EnergyPoint Research's Customer Satisfaction Index of Global Oilfield Suppliers Showed Decline in 2010

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Helmerich & Payne and Ensco Rank Highest Among Contract Drillers, While Derrick Equipment and Wood Group Are Favored for Equipment and Services

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Results from EnergyPoint’s independent surveys have demonstrated that today’s oilfield customers want suppliers to provide higher quality products and services than are currently being delivered in many cases.

Customer satisfaction scores for suppliers of upstream oilfield products and services fell by an adjusted 8.5% in 2010, effectively reversing the rise recorded a year earlier according to results from EnergyPoint Research's Oilfield Products & Services Customer Satisfaction Survey, the annual benchmark study of the oil and gas industry's satisfaction with the products and services it purchases and utilizes.

Driven by higher activity levels associated with rising North American rig counts, land drilling contractors incurred the largest decline in satisfaction in the survey, followed by oilfield equipment and materials providers. Meanwhile, offshore drillers saw their overall scores rise slightly, spurred by greater availability and more manageable day rates for certain rig types. Offshore drilling was the only major industry segment to show an improvement in customer satisfaction compared to 2009.

"After enjoying gains last year, suppliers took a half step back in 2010 in terms of meeting the needs and expectations of customers, both prerequisites for long-term success in the industry," said Doug Sheridan, managing director at EnergyPoint Research in Houston. "Higher customer satisfaction, including a greater sense of quality and value as seen through the eyes of customers, typically translates into higher revenues and lower overall costs for suppliers. It also enhances a supplier's reputation, which is a critical consideration for many users of oilfield products and services."

A number of suppliers that have fared well with customers in past surveys continued to show ratings strength in 2010 despite the overall decline in industry-wide scores. Helmerich & Payne, the total satisfaction leader among land drillers since 2006, once again took the top spot in the segment as the company continued to execute a business model characterized by organizational focus, operational

stability, and proven technology. The company dominated the rankings in over a dozen categories including: performance and reliability; health, safety and environmental (HSE); technology; and non-vertical wells.

In the oilfield products segment, Derrick Equipment, a maker of shale shakers and other drilling fluids management equipment and systems, ranked number one in total satisfaction for the third consecutive survey. Derrick's showing in the segment was driven by high ratings in engineering and design; availability and delivery; performance and reliability, and; other key categories. The company's products were rated highest by both large drilling contractors and E&P companies, as well as their smaller counterparts. Other suppliers rating first in various product categories and global regions include:

  • Davis-Lynch in cementing equipment, high-pressure high-temperature (HPHT) applications, and other downhole-drilling product categories;
  • Newpark Resources in multiple drilling-related categories, including: fluids products and services; HSE policies and practices, and; availability and delivery;
  • Lufkin Industries in artificial lift and post-sale support;
  • Schlumberger in a range of categories and segments, driven by strong ratings for its recently acquired Smith International, M-I Swaco and Geoservices units, and;
  • Sumitomo Metals for production tubing in both the U.S. & Canada and international markets, as well as for various special applications.

The survey also saw two traditionally strong performers, Ensco and Wood Group, break through to take the top spots for the first time in the segments of offshore drilling and oilfield services, respectively. Ensco took top honors among offshore drillers in multiple categories, including: shelf wells; job quality; HSE, and; technology. From a geographic standpoint, the company rated first in international markets, including Asia & the Pacific Rim and the North Sea.

Aberdeen-based Wood Group's performance with survey respondents led to its first-place rating overall among oilfield service providers, driven by leading marks in the all-important categories of performance and reliability, job quality and technology. Other oilfield service suppliers rating well across categories and regions include:

  • Frank's in numerous completion-related categories, including: casing and tubing installation and equipment; non-vertical wells, and; special-applications;
  • Core Laboratories in formation and well evaluation services, including: core and fluids analysis; onshore wells, and; in the U.S. & Canada, and;
  • Tetra Technologies, which registered substantial improvement over prior years' scores, in performance and reliability.

"Results from EnergyPoint's independent surveys have demonstrated that today's oilfield customers want suppliers to provide higher quality products and services than are currently being delivered in many cases," said Sheridan. "The ability of this year's winners to enjoy such standout ratings with customers, in some cases for several years running, reflects the strengths of not only their product and service offerings, but of their organizations, leadership and cultures as well."

EnergyPoint Research's contract drilling, oilfield products, and oilfield services surveys were conducted as part of the firm's annual industry-wide study, which this year was comprised of more than 4,100 in-depth evaluations performed over 24 months by qualified professionals at domestic and international customers of oilfield suppliers. The survey succeeds similar industry-wide studies conducted and published by EnergyPoint Research since 2003.

Suppliers were evaluated in various areas such as total satisfaction, pricing and contract terms, performance and reliability, technology, engineering and design, job quality, safety and environmental, service and professionalism, post-sale support and corporate capabilities. They were also evaluated across multiple product and service segments, as well as domestic and international regions. A total of 60 suppliers received the minimum number of evaluations needed to be included in the final rankings.

For categories in which pre-2009 supplier ratings existed, historical ratings were included in the 2010 category-winner calculations at lesser weightings. In no case were such historical ratings assigned a weighting of more than 20 percent for the purposes of calculating category winners.

About EnergyPoint Research, Inc.
EnergyPoint Research provides independent research regarding the oil and gas industry's satisfaction with the products and services it purchases and utilizes. Founded in 2003, the firm offers oil and gas industry professionals and organizations opportunities to both provide and gather confidential ratings and customer feedback in areas important to oilfield product and service suppliers through objective and independent evaluation processes. For more information regarding EnergyPoint Research and its surveys and data, visit the company's website at http://www.energypointresearch.com or contact the company at info (at) epresearch (dot) com.

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