Friday, April 25, 2014

Local Marcellus Drilling Relies on Regional Manufacturing for Steel Pipe

Written by Vince Delbrugge, Manager, Unconventional Drilling Operations

On April 8th, I was one of five ABARTA Energy employees to tour three local factories owned by TMK IPSCO that make the steel tubular products that we use to drill and complete our wells. Manufacturing processes used to make the pipe include those that are icons for Pittsburgh and the Ohio Valley: melting, casting, forming and cutting of steel. Dan Allen and Doug Dye, representing Miller Supply, and Tony Cargo, representing TMK IPSCO, hosted the tour. After meeting in Robinson Township for breakfast, we drove to the three different facilities in Ambridge and Koppel, Pennsylvania and Brookfield, Ohio (see map below highlighting locations) to watch production and learn how their operation influences ours. I describe some of the interesting processes in this article.
(1) Plant Tour Locations

(2) ABARTA ENERGY (AE) tours pipe manufacturing facilities owned by TMK IPSCO
L to R:  Doug Dye, Miller Supply; Shane Huffman, AE Geologist; Cliff Simmons, AE Director of Operations; Dan Allen, Miller Supply; John Emmerling, AE VP/COO; Jim Watson, AE Director of Unconventional Operations; and author Vince Delbrugge, AE Manager, 
Unconventional Drilling Operations.
The Koppel facility is modified to melt and cast the types of steel used for our applications. Electric arc furnaces use huge amounts of electricity to melt steel scrap which is the first operation of manufacturing tubing and pipe. Melting in an arc furnace is a spectacular event. Like lightning in a big bucket, thousands of Amperes of electric current spark between graphite electrodes and the steel. Both electric current and radiating light easily add enough heat to reach the steel melting temperature of nearly 3,000˚F. Sophisticated technology is used to measure and modify the amount of elements in the molten steel before they are cast into the solid, cylinder-shaped, billets. Small, precise amounts of carbon, manganese, chrome, molybdenum and other elements are specified and controlled in the molten metal that is about 97% iron.  Scrap metal for melting is limited to certain steels, because some elements cannot be removed or reduced once they are melted.
(3) Electrodes melting steel in the arc furnace.

(4) Continuous casting the round billets at the Koppel facility.
Billets cool and solidify in the Koppel factory with the shape, properties and element composition that all influence quality of the finished pipe. After cooling to room temperature, the billets are transported by truck to the factory in Ambridge where we watched them form the solid billets into the sizes and shapes for our oil and gas applications. The metal is stretched, bent, twisted and squeezed using a variety of traditional cold and hot processes that are performed at different temperatures ranging up to 2,300˚F. The first forming process at Ambridge is rotary piercing which creates the hole in the pipe that is called the inner diameter. This interesting process is illustrated below in details (a) through (d). Details (e) and (f) are sections of billets that were photographed after interrupting the rotary piercing process and cutting the billets that show the growth of the inner diameter. Subsequent forming processes at Ambridge refine the diameters, roundness and straightness of the tubular material that we need for our oil and gas operations. Heating and cooling processes called quench and temper change the atomic structure of the steel to increase its strength. 
(5, 6 & 7)
Size and shape of the pipe and tubing is complete when it leaves Ambridge, but it cannot be used yet for oil and gas operations. Almost all of our tubular products are connected together with screw threads, which are cut into the ends of the products at the Brookfield, Ohio facility (see below). We had the opportunity to watch an Okuma lathe cut threads into the outer diameter of pipe used for our production casing, which is the pipe that extends from the surface to the bottom of the well. Okuma lathes and many other machine tools can maintain tolerances of 1/10,000ths of an inch, which is more precise than is required for successful pipe connections. Roundness, straightness and other shape tolerances of pipe products and other structural materials created during forming are the most important factors that determine our pipe connection quality, and we saw the extensive inspection operations at Brookfield diligently monitoring those properties both before and after cutting the threads. Some of the pipe from Ambridge must be rejected at Brookfield because the threads cannot be successfully cut due to the shape distortion.
(8) Pipe threads cut on a lathe at the Brookfield, Ohio facility.
 (9) Coolant is used while the tungsten-carbide tool moves along the billet to remove metal and cut the thread geometry.
Working with suppliers gives us knowledge about their capabilities that will help our planning for our wells. Visiting the different facilities gave us the chance to observe processes that are critical in the path of manufacturing our casing, tubing and drill pipe, and we know how to evaluate the important characteristics and improve the quality of our wells. We are grateful to TMK IPSCO for the opportunity to tour their facilities and purchase material for our wells that is made here in our region.

