“I used to know a truck driver who worked for a oil purchaser company, they told him to steal his wages…” We cringe when we hear stuff like this. So, we thought we’d put together a short excerpt on how the digital oilfield keeps operators from coming up short…
(Please note: we’ve changed the names and a few minor details, but none of which detract from the story… )
One of the things we like most about our job is going out to the field and meeting with Pumpers. You meet all types — from kids just out of high school, to guys in their 60s who’ve been pumping for a better part of 40 years. We’ve met some real characters, and occasionally, one of these guys will tell us a story…
When GreaseBook first opened its doors, the oil & gas industry was unchartered territory for (good) oil field apps. We’ve talked to dozens of owners, engineers, and operations managers, and while we were quickly able to discover trends and understand how oil operators worked, the field perplexed us…
When it came to oil sales, it seemed the operator was coming up short.
We kept asking ourselves, “They have numerous equations for measuring liquids and gas in the field. They take into account variables like temperatures, BS&W, API, etc — but how can the methods used to measure liquids and gas be so precise, yet so inaccurate?”
We had a feeling that although the oil field was using volumetric equations to determine total oil sales (ie precision), a bias must exist in the equation. What’s a “bias” you ask?
A bias is a systematic (built-in) error which makes all measurements wrong by a certain amount. A few examples of bias:
when a scale reads “1 kg” when there is nothing on it
when you measure your height wearing shoes with thick soles
a stopwatch that takes half a second to stop when clicked
Now, we realize that maybe there are certain aspects of the oil field that people just accept… But, GreaseBook is a young company, and we feel this entitles us to ask simple questions that may get us into trouble…
So, we started asking Pumpers questions like, “what’s the oil sales process like?”, “do you ever see a difference between the measurements on a run ticket and the measurements you take immediately before and after a run?”, and “do purchasers ever take more oil than they’ve recorded?”
And, wouldn’t you know, we began to get some interesting feedback…
Jason, a pumper who pumps around Kingfisher, Oklahoma, was particularly informative… Jason told us, “I used to know a truck driver who worked for a oil purchaser company, and they told him to “steal your wages”.”
Jason went on to tell us that, “I see it all the time… I’ll have 11’ today, and I’ll leave and come back tomorrow and they’ll call it 10’10”. Then, there’s the bottom gauge, they usually call it 1’4”, but then you can go down there and gauge it and it’s 1’3” or 1’2”…”
We asked Jason, “so, is this just part of the business?” And Jason responded, “well, i could call and say, “hey, that’s not correct… and in the purchaser office, they may correct it or may not. But, it’s my word against theirs… the operator loses most every time.”
Another (perhaps more chilling) story involved a ring of pumpers who jumped in bed with the truck drivers of one of the oil purchasing companies. For $500, these truck drivers would deliver a load of oil to a nearby lease owned by one of the Pumpers.
While we didn’t catch all the details, by changing out the choke size to conceal a drop in line pressure, pumpers were able to siphon off a large quantity of oil. More interesting, it wasn’t the unsuspecting operators who caught them — it was the Texas Ranger Division. Someone caught wind of what was going on — not from decreased production figures on the grease sheets, but from some loud mouth at a local bar…
Had the operations management not been trapped in the confines of paperwork, had they been able to free themselves of this burden and have a more holistic sense of what was going on at their leases, these Pumpers wouldn’t have been able to get away with this.
These Pumpers were locked up for 6 months…
And guess what? They’re out pumping again.
“Who re-hires these guys?!”
“Were these operators too busy to do a proper background check?!”
Maybe a better question to ask is whether someone like this is pumping for you. . .
There’s simply too much going on folks. You can’t do it all… As much as that old mentality of “work harder” tells you you can get it all done, you can’t. You must work smarter. You must start to filter out the activities that aren’t adding to your bottom line. The paperwork you collect from the field does not add to the bottom line… it’s riddled with inaccurate measurements, and who loses because of it?
We have no intention of removing the human-ness from the oil field. Therefore, we “intentionally” left certain aspects out of the app… A certain amount of human thoughtfulness and intervention is still required. Whoever manages your production must upon occasion, still go look for himself or herself…
Free time pays dividends in more ways than one folks… Free yours, and prevent costly mistakes.
Are you still using spreadsheets (or even paper) to manage your oil & gas assets? Do you spend time tracking down pumpers reminding them to 'get their data in'? Do you ever question the overall accuracy or validity of these production reports? To find out more about how a "New Breed" of operator is using a simple mobile app to maximize oil production while keeping overhead costs incredibly low, click here.