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Small Company’s New Subsea Wellhead Tap Design Attracts Oil Majors Interest

As offshore drilling moves into deeper waters, new engineering techniques are needed to cope with temperatures that can hit 150 degrees Celsius, with crushing pressures that can exceed 25,000 pounds per square inch (psi).

As the 2010 BP Deepwater Horizon oil spill in the Gulf of Mexico proved, when things go wrong, the consequences can be enormous where high pressure, high temperature (HPHT) wells are situated, but the extreme conditions will increasingly impact major oil finds in not only the Gulf of Mexico, but developing areas of the North Sea, Arctic and offshore Brazil and Africa as well.

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Now the development by Aberdeen based engineering services business, Plexus Holdings, of a subsea wellhead tap design for controlling flow on a subsea oil well that will be ready for testing by the middle of next year, is attracting major interest. The subsea wellhead, developed in partnership with oil companies including Shell, Total and Eni will use an engineering system Plexus Holdings developed over 15 years ago, but which oil majors have been reluctant to embrace.

Developed in partnership with oil companies, including Shell, Total and Eni. CEO Ben van Bilderbeek explains that the wellhead’s innovative design is based on a simple principle. When one tube is run inside another in a well, a gradually tightening ring is clamped around the outside. The outer tube is forced onto the inner tube and the resulting friction subsequently eliminates all movement from the system. While traditional wellhead systems create torque from within, the Plexus Holdings design incorporates an “outside-in instead of inside-out” engineering process that also removes the movement between metal sealing parts that takes place in traditional wellheads, which can contribute to the failure of wells.

Van Bilderbeek commented on the value of the design, “It is only very occasionally that a technology emerges that surpasses the established norm and sets previously unattainable standards. When this happens, we believe that such an opportunity should be embraced and welcomed, rather than deemed disruptive.”

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Plexus Holdings has certainly proved its value in the niche market of oil services business; since 2010 their profits have surged 700 percent as the company’s surface wellheads, using its patented POS-GRIP system, have become widely used for new North Sea exploration wells. Plexus Holdings currently makes the majority of its revenues by renting its POS-GRIP wellheads to explorers, but its successes are currently isolated to projects where its superior performance makes it a product of necessity. In the world’s most technically challenging wells – HPHT environments – some of the world’s largest oil companies are customers, including BHP Billiton, Shell and Conoco Phillips. The success of their innovation is reflected in the company’s bottom line - in October Plexus Holdings reported another “record” year, with revenues up 30 percent to $41.6 million (2012: $32.1 million) and pre-tax profits rose 38 percent to $6.8 million.

Van Bilderbeek believes that the oil majors reluctance to embrace Plexus Holdings’ new wellhead design comes from both a reluctance to change their traditional way of doing things, preferring to deal instead with traditional bigger U.S. makers of wellhead equipment such as GE Oil and Gas, FMC Technologies and Cameron, plus his company’s interest in developing license sharing agreements. As Plexus Holdings’ management currently holds 70 percent of the company shares, a buyout by an oil major is out of the question, and van Bilderbeek is confident that they will come around, saying, “We will grow this carrot, polish it. It will be big and fat and beautiful and then we will hang that carrot in front of the industry and see what happens.”

By. John C.K. Daly of Oilprice.com

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