The Israeli stateswoman Golda Meir, who was born in Kyiv, said “[Moses] was leading us through the desert for 40 years to take us to the only place in the Middle East where there is no oil.” Golda Meir was right at the time, but could not foresee the development of the technology of the future.
The American oil company Noble Energy discovered the Tamar gas field in 2009 and the Leviathan gas field in 2010 on the shelf off the coast of Israel. The reserves of the latter are estimated at 450 billion cubic meters of gas and about 1.5 billion barrels of oil. This gas will be enough to provide Israel for the next 40 years. It is symbolic and proves that Moses was right, that he knew where he was leading his people.
The moral for the Ukrainians is simple – we should not give up in the search and the mining of hydrocarbons. We must continue to invest in the industry, be systematic and patient. Indeed, because Ukraine, with its huge potential in the field of hydrocarbon production, largely ignores it. It is a mistake, because there is a shortage of oil, gas and petroleum products, and there is no surplus of natural money. But it should be the other way around.
Mining is a non-stop process that is provided by the symbiosis of machines and people. Thousands of the Ukrainian citizens are working in the industry to support and increase those desired “debits” or volumes of hydrocarbons that are raised from the bowels of the earth – no matter if it is snowing, cold, hot or muggy. Because oil, gas, gas condensate and products of their processing play and will continue to play an important role in the world economy.
This article is not an attempt to perform a detailed analysis of the hydrocarbon production segment in Ukraine, because the analysis has already been done. This is an attempt to show not how the top management or the ultimate beneficiaries, but the usual ordinary drillers live, what they do and how they spent the last year. The company Ukrnafta was taken as the base that provides about 65% of domestic oil production and is the object of the years-long struggle between influence groups of Ukrainian business and politics. And it suffers from it.
First, there was betrayal…
PJSC Ukrnafta is the largest oil company in Ukraine. Due to the questionable financial transactions of the predecessors of the current CEO Mark Rollins, the company has become the main debtor of Ukraine according to the SFS, and therefore it is limited in its own investments. The lack of investment limits the production potential due to the inability to use modern imported technologies because of their high cost. On the other hand, the proper organization of work, cost consciousness and professional approach to procurement can if not to develop, then to significantly restrain the natural decline (about 15% per year) of hydrocarbon production volumes.
To illustrate the difficult situation in Ukrnafta we can give the following example from personal experience. The end of November 2016, a press tour to the Hnidyntsivske oil field in the Chernihiv region, which was developed within the framework of cooperation between PJSC Ukrnafta and the PLC Hals-K. At that time, it was the best example of joint activities (JA – ed.), which were beneficial – there were operations for drilling new wells, which is the best way to increase production.
A drilling platform is a drilling rig (with various equipment, hardware, and related infrastructure around) and trailers for drilling workers. In the best situation, there are road plates at the entrance and airfield plates on the platform. At worst, there is a viscous swamp. The normal option is just dirt. Therefore, journalists are taken there only when there are either access roads or when the ground dries up or freezes. The visit to Hnidyntsivske oil field was organized by a different scenario.
“It works” – drilling rig Uralmash 3d-76
The operation of drilling the well #276, which is 2108 m. deep has just been finished on the drilling platform. “We started drilling in September, and we are finishing in November. The drilling plan lasted 78 days,” the workers noted. They have something to be proud of because high-quality work in conditions of a critical decline of the material and technical base can only be built on the enthusiasm and experience. The Ukrnafta fleet is almost completely based on the worn-out drilling rigs Uralmash 3d-76, in which the work is controlled not by a joystick from an isolated control panel, but directly inside the rig in the cold, under the snow, using the “sledgehammer” technology. According to the author, working on that rig violates basic human rights, in particular, the right to health and decent working conditions. But ultimately, this understanding did not come immediately (although the frostbitten hands and face already hinted), it was necessary to compare with others, for example, observing the work of the American machinery Service King 3000 (680 t) that are in service of the group of companies Burisma, or the German Bentec (450 t), which are the pride of the Belarusian contractors from Service Oil. Although their machines are second-hand, their level of comfort is much higher – it’s like switching from VAZ-2101 to Mercedes Benz. And comfort is an important component of the effective work of the driller.
