ISSUE 2 | 2012

ON HYDRAULIC FRACTURING

FOCUS

ALS

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Demystifying Desalter Performance / Combating Corrosion Challenges

ABOUT Champion Technologies is a global specialty chemical company with 3,100+ employees in

over 50 locations in more than 30 countries delivering innovative and engineered programs for

upstream, midstream, and downstream oil and gas markets. Our integrated offering combines

sustainable chemistry, technology, and service to enhance your world.

Markets Served:Arctic | Conventional | Deepwater | Enhanced Oil Recovery | Heavy Oil | Industrial | Midstream | Offshore | Oil Sands | Refinery | Shale

Focus on hydraulic fracturing Greener chemistries address operator, community, and regulatory concerns FlowPlusTM VR-1100 Specialty chemical application increases production and profitability for heavy oil producers Increasing capacity without costly expansion Champion Technologies’ custom subsurface phase separation system frees incremental handling volumes

Demystifying desalter performance Champion Technologies combines emulsion breaker chemistry and operational innovation to achieve the biggest step change in desalter performance in 20 years

Combating corrosion challenges Stay ahead of increasingly challenging oilfield conditions

Paraffin management spurs reactivation of field on Alaska’s North Slope Champion Technologies’ paraffin inhibition chemistries encourage more ambitious plans at remote Badami field Investing locally, expanding globallyChampion Technologies’ new plant in Bogotá serves Colombia’s growing oil and gas market

Commercializing Al-PAM A new chemical aid for oil sands tailings treatment

Case History – Perenco’s gas production on three mature assets in North Sea boosted by 48 percent Safer offshore product leads to increased production and lower costs

CONTENTS

Markets Served:Arctic | Conventional | Deepwater | Enhanced Oil Recovery | Heavy Oil | Industrial | Midstream | Offshore | Oil Sands | Refinery | Shale

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12-15

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18-19

20-21

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Corrosion is a multi-billion dollar problem page 12.

FOCUS ON HYDRAULIC FRACTURING

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Champion Technologies’ Gyptron® T-475, boosts carrying capacity in many shale plays and low-permeability formations. A greener blend of partially neutralized specialty phosphonates, Gyptron® T-475 is compatible with cross-linked gel system frac fluids. Gyptron® T-475 also prevents deposition of common mineral scales by inhibiting and distorting crystal growth, even in the presence of as much as 200 ppm of iron. The chemistry can be winterized to -40°F, is compatible in high TDS brines and can be pumped “on the fly” at the well site, at recommended dosage rates of 500 ppm to 1,000 ppm.

BiocideChampion Technologies’, Bactron® K-31W, an all-purpose, non-foaming, aqueous glutaraldehyde solution is achieving success as a frac-fluid additive. Bactron® K-31 controls aerobic and anaerobic bacteria in fresh water, sea water and most brines during drilling, workover or completion operations. Developed to be cost-effective in cold climates, the product can be introduced by batch application or continuous injection into water-handling systems or down the annulus of water-injection or water-supply wells or

The impetus for change comes from efforts to optimize the performance of frac-fluid chemicals, while at the same time ensuring the biocides and scale inhibitors that play key roles in managing water quality do not contain components that could endanger groundwater or cause other adverse environmental effects.

Working Within a Complex regulatory environmentCalls for making the constituents of frac-fluid chemistries more visible are challenging specialty chemical companies to develop new high-performance frac-fluid chemistries that satisfy regulatory

environmental mandates and also help operators comply with requirements at specific well sites.

Due to this increasingly visibility in frac-fluid chemicals, Champion Technologies recently introduced a new scale inhibitor and a new biocide. These products were developed to provide high levels of performance in a variety of shales while

minimizing the impact on the environment.

greener Chemistries for responsiBle operations

scale inhibitionOne high-performing scale inhibitor,

FORMULATIONS OF OILFIELD SPECIALTY CHEMICALS

USED IN HYDRAULIC FRACTURING ARE EVOLVING

RAPIDLY. NEw CHEMISTRIES ARE BEING DEVELOPED

TO ADDRESS PRODUCTION ISSUES IN SPECIFIC SHALE

FORMATIONS, wHILE TAKING INTO ACCOUNT THE

ENVIRONMENTAL CONCERNS OF STAKEHOLDERS IN

AREAS wHERE ACTIVITY IS BOOMING.

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Responsiblefrac-fluid chemicals exhibit low toxicity and high rates of biodegration

production wells. Treatment guidelines vary by condition and application, but generally indicate 100 to 2,000 ppm for drilling and completion operations, 100 to 1,000 ppm when used as a packer fluid, 150 to 300 ppm in slugs for batch treatments, and 25 to 100 ppm for continuous injection.

