In 1931, after several years exploring the Patagonian wilderness, US geologist Charles Edwin Weaver wrote about a large rock formation seemingly rich in oil some 1,000km south-west of Buenos Aires. But it took nearly 80 years and the development of new drilling techniques to realize the impact that ‘Vaca Muerta’, meaning ‘dead cow’, could have on Argentina’s economy.
In 2011, Argentine oil company YPF – then majority owned by Repsol – announced that it had discovered massive shale oil and gas deposits buried several kilometers underground. A year later, the Argentine government nationalized YPF and put in motion an ambitious plan to develop non-conventional production in the region.
At around 30,000km2, roughly the size of Belgium, Vaca Muerta is now estimated to hold the world’s second and fourth most important reserves of non-conventional gas and oil, respectively. YPF is satisfied that by exploiting even a fraction of the formation, it can cover all of Argentina’s energy needs for decades.
The discovery promises to breathe new life into the province of Neuquén, where oil has been exploited for more than a century but conventional production has been in decline for years. It is also providing new opportunities for local companies such as Oilfield Production Services SRL (OPS), a local company providing a range of engineering and construction services to the hydrocarbons sector.
“Vaca Muerta has had a favorable impact in the area because it has drawn in massive investment,” says Ignacio Pascual, administrative manager at OPS. “We had a big incentive because the new oil and
gas needed to be compressed to be connected to the main gasoducts, and that’s our field.”
OPS, which began in 2001 offering small-scale civil engineering works, decided to invest heavily in new machinery to expand and capitalize on the new energy revolution. “We began with Volvo Construction Equipment around five years ago,” recalls Pascual. “We tested a machine and it turned out to be really positive and reliable so we decided to keep investing exclusively in Volvo, which now accounts for around 85% of our fleet.”
OPS has since expanded its Volvo fleet to 20, a mix of EC220DL excavators, L70F wheel loaders, BL70B backhoe loaders, G930 motor graders, and the new stars of the show: four PL3005D pipelayers.
The decision in 2014 to incorporate the Volvo pipelayers, which were delivered in 2015, was taken as part of the OPS plan to expand its operations in this activity. The company had started using its backhoes as a substitute for pipelayers, but found the process unwieldy and inefficient, especially as the scale of new projects increased.
“We had always specialized in gas compressor plants and the idea was to develop our work in pipe-laying,” explains Pascual. “The new Volvo machines have helped us with that, saving us a lot of time.”
According to head of logistics at OPS, Alejandro Faris, acquiring the new pipelayers has had a significant impact: “Yesterday on site we were able to introduce 2,800m of 24-inch (61cm) gas piping with just one pipelayer and an operator directing the procedure. Before, that same operation would have required a group of ten people, and it would have taken seven or eight days to complete those 2,800m.”
Faris says these time savings also apply when setting up to start a new project, a key consideration in Patagonia where distances are large and the quality of most access routes to remote areas leaves much to be desired.
“The equipment we used to use had to be divided in parts, so a logistical operation for a work site could take a week or ten days,” says Faris. “Now, with the Volvo machines coming fully assembled, we can have all our equipment up and running on site in two or three days.”
It is not just the management at OPS who are celebrating the regular arrival of modern Volvo machines. As the company races to secure new contracts and complete simultaneous projects stretching to around 100km, its machine operators are working long shifts in the arid and relentlessly windy conditions typical of the Patagonian steppe.
“The machine is really comfortable, with lots of space to work in,” says Claudio Veloso, one of four operators trained to use the new PL3005D pipelayers. “You are secure when working because you have great visibility, and there is no real risk of the machine rolling over.”
Another of the four, Cristobal Acuña, has been operating machines with OPS for 11 years and says he cannot imagine going back to the rented equipment he started with. “It’s the first time I’ve used such a complete machine. The seat is like a bed where you can rest during a break. There’s music, real air-conditioning and a heater. I think this technology helps operators remain healthy because otherwise we would really suffer working in 30- or 40-degree summer heat.”
The characteristics of the region also test the machines themselves. “Patagonia is a particularly arid zone, and sometimes quite extreme for the equipment because the ground can be very compact, very hard,” says Patrick Souyris, manager at Tecnodiesel and distributor for Volvo CE in the region. “This is a challenge for the machines, especially during excavation, as well as a challenge for Volvo CE to rise to the client’s need for cutting and digging components that serve their life cycle and maintain operational performance.”
OPS is hoping its improved efficiency and dependability will make it stand out among service providers to the major oil and gas players, enabling it to win more contracts at both a provincial and national level. The signs are promising: the company says it has already managed to complete a project that would normally take one year in just 45 days, and has recently picked up several contracts with YPF to complete projects left unfinished or in an unsatisfactory condition by rivals.
“OPS has been working with us continually for two years and we keep giving them more projects because of the confidence we have in them,” explains Guillermo Fernández, YPF’s head of construction for engineering projects in the Loma la Lata field. “The change of machines has been really effective: Volvo has made equipment with cutting-edge technology that makes excavating work more secure with the versatility to operate in small spaces.”
As the workload increases, so does the investment in new equipment. In November, OPS took delivery of a brand-new EC220D excavator, which Souyris says demonstrates the company’s ongoing “confidence, continuity, and faith” in Volvo CE.
“The company has put its faith in Volvo,” says Faris. “We have been satisfied not only with the equipment but all that comes with it, the mechanical service and on-site assistance. With new projects coming up in 2016, the company is prepared to improve and expand its fleet, and that’s why we acquired this new excavator.”
Photography by Patricio Murphy.
Picture 1: The operator rotates the superstructure of the Volvo PL3005D pipelayer through an impressive 360 degrees to lift and place large, heavy pipes with ease and precision.
Picture 2: Volvo’s innovative PL3005D pipelayer combines a 51 tonne lifting capacity with a host of industry-leading safety and productivity-enhancing features to produce one of the highest performing machines in the sector.
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