Baker Hughes 2004 Annual Report Download - page 55

Workovers.฀Workover฀products฀and฀services฀seek฀to฀
improve,฀maintain฀or฀restore฀economical฀production฀from฀an฀
already฀producing฀well.฀In฀this฀area,฀Baker฀Oil฀Tools฀provides฀
service฀tools฀and฀inflatable฀products฀to฀repair฀and฀stimulate฀
new฀and฀existing฀wells.฀Service฀tools฀function฀as฀surface-฀
activated,฀downhole฀sealing฀and฀anchoring฀devices฀to฀isolate฀฀
a฀portion฀of฀the฀wellbore.฀Service฀tool฀applications฀range฀from฀
treating฀and฀cleaning฀to฀testing฀components฀from฀the฀well-
head฀to฀the฀perforations.฀Service฀tools฀also฀refer฀to฀tools฀and฀
systems฀that฀are฀used฀for฀temporary฀or฀permanent฀well฀aban-
donment.฀An฀inflatable฀packer฀expands฀to฀set฀in฀pipe฀that฀is฀
much฀larger฀than฀the฀outside฀diameter฀of฀the฀packer฀itself,฀so฀
it฀can฀run฀through฀a฀restriction฀in฀the฀well฀and฀then฀set฀in฀the฀
larger฀diameter฀below.฀Inflatable฀packers฀can฀also฀set฀in฀“open฀
hole”฀as฀opposed฀to฀conventional฀tools฀which฀can฀only฀be฀set฀
inside฀casing.฀Thru-tubing฀inflatables฀enable฀remedial฀operations฀
in฀producing฀wells.฀This฀results฀in฀cost฀savings฀as฀rig฀require-
ments฀are฀lower฀and฀workovers฀can฀occur฀without฀having฀to฀
remove฀the฀completion,฀which฀can฀be฀very฀costly.
Fishing.฀Baker฀Oil฀Tools฀is฀a฀leading฀provider฀of฀specialized฀
fishing฀services฀and฀equipment฀that฀are฀used฀to฀locate,฀dis-
lodge฀and฀retrieve฀damaged฀or฀stuck฀pipe,฀tools฀or฀other฀
objects฀from฀inside฀the฀wellbore,฀often฀thousands฀of฀feet฀
below฀the฀surface.฀Other฀fishing฀services฀include฀cleaning฀฀
wellbores฀and฀milling฀windows฀in฀the฀casing฀to฀drill฀a฀“side-
track”฀or฀multilateral฀well.
The฀main฀drivers฀of฀customer฀purchasing฀decisions฀in฀com-
pletions,฀workovers฀and฀fishing฀are฀superior฀wellsite฀service฀
execution฀and฀value-adding฀technologies฀that฀improve฀produc-
tion฀rates,฀protect฀the฀reservoir฀from฀damage฀and฀reduce฀cost.฀
Specific฀opportunities฀for฀competitive฀differentiation฀include:
•฀ the฀engineering฀and฀manufacturing฀of฀superior฀
quality฀products,
•฀ reduced฀well฀construction฀costs,
•฀ enhanced฀production฀and฀ultimate฀recovery,
•฀ minimized฀risks,฀and
•฀ reliable฀performance฀over฀the฀life฀of฀the฀well,฀particularly฀
in฀harsh฀environments฀and฀critical฀wells.
Baker฀Oil฀Tools’฀primary฀competitors฀in฀completions฀are฀
Halliburton,฀Schlumberger,฀Weatherford฀International฀Ltd.฀
(“Weatherford”),฀BJ฀Services฀Company฀and฀various฀other฀com-
petitors.฀Its฀primary฀competitors฀in฀workover฀are฀Halliburton,฀
Schlumberger,฀Weatherford฀and฀various฀other฀competitors.฀Its฀
major฀competitors฀in฀fishing฀are฀Smith฀International,฀Inc.฀
(“Smith”),฀Weatherford฀and฀various฀other฀competitors.
Key฀business฀drivers฀for฀Baker฀Oil฀Tools฀include฀the฀number฀
of฀drilling฀and฀workover฀rigs฀operating,฀as฀well฀as฀the฀current฀
and฀expected฀future฀price฀of฀both฀oil฀and฀natural฀gas.
Baker฀Petrolite
Baker฀Petrolite฀is฀a฀leading฀provider฀of฀specialty฀chemicals฀
to฀a฀number฀of฀industries,฀primarily฀oil฀and฀natural฀gas฀pro-
duction,฀but฀also฀including฀refining,฀pipeline฀transportation,฀
petrochemical,฀agricultural฀and฀iron฀and฀steel฀manufacturing.฀
Additionally,฀Baker฀Petrolite฀provides฀polymer-based฀products฀
to฀a฀broad฀range฀of฀industrial฀and฀consumer฀markets.
