eProduction Solutions, It's in the hole

Manufacturing in Action, Source : The Manufacturer US

Developing new products for the oil and gas industry keeps eProduction Solutions busy, Gary Toushek reports

The blunt reality of the oil and gas production business is its cyclical nature, and it takes a certain amount of patience, skill, and capital for a supplier to the industry to get through the rough spots. Of course, the rewards come at the upswing, and then the challenge is to keep up with demand. Offering different services helps too, and Kingwood, TX–based eProduction Solutions (eP) provides optimization products, field services, and consulting services. Its parent company, Weatherford International, is a large global provider of comprehensive artificial-lift, drilling, and completion products and services for the drilling and production sectors of the oil and gas industry. It operates in more than 730 locations in about 100 countries, employing more than 25,000 people.

eP, founded in 2001, provides solutions to optimize field, reservoir, and well production. Its systems are used in more than 90,000 wells globally. The company provides six basic types of products: artificial-lift optimization (electronic hardware at the well site for control and monitoring, communication systems, and host systems for analysis); metering products (once the fluid comes out of the ground, determining the percentage of oil and water it contains, and in what quantities); down-hole electrical gauges (measure temperature and pressure of the fluid); optical sensors (using fiber optic cable to measure down-hole temperature, pressure, distributed temperatures, seismic measurements, and flow); control systems (safety systems and orderly shutdown systems for flowing wells based on hydraulics and/or electronics); and software (for design, analysis, and monitoring production operations).

The manufacturing process is a hybrid of assembly and a job shop. Orders follow a pull system, built to customer requests. The lean manufacturing philosophy limits the amount of components in inventory, demands cross-training of the assemblers, and requires regular changes of the manufacturing floor. Hundreds of configurations for many of the products prohibit inventorying of finished units. Instead, the company uses a combination of sales forecasts, parts inventory management, and supply chain management to anticipate and fulfill orders to the customer’s request. Many of the orders are filled with as little as a two-week turnaround.

“Due to the diversity of our products, each has a unique manufacturing process,” says operations manager Betty Pollard, who oversees manufacturing, purchasing, shipping/receiving, and customer service. “Our volume/product mix increased 30 percent last year, which prompted a total revamp and expansion of the shop floor by about one-third, adding new assembly and test centers to handle the diversity of our products and the anticipated increase in volume in 2006.” Two of their established product lines, remote terminal units and rod pump controllers, are assembled using cellular manufacturing methods. The shop floor is laid out in work cells, and products are assembled in small batches. In a given cell, components are stored and replenished using a supermarket system. The facility is ISO 9001:2000 certified, and the MRP system is changing from a customized system to JD Edwards.

eP’s new Red Eye 2G water-cut meter combines optical technology with the company's field experience in high water-cut measurement. It uses fiber optics to extend performance to wide-range measurements (low to high water cut) by simultaneously measuring multiple near-infrared frequencies. It operates independent of water salinity and has a low sensitivity to entrained gas. The electronics are mounted directly to the measurement probe, so there is no field wiring other than power and output signal cable. The new meter's configuration software can run on a PC or a hand-held PDA. From an operations standpoint, this new-generation meter features simplified calibrations, lower-cost installation, and an improved user interface. The net oil computer module can include a local keypad/display interface and a wireless link to a hand-held PDA for operator convenience.

The production of the Red Eye 2G involves complex processes new to shop personnel. These processes have been implemented through defined work cells, work instructions, test procedures, and intensive training delivered to the shop personnel, says manufacturing engineer Chetan Karmarkar. “When dealing with fiber optics you have to be careful, because it’s a fragile item and needs precision work. We also learned how to work with near-infrared light, which is a new concept in the industry. Prior to implementing a new product to the shop floor, it’s important to ensure that various processes are documented, training is complete, and test procedures are in place for a successful execution.”

“Our supply chain stems from our planning process, which is directly related to forecasting, adjusted monthly against sales,” says quality assurance and planning manager Don Harber, responsible for certification, forecasting, and production plans. “Most products have printed circuit boards procured from at least two main contract manufacturers so we’re not dependent on any one.” For the new Red Eye 2G, the company spent a long time qualifying new suppliers for the components, especially for the customized aspects. For fiber-optic cables it has only one supplier, so it is building up more inventory than normal so as not to be caught short.

Vice president of operations James Williams says one of the company’s mandates is to realize four to six percent savings in product costs this year, which means a focus on the supply chain. “We’ll be hiring someone to fine-tune the supply chain. To get our costs where they need to be to keep our customer base, we need an active, efficient supply chain to keep these products moving forward. We also need to shorten lead times for better on-time delivery. We did a good job last year, but with our new products we’re not yet where we need to be.”

The company is under constant pressure to shorten lead times, reduce inventory, cut manufacturing costs, and maintain the highest quality. It accomplishes this task by creating an excellent work environment for employees, establishing positive relations with suppliers, and empowering managers to make decisions to constantly improve manufacturing processes.

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