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Litigation Support Disciplines

When an incident occurs in the oilfield, it can impact many lives – physically and financially. The litigation process typically tries to resolve multiple issues: What happened, why, and who is ultimately responsible? To answer these questions, you need an expert familiar with the many disciplines of oilfield life. Signa provides professional Petroleum Engineers who have served as expert witnesses in dozens of onshore and offshore litigation cases. Our experts represent both Plaintiffs and Defendants. Our references and case histories are available by request.

Casing Failures
Tubulars are the lifeline between your downhole resources and the surface. When casing or production strings are mishandled in the field, that lifeline can be severed. Other times, an improperly-drilled well can lead to premature parting. Or, if the tubulars weren’t manufactured up to spec, they can fail despite proper care. Signa engineers analyze the root cause behind casing failures, and then explain the fine details in an easy-to-understand report. Our expert witnesses provide testimony for their opinions in deposition and trial.

Personal Injury
The energy industry is composed of many moving parts. So when a worker’s health is compromised during an oilfield operation, it’s important to tell the entire story. You need to explain the details in a clear, concise manner to ensure a fair and honest judgment. Signa engineers determine the root cause that led to the death or injury, and then explain everything in an easy-to-understand report. Our expert witnesses provide testimony for their opinions in deposition and trial.

Patent Infringement
Patents are what protect your unique contributions to the energy industry. Our patent expert engineers have extensive experience working with patent cases, including being a named inventor on a patent. We understand the process from claim construction to claim limitation. Our experts have done prior art searches for numerous cases and understand how to prove invalidity, or to demonstrate that certain prior art is not applicable. Our expert witnesses have provided testimony in deposition and in the courtroom, including Markman hearings. Signa has experience with the Inter Partes Review process, having provided reports or expert witness testimony in several IPR cases.

Intellectual Property
Mr. Rick Stone, P.E., started Signa Engineering Corp. in 1992 and remains as Chairman/CEO. As such, he was involved in the startup of a globally recognized, registered, petroleum engineering company. This included the development (and subsequent protection) of intellectual property unique to Signa. Mr. Stone, along with Executive Vice-President George Medley, P.E., understand the importance of such property to a company’s success. Together, they have worked for numerous operators and service companies (such as Anadarko, Halliburton, and Schlumberger) with trade secrets that necessitate confidentiality agreements. Likewise, they have represented plaintiffs and defendants in multiple cases involving intellectual property, including expert reports, depositional testimony, and trial appearances.

Equipment Failures
Understanding oilfield equipment can be difficult, especially for those who haven’t operated any (or even seen it). Explaining how these tools work is vital for gaining an edge in the depositional and trial phases of a lawsuit. Since 1992, Signa engineers have designed the layouts for leading-edge technology, and operated equipment on location, around the globe. This experience allows our experts to explain the mechanisms to all legal stakeholders. The details are spelled out in a concise, easy-to-understand report, which utilizes elementary graphics to tell the entire story. Our expert witnesses also provide testimony for their opinions in deposition and trial.

Operational Errors
In the event of a catastrophic loss at the wellsite, there are often disagreements over which parties share in the liability. Signa has managed drilling projects for operators and vendors around the globe. We also provide onsite consultants who act as the operator’s representative. This gives us insight into their responsibilities and culpability during field operations. In legal cases, we determine all factors that contributed to the operational error, and then explain everything in an easy-to-understand report. Our expert witnesses provide testimony for opinions in deposition and trial.

Well Control
Since 2011, Texas has experienced 78 blowouts and well control events, leading to at least 13 injuries and two deaths. In the Gulf of Mexico, 109 incidents were recorded from 1980-2011, the highest profile being the deadly Macondo disaster of April 2010. Well control events can also lead to equipment damage, environmental pollution, and loss of reserves. Evaluation of well control events, blowouts in particular, requires a highly technical analysis to understand what happened, why it happened, and who is responsible. Signa experts have testified and provided litigation support for dozens of blowout cases over the past decade, including the Macondo disaster.

Flame Retardant Clothing (FRC)
In the last two years, at least three multiple-fatality incidents have occurred at Texas oil and gas wellsites. In some cases, regulatory agencies have cited the operating company for not ensuring the use of fire-resistant clothing (FRC) by personnel. Signa has represented clients with litigation involving equipment failure, operational errors, and usage of FRC. Understanding these difficult concepts is vital for depositional and trial phases. Signa also manages projects for operators and vendors on drilling, workover, and completion projects. We provide onsite consultants who act as the operator’s representative, which gives us insight into their responsibilities and culpability during field operations.

Root Cause Analysis
To determine liability in oilfield litigation, it’s imperative to identify the “root cause” of the incident, or why it occurred in the first place. A problem-solving method called Root Cause Analysis (RCA) can be used to determine the exact origin of a problem. RCA uses a step-by-step approach to find the individual cause-and-effect sequence of events leading up to an incident. Signa uses RCA as a framework to assist attorneys in questioning witnesses and analyzing witness depositions. Frequently, there is a great deal of information that must be organized and cross-referenced. Signa uses the RCA event sequence as a basis for comparing individual witness statements. This helps to resolve conflicts by demonstrating which statements are supported by evidence. The final result is a defensible engineering opinion, supported by technical analysis and eyewitness accounts.

2018-06-21T10:10:54+00:00 June 21, 2018|Uncategorized|0 Comments

MPD commoditization: What’s the real price?

By Signa Engineering Corp.
©2018

Operators have traditionally used experts from several disciplines to implement Managed Pressure Drilling (MPD). Subject matter experts (SMEs) and drilling engineers create a drilling program. MPD engineers were generally utilized for design and process application. They examine objectives, determine functional requirements, and evaluate pros and cons of each MPD variation. Risk mitigation is always at the forefront. After determining the optimal MPD equipment spread, operators rent equipment from large oilfield providers, and rely on qualified service personnel to install and operate the spread onsite. The end result has historically been successful application of complex technology.