The last meters of drilling the well #276 on the drilling rig Uralmash 3d-76
More than two years have passed since then. British-American management has changed many practical approaches to work, especially in the attitude to employees. And while maintaining a meager level of investment, which is about $30 million a year, they were able to stabilize gas production and for the first time in 12 years to increase oil production by 5%. It is difficult to argue with good results, although we must admit that without investments the company will lose its potential, and sooner or later will disappear.
An employee of Service Oil in control of the modern drilling rig Bentec
An example of Ukrnafta has shown that even with little resource, it is possible to achieve high-quality results. Therefore, the editorial staff of NaftoRynok sometimes is not buying the arguments of the speakers of Ukrgasvydobuvannya, that if they give more money – we’ll get the desired gas independence. One can invest an unlimited amount of money with no result, even if we do not consider the factor of corruption. Therefore, we offer to adopt the forced experience of Ukrnafta regarding the cost-conscious use of resources and acting. The main thing is approaches, and also the staff which creates and realizes them. The author does not agitate to limit the investments into state and semi-state oil and gas companies (but rather vice versa), but insists that investments should be more responsible because success in the war for energy independence is no less important than military success.
A week ago, I made a request to the press service of the oil company – I asked the employees in the industry for comments of the type “Do you live, driller?”. Of course, this is a press service, so we need to make an adjustment to the filter of criticism, so I asked employees to write to the author on Facebook and we will form the second part of the material – black edition. Although, I have an internal hope that maybe there were no filters and the powerful changes in the attitude of employees indeed took place. After reading the comments of the drillers, you may ask, where is the “victory”? In the existence of professional competition and the allocation of a whole Mitsubishi L200 per team? And the answer is simple – yes because this has never happened before and these are exciting experiences for people. Organizing training and education, in general, was not the custom in the semi-state-owned Ukrnafta. And in terms of technical support, there were not only no Mitsubishi L200 – there were even no normal shoes. And people appreciate these changes. But the truth is, in due time we were ruling and finished badly so that we were even ashamed to look into the people’s eyes.
And then there was hope a and Toyota…
Mykola Shpynta, the operator for production of oil and gas of the plant #2 of the oil-and-gas production company Nadvirnanaftogaz:
We’ve had a lot of changes lately. The first thing I want to note is an improvement in the quality of uniform, especially compared to what was worn 4 years ago. People can work normally in the current one. The same situation is with the shoes: they started to provide new, much more comfortable boots, and it is very noticeable, especially when you have to walk a lot on the mountain roads every day.
It is nice that we have transport that is gradually updated. When I see our new Mitsubishi L200 (instead of the old KAvZes) and new special equipment, I feel a sense of pride that I work in this company. However, the obtained equipment is not yet able to meet all the needs of production: a car was allocated for the night shift for our team, but to get to the workplace on time, I have to travel several kilometers by a forest road. I hope that this will change in 2019…
Last year, the well #24 “Pivdennyi Hvizd”, which is located in the chain which I serve, was transferred to the operation with the help of an electric power pump (EPP) after a powerful hydraulic fracturing. Now the well is being developed, and my colleagues and I are learning to manage its operation with the help of an EPP installation. Such automation of the operation of well, the installation of modern equipment on it and the ability to program and to set the optimal mode of operation is a step forward. On the other well #2 (Pivdennyi Hvizd) the Tril equipment was installed which prevents the deposition of paraffin. Due to this, the well works better and its inter-overhaul period has increased. Last year, the light bulbs in the floodlights were replaced by more durable and energy-efficient LED at the facilities. This is an important moment for the oilmen so that the territory of the well will be illuminated at night.
I am particularly impressed that communication with management has improved. Due to modern technologies, I am constantly in touch with the master and senior production engineer through Messenger. I send them the parameters of the good operation, I can consult at any time and make proposals that will be considered.
For the future I want our oil industrial region to develop – to keep drilling, implementing as many operations as possible for the production stimulation for the recovery of problematic wells, introducing the latest technology, modernizing the equipment. In 2019, perhaps, like all, I expect a salary increase. I do not have higher education, so I could not take part in the company’s project for the development of youth – MIST. But I really like the job, the job is my life, I want to develop in it and grow in this direction. Therefore, I would like to participate in some development projects for workers. Also, I expect further improvement in living conditions for the crew, because there is still a lot that can be done for workers.
