For many years, mud systems were a key component of the oilfield-based drilling industry. But about 30 years ago, a new industry opened its doors for mud system manufacturers and they pounced on it.

When you see an opportunity to expand your business and your customer base, what would you do?

Sure, directional drilling was an untapped market that had enormous potential - this would simply be an extension of what they were making for the oilfield guys. However, directional drilling was basically an unknown and untested market.

But three oilfield-based drilling mud system manufacturers knew better than to pass it up. Talk about getting in on the so-called ground floor.

The three companies - Parchem Inc., Tulsa Rig Iron Inc. and Derrick Equipment - that rolled the dice and jumped into the HDD industry have thrived in the market today.


"Mud system manufacturers, such as Parchem Inc., have played
an important role in the evolution of the HDD industry.

Many in the industry point to two factors when explaining how and why the mud system market exploded: environmental concerns during the 1980's and the influx of the fiber-optic market in the late 1990's.

Whatever the reason cited for the growth, mud systems - mixing, cleaning and recycling - are now an integral force in the directional drilling industry. Drill rigs and mud systems go hand-in-hand. Instead of the few mud system manufacturers and suppliers, there are quite many.

With the competition to sell these systems, comes the added benefit for everyone of improving the systems and pushing the technology envelope - which the manufacturers welcome. First, there was just mixing the drilling slurry; now, they're also recycling the fluid.

"In the early days, there was just a handful of suppliers to the HDD market," said Ray Clayton, vice president of Derrick Equipment's underground construction and civil engineering division. "Today, the market has grown to at least 16 companies. This is part of the HDD industry's growth.

"Just look at the (trade) shows," Clayton continued, "they have become saturated with mud systems and vacuum systems."

Clayton knows what he's talking about. He spent nearly 15 years in the oilfield and environmental mud cleaning business before turning his attention to the HDD industry. He was with Derrick Equipment, one of the three suppliers to get into the HDD market in those early days. He eventually moved on to Tulsa Rig Iron Inc. - another HDD mud system pioneer - before just recently returning to Derrick.

Times Have Changed
But a lot has changed since those early days - from the way the systems are assembled to the tank size and speed at which the slurry is mixed.

Early on, the manufacturers used surplus oilfield equipment, not making any real adjustments for the HDD work. The systems were bulky and skid-mounted, necessitating a very involved setup procedure. Sometimes, assemblage was an all day job. Not anymore. Trailer-mounted systems have taken their place (although larger drills sometimes still use them), making assemblage just a small part of the drill site setup.

"Now, they are portable, self-contained systems. You can set up your equipment in an hour," said Eddie Sellers, field technical service manager for Tulsa Rig Iron. Sellers has been in the business for more than 15 years and has also see the evolution of the HDD mud system.

"The systems are so much more efficient," Sellers said. "The skids were too slow to mobilize. Now (the systems) are easier to use with smaller rigs."

There are a number of models that manufacturers sell, all of which have the same basic parts. Basically, manufacturers say there are six primary models, ranging for 50 to 1,000 gpm (190 to 3,800 1pm) and costing anywhere from $70,000 to $450,000.

"Each has different features and different performance levels," Clayton said. "They all serve some function. It simply depends on what your needs are."

"The (HDD) industry was slow to go to cleaning/recycling systems," acknowledged Pete Tynes, president of Parchem Inc., which, besides making mud systems and their components, also sells drilling fluids. "The cost of drilling fluid, cost for disposal and, of course, the environmental concerns of people surrounding the drilling fluid are what pushed them" - even though drilling fluids are non-toxic.

"In the early days, contractors just didn't recycle drilling fluid," Tynes said. "They used new bentonite to make new mud."

Clayton concurred with the belief, adding "If you don't recycle your mud, it's messy and it can be a major headache to dispose of. Recycling is a cleaner choice, you have dry cuttings and it does improve the public's perception about HDD." And it's economically sound, he said.

Recycling systems for smaller drills came into vogue about five years ago, with the emergence of rock drilling being done with smaller rigs. Mud motors were needed to drill, which meant drilling fluids as well. Before that, the large diameter drills pretty much held the market. But with all of the fiber-optic work being done in smaller, urban communities and the use of smaller drills to bore in rock, systems needed to be developed for the smaller guys - which opened another niche for manufacturers to address.

Sellers attributed the gains in the market to the fiber-optic explosion that began about four years ago with huge cross-country projects, such as Level 3. "They began drilling in towns and populated areas and they needed to recycle the fluids. You just couldn't dump it."

He added that recycling is also just good economics. "You save money in the long-term," Sellers said.

Evolution of the Systems
The changes to mud systems over the years have been natural ones - speed, efficiency and size are the most obvious ones. Contractor knowledge of the systems has also grown. Service has also been a big addition.

And the competition has changed.

Tynes pointed out that some drill rig manufacturers have joined the fray by designing and making mud systems to accommodate their own drills. He cited American Augers, Ditch Witch and Vermeer as examples of drill makers that make systems to match their small- to mid-sized drills.

"I really enjoy the competition," Sellers said. "It keeps everyone honest."

Biggest Change
However, the one single advancement made to the systems that manufacturers point to as revolutionizing the market was the development of the linear motion shaker for the cleaning/recycling systems, replacing the elliptical motion shakers. What this development did was make available a shaker that handles finer particles by using a finer mesh screen, resulting in better solids removal from the fluid.

"That was pretty much the big deal," Sellers said, noting that Tulsa was one of the firsts to use the linear motion shakers on its equipment.

Although the oilfield drillers had used the linear motion shakers for years, its limited use wasn't introduced into the HDD market until the early 1980's. The shaker became industry-accepted by the late 1980's.

Clayton also noted one of the latest advancements in cleaning and recycling: a three-dimensional screen has been introduced that can handle more fluid and removes even finer particles. He said the screen - which was patented by Derrick Equipment - hasn't really taken off in the HDD industry yet, but has done well in other drilling markets.

To Rent, Buy or Lease?
It's just like the auto industry. Contractors must make the financial decision of how they will obtain their mud system. How they are doing it depends on whom you talk to. Some say that many customers are still renting equipment, while some say the larger diameter market is beginning to switch from renting to making a long-term investment in buying. Leasing has been a popular option for smaller jobs.

"Some customers tend to lease with an option to buy for economical reasons," Sellers said.

An economic slowdown is being felt throughout the directional drilling market and the mud system market is no different. How is it affecting this segment of the industry?

"It's affecting how they are paying," Tynes said, tongue-in-cheek. He said that in his view, the financial pinch has hit the small- to medium-sized contractors the most.

"That (market) has definitely slowed," Tynes said. It seems to have slowed considerably."

Because of the slower sales, another problem for manufacturers has developed: contractors are selling off their used equipment, thus competing with the manufacturers for sales.

"There is a glut of used equipment," Clayton said. "We are competing against our own equipment (for sales.)"

But the tight times won't last forever. While the small- to mid-sized jobs have slowed, there has been a pickup in the amount of big rig work out there.

"There is a glimmer of light," Clayton said. "The large diameter work is beginning to pick up, primarily in the gas well drilling work."

"The oilfield work has been up while the HDD work has been down," Seller said. "We're trying to move into other markets, such as water well drilling.

"But I think (industry slowdown) will turn around," he added. "I see it coming back. Maybe not like it was, but it will come back."

Sharon M. Bueno is managing editor of Directional DRILLING
Photos courtesy of Directional Drilling
(Directional Drilling Magazine, August 2001)

>> Back to Top