Meeting the Challenges - Allied-Horizontal Wireline...

Edition 3 • July 2015

What’s InsideDollars & Sense

Did You Know?

Feature Story

Marketing Update

Success Stories

Employee Spotlight

HESC News

Service Quaity News

Events

HR News

Photo Submissions

Meeting the Challenges

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At this point, 2015 has proved to be a very challenging year for our industry, with the rig count peaking at 1876 rigs on November 21, 2014, then declining for 30 consecutive weeks. There are currently 859 rigs operating onshore in the US -- a 54% drop in activity. At Allied-Horizontal Wireline Services, our business also declined by 52% during this time period. But while these numbers sound the same, there is more to the story.

When we account for the fact that, in order to keep as many of our personnel and equipment working as possible, Allied-Horizontal cut prices -- by as much as 25% to 35% in some cases -- it is truly amazing that we have only seen a 52% decline in our business. How did we do this and what does it mean? It means that we have grown our market share in a down market -- and we did it by staying focused on our corporate objective and our guiding principles.

Our objective at Allied-Horizontal is to become the largest full service independent wireline company in the

world. Our guiding principles to reach this objective are People, Process, Equipment and Technology.

People – It may sound cliché but our people are truly our greatest asset. (Now I can hear many of you groan, “Just another corporate slogan,” but I have spent my lifetime working in the wireline business and have never seen a better Team than Allied-Horizontal.) From Irwin to Brighton, we have top-notch professionals who are properly trained for the job and enjoy what they do. During this downturn, we’ve retained the most highly skilled people in our company. In fact, we are strategically investing in additional sales personnel to grow our current opportunity set and best position the company for the ultimate rebound in activity levels. We continue to conduct training at every level of the organization. From new hires to focused sales training, we will not cut corners related to safety and our service model: We’ve upgraded our online Mind Flash training modules and have published a new Field Operations Manual (FOM). We’re conducting crane training, pressure control equipment (PCE) training and operations training. And we will continue to invest in this great resource.

Process – We document all of our processes and we continually update them. As a result, we get an amazing number of compliments from clients when they receive a detailed Job Problem Report (JPR) from Allied-Horizontal. Not only do they receive a well-written and honest report, they get it quickly, as we strive to deliver it within twenty-four hours. This has become one of the signature features that sets Allied-Horizontal apart from

Allied-Horizontal Wireline Services 2

We are certainly not just another wireline company.

the competition. Friends of mine at the major Fortune 500 service companies admit they’re envious of the discipline we have instilled in this process -- so please keep that in mind when you’re asked to preserve evidence or quickly communicate information about a failure. It may not seem important to you, but it is 100% “mission critical” for our company.

Equipment – We have the best equipment that money can buy. Our units from Synergy and Texas Wireline are first-class, state-of-the-art logging units. We’ve invested in new 10K PCE, and several 100-ton cranes. We practice what we preach to our clients: Value is the intersection of price and quality. That point varies from company to company and person to person, but we see companies cut spending in these tough times and something always suffers. That’s because you get what you pay for, and when you pay less you will always get less. At Allied-Horizontal we’ve continued to buy the best equipment we can possibly afford, so that we set up our field people to succeed each and every day. This is exactly how we are gaining market share.

Technology – Think about this: Despite the fact that Allied-Horizontal is an independent wireline company, we have invented, deployed, and modified cutting-edge and new technologies. With lower oil and gas prices, our customers are more focused than ever on driving efficiency into drilling and completion programs in order to minimize cost to produce and maximize recoveries. We are the only independent wireline company capable of employing technology for reservoir analysis, frac design and the safest, most efficient completions to drive better economics for our customers.

Fail-Safe Addressable Switch Technology (FAST) Selectronic, Dyna Select, Exploding Bridge Wire (EBW). These 100% safe perforating systems prevent accidental surface detonations and downhole off-depth perforating incidents. Allied-Horizontal leads the industry in deployment of this technology.

Reservoir Analysis Sonde (RAS) Pulsed Neutron/Carbon Oxygen logging tool. The best cased-hole formation evaluation tool on the market, and an integral part of the StageFinder TM process.