Ivan Korol, the operator of oil and gas production of the plant #2 of the oil-and-gas production company Dolynanaftogaz:
In general, there were many changes last year. For me, 2018 was decisive due to the participation and victory in the competition of professional skills “Best in profession in PJSC Ukrnafta”. In the first round of the competition I won among the operators of oil and gas production of the oil-and-gas production company Dolynanaftogaz, and in the final, I won first place in the company. This competition was held for the first time in Ukrnafta – and this is a great opportunity to express yourself and earn bonuses. As a reward, I got a salary increase for high professional skills and a one-time payment. To win, I had to thoroughly prepare theoretically (to remember college years) and practically (the management of the plant contributed here). And during the competition, the support of our operations manager added confidence.
Also, as a winner, I had the opportunity to participate in the UP project (Ukrnafta Professionals) for engineering and technical employees of the company – the program, which also took place in 2018. It was interesting to listen to the heads of the main business functions and to meet and communicate with colleagues from other structural units.
The changes in the plant itself are also tangible: monthly meetings of workers with the head of the plant were introduced. During such meetings, our manager provides information about events in the company, and we voice our problematic issues and suggestions. Management listens to the opinion of workers and responds promptly.
In 2018, several wells of the plant were transferred to the operation with the help of electric pumps (EPP). As a result, there is increased production and easier work for the operators. Since April last year, a new car Mitsubishi L200 was provided for our team. Due to this, it is possible to travel directly to the well, the car is always at hand, does not break down, like the old cars, so production tasks can be performed much more quickly.
Since 2019, I expect prospects in work and professional growth. It would be good to have a professional skills competition this year, but my participation in it would be unfair to colleagues. I think others should have a chance to try and express themselves.
In addition, I expect an improvement in living conditions. Currently, the building for the group meeting, where the operator changes clothes, at the beginning of a shift, and where he is during the working day when he is not bypassing wells, require serious repairs, and furniture, bathroom, shower, and dryer are seriously obsolete. According to our management, this year it is planned to overhaul the operating room to bring the conditions to modern requirements.
Mykola Kachailo, the operator of oil and gas production of the 5th class of the oil-and-gas production company Okhtyrkanaftogaz:
For me, 2018 was full of good changes. The first thing that comes to mind is a completely different level of personal protective equipment (PPE): last year we were given new PPE, and as the result, it became more comfortable to work. In general, I did my best at work, tried to do everything I can. It was last year that I felt the importance of teamwork and development. I was lucky to participate in the final of the contest “Best in the profession in PJSC Ukrnafta”. And this is an incredible motivation. It was very useful for me and for my colleagues because at first the guys tried very hard and fought for the title of the best, and then, after the selection, there was a huge exchange of experience between colleagues from other oil and gas departments. As it turned out, we all have the same principle of work, but different approaches. So, we learned a lot of useful things.
Serhii Panchenko, the operator of oil and gas production of the 5th class of the oil-and-gas production company Chernihivnaftogaz:
For me, in terms of work, 2018 was very interesting. What do I remember? The final of “Best in profession”. It was the first participation in the competition for the oil industry workers from the oil-and-gas production company Chernihivnaftogaz. New huge experience, interesting meetings with colleagues from other departments, new impressions, a spirit of competition, exchange of ideas. Then I was also lucky to be among the participants of the UP Program (Ukrnafta Professionals) for the Eastern oil and gas region. Two days of intensive training and teamwork. It was very interesting and useful. And concerning the work – we try, we want to fulfill the production plan, we’re doing everything possible so that the oil production functions around the clock. Concerning the significant improvements of the last year – there is the opportunity for operators to drive through the production facilities on the brand-new Toyotas. Of course, there is still much to strive for – of course I would like more equipment updates. And I am glad that the company is already doing a lot for this. Changes go on, they are tangible, there is much to strive for. So, I expect only positive development from the year 2019!
Text and photos by Volodymyr Dolnyk