Baker฀Petrolite฀provides฀oilfield฀chemical฀programs฀for฀
drilling,฀well฀stimulation,฀production,฀pipeline฀transportation฀
and฀maintenance฀programs.฀Its฀products฀provide฀measurable฀
increases฀in฀productivity,฀decreases฀in฀operating฀and฀mainte-
nance฀cost฀and฀solutions฀to฀environmental฀problems.฀Examples฀
of฀specialty฀oilfield฀chemical฀programs฀include:
•฀ Hydrate฀inhibitors฀–฀Natural฀gas฀hydrates฀are฀solid฀ice-like฀
crystals฀that฀can฀form฀in฀production฀flowlines฀and฀tubing,฀
causing฀shutdowns฀and฀the฀need฀for฀system฀maintenance.฀
Subsea฀wells฀and฀flowlines,฀particularly฀in฀deepwater฀envi-
ronments,฀are฀especially฀susceptible฀to฀hydrates.
•฀ Paraffin฀inhibitors฀–฀The฀liquid฀hydrocarbons฀produced฀
from฀many฀oil฀and฀natural฀gas฀reservoirs฀become฀unstable฀
soon฀after฀leaving฀the฀formation.฀Changing฀conditions,฀
including฀decreases฀in฀temperature฀and฀pressure,฀can฀
cause฀certain฀hydrocarbons฀in฀the฀produced฀fluids฀to฀crys-
tallize฀and฀deposit฀on฀the฀walls฀of฀the฀well’s฀tubing,฀flow฀
lines฀and฀surface฀equipment.฀These฀deposits฀are฀commonly฀
referred฀to฀as฀paraffin.฀Baker฀Petrolite฀offers฀solvents฀that฀
remove฀the฀deposits,฀as฀well฀as฀inhibitors฀that฀prevent฀new฀
deposits฀from฀forming.
•฀ Scale฀inhibitors฀–฀Unlike฀paraffin฀deposits฀that฀originate฀
from฀organic฀material฀in฀the฀produced฀hydrocarbons,฀scale฀
deposits฀come฀from฀mineral-based฀contaminants฀in฀water฀
that฀are฀produced฀from฀the฀formation฀as฀the฀water฀under-
goes฀changes฀in฀temperature฀or฀pressure.฀Similar฀to฀paraffin,฀
scale฀deposits฀can฀clog฀the฀production฀system.฀Treatments฀
prevent฀and฀remove฀deposits฀in฀production฀systems.
•฀ Corrosion฀inhibitors฀–฀Another฀problem฀caused฀by฀water฀
mixed฀with฀downhole฀hydrocarbons฀is฀corrosion฀of฀the฀
well’s฀tubulars฀and฀other฀production฀equipment.฀Corrosion฀
can฀also฀be฀caused฀by฀dissolved฀hydrogen฀sulfide฀(“H2S”)฀
gas฀which฀reacts฀with฀the฀iron฀in฀tubulars,฀valves฀and฀other฀
equipment,฀potentially฀causing฀failures฀and฀leaks.฀Addi-
tionally,฀the฀reaction฀creates฀iron฀sulfide฀which฀can฀impair฀
treating฀systems฀and฀cause฀blockages.฀Baker฀Petrolite฀
offers฀a฀variety฀of฀corrosion฀inhibitors฀and฀H2S฀scavengers.
•฀ Emulsion฀breakers฀–฀Water฀and฀oil฀typically฀do฀not฀mix,฀
but฀water฀present฀in฀the฀reservoir฀and฀co-produced฀with฀
oil฀can฀often฀become฀emulsified,฀or฀mixed,฀causing฀prob-
lems฀for฀oil฀and฀natural฀gas฀producers.฀Baker฀Petrolite฀
offers฀emulsion฀breakers฀which฀allow฀the฀water฀compo-
nent฀of฀the฀emulsion฀to฀be฀separated฀from฀the฀oil.
For฀the฀refining฀industry,฀Baker฀Petrolite฀offers฀various฀
process฀and฀water฀treatment฀programs,฀as฀well฀as฀finished฀
fuel฀additives.฀Examples฀include฀programs฀to฀remove฀salt฀from฀
crude฀oil฀and฀environmentally฀friendly฀cleaners฀that฀decontami-
nate฀refinery฀equipment฀and฀petrochemical฀vessels฀at฀a฀lower฀
cost฀than฀other฀methods.
2004฀Form฀10-K฀฀฀฀฀5