StageFinderTM A new log analysis and completion design methodology that we have developed and is proprietary to Allied-Horizontal.

Cased-hole Spectral Gamma Ray (SGR) We are currently the only company in the world running and RAS and SGR in a single logging pass.

Converging Shot Technology A new perforating concept developed completely inside of our company.

Vertical Interrupt Device (VID) A safety device for tubing conveyed perforating that is another technology developed exclusively at Allied-Horizontal.

We were the first company in the world to deploy the NOV Uni-Body truck with the E-Drive system.

We were the first company to successfully deploy GE open-hole logging technology.

Rotary Sidewall Coring Tool (RSCT) Designed to drill up to 50 samples of the rock inside the well bore so they may be brought back to the surface and analyzed for oil and gas content.

Resistivity Micro Imager (RMI) An open-hole logging tool that makes a visual image of the rock formations found in a well bore.

Cross Dipole An open-hole logging tool that will help us get more logging work and will refine the StageFinderTM answer product.

Go back and reread that list. Allied-Horizontal is certainly not “just another wireline company.” In fact, we are among the Top Ten wireline companies in the world, and I believe we are the largest pure play, independent wireline company in the world. These are not bad credentials for a company that only recently turned five years old.

Our industry and our company have experienced a very difficult seven month period. The collapse of the rig count was the most severe the industry has ever seen. Fortunately we have been able to react and manage to keep our expenses in line with our revenues; however, our profitability has suffered on lower pricing and volumes. We are not out of the storm yet, so we need to be laser focused on cutting costs and spending each dollar as if it were our own, so that we can continue to invest in our people and our business.

I am very proud of each and every one of you on this Team, and I’m confident we will emerge from this downturn in a position of strength and significantly outperform our competition!

Well Done!

Scott O’BeirneSenior VP Completion Services


Several profit metrics are used to evaluate business performance, with each providing a unique and informative insight into how the business is doing. While there are no set standards for the names or what exactly is included within each profit metric, this article examines Gross Profit, Operating Profit and Net Income, all of which are fairly common terms.

Gross Profit: Price versus Cost of ServiceGross Profit is revenue less the costs and expenses directly attributable to the business activity for which the customer is paying. In the case of Allied Horizontal, this would be the profit generated from the specific wireline service performed. For example, a perforating stage:

We typically provide a price per-stage to the customer. To deliver this service, a crew must be on location with the proper equipment. Key expenses include fuel to operate the unit, salaries and bonus for the crew, hotels, per diem, guns, explosives, detonators and all other perforating consumables, as well as depreciation charges for the unit, pressure control package and other equipment. (A depreciation charge reflects a period expense for long-lived assets like

dOLLARS & sENsE

The last edition of Dollars & Sense focused on the importance of cash and generating cash flow, the lifeblood of any business. But profits and profit margins are also important metrics for measuring the health and performance of a company. Let’s consider how and why.

While cash flows are real, in the sense they provide the actual currency needed to operate and invest in the business, profits are a creature of accounting. Despite this difference, the two are not unrelated. A company may have negative profits, yet continue to generate positive cash flows (the opposite is also possible). This is because the timing of billings, cash collections and payments impact cash flows during any given time period. Over time, however, generating losses instead of profits will likely catch up to a company’s cash flows -- with negative results.

While some companies may consciously choose to forego profits for a period for competitive or strategic reasons, such as building a customer base or launching a new product, a sustained inability to generate profits and margins at rates equal to or better than competitors likely signifies real issues with a company or business model. Profits matter.

What are Profits?Profits are the financial benefit realized when the amount of revenue generated from business activities in a given period exceeds the costs and expenses needed to deliver the activities and support the business. In other words, when a company charges more for its activities than it costs to perform them, profits are the excess. Profit margins are simply the amount of profit as a percentage of revenue – how much of each revenue dollar is converted into profit.

Why Profits MatterBy Peter Brink, Chief Financial Officer

wireline trucks that are paid for once but used for multiple years).