There is much regulatory uncertainty surrounding hydraulic fracturing. Developing and deploying better frac-fluid

chemicals is one measure the industry can implement to help stave off future over-regulation. 2012 may prove to be a watershed regulatory year for hydraulic fracturing, but the evolution of fracking rules will continue to be a complicated and dynamic process for years to come.

GREENER CHEMISTRIES ADDRESS OPERATOR, COMMUNITY, AND REGULATORY CONCERNS

wITH THE HELP OF A NEw TECHNOLOGY DEVELOPED

BY CHAMPION TECHNOLOGIES, PRODUCERS IN

THE LLOYDMINSTER AREA OF wESTERN CANADA

ARE PRODUCING OIL THAT PREVIOUSLY STAYED IN

THE RESERVOIR.

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Oil producers in the area use a process known as CHOPs (Cold Heavy Oil Production with sand). The heavy oil is highly viscous, typically demonstrating viscosities between 10,000 and 100,000 cPs or higher. High viscosity can lead to a number of costly issues that can shut down production for a heavy oil well. The shut-down can be temporary or permanent, leaving most of the unproduced oil in the reservoir. It is estimated that billions of barrels of oil are still in place in reservoirs as a result of these limitations.

Champion Technologies is solving this problem for heavy oil producers with an exclusive specialty chemical application – FlowPlusTM VR-1100. VR-1100 manages the viscosity of heavy oil without the use of steam or other thermal technologies. It is a surfactant-based chemistry that, when injected into the wellbore through the annulus, forms an oil-in-water dispersion. The dispersion significantly increases the mobility of the oil, allowing the producer

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to maximize the rate of production through increased pump speed. In some cases, it is allowing profitable production from wells previously shut in due to poor economics brought on by high oil viscosity issues. VR-1100 is the result of Champion Technologies’ extensive research to identify production enhancement solutions for the heavy oil market.

inCreased produCtion and sustained improvement So far, the results have been impressive. “We have seen well speed increase significantly, due to reduced viscosity of the dispersion, lower drag and improved pump efficiency,” said Travis Minish, Business Development Manager for Champion Technologies. “This has increased oil production by as much as 300 percent. In some cases, these wells would not have been able to produce any oil without the use of FlowPlus™.” Minish has been involved in the development of the program from the beginning, and

he has seen its success first-hand. Even months after application, producers are seeing sustained improvement.

FlowPlusTM VR-1100 also reduces problems with sand in these wells. The viscous oil associated with CHOPs can drag large volumes of sand from an unconsolidated reservoir. When this sand gathers in the wellbore, it can plug the perforations, settle and pack around the pump intake or within production tubing. This introduces pumping issues and limits production, often leading to a well shut-down. The oil-in-water dispersion created by VR-1100 is homogeneous from the perforations, through the pump and up the production tubing. Therefore, without a free water phase present, the sand is carried to the surface with no opportunity to settle and create production issues.

proven results and QuiCk turnaroundProducers typically see the effects of VR-1100 within hours of injection. Once the dispersion reaches the production tank, the oil and water separate easily in less than an hour. The oil is ready to be transported to the local treating facility, and no negative effects have been observed as a result of the demulsification of the produced fluids.

FLOwPLUSTM VR-1100

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Proven resultsand quick turnaround Producers typically see the effects of VR-1100 within hours of injection

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While FlowPlusTM VR-1100 is not the right solution for a near-depleted well that lacks reservoir drive, producers are finding that it is the answer for many wells with viscosity issues. With billions of barrels of otherwise unrecoverable oil left in the ground, VR-1100 is a game-changer for heavy oil recovery.

Oil –no treatment

Oil treated with FlowPlusTM

INCREASES PRODUCTION AND PROFITABILITY FOR HEAVY OIL PRODUCERS

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IN A SHORT FIVE MONTHS, A PILOT PROjECT IN CHINA’S

BOHAI BAY HAS DEMONSTRATED THAT CHAMPION

TECHNOLOGIES’ CUSTOM-BUILT DOwNHOLE SEPARATION

SYSTEM (DHS) GIVES FIELD PARTNERS THE FLExIBILITY TO

INCREASE OIL PRODUCTION wITHOUT THE ExPENSE OF A

MAjOR FACILITIES ExPANSION.

The project pairs a custom-built (DHS) system with new phase separation chemistry, implementing downhole separation at individual wells as oilfield circumstances evolve rather than investing in field infrastructure that would cost significantly more. This approach frees incremental capacity in existing processing and handling facilities for increased production.

the ChallengeA producer initiated the study to find optimization and redevelopment options that would allow field development to continue in Bohai Bay. The field produces heavy oil from reservoirs with strong water drive, so the production stream contains relatively large volumes of water that have continued to gradually increase. The producer opted to proceed with a downhole separation project to address the deficiencies in existing configurations.

