If I were to tell you about a dynamic, innovative, global technology company that had doubled its revenues in a single year, you’d be forgiven for making several assumptions: that the technology in question was digital; that the company was based in San Francisco or Silicon Roundabout; and that we were talking about a start-up focused on a new sector like fintech, healthtech or adtech.
What if I then told you that the technology was actually mechanical, that the company was based in Aberdeen and celebrating more than a decade in the business, and that it was focused on the offshore oil and gas industry?
That response would probably challenge every preconception and assumption that we all tend to make about fast-growing tech stocks. Yet it is exactly where DCT finds itself at the end of an incredible year in which we showed that explosive growth is not the preserve of coders working on algorithms, AI and robotics.
In the last year we’ve grown our sales team at our Aberdeen headquarters – with the key appointments of both a global sales manager and a European sales manager – and expanded our sales team on the ground in the Middle East.
In tandem with this increase in headcount, we’ve turbo-charged our network of regional sales partners across the globe, bolstering our presence in Malaysia, Australia and Brazil.
The time has been right to scale our business globally. Rig counts in all of these territories are recovering strongly and demand for our tools is surging. Of the 500 tools we’ve sold since we started in 2008, 100 have been in the last two years alone.
Significantly we are selling tools in the North Sea again for the first time since 2014. But it’s not just about the resurgence of our traditional markets. We signed a major new five-year contract with Saudi Aramco to supply our Turborunner and Turbocaser reaming tools, reinforcing our relationship with this major client.
We’ll continue to expand our footprint worldwide with further contracts with national oil majors in the pipeline for announcement early next year.
However, while sales of the latest versions of our legacy tools are rebounding, 2019 has been significant for our move into new late life technologies.
While we are already well-known for precision-engineered technology that helps oil and gas operators drill more wells with huge cost and time savings, we have extended our expertise into the area of plugging and abandonment (P&A).
Global expenditure on oil and gas decommissioning in the next decade is forecast at $105 billion with P&A costs accounting for nearly half of those projected budgets.
Closing a well permanently is a complex, risky and costly process but simple, innovative technologies, such as our Casing Cement Breaker, are set to make these operations more predictable and reliable, thus substantially reducing the length of an operation and improving sustainability.
This year we entered into a unique three-way partnership with the Oil & Gas Technology Centre and the French oil major Total. Our new casing recovery tool will be trialled early next year on wells in Total’s Alwyn and Franklin fields with the aim of making it fully commercial by the end of 2020.
Given the reluctance of risk-averse operators to deploy new technologies in the current economic climate, this is a real achievement. It’s also a significant endorsement of our systems expertise and reputation for innovative design and product development.
I’ve always been struck by the idea that the Stone Age was characterised by humankind’s clever use of crude tools whereas the Information Age, at least until now, has been marked by our species’ crude use of clever tools.
At DCT, we passionately believe that the winners in the new Hydrocarbon Age will be those innovative companies that make clever use of clever tools. Our portfolio now offers simple but smart solutions for the entire well lifecycle, from drilling to decommissioning; 2020 is shaping up to be another exciting year of growth in revenue, territories, people and patents.
Digital may get more of the attention, but the future is looking bright for smart mechanical technology: in the offshore drilling industry the bits are every bit as important as the bytes.
David Stephenson is chief executive of Deep Casing Tools
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