Do Drilling Rig Companies Need Marketing?

Trials of Sourcing a Drilling Rig – Now!

Obviously, a drilling rig is the quintessential starting point to begin to extract oil or gas from the earth, but how does this process really work from a selection standpoint? How do you know which company to choose to get the job done properly? It seems in Western Canada most of the decisions relative to drilling company selection come from relationships and past experience, either good or bad. At least, that seems to be the popular perception. There are a finite number of wells being drilled at any given moment, and we are all aware that drilling activity in 2014 is considerably down. According to the Canadian Association of Oilwell Drilling Contractors (CAODC) the current rig count stands at 419 active among the 45 drilling companies represented in the CAODC membership.

Competition would appear to be tough! You would think considering a drilling rig is an essential part of the drilling process that this would be a clearly defined and insulated group. Operators entering drilling program should have a clear handle on who the players are and what they can offer. It doesn’t seem complicated. I need a rig…who has one available? Right? Well not so much!

Recently, our Leadstone Group sales team was tasked with providing assistance to one of our valued Operators that utilizes Oilfield HUB as their project and supply chain management solution. This Operator recently initiated an ambitious drilling program in Alberta. They found themselves faced with a time constraint relative to getting to ‘spud’ prior to the expiration of a couple well licenses. What struck me as odd is even though this Operator has under its employ an impressive array of veteran field operations personnel, who you would assume have access to strong and reliable connections, they were scrambling to find and connect with a company with available drilling rigs. They reached out for our help. Of course, we were happy to oblige!

Our team got to work and burnt up the phone lines searching for available rigs to fit their requirements. It was both an interesting, and frustrating exercise. The response from drilling company representatives ranged from eager and immediate responses, to complete dismissal of our inquiries, which covered the potential of putting a couple of their rigs to work right away. Several of our calls, including some originated directly from our client, went totally unreturned. At an average day rate of $14k to $18k, you have to ask why a courtesy call back to us was not part of the process, even if they were or were not able to accommodate our sourcing inquiry. Now that’s a head scratcher!

In my previous blog, I talked about the value of being a VIP client in our Oilfield HUB online business community. We’re putting together our own impressive group of VIPs covering the major services required in construction, drilling, and completions. We call them our HUB Advocates. Our mission is to help bridge the delta that exists between energy services companies and their exploration and production customers to better manage the lifecycle of their service, supply, and rental requirements. Better preferred vendor lists, project management control, and centralized communications means everyone works leaner, meaner, and more cost efficiently. The benefits to being on this VIP team is becoming a thought leader in your product/service category and building an even bigger audience and market awareness, as well as the opportunity to obtain sourcing inquiries, bid requests and orders from the Operators and EPCs that are doing business through Oilfield HUB.

Leadstone is looking for progressive companies to strengthen our HUB Advocate VIP Dream Team bench strength, including one of those 45 drilling companies out there. A company interested in working directly with us, who we can promote as our exclusive ‘go-to’ drilling vendor in Oilfield HUB, particularly when the next request for a rig comes up, and as we introduce our new Operations Reporting and Field Cost plugins in Oilfield HUB to Operators and EPCs.

The good news in the case I described above is we were successful in helping our client find two drilling rigs and beat the clock to preserve their licenses. The bad news is the old tried and true “who do you know’ formula the oil and gas industry claims works just fine let our group down again. It’s a fallacy to think the way we have always done things will continue to be effective as our industry enters a paradigm shift generated by a younger generation of decision makers.

Is your company our next VIP thought leader in your service category? Why not give me a call?

December 15, 2014

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Dave O’Connor Vice President – Sales Leadstone Group Inc.

Get in touch with Dave:                                              dave.oconnor@leadstonegroup.com       (403) 910-4172