Interview with Hunter Simmons (PART 1)

Welcome to the Erdos Miller podcast. We spend our non-productive time talking about everything drilling tech and getting the latest industry insight from leaders on our show. I'm Ken Miller.

And I'm David Erdos.

And today, we brought on an industry leader and a good friend from Total Directional, Mr. Brad Barevich. Brad, welcome to the show.

Hi everyone. How's it going?

I'm doing okay. I think to say it's a pretty good Friday, right?

Yeah. Fridays are always good.

It's not quite noon yet. So I can't religiously check the rig count just yet, because I think Baker Hughes updates it at noon, but I think we were plus three last week. And then I think, I think we've had a pretty good run of just inching back up, except for, I think what two weeks ago we lost a couple of rigs? But then we're back up two or three, so that's good, right?

Yeah. More rigs the better

I could not agree more. I look back on 2014 when we had 1800, 1900 rigs running and that would be so nice. There used to be so many more rigs.

Yeah.

So Brad, I'd love to hear what your path has been. I think it's really important for others out there that are trying to make their way through their careers and their journey in the industry. It's always good to have data points from others who have succeeded in the industry and how they've come about in it and how they got to where they are. Can you tell us a little bit about how you got started in the industry and maybe a little bit about your education and that kind of stuff?

Sure. Yeah. So as you said, it worked for Total Directional. We're a service company in Colorado and we work all over down in the Permian Basin, up in the Wilson Basin, all over the U.S. So I was born and raised in Canada. Alberta was big into the oil and gas scene, still is, technically right now, not so much, but I wanted to get into the schooling part of it. Went to college. I took geology and geophysics was what I got into. Coming out of school, it's not that jobs were readily available for that kind of thing. So I just got onto oil and gas service company and learned my way, working with tools, servicing, maintenance, part M stuff. For me it was more satisfying working hands-on with the tools being more mechanical with it, finding new ways, adapting to service procedures that were, I wouldn't say old, but that someone made up, there's always room for improvement on these service procedures and everything like that. So, that's where I thought I could excel and improve upon other people's stuff.

I definitely say that entering the industry as a young person, I had this idea that any amount of process was evil and a waste and I could not have been more dead wrong. So that was a huge learning experience for me. I definitely went into a lot of financial dollars in a way. So, where did you go to school?

So I went to school at SAIT. It's called the Southern Alberta Institute of technology.

That's kind of an interesting entry that you came with. That's, that's pretty cool that you came with the geology as your physics background. Have you found that to be helpful or give you more insight into the drilling and MWD?

I mean, honestly, I probably forgot more than I learned from that.

So I wish I had a geology degree because I feel like I've had to learn a lot of that stuff the hard way, because I started off with a bachelor of fine arts. I went into school with the kids that were working on art and advertisements and Photoshop and Adobe illustrator, believe it or not. It was the weirdest thing for me, because I had a day job at TI and a TI was working on software and circuit boards and then I'd go to school and I'm making art and it's just a weird disconnect. There's something that doesn't really quite fit here. I guess that the guys at TI eventually turned me on to all the technology and that kind of really taught me all of the passion for actual engineering. But Dave, one of the most interesting thing for us with geology has been the gamma detectors. We've had to learn a lot about the geology to be able to build a successful gamma detector. I love what's the joke we call it like a banana detector

I have heard.

So a little bit of potassium in there and they're about as radioactive as the formation that we're trying to pick up on.

So we'll just have a bunch of bananas in our shop and we'll [inaudible 00:05:16]

I think we should do the gamma calibration. We should do a giant pile of bananas and you move the gamma probe in and out of a giant pile of bananas. So have you always worked with total or were you with other servers coming before that?

With a the couple of different service companies in Canada and then moved down to Colorado about almost six years ago. So I've worked with guys at Total for about eight years and moved down to Colorado about five and a half years ago and been working with them since.

And has it always been in service related to NWD technology or have you worked in other kind of areas of service companies in the industry?

No, it's always kind of an MWD. When I first started, I was working on the old geo link tools, the negative pulse tools from the UK and stuff like that.