The major components of Champion Technologies’ unique DHS are two

INCREASING CAPACITY wITHOUT COSTLY ExPANSION

electrical submersible pumps (ESPs) and a hydrocyclone downhole separator. The DHS is configured with the three components in line: one ESP on top and one on the bottom, with the hydrocyclone between the two. While the producer established a target oil-in-water concentration threshold for water separated for reinjection, even at g-forces generated by a hydrocyclone separator a water-oil emulsion will not separate readily without chemical help. Champion Technologies advised that separating the stable emulsion created by the lower ESP after a few seconds in the separator would be virtually impossible without the support of tailor-made chemistry.

To match the requirements of the DHS, Champion Technologies’ phase separation specialists determined the chemistry would require these attributes:

> Compatible with the DHS, stable with low viscosity and no solids, non-gelling and pumpable

> Stable and easy to handle in a temperature range of -20°C (-4 ° F) to 40°C (104°F)

> Able to perform at production temperatures as high as 85°C (185°F)

> Works rapidly

> Does not allow the production stream to re-emulsify when exposed to a high level of agitation

> Compatible with the demulsifier being used

> Able to achieve clean oil and clean water separation without excessive flocculation

the solutionChampion Technologies’ phase separation specialists used state-of-the-art equipment and chemical test packages to conduct a series of carefully designed tests. Despite considerable formulation challenges, they successfully developed a unique, proprietary surfactant component combined with an

formulated from an aqueous-based polymer and organic solvent-based surfectant, the custom phase separation product achieved quick and efficient separation of oil and water.

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Custom chemistries address specific in-field conditions and challenges

advanced flocculent to meet the specific requirements of the DHS. Working with the strong centrifugal forces created by the hydrocyclone, the surfactant enables rapid breaking of the emulsifying film around the water droplets, which, in turn, enables rapid dispersion of the demulsifier into the produced fluids. Once this film is broken, the high molecular weight polymer flocculates the oil droplets, completing separation. The resulting smooth interface and clean oil reduces the potential for blockages in processing equipment, the sampling line, the DHS and gathering pipelines.

Once specialists identified the effective chemistries, they undertook extensive formulating work to combine the aqueous-based polymer and organic solvent-based surfactant into a stable product. The finished injection-ready phase separation product meets the physical properties required for injection downhole. Champion Technologies demonstrated its effectiveness in a pilot plant trial in Morgan City, Louisiana, USA.

In the one-week trial, the producer tested the DHS with the custom phase-separation chemistry by injecting the product downhole at a point above the lower ESP and below the hydrocyclone. On day one of the trial, the producer restarted the well and pumped an analogous oil-water mixture through the actual separator. As the well ramped up, the frequencies of the ESPs increased, and production rates increased and stabilized.

With steady production came higher rates of mixing downhole and optimal conditions for injecting the phase separation chemistry. The amount of oil-in-water declined 30 to 65 percent compared to levels prior to chemical application, and by optimizing the injected amount of phase separation chemical, chemical usage decreased by nearly 10 percent.

As the trial progressed, production rates to surface stabilized at approximately 260 m3/d (1635 bpd), while the water cut of fluid produced to surface declined to 85 percent. During the last four days of the trial, the well produced 39 m3/d (245 bpd) of oil on average.

the resultsIn the months following the field trial, ongoing monitoring of the downhole separation pilot project’s performance and continuing investigation into the unconventional chemistry underlying the custom phase separation product guided additional improvements. Champion Technologies’ specialists increased concentrations of active materials trimming treatment rates by more than 50 percent to about 200 liters while maintaining oil-in-water concentrations of reinjected water. Production data indicated the oil-in-water concentrations of reinjected water were below original targets for water purity, and total production from the well’s productive

CHAMPION TECHNOLOGIES’ CUSTOM SUBSURFACE PHASE SEPARATION SYSTEM FREES INCREMENTAL HANDLING VOLUMES

intervals had ramped up to about 10,000 bpd of fluids.

The downhole separation project enables the producer and its partners to separate about 8,000 bpd of water for reinjection into the disposal zone, leaving approximately 2,000 bpd of fluids to be produced to surface. By not producing this 8,000 bpd of separated water to the surface, 8,000 bpd of handling capacity is made available for production from other wells in the field. As oil content of production is around 13 percent on average, this new technology could allow partners to produce as much as 1,040 bpd of incremental oil.