The recent downturn, however, has changed how some operators view and apply MPD.
The sharp reduction in oil prices led to significant pay cuts for some, while others were laid off or retired early. Some left the industry for greener pastures. Some banded together to start their own MPD service companies, usually by making an MPD manifold or two. The owners of these companies typically have some experience in MPD operations.

However, they often spend most of their time in marketing or management, not overseeing wellsite operations.
This shift in roles and responsibilities has resulted in a reduction of trained, experienced personnel. And it presents a possible major risk for our industry. Just because someone is listed as an “MPD expert” doesn’t always mean they have the necessary skills to apply MPD. And if a catastrophic HSE event occurs, the “MPD” name could be tarnished (especially to those outside our industry). This could lead to increased regulatory restrictions, a stall in MPD prospects, or even a setback in MPD technology.

The commoditization of MPD means cheaper prices for operators; this much is undeniable. It’s convenient to have a “cradle-to-grave” company that can provide every component that appears to solve the MPD equation. However, a large portion of these companies have limited engineering capabilities to provide complete wellbore analysis.
Equipment hands may be capable of performing computer simulations to evaluate a range of pressure scenarios. However, they might not know how to react to unknown pore pressure/frac gradient variances. They operate surface equipment to manage backpressure, but might not understand the actual implications downhole. In MPD, new formations are constantly being exposed. It might be a fracture, fault, sandstone, or tight rock.

To fully mitigate these risks, an experienced and qualified MPD engineer should be involved in every MPD project. The engineer anticipates everything downhole. They analyze formations and test their conclusions against engineering principles, then specify parameters and equipment settings.

Many operators now believe they don’t need engineering to apply MPD. They will forego hazard identification/hazardous operations (HazID/HazOP)s and downhole investigations. They don’t think about switching from conventional to MPD and back again. They don’t consider crucial elements like:

• How to kill a well during trips
• How to handle a hole in the drillstring high in the wellbore
• What to do if pipe gets stuck
• Breaking down a shoe with too much backpressure
• Rotating Control Device (RCD) pressure ratings

The real danger is operators that don’t understand (or don’t want to know) the importance of doing application engineering prior to spudding an MPD well. One anomaly feeds this misconception: Most current domestic prospects are shale, which is tight rock. Shale plays allow for limited engineering analysis because they are typically “tight” and may not flow when slightly underbalanced. Combined with a self-healing type of formation, the need for precise ECD management is greatly reduced. Since the formations are relatively passive and forgiving, these techniques and limitations will provide satisfactory results in a large majority of land-based shale projects, perhaps even 85-90%. However, the remaining 10-15% presents issues like well control (kicks), severe mud losses, and other non-productive time (NPT).

MPD is typically useful when fractures exist, but may not be really applicable for tight rock. However, many operators are running an RCD to keep gas off the rig floor. Since an RCD is being used, many consider this to be “MPD,” which leads to a false sense of security. The truth is that they have gotten lucky by avoiding negative incidents. They might not have experienced lost circulation or kicks. And even if they were underbalanced, the well typically didn’t flow because the rock was so tight. But when drilling a real MPD candidate well, many won’t know how to react to the dynamic (and potentially dangerous) environment. At the very least, operators are setting themselves up for disappointment in the technology.

Without professional engineering, service companies might try to make the drilling program fit the capacity of their equipment. This presents a significant risk. The equipment should always be made to fit the drilling program, not the other way around.

Some smaller service providers have limited equipment spreads and will try to utilize these for all their projects. Typically, they’re designed to suit the majority of passive, land-based MPD projects, but may not be the best solution for complex MPD well programs. Financially, it wouldn’t be in the best interest for the MPD service company to acknowledge any shortcomings that the equipment spread may have.

Conversely, equipment operators may bid on every MPD job that comes available, and attempt to get their entire equipment spread on the job, regardless of the application. A “complete” MPD package consists of many parts, which might be overkill.

So what’s the solution? As with most risk mitigation, the easy answer is training and use of SME MPD engineers for project design and execution. All involved personnel should have an in-depth understanding of MPD operations, both surface and downhole. They need training on the MPD process as well as equipment operation. MPD personnel need to be more than just “equipment hands.” They need to be application savvy. They should understand how to manage dynamic problems that occur during MPD. Training, combined with engineering, will result in optimal equipment and personnel placement and application engineering. The savings will easily cover the cost of the training and engineering.

For an MPD drilling program, all MPD elements should be addressed, including: planning and design, advanced hydraulic design, hole cleaning and cuttings transport, required equipment, MPD variations (Constant Bottomhole Pressure [CBHP], MudCap, etc.), hydraulic simulation, pore pressure and frac gradient variations, fluid selection, connections and tripping, and completions.

In a commoditized market, goods that have economic value – and are distinguishable by uniqueness or brand – end up becoming simple commodities. Hence, the pricing power of the manufacturer is weakened. When products become more similar from a buyer’s point of view, they will tend to buy the cheapest.

By commoditizing MPD, we are entering a dangerous phase that may ultimately hinder its adoption. MPD has been confirmed to manage difficult wells, and has become somewhat familiar to the “rank and file” of our industry. In so doing, manufacturers and service providers can provide equipment and personnel at a reduced rate.
But at what price? Is the risk reasonable?

For further information, contact Signa Engineering Corp. at 281.774.1000 or signa@signa.net

2018-06-26T15:34:45+00:00 June 21, 2018|Uncategorized|0 Comments
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