Oh, That is.

Definitely different, definitely sort of some old school stuff, but, learning the new ways and new technology that people have broadens my horizon for sure. On what's coming what's better and what works better.

It's really interesting to hear you say that. Because I into the industry I think after those tools were sunset and I've always been so curious about them. Can you tell me what are some of the biggest, most interesting differences between a negative pulse tool and the more positive pulse tools that we use now?

So, the negative pulse tools was a lot more machining parts. The body of the Pulser was huge, the UBHL, I guess it wasn't UBHL just the standard color it was mounted to was a lot bigger. All this stuff was a lot bigger. Having a positive pulse tool allows less wash to happen at the actual transmitter part of it.

So it's more streamlined, I guess.

Yeah. More streamlined. I think the machining and everything of the negative pulse tool just cost too much money. The kids were expensive, the maintenance on them wasn't as... I'd like to be more redundant on our service and checklists on these tools. It was hard to gauge or have an efficient checklist going on these negative pulse tools in there on the positive pulse tools.

Was that just because of their much higher mechanical complexity and size than a positive bulls tool?

Yeah. There are a lot more complex and it wasn't as many electrical parts in it, so it was a lot more mechanical and if one thing sort of washed out or plugged off or anything like that, you could lose everything and you wouldn't know until it was too late.

How was the reliability?

Yeah. I think the reliability is lot better than the positive pulse tools. We're able to communicate a lot better real time, everything like that. Use less power.

I've always heard that the occasional test on the rig floor with a negative pulse tool was always interesting because it would send giant jets of fluid flying out the side of the collar now that you were supposed to do that, but people have certainly told me that it's been done.

Right.

So I remember the first time I saw an NYU duel, I was like, what the heck is that? Because they're really just big skinny pieces of junk that do nothing on the surface. They're totally useless on the surface. So, what was your first reaction to seeing the tools and learning about them?

So my first reaction, I went in, people were saying you're going to start servicing these tools. You got to learn certain directional modules, gamma sensors, Pulser probes, everything like that. I look at a pile of stuff on the floor that all looks exactly the same and I'm like, "well, which one's, which", and they're like, "well you got to know there's more inside than there is on the outside. It's not just a copper brilliant tube that you're going to scratch the surface on. Right."

And you can totally look at those things from the outside and underestimate the amount of complexity that goes on inside that crop cover beryllium tube, right?

Exactly. Yeah.

No, it's absolutely crazy. So what is it like living right there at the edge of the rig with the service companies, right? How hard of a job is that, is it truly 24 seven? Do you guys ever get a break? What's that like?

It's truly 24 seven. Drilling isn't stopping for Christmas, COVID, anything really. It's slowing down, but we have to be ready. We have a big team of people at Total Directional, operations teams, shop teams, lab teams, remote operations teams, everything like that. Everyone has to work together. There's some schedule and some crossover between all of our groups at Total Directional, operations, maintenance, technical resources, and services and stuff like that. Everyone has their own job, but everyone helps out and everyone crosses over between those duties and everything like that. So it's a, it's a 24 hour job, but everyone's ready. Everyone's signed up for it. We all know what our rules are and how we can help and improve it.

So I'm curious if you in your experience in the industry have ever come to a scientific or technical theory as to why rig emergencies seem to predominantly happen between the hours of 1:00 AM and 3:00 AM?

Or on holidays. Or on holidays.

Yeah. I mean, it is Friday, so I'm expecting something to happen here in the next few hours.

You can't take a break, right?

Nope. Can't take a break, but it's okay. You learn from all these things. So, that's what excites me about a little bit. I hate to be doing something repeatedly over and over and over again and not learning from it.

Well, it's one of the things I tell my guys as well, I always want to be taking further and further steps forward making all the technology and the products better, but sometimes things happen and there are just emergencies and we got to fix something on the technology or fix a tour or something. It's like, okay guys, when that happens, the most important thing is we got to take care of the customer at the end of the day. So we've got to jump on it, get the solutions, as fast as humanly possible, get a quick fix. If you can find the quick fix, make the long term fix. But, what's, what's most important is, solving that customer issue as fast as possible.

