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Industry Commentary from Around
the World
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I N N O V AT I O N S • V O L . V I I , N O. 1 • 2 0 1 5
Industry Commentary from Around the World
ADJUST ING TO THE NEW GAME
To claim that shale and unconventional developments in the United States
have been anything less than game-changing on a global scale would be a gross
understatement. As proven reserves, even with rapidly increasing production, have
grown – nearly doubling for oil and up 40 percent for natural gas since 2008 – the new
rules are here to stay.
However, by simply focusing on the new way to play, it can be easy to overlook
the complexity of the infrastructure, regulation, and maintenance required to
accommodate and sustain such a steep growth curve. A rising and formidable
challenge – shared equally by upstream, gathering and transmission pipeline
operators – is how to safely execute their largest capital expenditure growth programs,
while simultaneously improving the performance and integrity of their existing pipeline systems; not to mention the
mounting pressure to transport ever-increasing volumes without interruption to flow, and maintaining focus on financial
performance and shareholder value.
Further upping the game’s difficulty, U.S. operators must adjust to falling oil prices, with shifts in global supply
and demand resulting in lows not seen since 2009. Many operators, however, have discovered the winning move:
Drastically lower production and operating costs to remain competitive. Through strategic partnerships with
specialized pipeline service providers and consultants, operators are becoming better prepared to meet the market’s
seemingly incompatible demands.
Chad Fletcher
VP WESTERN HEMISPHERE OPERATIONS, T.D. WILLIAMSON
NOCS: ROCK AND A HARD PLACE
Synonymous with National Oil Companies (NOCs), the Latin American energy
industry has historically underinvested in and overtaxed its infrastructure, resulting
in aged and limited pipeline systems. To complicate matters, in the last decade,
global energy prices have pressured NOCs to significantly increase their output,
further stressing old infrastructure.
Somewhat between a rock and a hard place, the NOCs are also facing increasing
safety and environmental regulation. Although often performing the dual role of
regulator and producer, the NOCs have developed a strong partner network to
navigate this challenge. It’s common for them to collaborate on and adopt one
another’s best practices, and to lobby for similar legislation. They also depend on
specialized partners for guidance on new technology and operational innovation.
This reliance on their peers and industry partners has helped NOCs accomplish their sometimes conflicting goals of
increased uptime and production on aging infrastructure, and compliance to tightening regulation, allowing them to
safely grow their pipeline networks from south of the Rio Grande to Tierra del Fuego.
Roberto Mejia
DIRECTOR, LATIN AMERICA, T.D. WILLIAMSON