While not exhaustive, these are many of the key cost buckets directly tied to completing the perforating stage. Any profits after these expenses are Gross Profits, a highly useful measure of the relationship between the prices for our services versus the direct costs to provide them.

Operating Profit: Costs to Run the BusinessWhile helpful in comparing prices to the direct expenses of the job, clearly missing from the Gross Profit calculation are District level expenses associated with repairs, maintenance, safety, service quality, some sales expenses, employee benefits, management and the administration required to operate each location. Starting with Gross Profit and subtracting these amounts results in “Operating Profit”; this is the profit remaining after accounting for all direct and indirect costs associated with field operations – district level profitability, in other words.

So the Operating Profit metric provides a closer look at how well the revenue (essentially pricing) covers the direct and indirect expenses (cost of doing business). It’s another useful



metric, but it’s still not the complete profitability picture: corporate level costs and expenses also must be accounted for in order to capture all costs of the business.

Net Income: The Bottom Line A complete picture of business profitability accounts for all costs of company operations – not only at the field level, but including corporate as well.

Corporate expenses are similar to Field Operating Expenses, but also include general liability and other insurance expenses, sales costs (including compensation for sales personnel), interest payments on borrowings (or other costs associated with outside financing sources), and taxes. Subtracting these expenses from the Operating Profit yields the Net Income or earnings of the company.

Net Income, then, equals the total profits of the business after all expenses, including accounting expenses, such as depreciation and amortization, as well as the costs to finance the business and,

of course, a cut to the government. A positive Net Income reflects the ability of a business to price services high enough, in combination with operating the business efficiently enough while managing costs well enough, to deliver a profit to the bottom line.

Margins: Capturing More of Every Revenue DollarProfit margins at any level are ultimately a function of pricing, efficiency and cost management -- plus the service mix and the revenue volume.

Some services generate higher margins than others (e.g., logging, which uses no consumables, should be expected to deliver higher Gross Margins than perforating), so the mix of services impacts profit margins, while obviously, greater revenue volume enables a company or district to support a higher overhead support structure.

In the current market environment, we know the industry is facing significant cost pressures and have experienced it in our own business,

Why Profits Matter (continued)

dOLLARS & sENsE

resulting in lower prices we can charge for our services as our customers seek lower costs and improved efficiencies to address lower oil and natural gas prices. As our own pricess have come down, it has been necessary to address the costs in our business as well.

We are constantly looking for ways to manage our costs by buying more efficiently and seeking out the best vendors with the best prices, while also managing prices and developing higher margin services where we can in order to increase profitability. Additionally, we must continue to operate safely and efficiently in delivering our services, knowing that retaining our customers and exceeding their expectations will be a key factor in driving profits for the long term benefit of all of us and our company.

If you have questions, comments or would like to see a specific financial issue addressed, please do not hesitate to email someone on the Finance & Accounting team.

Did you Know?Before oil and gas was “discovered” commercially, the Iroquois used crude from natural seeps in the ground in Pennsylvania as salve, mosquito repellent, purge and tonic. Native Americans had been harvesting oil from these seeps as far back as 1410. When salt mines owned by Samuel Kier, the man credited with founding the petroleum refining industry in the U.S., were polluted by oil during the 1840s, Kier simply disposed of the crude in Pennsylvania’s Main Line Canal. It was considered a worthless byproduct until an oil slick caught flame, forcing Kier to reconsider its applications. Kier had no formal chemistry knowledge or education before he began experimenting with the crude oil he had been previously dumping into the canal. In 1848, he began offering the product as a patent medicine to treat burns, ulcers, cholera, asthma, indigestion, rheumatism and blindness for about $0.50 (equivalent to about $13.49 today). Kier also put petroleum jelly on the market as a topical treatment similar to what we still use today.

Establishing Kier Refinery in 1853, America’s first oil refinery (located in Pittsburgh), Kier used crude oil from salt wells at Tarentum. In 1854, using a five-barrel still, Kier Refinery was the first commercial refinery to produce illuminating oil from petroleum. Kier consulted with Edwin Drake concerning Drake’s experimental oil well. The first shipment of oil from Drake’s well went to Kier’s refinery.


