SIC 1389 Oil and Gas Field Services, Not Elsewhere Classified
SIC 1389
This industry includes establishments primarily engaged in performing oil and gas field services, not elsewhere classified, for others on a contract or fee basis. Services included are excavating slush pits and cellars; grading and building of foundations at well locations; well surveying; running, cutting, and pulling casings, tubes, and rods; cementing wells; shooting wells, perforating well casings; chemically treating wells; and cleaning out, bailing and swabbing wells.
Establishments that have complete responsibility for operating oil and gas wells for others on a contract or fee basis are classified according to the product extracted rather than as oil and gas field services. Establishments primarily engaged in hauling oil and gas field supplies and equipment are classified in a range of Transportation and Public Utilities Standard Industrial Classifications. Establishments primarily engaged in oil and gas machine shop work are classified in SIC 3599: Industrial and Commercial Machinery and Equipment, Not Elsewhere Classified.
213112
Support Activities for Oil and Gas Field Exploration
Companies categorized in this industry provide specialized services to assist in the excavation of oil and gas. These companies are used by drilling contractors to provide services in producing new wells and maintaining existing wells. The economic condition of oil field service companies is predicated on that of the oil and gas industry in general. Service-related work has been contingent on the number of rigs in operation, the price of oil and gas, and the demand for energy.
At the end of 2003, the number of rotary rigs drilling for oil and natural gas totaled 1,111, of which 109 were offshore and 1,002 were onshore. While this reflected an increase from the average annual active rig count of 830 in 2002, it remained below the 1,156 average active rig count in 2001.
Crude oil prices in 2002 averaged $22.51 per barrel, an increase from $21.84 in 2001. Natural gas prices declined between 2001 and 2002, falling from $4.07 per thousand cubic feet to $2.95 per thousand cubic feet.
Domestic demand for energy continued to grow in the early 2000s as the United States used 97.35 quadrillion Btu of energy, compared to 96.32 quadrillion Btu in 2001. Petroleum and natural gas accounted for 63 percent of U.S. consumption, with crude oil and natural gas liquids accounting for 39 percent and natural gas accounting for 24 percent. To meet demand, the United States relied on imports for 61 percent of its crude oil supply and 19 percent of its gas supply.
Companies classified in this industry provide services intended to increase or improve well production. Services are provided throughout the life of the well, including the initial drilling, the completion phase that sets production, and the maintenance or stimulation of existing wells.
Casing and cementing services are provided when the well is drilled. Casing is a large steel pipe, inserted into the wellhole and cemented into place. Oil well cementing is a mixture of water and cement that is pumped into the space between the casing and the wellbore, known as the annular space. The cement bonds the casing to the formation, providing structural support and directing fluid movement. Cementing also limits pipe corrosion, prevents natural gas blowouts, and aids in maximizing production circulation.
After the well has been drilled to its determined depth, evaluations are made to determine if the hole will produce a sufficient amount of oil and gas. Downhole formations can be analyzed by five different methods: well logging, drill stem testing, potential testing, bottomhole pressure testing, and productivity testing.
If it is determined that the well should be completed, the service company will lay production casing and complete the well, bringing the flow of liquid to the surface. Specific types of completion services depend upon the formation of the hole. The open-hole and liner methods are available, although the perforated casing technique has become the most commonly...
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