Then, taking that step backwards and turning it into a step forward. So, because anytime we have a failure in the field, it's usually because we didn't anticipate something like a process wasn't followed or maybe we didn't design something quite as well as we could have. Maybe there was just something that we couldn't think about during the design process or didn't realize until we got out there in the field and had that experience. But, the most important thing is to transform that accident or that oversight into a better product or better services. I think that goes on at both levels, with the service company, your people, your service, your customer services, your service, your companies, your service. So, I think that you put a lot of investment back into making the overall service better, right?

Yeah. For sure. Yep. Learning from any sort of incident or process inadequacies is what makes us better. We're just trying to, same as you guys, we're trying to get our customers happy and get the job done.

Yep. So you mentioned the remote center earlier and that kind of made me want to ask you, where do you see the future? Are you in the camp where we're going to go full remote, nobody on the rig? Are you in the camp where people that think there's too much value to having staff on the rig that full remote doesn't really make economical sense, even though it's quote unquote lower cost because there's more wrapped up into NPT, et cetera. And don't me just puts you in, into one of those two camps, I'm just bringing those up for discussion, right?

No, for sure. Yeah. I'm excited about the remote operations that we have and how the industry is going towards that. You're obviously going to need some people at the rigs at all times, but having that human error possibility be removed and some of it is a lot better in my opinion. I mean, I'd like guys be able to watch over many different rigs, they can talk together in the operations for the remote ops center. They can, discuss and collaborate with each other. It just makes more sense in my opinion.

No, I think it's a good chance to add a lot more consistency. Right? I mean, we continue this debate as an industry and I think the whole transition probably moving a bit slower than anyone expected, but I think it's been kind of sped up a bit by COVID. But, somebody gave me argument through the day, it only takes seven or 10 minutes of lost time on a rig to wipe out the savings you had from an extra hand not being there for the day. I mean, because you might save, 500 bucks, 700 bucks, a thousand dollars on the NBD day rate by not having that extra handout there, but we're talking about rig time. That's easily on the order of a hundred dollars a minute is what it could cost to run a rig. And so, I mean that math kind of makes sense. What do you, what do you think about that?

Yeah. It makes sense. I'm not saying that some of the field personnel are some are more experienced than the other, some are more adept to fixing some problems or solutions or anything like that. Having a sort of a smaller group of well-experienced or, field supervisor guys going around him and ranks to being at the job makes sense. Having office guys basically doing the watching, the logging, the data interpretation stuff.

Yep. So, I know it's not any one thing that makes or breaks a company. A lot of people tend to look for that one thing, and usually success is a whole lot of things coming together. But, what do you think as a service company is just the most critical thing? That you have to get right, is it the people in their training? Is it, is it the processes and how you service the tools? Is it the salespeople who get all the jobs? What, what is the most critical, in your mind as far as overall success for a service company, or maybe even a ranking of what do you think the most, the highest priorities are?

Well, I'm a little biased on what I think is the most important stuff, being a shop and lab kind of guy, but I think everyone's super important in it. Sales team, operations team, servicing team, everything like that is super important. Development of new technologies in house is also very important when we just want to be super consistent with what we do and we want to finish the job better. Our reputation at Total is consistency, innovation, we got tons of great experience and quality guys there. So for me, I don't think there's one thing that's, most important in a service industry. Everything has to work together.

That's really true. I know this is probably a silly and tired analogy, but I've really started to think about a company as an engine. So, sales, operations, manufacturing, HR, everything has to succeed together or everything breaks, right? You'll never overcome, a poor sales organization with an outstanding operations organization. Or vice versa or whatever else. You really can't drop anything. It's all got to be working together and it's all going to be working well. Any one of those categories starts to suffer in the whole company suffers as a result. There's just no way to overcome one category being deficient by overcompensating in another. So, what do you think, what are the biggest insights that you've gathered in your career as far as being on the service side, the 24 seven side, what's been one of the more interesting things that you kind of learned over the years?