Allied-Horizontal to the Rescue on Two Oklahoma Jobs By Paul Roden, Technical Sales, OKC

feature Story

On more than one occasion recently in Oklahoma, Allied-Horizontal has been called upon to “come to the rescue” when a major competitor has been unable to get the job done. Our performance was failure-free, and in one case, resulted in additional work from a customer we’d been pursuing for some time.

Right Tools, Right JobAfter years of trying to get work from XTO, in June Allied-Horizontal completed our first stage job for that client when we stepped in to complete the last 12 of 20 stages on the Brewster Well 1-32H29 in Love County, Oklahoma, after the competitor showed up with the wrong equipment the night before the job was due to begin.The Brewster 1-32H29 is a 4.5” completion with 15.10# casing set to 22,200’ and a TVD of 17,200’. There is a 38’ Enventure casing patch set at 16,000’ with an ID of 3.196”. Seven of the 20 stages had been completed by the competitor before a squeeze job on 4.5” casing was performed, after which they were called back to complete the job, but could not get through the casing patch with their equipment. XTO then asked Allied-Horizontal to get set up for the job, which would use Magnum long range plug and Owens 2 ½” setting tools, and three 2’ x 2 ¾” guns. However, after multiple discussions with Magnum and XTO over the next week, we were told that the competitor had, in fact, come up with the right tools for the job, and Allied-Horizontal would not be doing it. Nevertheless, XTO was advised to check the competitor’s tools, as they were not the correct tools to match up with the Magnum plug... Sure enough, with the job scheduled to start on Friday, June 26th, and with the competitor on location, XTO discovered they had the wrong equipment. That night at 8:45pm, Allied-Horizontal was called to replace the competitor’s

wireline crew, with a start time of 6am the next day, Saturday, June 27th. From that point on, Allied-Horizontal completed 12 stages with no failures in four days. The door was opened! XTO awarded us the next job with a similar set up, and a new client relationship has begun.

Fast and Failure-FreeEarlier in June, customer Devon Energy called Allied-Horizontal to relieve a major competitor on a Logan County, Oklahoma well, after they experienced multiple failures pumping tools through a casing patch to bottom.The Freeborn G 4-18N-3W 3MH well is a 7” completion with 29# x 4 ½” liner. Originally, it was not a Plug/Perf job as it had sleeves, with a PackerPlus system. Six of the 26 stages were fracked when Devon discovered they had a casing problem in the lateral, so sleeves were drilled out to the casing problem and an 89’ Enventure casing patch was set to realign the casing. The competitor was called back to finish the well, which required pumping the plug and guns through the casing patch with coil tubing fishing tool strings, but after three failed attempts over an eight day period, Allied-Horizontal was called to relieve the competitor’s wireline crew on the

afternoon of Friday, July 10th. With a start time of 10:00pm that night, we began on Stage 8 with Magnum long range plug and 2-½” Owens setting tool, 2 ¾” guns, 2 ¾” weight bars. Working with the competitor to operate the pumps, we pumped 17 of the total 20 stages through the casing patch, with pump rates varying from 12bbls/min to 5 bbls/min, back to 12 bbls/min, at wireline speeds from 150 ft/min to 850 ft/min. We completed 19 stages in four days with no failures. Success!

A Close CallThe Continental Resources well Ireta 1-4-9XH was being fracked by Frac Tech with Allied-Horizontal doing the Plug/Perf when, on Saturday evening, July 18th, one of the pumps overheated and burst a hydraulic line, catching on fire and burning the Frac Tech equipment along with several other trucks located nearby. No one was injured, and we were able to get Allied-Horizontal equipment off location before the fire got too close, but Frac Tech lost an entire bank of trucks and a couple of sand haulers before the fire was contained. Lesson Learned: Monitor equipment operation continuously!


Marketing Update

Expanding Our ToolboxIn a short period of time, Allied-Horizontal has proven to be a leader in the wireline industry. Our employees provide the best service quality available, setting us apart from the “blue and red giants.”

