Players Look for Their Niche

The upbeat outlook prevalent among a number of players in the seismic industry indicates the worst may be over.

It's a perspective that's bolstered by current activity:

  • New companies are forming.
  • Certain stalwarts not only are thriving but expanding.
  • The big folks appear determined to reinvent themselves in some form or fashion.

Yet there's always a new challenge of one kind or another, capable of causing grief for some and opportunity for others.

Look, for instance, at the expanding community of Russian and Chinese boats and crews, particularly in the Gulf of Mexico, which is garnering increased attention domestically.

These folks have access to state-of-the-art equipment and technology the same as domestic contractors. Even so, there are naysayers who turn a deaf ear, arguing that the equipment used is inferior and the crews untrained, with the end result being sub-standard data.

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The upbeat outlook prevalent among a number of players in the seismic industry indicates the worst may be over.

It's a perspective that's bolstered by current activity:

  • New companies are forming.
  • Certain stalwarts not only are thriving but expanding.
  • The big folks appear determined to reinvent themselves in some form or fashion.

Yet there's always a new challenge of one kind or another, capable of causing grief for some and opportunity for others.

Look, for instance, at the expanding community of Russian and Chinese boats and crews, particularly in the Gulf of Mexico, which is garnering increased attention domestically.

These folks have access to state-of-the-art equipment and technology the same as domestic contractors. Even so, there are naysayers who turn a deaf ear, arguing that the equipment used is inferior and the crews untrained, with the end result being sub-standard data.

Not so, according to some of the in-the-know crowd, including Steve Mitchell, VP of operations at Fairfield.

"Their crews absolutely are knowledgeable and capable," Mitchell said, "and they do acquire good data."

They're in the market in a couple of ways:

  • Working for spec data companies without crews in the spec data realm.
  • Working directly for oil companies on straight heads-up proprietary jobs.

This is not all bad, according to Piers Gormly, VP marketing, GX Technology.

"The Chinese and Russians compete strongly in the marketplace, owing in large part to their attractive cost structure," Gormly said. "However, because the majority of survey cost is tied to moving cable, this gives our industry a window of opportunity to use their acquisition assets advantageously."

Mitchell said he thinks these groups are more of a force to the proprietary market.

"I haven't seen them putting capital into spec surveys for themselves," Mitchell said, "but that's not to say they won't do it at some time."

Land is their big thing at the moment.

"The Russians and Chinese may be competition, but in a certain niche market," said Steve Ludlow, president at Veritas. "The Chinese are a big threat in the land market," he said, noting that BGP is the largest land acquisition company in the world.

Operating as a wholly owned subsidiary of China National Petroleum Corp., BGP Inc. (formerly the Bureau of Geophysical Prospecting) has 94 seismic crews and 17 non-seismic crews operating in China and internationally.

Competition overall likely will be stiffer in parts of the world other than the United States, according to Bob Peebler, president at Input/Output.

"If you're competing on the basis of logistics activities, where you're competing more on the cost of crews, the feeding and moving around, it gets more and more difficult," Peebler said, "especially when you consider that more and more oil and gas activity is not in North America and places where you have higher wages, but will be where the oil is.

"The grounds of competition will be in Russia, Iraq, Iran, around the world," Peebler added. "So if a good part of the value you're delivering is logistics which is people intensive, it's going to be tough to compete."

For now, a lot of folks are keeping a watchful eye on the Gulf of Mexico.

"If I were a person doing proprietary work," Mitchell said, "I would stand up and take note.

"In fact, for a company that does not do a lot of proprietary work," he said, "we have stood up and taken note."

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