CHAMPION TECHNOLOGIES COMBINES EMULSION

BREAKER CHEMISTRY AND OPERATIONAL INNOVATION

TO ACHIEVE THE BIGGEST STEP CHANGE IN DESALTER

PERFORMANCE IN 20 YEARS.

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Over the past 25 years, global energy markets have seen a crude slate in transition with greater reliance on heavy crude that keeps getting heavier. Most United States refineries have invested significantly in coker expansions, deep cut vacuum unit conversions, improved desalting capabilities, and other major capital projects designed to increase the volumes and improve the efficiencies of heavy crude processing.

Even after costly desalter modifications and additions, many systems fail to meet the Key Performance Indicators (KPI’s) of high salt and solids removal, proper oil dehydration, and oil-free effluent water. Additional concerns include uncontrollable

8 emulsion layers in the desalter, asphaltene precipitation and consequent fouling of the crude preheat exchangers, high chloride levels in fractionator overhead receivers, increased tower and overhead corrosion, and increased caustic injection rate to the desalted crude.

While several chemical companies developed new high-performance emulsion breakers, Champion Technologies combined improved chemistries with innovative operating strategies that have led to the biggest step change in desalter performance in 20 years.

Chemistry meets strategyChampion Technologies developed

new, more robust demulsification chemistries in the heavy oil production fields of Canada, Mexico, and South America. Designed to resolve emulsions at temperatures significantly lower than desalter operating temperatures, and without the benefits of any electrical fields, Champion Technologies’ emulsion breaker chemistries are also able to resolve tighter emulsions in the desalter. This level of performance enables a key operational change: injecting desalter wash water at levels up to 8 percent directly into the suction of the crude charge pump. Injecting wash water ahead of the charge pump radically increases mixing energy and intimacy of contact between crude charge and wash water, creating emulsions from smaller water droplets that significantly increase salt and solids removal. In addition, placing the wash water into the crude oil prior to any heating prevents the native, water borne salts in the raw crude from depositing on heat exchanger surfaces.

DEMYSTIFYING DESALTER PERFORMANCE

Continued on next page

us refinery input By api gravitysince 1985, the average gravity of crude oil inputs into all u.s. refineries has declined by about 2.0° api, challenging equipment and operators.

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u.s. refinery input by api gravity

source: energy information administration dec 2011

api g

ravi

ty

33.0

32.5

32.0

31.5

31.0

30.5

30.01985 1989 1993 1997 2001 2005 2009 2011

Innovative chemistry and operational strategy result in breakthrough performance

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Continued on next page

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real World resultsOne Champion Technologies customer, a refinery processing a Western Canadian diluent/bitumen blend, was experiencing high overhead chlorides, with an associated elevated caustic injection to control the chlorides, combined with crude tower corrosion, poor salt removal, and oily effluent water.

Switching to a new Champion Technologies product, along with increased service and operational changes, reduced the salt content of the desalted crude from 3.0 PTB to less than 1.5 PTB and allowed the refinery to shut off the caustic injection to the desalted crude. Subsequently moving the water injection location to the suction of the charge pump further reduced salt levels to below 1.0 PTB, improving day-to-day variation in performance and all but eliminating upsets and spikes in salt removal.

By improving desalting, Champion Technologies was able to maintain the same chloride levels as the previous treatment program without the use of caustic, avoiding potential downstream equipment fouling, furnace tube embrittlement and catalyst poisoning that have been attributed to elevated caustic injection in the crude unit. After the wash water was moved to the suction of the charge pump, caustic injection remained at zero and overhead chlorides were reduced by 50 percent to an average of 30 ppm.

Today, more than half the desalters treated by Champion Technologies are feeding water to the suction of the charge pump. Experience demonstrates that the improvements they see will not be limited to KPI’s at the desalter, but will be translated into lower corrosion rates, lower fouling issues, and improvements in most downstream processing units.

RETHINKING DESALTING

rethinking desaltingrefineries most commonly inject wash water just upstream of the desalter mix valve (a). some inject a small portion into the discharge of the crude charge pump, upstream of the preheat exchangers, to minimize salt fouling (B). Champion technologies has found that, with the use of robust demulsification chemistries, injecting 60 to 100 percent of the wash water into the suction of the crude charge pump (C) significantly increases salt and solids removal.

DEMYSTIFYING DESALTER PERFORMANCE continued

From Tank Farm

Crude Battery Limits

Charge Pump

Wash Water

Mix Valve

“Cold Train” Pre-heat Exchangers

Desalter

AB

Wash Water Injection

Typical

Alternate

Unique to Champion

A

B

C

C

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RETHINKING DESALTING

EVERY YEAR, CORROSION DRAINS BILLIONS OF

DOLLARS FROM THE OIL AND GAS INDUSTRY IN LOST

INCOME AND TREATMENT COSTS.

