Today, Recon Technology, which has built a strong reputation within China’s burgeoning oil field services industry as a 10-year veteran, non-state owned, broad spectrum provider of ingenious software and field service equipment engineered to improve efficiency/automation, reported debut of the Baker Hughes Frac-Point™ Completion System 3 to Sinopec’s Zhongyuan oilfield (China Petroleum and Chemical Corp.) via one of the company’s variable interest entities, Beijing BHD Petroleum Technology Co., Ltd.
This powerful horizontal fracturing technology allowed Sinopec to bring in a dense sandstone horizontal well which required multi-state fracking, thus placing BHD in a prime position to benefit off Sinopec’s continuous fracturing requirements. BHS has signed several contracts (as of Mar 19) totaling some $4.75M (RMB 30M) in accumulated contract value, slated for incremental completion that should wrap up during the first half of this year.
CTO of RCON, Chen Guangqiang remarked on the prioritization of this key technology by Sinopec within their 12th Five-Year Plan, citing projections that China’s largest producer and supplier of oil and petrochemical products would roll the technology out across some 1,100 of its wells every year for the next three. At some $475k of investment per well (RMB 3M) on average, this is a huge market for the company to sink its teeth into. RCON aims to tackle as much of the opportunity as possible while advancing the overall service envelope in anticipation of increasing market share, both at Zhongyuan and throughout China’s thriving hydrocarbon sector.
These developments are well in line with RCON’s drive to become a leading oilfield provider of safe, efficient full-service support, secure in the knowledge that now, as always, the evolution of the demands called for by clients would guide the company’s own development.
Oil prices were up over two percent Friday on sustained tensions in the Middle East, with Iran taking center stage over disputes about that country’s nuclear program, despite plans by the US/UK to release from strategic oil reserves this year. Although this reserve release report was officially denied, waning consumer prices and sovereign debt in the US and Europe, combined with a flagging dollar, have placed energy at the forefront.
As a smaller company operating in the sector, RCON will gather further knowledge and technical expertise by cooperating with leading international entities to advance the technology which has already seen use in some 2,200 wells worldwide (150 of which are in China). With results of the installation at Zhongyuan showing a 4.6 increase over the previous gas production levels, RCON is pleased that BHD has signed contracts to provide the technology of at least ten wells in the Zhongyuan.
Spearheading the emergence of this important horizontal multistage fracturing technology in China, after having so shrewdly anticipated its adoption, RCON stands poised to deliver results from the task force originally established to cultivate the technology.
For more information on Recon Technology, Ltd. please visit the Company’s English website at: www.recon.cn
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