Schlumberger Limited. (SLB), Cameron International Corporation (CAM): Profiting From Energy’s Technology Explosion, Part 1

In traditional single-gradient drilling, the riser pipe, which connects the production platform to the subsea wellhead, is weighted by drilling fluid. This concoction creates hydrostatic pressure on the wellbore, which can make the well difficult to control. Under Chevron Corporation (NYSE:CVX)’s DGD approach, the drilling fluid in the marine riser is replaced by seawater. Pressure on the wellbore is thus reduced dramatically, the well becomes easier to control, and safety is therefore heightened.

Chevron has been working hand-in-glove in implementing DGD with offshore rig operator Pacific Drilling SA (NYSE:PACD). Pacific’s drillship Pacific Santa Ana was specifically built to Chevron Corporation (NYSE:CVX)’s DGD-enhancing specifications and is working for the big company in the Gulf of Mexico.

As Chevron Corporation (NYSE:CVX) noted in a release announcing the arrival of the new drillship in the Gulf, “Pacific Santa Ana is equipped with a DGD riser, a mud lift pump handling system, six mud pumps — three for drilling fluid and three for seawater — extensive fluid management system enhancements, and more than 72,000 feet of DGD-related cables.”

Luxembourg-based Pacific Drilling sports a 2.0 (buy) consensus rating from the analysts who follow it. Given its leg up in acquiring DGD-compatible equipment and in working with Chevron Corporation (NYSE:CVX) on implementing this technological advancement, it clearly bears watching by Foolish energy investors.

Foolish takeaway
All of the companies named above, obviously among others, stand to benefit from ongoing advancements in the technologically sophisticated world of subsea operations in the deepwater. In Part 2, we’ll take a look at companies that are providing leadership in such additional challenging arenas as multi-well drilling pads, offshore gas liquefaction, and improvements to the world of seismic operations, where the quest for oil and gas begins.

The article Profiting From Energy’s Technology Explosion, Part 1 originally appeared on Fool.com and is written by David Smith.

Fool contributor David Smith has no position in any stocks mentioned. The Motley Fool recommends Chevron and owns shares of General Electric.

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