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No metal surface or metal-alloy component of a piece of equipment is immune to corrosion issues – top-of-line corrosion, under-deposit corrosion (UDC) microbially influenced corrosion (MIC) or pitting. This means that production tubing and equipment, processing equipment, separators, pumps, and flow lines are at risk at literally every step in the production-handling process.

By detecting corrosion mechanisms and identifying conditions that lead to corrosion, Champion Technologies predicts corrosion problems before they damage equipment, impact production or compromise safety. Armed with cutting-edge science, refined testing protocols, and powerful analytic tools, Champion Technologies’ specialists develop chemistries that can

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control corrosion before it becomes problematic and determine the most effective application strategy for placing corrosion-inhibition chemistry in oil and gas production, storage, or transmission systems.

proteCting produCersConditions are numerous and circumstances frequently complex in which corrosion can occur in oil and gas production, processing, and pipeline systems. The principal corrodents in oil and gas production are carbon dioxide (CO2), hydrogen sulfide (H2S), oxygen, chloride ions, and bacteria, all of which use water as a medium. In addition, almost any oxygen-rich environment can nurture corrosion.

Over the past six decades, Champion Technologies has worked alongside producers in the lab and at the well site, helping find solutions for the ever more challenging producing conditions that have arisen. During that time, Champion Technologies has developed specialized corrosion-inhibition chemistries and new application strategies to prevent corrosion. In addition, Champion Technologies has generated more effective methods of predicting corrosion, helping producers address the issue before it occurs.

heavier Crudes, higher pressuresCrude oil supplies are becoming steadily heavier and more sour with more basic sediment and water (BS&W), all characteristics that contribute to several types of corrosion mechanisms. At the opposite extreme, recent advances in directional drilling and multi-stage hydraulic fracturing are enabling access to numerous low-permeability reservoirs previously considered too risky to develop.

COMBATING CORROSION CHALLENGES

Continued on next page

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Innovative chemistry and operational strategy result in breakthrough performance

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pipeline flow is halted so that workers can replace a section of corroded pipeline.

Continued on next page

CHAMPION TECHNOLOGIES’ KNOwLEDGE AND TOOLS STAY AHEAD OF INCREASINGLY CHALLENGING OILFIELD CONDITIONS

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Ultra-low-gravity oil, such as that produced from the oil sands in Canada, must be blended with a diluent to be transported via pipeline. However, heavy oil blends and diluted bitumen contain BS&W made up of complex mixtures of waxes, asphaltenes, clays, silica, water, and bacteria in micro-emulsions. Lab tests have demonstrated that some of these solid particulates are more corrosive than others, and researchers are focused on finding out why.

Champion Technologies evaluates the corrosion tendencies of various solids matrices found in heavy oil and is working cooperatively with several pipeline companies to design tests that will better represent specific pipeline corrosion issues with regard to solids deposition. To date, research has revealed that some corrosion inhibitor-surfactant packages control internal corrosion within solids matrices and that treating exposed metal surfaces with inhibitor before solids can accumulate is the most effective way to prevent internal corrosion.

The extremely high pressures generated by hydraulic fracturing of gas shale and other low-permeability reservoirs present a unique problem for delivering chemical treatments of all types. By formulating corrosion-inhibiting chemistries into stable chemical products with the physical properties required for injection downhole, Champion Technologies

has been able to develop a simple-to-implement batch method for protecting hydraulically fractured wells from corrosion during flowback.

The treatment program allows preventative chemicals to be forced deep into stimulated zones as constituents of fluids injected during the fracturing process. Extremely small amounts of inhibitor are then produced back to the surface throughout the flowback period and for several more months after the well begins production.

New corrosion issues will arise inevitably as the oil and gas industry continues pursuing prospects in more hostile, difficult-to-produce downhole environments. When corrosion challenges occur, Champion Technologies will be there with the knowledge, experience, tools, and resolve to formulate new corrosion-fighting chemistries and to develop innovative methods of application to meet producers’ changing needs.

ExPERIENCE MEETS ADAPTATION IN THE EVOLUTION OF OILFIELD CHEMISTRIES

CORROSION

COMBATING CORROSION CHALLENGES continued

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ExPERIENCE MEETS ADAPTATION

SAVANT ALASKA L.L.C., THE ONLY PRIVATELY HELD OIL

AND GAS OPERATOR wITH PRODUCTION ON ALASKA’S

NORTH SLOPE, HAS SUCCESSFULLY REACTIVATED

PRODUCTION AT BADAMI FIELD AND IS LAUNCHING

A NEw DEVELOPMENT PLAN IN wHICH CHAMPION

TECHNOLOGIES’ PARAFFIN-INHIBITION CHEMISTRY wILL

PLAY AN INTEGRAL ROLE.