I guess the most important things I learned is, like we talked about earlier, is you have to adapt and you have to learn from any sort of issues that went on in the past. You can't repeat them, you try not to repeat them. You just want move forward. To me, learning all the time about new stuff is what's the exciting part about the industry is nothing's the same, even though it's a little bit redundant, there's never anything that's going to be exactly the same, not going to see the exact same incident. You're not going to see the same failures go down on certain tools every time everything's going to be a little different.

Well, it's also interesting all the technology is constantly getting better in every direction, bits get better, motors get better, anybody gets better, mud pumps get better, rigs it better. So there's no constant, right? Nothing's the same as it was two years ago, five years ago, or 10 years ago, or whatever. Because all these different things that we interact with are changing all the time.

Right yeah.

Now you mentioned custom technology. Have you found that your in-house technology to go out and then it's giving you a competitive advantage or has it increased reliability? Or what kind of focus is there?

Yeah, it's definitely increased reliability in certain aspects of it. We have to work with a lot of providers and companies like yourselves to improve what we want to sell and the services, what we're selling. For instance, we have these [inaudible 00:20:42] that is some filters and stuff like that for decoding. We have the new Titan tool out and that's a real time telemetry communication with the orbit tool. And for us, it's been a game changer what we're able to see, what we're able to do, what we're able to provide to the customer. So, we can't rely always on other companies to do it for us. Sometimes you got to do it yourself.

That's great. Brad, what do you think the most important thing for everyone to work on as an industry for the next few years?

I don't think we need to get, well, no, one's going to get complacent, but moving to faster drilling speed, hotter temperature, everything is becoming tougher on the service companies and development companies with technology because everyone wants to get faster, better hotter. So, learning that, gearing up for the future, improving techniques and technology is what everyone is trying to do. It's what everyone needs to do. We want to make it as best as we can.

I think one of the things that I've thought about and we've discussed internally is how NWD service companies, MWD tools. It's all at the end of the day, data MWD service companies are data companies, you delivering data to your customers. It's that interesting paradigm shift when entering the industry, "ah we are designing hardware that does stuff", when really that's secondary to delivering the data to the end user to allow them to steer and drill their Wells.

Yeah. We have mountains and mountains of data, processing it and getting through it and interpreting it is one of the biggest hurdles that we find. We can gather all the data, we have signal builders, and transducers, and everything else. We're getting accelerometers, and magnetometers, and everything. We're gathering the data, putting it to good use is a different story.

The data is only as good as what you do with it.

Yeah. That's, that's always the big challenge, right? I worked really hard to design this system and now I've got all this data coming in and you go "now what?" It's just surprising because you think all the work is into designing the system to get you the data. And it's not, there's a whole another part on using all the data that you produce. I'm right with you on Brad, as far as the technology roadmap, I think we need to drill more efficiently, we need to go after more resources, get hotter. I am all about U.S. and Canada drilling and North American energy independence. We have made some crazy gains. There's been so many man hours in this industry that been put into, I'm talking tens of millions of man hours or more.

That's put in, put into making every part of the drilling process. Everybody's working on bits, motors, NBD, agitators, drill pipe, connections, rig systems, mud pumps, automatic drillers, automation, cloud KPI systems, and all this kind of stuff. We've made such a massive impact in our ability to produce energy. If you look at it on a per rig basis, the amount of footage that a rig today can drill compared to 10 years ago and the amount quote unquote barrels that it can access and produce, the amount of oil that we produce as a continent or as a country compared to the rig count, we're producing more oil all the time. I feel like we have this huge duty to continue pushing that forward. I'm just so excited for the future because I really think we're just getting started. There's so many things that we can dream that these rigs can do that we're just getting started.

Yeah. Yeah. Totally completely agree. It's pretty crazy out there.

Well, that's all the time we have for today. Thanks Brad for joining us on today's show. Be sure to check out our podcast on iTunes, Spotify, and YouTube. Thank you for tuning into today's episode.

Thanks guys. Appreciate it.