Image References.
[1] Image from Google Earth.
[2] Image by Anthony Cargo.
[3] Mr. Blaaaaah. An Electric Arc Furnace’s Three Graphite Electrodes. Web.
[4] Web. http:/…
[5] Schematic of the rotary piercing operation. Web. Modified by Vince Delbrugge.
[6] E. Ceretti, E.; Giardini, C.;  Attanasio, A.; Brisotto, F.; and Capoferri, G. Figure 6. Longitudinal section of the rod, start and development of the hole, in FEM Analysis of Rotary Tube Piercing Process. Web. Modified by Vince Delbrugge.
[7] E. Ceretti, E.; Giardini, C.;  Attanasio, A.; Brisotto, F.; and Capoferri, G. Figure 7. Α 3˚, Formation of the internal hole in the rolling direction: =Comparison between simulation and experiment, in FEM Analysis of Rotary Tube Piercing Process. Web. Modified by Vince Delbrugge.
[8] Industrial Piping Specialists, Incorporated. Web.
[9] Okuma. Web.

Thursday, April 24, 2014

ABARTA Energy Well Represented at NAPE East

Written by Tom Bartos, CFO

ABARTA Energy rolled out its new identity at NAPE East in April at the David L. Lawrence Convention Center in Pittsburgh.  In addition to being represented by staff on the exhibit floor, I was one of four speakers on an open panel discussion with other industry leaders  from MarkWest, Talisman Energy and CONSOL Energy.  A brief overview of our company follows.

ABARTA Energy, also known as ABARTA Oil & Gas Co, was founded in 1979 as a way to further diversify Taylor and Bitzer family interests, which at the time consisted of newspapers and Coca-Cola bottling plants.  The company began by making relatively small energy investments each year with different oil and gas developers and remained a passive financial partner through the late 1980s.

In 1995, Jim Taylor, a third generation family shareholder, realizing the opportunity to increase shareholder value in the energy business, joined ABARTA Energy and assembled a management team to move the company to the next level.  ABARTA Energy then became a more active partner with energy companies who shared its vision for growth.  We developed in-house expertise in geology, engineering and operations so we could pursue a balance between continued growth through the drill bit and acquisitions.  In 1997, ABARTA Energy completed its transition to an operating company by acquiring the joint venture assets from Meridian Exploration and by 2007, owned and operated over 1,000 wells in West Virginia, Kentucky, Pennsylvania, Ohio and Texas.

Today we own an interest in over 2,100 oil and natural gas wells in eight states with over 50% of our revenues derived from participating in horizontal shale joint ventures in Bradford and Tioga Counties, Pennsylvania, and a Utica shale joint venture with Rex Energy in Ohio.

Headquartered in Pittsburgh, we have field offices in Pennsylvania, West Virginia and Kentucky where we operate over 750 conventional wells, 260 miles of pipelines along with multiple compression stations and sizeable sour gas and cryogenic plants. 

ABARTA Energy strategically decided not to be a first mover in the Marcellus and subsequently participated in the play once it became derisked by other companies.  In 2010, ABARTA Energy joint ventured with two established public companies on our acreage in Bradford and Tioga counties to develop the Marcellus.  To date, ABARTA Energy has participated in over 115 horizontal shale wells in Pennsylvania and Ohio with our joint venture partners.

The company currently owns approximately 130,000 acres of oil and gas leases for unconventional development in the Marcellus, Utica, Burket and Rogersville shales.  All the operated acreage in Pennsylvania is strategically positioned in a proven, stacked shale area with plans to continue developing our shale assets in the coming years.

Additionally, ABARTA Energy owns over 70,000 mostly contiguous and HBP (held by production) acreage in Kentucky containing highly prospective Rogersville shale development opportunities.  The Rogersville shale is a liquids-rich resource play in the Cambrian section of the Rome Trough, at depths of 10-12,000 ft.