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In November 2010, Savant and partner Arctic Slope Regional Corporation (ASRC) restarted production from six wells at Badami, a remote field located approximately 35 miles east of Prudhoe Bay on Alaska’s North Slope. This commenced under a farm-out agreement negotiated in June 2008 with BP Exploration (Alaska) Inc. Savant assumed 100 percent working interest in the field on January 7, 2012.

From zero in November 2010, Savant ramped up Badami production to more than 1,500 b/d on average in the fourth quarter of 2011. Development will proceed under plans approved by the State of Alaska Department of Natural Resources, Division of Oil and Gas. Operator Savant is committed to achieving certain undisclosed development and exploratory drilling by July 15, 2013.

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preventing paraffin in permafrost

As Savant reactivated wells at Badami, it ran into difficulty keeping production optimized due to severe paraffin deposition. The wax appearance temperature (WAT) of Badami crude is about 64°F on average, so at reservoir temperatures of 180°F to 200°F, the paraffin stayed in solution. However, permafrost penetrates deeply on the North Slope. So as Badami oil and associated gas flowed to the surface, paraffin began to precipitate onto the inner walls of production tubing beginning at about 3,800 feet true vertical depth (tvd). In the worst cases, paraffin build-up was so rapid that Savant had to shut in wells to brush or scrape paraffin from production tubing every three or four days.

The stability of operations were hampered further as Badami wells were produced by

gas lift, and shutting in a well for service starved the operating plant of much-needed gas for the artificial lift system. In addition, the operator was using gas to generate electricity for operations. It was apparent that shutting in a well to treat for paraffin complicated operation management and put other wells in the field at risk.

To solve paraffin problems at the Badami field, Champion Technologies recommended batch treating wells when production declined to an unacceptable level by pumping Flexoil® FM-205, a wax crystal modifier composed of branched chain polymers, which prevents paraffin formation by interfering with the bonding of aliphatic wax molecules. FM-205 controls paraffin by bonding to the wax crystal lattice at an active growing site, where it prevents further growth and interferes with deposition by disrupting the lattice structure. Wax crystals are unable to grow large enough to block production lines, so production is not impeded even at temperatures below the WAT. Additionally, FM-205 is winterized, with a pour point of -40°F, making it ideal for the frigid temperatures on Alaska’s North Slope.

Savant and Champion Technologies began batch treating Badami wells with FM-205 in early 2011, and the response was both immediate and dramatic. Production of a treated well would begin to recover within

PARAFFIN MANAGEMENT SPURS REACTIVATION OF FIELD ON

ALASKA’S NORTH SLOPE

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hours, and the frequency of scraping treatments increased to two or three weeks from three or four days. The chemistry worked so well that Savant decided to install engineered paraffin-mitigation systems on the B1-36 and B1-38 wells that continuously inject a precise dose of FM-205 into the casing annulus to be carried to the reservoir by gas-lift gas.

Savant not only has been encouraged to commit to a new, more ambitious development plan at Badami, the company also is evaluating plans to install continuous paraffin-injection systems on other Badami wells.

Continuous injection pump used to batch treat the Badami field with fm-205

aerial picture of savants’ Badami field on the north slope of alaska

CHAMPION TECHNOLOGIES’ PARAFFIN INHIBITION CHEMISTRIES ENCOURAGE MORE AMBITIOUS PLANS AT REMOTE BADAMI FIELD

The chemistry worked so well that Savant decided to install engineered paraffin-mitigation systems on the B1-36 and B1-38 wells

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CHAMPION TECHNOLOGIES’ NEw PLANT IN BOGOTá

SERVES COLOMBIA’S GROwING OIL AND GAS MARKET.

In the 15 years since Champion Technologies officially opened its office in Colombia, the Colombian oil and gas market has undergone significant growth, and Champion Technologies´ Bogotá employees have risen to the challenge. Recent regulatory reform, the partial privatization of state oil company Ecopetrol, and an improving national security situation have led to a dramatic increase in oil and natural gas production following a lengthy period of steady decline. Today’s political and economic environment increases Colombia’s accessibility and attractiveness to foreign investors interested in the relatively under-explored country’s substantial oil

INVESTING LOCALLY, ExPANDING GLOBALLY

reserves and infrastructure. Champion Technologies’ local presence has positioned the company to benefit from big growth in the oil and gas market, and current customers include the largest oil producer in Colombia—Ecopetrol SOP—and international oil and gas exploration and production and pipeline companies such as Oxy, Hupecol, Ocensa and Vetra. Champion Technologies became and remains one of the premier providers of technical services in Colombia by introducing innovations in business and chemistry, including pioneering the use of alliance contracts and introducing encapsulated, downhole chemical treatment technologies.

