Ben van Bilderbeek is a frustrated man – and with good reason. He is convinced that his invention, the ‘Pos-Grip’ method of engineering, is safer than competing oil and gas wellhead technology currently on the market.
He is also adamant that it should be much more widely deployed in the oil industry. But because of the intransigence of the US oil establishment, the Pos-Grip is not approved for routine deployment on oil wells and remains largely unused.
I met van Bilderbeek and his colleague, Augusto da Mota, last week in Aberdeen, at the opening of a new testing facility for their company, AIM-listed Plexus Holdings (LSE:POS).
As van Bilderbeek, Plexus founder, explained, this is a story that has implications for other innovative small businesses. He summed it up thus: “Only very occasionally does a superior technology emerge that surpasses the established norm and sets previously unattainable standards. When this happens we believe that such an opportunity should be embraced and welcomed, rather than deemed disruptive.”
The little innovation that could transform the oil industry
The story goes back to 1997 when van Bilderbeek, who had already created one highly successful business based on innovative wellhead and oil drilling systems, came up with a novel method of joining two lengths of tube together.
The concept is simple enough. One tube is slipped inside the other, and then a ring is clamped around the outside. When gradually tightened, this forces the outer tube tight onto the inner tube. Once locked together, the force of friction prevents the inner tube from slipping. Such is the simplicity of the Pos-Grip.
Though it could have various applications, van Bilderbeek designed the Pos-Grip with the oil industry in mind. This is because it has one very significant advantage over the systems currently in use.
As part of the process of setting up an oil well, it is necessary to terminate and seal the well casing strings (the pipes within the well through which oil is extracted). The majority of systems used today require that the well’s blow-out preventer (BOP) – a large valve that can seal off a well that is being drilled or worked over – be temporarily removed while this takes place.
The removal of the BOP is a process described by Plexus’s non-executive director Augusto da Mota as akin to a driver disconnecting the brakes every time he changes gear. Removing it costs the industry huge sums of money, owing to the downtime necessary to perform the procedure. But it also poses a major safety risk and has resulted in numerous blow-outs over the past few years. The Pos-Grip entirely removes the need to peform this complex and risky process.
But while the Pos-Grip is regularly specified for high pressure/high temperature gas wells, van Bilderbeek believes that it should be used far more widely. But one big obstacle stands in the way.
How Plexus could profit from the post-Deepwater shake-up
To fulfil its potential, the Pos-Grip needs to get the blessing of the all-important American Petroleum Institute (API). This organisation sets the standards for the industry and determines which equipment should be used.
The API, which is largely made up of representatives of the big American oil and oil service companies, has been in no hurry to accept a potentially disruptive outsider. Now though, following BP’s Deepwater Horizon incident, the API is coming under pressure –not least from Barack Obama.
Last week the US president suggested the oil companies and the API have a “cosy relationship”. He added: “It seems as if permits were too often issued based on little more than assurances of safety from the oil companies. That cannot, and will not, happen anymore.”
So, with oil now lapping at the shores of Louisiana, the API could start to pay rather less attention to the vested interest of the big US oil equipment companies and rather more to the merits of the Pos-Grip.
Even so, van Bilderbeek remains wary. For one thing, he is afraid that the true cause of the BP disaster will be lost amid the finger-pointing and the welter of legal claims that are already emerging. “In the old days when there was an accident,’ he said, “everybody wanted to work together to find the cause. Today everybody blames everybody else.”
And, while he makes no secret of his desire to find a partner to promote the Pos-Grip, he is well aware of the dangers of trusting the product to a larger competitor that may be only too happy to suppress it.
The Pos-Grip, van Bilderbeek argues, should become not just the product of necessity, but the product of choice. But Plexus faces the same dilemma that challenges many other small companies – how to get broad support for a new innovation in the face of powerful vested interests.
Plexus is one to have on your watch list.
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This article
was first published in Tom Bulford’s free twice-weekly email
The Penny Sleuth