The Al Mansoori Group of Dubai signs on to market high-tech oil monitoring device in region.
Camcon Oil launches Apollo oil recovery service
Big oil producers like to compare the complexity of their deep-sea drilling to rocket science. So it is fitting that a newcomer to the oil patch is making a splash with a gadget it calls Apollo.
The device, developed by the UK company Camcon Oil, does not propel astronauts to the moon. Instead, it forces crude from tapped-out wells during "artificial gas lift", a process that makes sluggish oil behave like soda erupting from a shaken can: compressed gas forced down the sides of wells forms bubbles in the oil column, helping sticky crude rise to the surface.
This enhanced oil recovery is used widely in the Middle East, especially on offshore production platforms that cannot support heavy "nodding donkey" pumps. That is why Camcon is seeking clients in the region.
It has already signed up two in less than a month.
Probably not by coincidence, the company's first regional partner, Al Mansoori Group, based in Dubai, is a major shareholder of the second, Omani Special Oilfield Services (SOS).
On Monday, Camcon announced a three-year agreement giving SOS rights to sell, install and support its products throughout Oman.
This month, the UK company clinched a wider deal with Al Mansoori, the conglomerate founded and chaired by Sultan al Mansouri, the Minister of Economy. Under that agreement, the Dubai enterprise has the rights for three years to market, install and support Camcon's products in the rest of the GCC and in Iraq, Iran, Egypt, Libya and Yemen.
"Al Mansoori prides itself on embracing the latest innovations as a means of addressing the needs of our customer base throughout the upstream Middle East oil and gas sector," said Foroohar Farzadnia, the corporate marketing and business development director of Al Mansoori. "Apollo is addressing some of the most pertinent issues in the Middle Eastern oil and gas sector today."
Ian Anderson, the chief operating officer of Camcon, said Apollo was the first oil-well gas-injection device equipped with digital capabilities that allowed constant monitoring of temperature, pressure and other conditions inside oil wells while automatically adjusting the flow of gas.
That is done through a system of sensors connected to valves that open or close as conditions change. An engineer, typically assisted by computer software, can monitor the operation from a control room on the surface and intervene if necessary.
In theory, that sounds simple. In practice, it took a team of Cambridge University boffins to work out the details of how to bring artificial gas lift into the digital age.
The problem was that the "wire-line" tools that established oilfield services companies had developed to measure conditions inside wells typically did not provide real-time data. They had to be retrieved from the wells to be read. That, and making subsequent operational adjustments, would usually entail shutting down oil production. Moreover, much gas was wasted when its flow was not optimised.
The problem taxed even the biggest oilfield services companies, creating a niche opportunity for a talented entrepreneur.
"One of the key criteria for us when selecting our partners is innovation and whether their solutions bring something different to existing oil and gas operations. We are confident that Camcon and Apollo does just this," said Joseph Steven, SOS's general manager.
The original application that Camcon's founders envisaged, however, was in an entirely different field. Ten years ago, they were busy designing quieter jet engines.
"We have done a lot of research with Rolls-Royce to show our technology can do just that," Mr Anderson said.
By 2003, Camcon was developing devices for the agricultural sector aimed at improving the precision of crop-spraying and reducing its toxic side effects.
"But the business needed to go further than that," Mr Anderson said. "I took a valve and attached it to a Perspex column of water and injected gas into the column of water. Instead of droplets coming out, it was gas going in."
From that eureka moment flowed Camcon's new business model, with its emphasis on the oil sector. The company's first test ground was in the North Sea, off the Shetland Isles. Promising results encouraged Mr Anderson and his team to seek a launch-pad for their Apollo in the Gulf.
As the world economy recovers, many Gulf oil producers are stepping up efforts to boost output cost effectively from maturing fields.
"For new entrants like Camcon, this is a major opportunity," Mr Anderson said. "It has got the industry looking at new technology again."