Continued growth, increasing opportunity and a commitment to outstanding customer service in Latin America have led to the construction of a new 2,500 square-meter plant on the outskirts of Bogota. The new plant will facilitate additional products, services and capacity and includes:

> A product blending plant with a capacity of 132,000 gallons per month;

> A 2,000 mt2 storage area for raw materials and finished product built in accordance with ANSI, NTC and OSHA regulations;

> A technical laboratory;

> A training room for internal staff and customers;

> Administrative offices.

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Globalpresence through local investment and responsiveness

According to Bogotá-based Maritza Ortiz, Champion Technologies Business Development Manager, “The plant, which has two blending vessels, will manufacture a full range of products, including demulsifiers, reverse demulsifiers, water clarifiers, scale inhibitors, corrosion inhibitors, and biocides.” Preliminary studies indicate that the plant will improve supply of products in the region and promote growth in local communities. “Investing in our local infrastructure allows Champion Technologies to meet operational and market needs,” said Ramon Yibirin, Champion Technologies Andean Region Manager. “Improved product manufacturing and logistics confirm our position as a leading provider of high level technical services to the Colombian oil and gas market.”

While the success in Colombia is possible only through the concerted efforts of field, administrative, plant and technology personnel, support staff and transport companies, the opening of the new facilities reinforces Champion Technologies commitment to the region and its rapidly growing oil and gas industry.

“ Investing in our local infrastructure allows Champion Technologies to meet operational and market needs...”

CHAMPION TECHNOLOGIES IS LOOKING AT

COMMERCIAL PRODUCTION OF A NEw CHEMICAL

THAT COULD MINIMIzE THE AMOUNT OF wATER USED

FOR BITUMEN RECOVERY FROM THE OIL SANDS, HELP

REDUCE THE SIzE OF OIL SANDS TAILINGS PONDS,

AND POTENTIALLY INCREASE THE RATE OF LAND

RECLAMATION IN NORTHERN ALBERTA.

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The chemical—called Al-PAM—was identified by Dr. Zhenghe Xu’s team at the University of Alberta under the Natural Sciences and Engineering Research Council of Canada (NSERC) Industrial Research Chair (IRC) program in Oil Sands Engineering, along with the former chairholder Dr. Jacob Masliyah, a scientific pioneer in bitumen extraction.

In the surface mining industry, the current process for separating bitumen (heavy, viscous oil) from sand grains requires up to 18 barrels of total water for every barrel of oil produced. The majority of this water—up to 85%—is recycled. The remaining mixtures of water, waste clays and mineral fines are carried to tailings ponds where they are left to slowly consolidate. Managing and reclaiming these large artificial ponds are both difficult and costly for industry.

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In 2002, Champion Technologies joined the list of companies already sponsoring the NSERC Chair. Champion Technologies, which employs about 340 employees in Canada, develops, manufactures and sells specialty chemicals for the oil and gas industry. It was the first non-oil producing company to join the Chair.

Al-PAM shows promise as an effective process aid for tailings management. The chemical is added to the tailings, causing the solids within to coagulate and sink. After rapid settling of these coagulated fine particle agglomerates, fines-free water from the upper layer of the ponds can be recycled into the oil sands process, reducing the amount of fresh water needed.

“This chemical could help settle the tailings solids quickly and release a larger volume of cleaner water. This water could then be recycled into the process thereby reducing the amount that needs to be taken out of the Athabasca River,” says Champion Technologies’ Section Manager of Oil Sands, Dr. Roger Melley.

Al-PAM has been shown to work in the lab, and now Champion Technologies is scaling up its production, to facilitate potential future large scale testing.

Although Champion Technologies has its own in-house research and development programs studying the recovery of bitumen from the oil sands, its involvement with the Chair allows the university’s fundamental findings to become inputs to the planning of its applied research.

Champion Technologies has already done a laboratory proof-of-concept of Al-PAM, using an experimental system that simulates the hydrotransport process (LHES)—where oil sands processing begins for real in the mining operation. Both the Chair and various companies use these laboratory hydrotransport extraction systems to test new ideas before implementing them in the field.

Source: InPartnership Newsletter, Volume 2 (Issue 3), August 2011. Published by the Natural Sciences and Engineering Research Council of Canada (NSERC)

COMMERCIALIzING Al-PAM by Kasia Majewski of NSERC

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“LHES was developed within the NSERC-IRC and it has become a key test for our chemicals,” says Melley.

