Attractive opportunities in upstream oil & gas

The upstream oil & gas opportunities for valve sales are centered on two primary types of applications: wellhead and pipeline. The former are generally governed by the API 6A Specification for Wellhead and Christmas Tree Equipment, and the latter by the API 6D Specification for Pipeline and Piping Valves.

Wellhead applications (API 6A)
Opportunities for wellhead applications are broadly projected based on the Baker Hughes Rig Count which provides a leading metric for the upstream oil & gas industry. This metric turned positive in 2017, although almost exclusively in North America (see Chart 1). A typical wellhead includes five or more valves that meet the API Specification 6A. These valves are generally of a relatively small size in the range of 1” to 4” for onshore wellheads. The valves may include an upper and lower master valve for well shutoff; a kill wing valve for introduction of various chemicals for flow enhancement, corrosion resistance, and other purposes; a production wing valve for shutoff/isolation of the wellhead from the pipeline system; a choke valve for adjustable throttling of flow from the well; and a swab valve at the top of the tree assembly for vertical access into the well bore. Valves are generally of the gate or ball type and are selected especially for tight shutoff, resistance to flow erosion, and resistance to corrosion that can be of particular concern for sour crude or sour gas products with high sulfur content. It should be noted that the foregoing discussion excludes subsea valves which are subject to far more demanding service conditions and on a delayed market recovery track because of the higher cost basis for subsea production.

Post time: Mar-27-2018