In the volatile world of oil and gas, price fluctuations are an unavoidable reality. When oil prices begin to decline, the pressure mounts on operators to maintain profitability while minimizing operational costs. One of the most effective strategies during these downturns is to optimize artificial lift operations. Artificial lift is a critical component of oil production that can significantly impact a well’s economic performance.
Artificial lift systems, such as rod pumps, gas lift, electric submersible pumps, and progressive cavity pumps, are employed to maintain or increase production in wells that can no longer flow naturally. While essential to sustaining output, these systems also represent a significant portion of operating expenses. During periods of lower oil prices, inefficient lift operations can quickly erode profit margins. Shrinking margins can turn once-viable wells into financial liabilities.
Efficiency Equals Profitability
When oil prices fall, the margin for error shrinks. Improving the efficiency of artificial lift operations can mean the difference between shutting in a well or keeping it profitable. This starts with data-driven optimization. Today’s advanced monitoring systems can track pump performance, fluid levels, energy usage and downhole conditions in real-time. Leveraging this data allows engineers to fine-tune pump speeds, identify issues early, and avoid costly equipment failures or downtime.
Even small efficiency gains – such as reducing energy consumption or improving run time – can yield substantial savings across an entire field. For instance, optimizing a rod pump system to reduce pump off or identifying a non-opening gas lift valve could extend equipment life and reduce repair costs. In a low-price environment, these incremental improvements have an outsized impact.
Preventing Unnecessary Capital Spend
Another key value of efficient artificial lift operations during price declines is the ability to defer or avoid major capital expenditures. Instead of replacing lift systems prematurely or overhauling infrastructure, operators can often extend the life of existing equipment through better maintenance and optimization. Predictive analytics and machine learning now allow teams to forecast failures and proactively address issues, minimizing downtime and maximizing return on investment.
Moreover, a well-optimized artificial lift strategy enables companies to better allocate their resources. High-performing wells can be prioritized, while marginal wells can be closely evaluated to determine if continued operation is justified. This targeted approach ensures that limited budgets are directed toward the most productive and cost-effective assets.
Optimizing the Downhole Tool String
Research from Leistritz Corp. estimates that 85% of oil wells in the United States use some type of artificial lift, and of those, 71% employ a sucker-rod pump. These pumps are favored for their simplicity, reliability and ability to handle a variety of fluid conditions. With such a significant investment in rod pumps, adding even minor efficiencies to the downhole tool string can yield significant results.
One of those efficiencies is replacing standard B2 tubing anchor catchers (TACs) with the Slimline® TAC from TechTAC®. The Slimline features a reduced outside diameter (OD) that offers up to 245% more flow-by area around the anchor than a standard TAC. That increase allows gas to flow up and sediment to drop down past the anchor without creating a choke point that restricts flow and leads to the formation of scale, paraffin and other deposits. The result can be a significantly more efficient pumping operation.
As one Slimline TAC customer noted: “We have seen increased pump fillage on wells we converted to the Slimline TAC. Increases of 15-25% are common.”
Strategic Resilience When Oil Prices Decline
Ultimately, creating more efficient artificial lift operations isn’t just about surviving drops in oil prices – it’s about building resilience and long-term competitiveness. Companies that invest in smarter, leaner operations during tough times are better positioned to thrive when the market recovers. The knowledge, systems and efficiencies developed during downturns often become permanent advantages that elevate operational excellence across the board.
