Oilfield services technology supplier Enteq has signed a licence agreement with Shell subsidiaries Shell Global Solutions (US) and Shell Global Solutions International for drilling technology.
According to the agreement, Enteq will receive exclusive rights to incorporate Shell’s intellectual property and other technology into the engineering and manufacture of a Rotary Steerable drilling system.
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The Rotary Steerable drilling systems are used for efficient drilling of oil, gas and geothermal wells.
The Rotary Steerable drilling market currently stands at $1bn within the globally assumed $10bn directional drilling sector for oil and gas and is expected to grow at a compound annual growth rate (CAGR) of 7%.
Combined with Shell’s information, Enteq’s product innovation, engineering and commercialisation offer the potential to produce a next-generation product with potentially significant cost reductions and other operational benefits.
Enteq predicts that the development of a commercial system will take another two years and the total investment of the system stands approximately at $3m over that period, which also includes several initial payments to Shell.
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By GlobalDataShell Wells Technology general manager Adrian Chesters said: “Enteq is a strong licensee and collaborator for this project due to its status as an independent supplier with access to the directional drilling market. Their interest in further developing and commercialising the technology aligns well with our own.”
Enteq will also make royalty payments to Shell, upon commercial operations of the drilling system.
Enteq CEO Martin Perry said: “The Enteq team has a track record in commercialising innovative engineering projects which have achieved good market share. We look forward to building upon Shell’s innovative work to date in order to bring an exciting new product to the directional drilling market.”
