During my 35 years in the upstream oil and gas business, I have seen firsthand the tremendous gains in efficiency, productivity, and cost reduction that the industry has achieved through innovation and technology. Drilling and completion times have been shortened dramatically, wells perform much better than they used to, we are drilling even-longer laterals, and we are able to operate in increasingly hostile conditions. As we have seen during the current downturn, these types of gains have been critical to survival for many operators.
Despite our progress, we face a pressing need to close the sizable efficiency and productivity gaps that continue to hinder performance and value creation industrywide. These gaps limit profitability during growth cycles and exacerbate vulnerability during downturns. We must fundamentally change the way we operate to be sustainably successful going forward.
The good news is that we have a very powerful tool in our arsenal to reset the bar in these areas. That tool is technology. It can lead us to what we at Baker Hughes like to call “radical efficiencies” in well construction and oil and gas production that will create a more profitable and resilient industry—one that is less vulnerable to the cycles and volatility we constantly experience....
Needed: Radical Efficiencies
Martin Craighead, Chairman and Chief Executive Officer, Baker Hughes
01 April 2017