way for delivery of the rigs.
The challenges inherent with constructing rigs for the desert fields of Oman were significant, but Highwood worked closely with AOS to understand the harsh working conditions they would face. Omani summers often see temperatures exceeding 120o F, Fig. 2. And sand is an insidious enemy to machinery, so extra filtration for the hydraulic and air systems is an absolute necessity.
But as it turned out, in some ways it was as simple as turning the temperature challenge upside down. Canadian winters can be bitterly cold, especially in areas that can’t be reached until the ground has frozen. Taking wind chill into account, temperatures can fall to -50o F across northern Canada. Each rig, or hoist, as they’re called in Oman, was equipped with cooling units to ensure that they could function in the extreme heat, Fig. 3. Aside from the standard engine and transmission coolers, Highwood added gearbox, control panel, and hydraulic coolers, plus air conditioning in the driller’s cabin.
Logistical challenges. As construction of the rigs proceeded, the team wrestled with governmental restrictions associated with Covid-19, as well as an outbreak at their facility. Strict measures were implemented to ensure work could continue without compromising staff safety.
Supply-chain issues, one of the quiet crises of the pandemic, were also extremely challenging. Items that were readily available pre-Covid, like standard engines, were back-ordered up to 30 weeks. Prices of certain commodities skyrocketed: electronics, tech, and steel increased by as much as 200%. Highwood expedited what they could and built what they couldn’t.
Highwood is a small company, particularly by international standards. But its mindset of innovation and creativity is part of the corporate structure. Under the umbrella of The Highwood Group, there is also Spokane, Wash.-based Highwood Global LP, and Waco, Texas-based Highwood Machine Tool. The companies use their knowledge across seemingly unrelated businesses to bolster creativity and enhance problem-solving. This mindset allows Highwood to provide clients with full turnkey solutions, right from concept to final commission and delivery in the field.
To meet their tight deadlines, Highwood also outsourced locally, or reached out to its U.S. affiliates in Waco and Spokane to assist with supplying the skilled labor that has disappeared from the Canadian oil patch over the past several years. It is estimated that over 150,000 oil and gas industry professionals have lost their jobs during the recession and ensuing pandemic. It’s far more difficult to staff up in Canada than during the previous boom-and-bust cycles that only lasted a year or two.
A key focus for Highwood was ensuring that at least two of the rigs reached Oman as quickly as possible. AOS needed the units in the field, so it could commence operations, meet deadlines, fulfill commitments to clients, and hit revenue targets. The collaboration between Highwood and AOS not only led to a deeper understanding of the client’s technical needs, but of their circumstances and business drivers. Focusing on the complete cost of ownership and solving system challenges (which are significant when delivering products internationally) is a big part of the process at Highwood. And even the smallest non-systemic improvement can lead to marginal gains that make a big difference.
With the three hoists delivered and operating in Oman, Highwood is now focused on expanding its international business. Demand for innovative technical solutions is growing, as more and more companies look to reduce their footprint and adhere to growing ESG requirements. As worldwide demand for energy grows, this small-but-growing firm is fixed on finding unique and effective technical solutions in the increasingly complex world of hydrocarbon extraction.
TWO RIGS TAKE FLIGHT
The massive plane moved slowly across the brilliant blue expanse. At times it appeared to almost be hovering in place; its bulk incongruous with the regular jets normally seen in Alberta skies. The Antonov AN-124, one of the world’s largest aircraft, had attracted a group of plane watchers to Calgary International Airport on a blazing hot morning in late June. As the sun beat down on the tarmac, the enormous aircraft landed and taxied to the terminal, Fig. A. Crews scurried about preparing for the arrival of two rigs. For now, the Antonov sat alone.
Transporting the rigs from their fabrication facility in Aldersyde—just south of Calgary—to the airport seemed almost like an afterthought compared to the complicated and challenging process that had brought them to the point of completion. But as crews checked and rechecked valves, fittings and systems, sometimes for what seemed like the thousandth time, the trailers arrived that would take the rigs north up Alberta’s #2 highway, the main north/south artery of the province. Loading the rigs was difficult: at one point, late on the Friday night before the rigs were scheduled to be shipped, there was concern that the rigs wouldn’t load properly on the flatbeds that were standing by.
There were other issues that arose at the last minute. Due to elevated summer temperatures, Volga, the Antonov operator, reduced Highwood’s payload by 10 tons and the freight forwarder advised Highwood that the loading equipment was part of the company’s payload just days before. The total weight of the rigs was just under the maximum payload of the aircraft. Even the loading equipment would put them over. The solution? Strip a bunch of equipment and air freight the heavy components separately. And there was no warning of the potential logistical challenges associated with weight or temperature.
Loading presented its own challenges. The rigs fit the cargo hold of the aircraft so perfectly, there were only 12 in. to spare above the highest points of the rigs. The rigs were unloaded from the transport trailers, then driven on to the plane back-to-back. Driving them on required extreme precision on the part of Highwood’s crew. Using the ramps from the plane, one rig was backed on, and the second was loaded forward. The drivers had to ensure that the rigs were perfectly aligned with the ramps and lined up internally to exacting specifications. It was slow and painstaking work.
With the plane loaded, weight restrictions observed, temperature adjustments made, and the loading equipment back on board, the Antonov was ready. It took off in the early hours of June 28, 2021. But even then, other issues arose. Enroute, Highwood was advised that the plane had taken off without approval to land in Oman. Fortunately, the client, AOS, secured approval from the Ministry of Transportation before it arrived in Oman.
On July 2, 2021, the rigs landed in Muscat and began their working lives as Hoists 75 and 76 in the employ of Al Shawamikh Oil Services, Fig. B. Hoist 77 would arrive by sea in late November.
HIGHWOOD EQUIPMENT TECHNOLOGIES’ EXECUTIVE TEAM
The following executives were among personnel involved with the successful movement of the well service rigs to Oman.
KEVIN KERR is Highwood’s founder, Director and CEO, with over 25 years of manufacturing, service and sales experience. He brings over two decades of leadership experience to Highwood, having founded, grown, and sold three separate multi-million-dollar companies from the ground up. He has successfully launched business operations throughout the U.S., Canada and Australia. His career history includes key roles in companies providing equipment technology in the oil and gas, mining, and aerospace industries.
ROB WAWRZYNOWSKI joined Highwood in 2016 as President and reports directly to the CEO. His focus on identifying key market drivers, and targeting new equipment to meet those needs, has allowed Rob to sell more than $1 billion of oil and gas equipment worldwide. As a professional engineer, he brings an extensive background in direct engineering and development of well servicing, well stimulation, well servicing equipment, and end-to-end oilfield product lifecycle. He holds an MBA from Cornell University and a BS degree in mechanical engineering from University of Alberta.
BRENT KOHLS is Vice President of Engineering and Director for Highwood. Accumulating over 20 years of engineering and design leadership, Brent excels at closing the loop between the conception and manufacturing of products. To date, he has led the development of over 20 new oil and gas products. Brent’s diverse background includes experience in agricultural, mining, industrial service, and oil and gas equipment. Among numerous professional development certifications, Brent is an SAIT graduate with a diploma in engineering technology and has a Professional Engineering License with APEGA.
COLIN KNAPP heads new product development and daily shop operations at Highwood. He takes clients’ challenging ideas and designs customized, cost-effective equipment solutions that are not available elsewhere in the market. He works as part of the leadership team in business development, as well as managing projects. Colin is a graduate of the Mechanical Engineering Technology program at the Southern Alberta Institute of Technology (SAIT) and is a member of The Association of Science and Engineering Technology (ASET) as a Certified Engineering Technologist.
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