In addition to basic science and new technologies, Melley stresses that one of the main benefits of its participation in the Chair is opportunities to network with their customers and with experts in academia.

“It allows me to sit down with the scientific staff of the operators, who are our customers, as well as with faculty members of the university and their student body for open discussion on any aspect of the oil sands extraction process. Of all the chairs in similar programs that we are part of, this is the one that we always support. Everyone within Champion Technologies believes this is a key venture for us.”

suncor’s primary extraction plants separate raw bitumen from the sand in giant separation cells.

suncor’s oil sand is mined using shovels with buckets that hold 100 tonnes, loading huge 240 to 380

tonne trucks. the mine delivers about 500,000 tonnes of oil sand per day to the ore preparation plants.

Photo provided by Suncor Energy

Photo provided by Suncor Energy

Source: InPartnership Newsletter, Volume 2 (Issue 3), August 2011. Published by the Natural Sciences and Engineering Research Council of Canada (NSERC)

Al-PAM shows promise

as an effective

process aid for

tailings management

A NEw CHEMICAL AID FOR OIL SANDS TAILINGS TREATMENT

by Kasia Majewski of NSERC

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CASE HISTORY:

risks. By using this product rather than the incumbent methanol-based product, Perenco could eliminate the need to build fire precautions into the skids and significantly cut costs.

Working closely with Perenco Production Enhancement Engineer, Mark Browne, Champion Technologies’ Heuvel and Phase Separation Section Manager, Scott Caird, applied the proprietary Perfoam® foam treatment modelling software to design the foam applications. Suitably detailed for field trials, the resulting models accurately demonstrated cost savings attributable to the use of Foamatron® V-502 in these applications.

In 2011, Heuvel, Technical Support Team Leader, Malcolm Wilson, and Perenco personnel travelled to two of Perenco’s platforms and successfully completed

field trials. They also carried out a foamer bubble performance test on a third asset for the next planned treatment regime. Perenco realized a 74 percent reduction in chemical volume to the first two platforms, confirming the company’s decision to replace all foamer products with Champion Technologies products. CalCulating BenefitsThe field trial on the third platform using V-502 delivered a 10,000 percent return on investment for one of the Perenco operated subsea wells. The well couldn’t be produced because the hydrostatic head of the liquid column counteracted the reservoir pressure, and the well’s receiving platform had insufficient liquid handling facilities to cope with the entire water column. A previous attempt to lift the liquid column in one batch sent liquid and foam right through the gas compression system and shut down the platform. Champion Technologies Account Manager, John Dickinson, worked closely with Browne, gathering data and developing a firm understanding of its topside capabilities. A novel approach combining a sequence of small batch treatments used in synergy with Defoamer AF400

CHAMPION TECHNOLOGIES UK SALES AND

TECHNOLOGY TEAMS RECENTLY BOOSTED PERENCO’S

GAS PRODUCTION ON THREE MATURE ASSETS IN THE

SOUTHERN NORTH SEA BY 48 PERCENT.

Perenco’s commodity supplier, Champion Technologies first pursued this gas well deliquification opportunity in late 2009 when Commodities and Hydrotest Account Manager, Rob Anderson, arranged for foamer and defoamer Specialist Development Chemist, Steven Oude Heuvel to visit and present on Champion Technologies’ capabilities. CalCulating CostsBased on product price, Perenco initially selected a competitor’s product for use in its North Sea wells, but Champion Technologies remained in touch. When Perenco began to build automatic dosing skids for unmanned platforms late in 2010, its interest in Champion Technologies’ Foamatron® V-502 was renewed. Foamatron® V-502 is an environmentally acceptable methonal-free product, which offers safer handling, and reduces fire

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Restoreprofits and production in declining gas wells with Foamatron® products and PERFOAM®

predictive modelling

offloaded small targeted sections of the liquid column in stages, keeping liquid and foam levels within capacity of the facilities and preventing operational upset.

Applying Foamatron® V-502 batch-wise resulted in a 48 percent increase in gas production compared to the incumbent foamer product and a 158 percent increase compared to no foamer treatment. With the combination of an effective foaming program and safer products, this regime will ultimately enhance production and increase profits due to lower treatment rates, lower treatment costs, and because the expense for stringent fire prevention equipment is reduced. The program will also allow Perenco to receive ready supply via remote dosing skids. All the successes thus far now mean Perenco is currently switching all foamer applications to a Champion Technologies product suite that includes Foamatron® V-502 and Defoamer AF400. With a total of around 200 wells in the southern North Sea, Perenco will be working with Champion Technologies to identify wells that could benefit from the use of foaming products.

SAFER OFFSHORE PRODUCT LEADS TO INCREASED PRODUCTION AND LOwER COSTS

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