Energy Investment-Oil and Natural Gas--Business Profile

Here's a company working in the oil and gas sector in Ukraine profiled in the article Resource Investor - Energy - An Opportunity in Ukrainian Oil & Gas?

The article mostly reads like a press release and it is a bit of a tough slog through it. It touts the contacts the company has, an important thing here. And then some interesting information:

A mix of workovers and new drilling is characteristic of Cardinal's development plans for its various assets across Ukraine. Many of the country's existing oil & gas wells are poorly completed and can often benefit from workovers either to restore production where total failures have occurred, or to raise output levels where these sit below their potential.

Cardinal uses mostly Ukrainian equipment hybridised with certain Western components, which keeps costs lower than would otherwise be the case and should improve effectiveness, as local equipment tends to be outdated and ill constructed. However, given the absence of Western oil & gas service companies in Ukraine, use of adapted local equipment is a convenient option for Cardinal.

Apparently, some wells have played out for reasons that aren't stated but are being re-worked by Cardinal. That must mean making them productive with new methods or with their hybridized equipment. That equipment is a hybrid of Ukrainian equipment augmented by the addition of Western components. They argue it saves money and I bet it does.

Equipment used here is mostly old. Not much has gone into investing in new equipment. And there isn't much of an industry to produce new equipment and the equipment that is produced tends to not be up to Western standards though it is serviceable in a general way. And there are no companies manufacturing pumping equipment capable of producing at levels below 6000 feet. That must be the reason for the Western components.

So we have a company having success re-working old wells using hybrid equipment which saves them money. Sounds good to me.


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Oil
natural gas
Ukraine investment
Ukraine business
Oil production equipment