What’s more, we have top of the line equipment and continue to expand our toolbox with some of the best new technology available.

Our new StageFinderTM Engineered Completion Service utilizes our Reservoir Analysis Sonde (RAS) and Spectral Gamma Ray to provide our clients the opportunity to not only optimize the production of known pay zones, but also to take advantage of those zones that may be overl ooked, thus increasing the overall production of an asset. The StageFinder service provides a cost effective formation evaluation method to improve the selection of frac stages and perforation clusters, leading to higher production and/or eliminating stages in both vertical and horizontal wells.

With the launch of our Fail-safe Addressable Switch Technology (FASTTM Perforating Systems), we are not only providing a more reliable perforating solution, but more importantly, a safer solution. A new dimension to electrical wireline, FAST perforating has the ability to block all sources of inadvertent current from the electrical detonators in the tool string, preventing accidental misfires. The operator communicates and controls each of the sections of the downhole assembly, allowing the switches to be checked before and during the wireline run, thus improving reliability. Real-time shot detection

provides feedback on whether plugs have set or guns have fired, and gun sections can be skipped in the event any section fails to detonate. Allied-Horizontal will soon be one of the first service companies to discontinue the use of the older technology and utilize only the newer, safer technology, thus setting the standard for perforating services across the industry.

StageFinder and FAST are only a couple of our new offerings you can follow with the new Employee Portal, where you’ll find information on the company’s services, employee benefits, training information, key contacts and much more. By now you should have received your login information, and I hope you take the opportunity to log on and explore this new tool. All employees have access to the Portal, but username and password are required, so if you have not received this from the IT Administrator, please contact Ken Carlson.

To suggest input on the content or how you think we can make the Employee Portal more useful, please contact me, [email protected]. We want to make this tool a valuable part of your day!

FAST Perforating - A safer, more reliable way of perforating

Looking for a phone number, benefit information or maybe what training is scheduled in your area? Check out the new Allied-Horizontal Employee Portal.

mailto:[email protected]

mailto:[email protected]


Success Stories

Following a lead on a new startup operator working in North Dakota, Allied-Horizontal Denver sales talked to the Denver-based operator Solutions Energy for the first time at the start of May, 2015, setting in motion a team effort that would end in a record TCP job little more than a month later. Invited to visit their facility in Brighton, our sales team learned Solutions Energy had drilled a shallow 4,000-foot lateral well in an unconventional play near Minot, and was looking for a completion method that would fit their budget. With no plans to stimulate the well, the challenges were to keep fluid off the water-sensitive target Carbonate-Mission

Canyon formation, and avoid the need for use of costly H2s equipment. Armed with these insights, and after weeks of discussions and examination of options, Allied-Horizontal and the now-new client agreed that a TCP completion was the answer. But not just “any” TCP completion:On June 11, 2015, Allied-Horizontal successfully completed 28 ten-foot intervals of Solution Energy’s well, using a record-setting total of 30 time delays on a pulling unit supplied by Key Energy. This was no little success; it was a major achievement. Operations had less than a week’s notice when job

preparations began, and several challenges immediately came to light. For starters, finding a workover rig that would even accept the challenge of pulling the 120-foot spacing needed between each six-minute time delay was not easy. But the team persevered and was in place to perform the job on schedule, thanks in part to the combined efforts of our PA and OK facilities for expediting the additional equipment we needed and allowing us to minimize expenditures. Finally it was time to begin. Many hours of preparation and planning had brought our team to this point. The next 3 ½ hours were committed to a flawless TCP operation, including successful deployment of the record number of time delays.

Teamwork Leads to Innovative Performance By Russ Rall, Technical Sales, Denver

Solutions Energy owner Darien O’Brien plays the ‘Call to Post’ on trumpet as FSM Robert Grissom places the ball in the tubing to commence operations. Solutions Energy owner Andrew Forcina was also on location for the TCP operation, which deployed a record 30 time delays.

Recent successes in challenging North Dakota wells show how teamwork is enabling Allied-Horizontal to consistently deliver innovative solutions for our clients. Bringing together People, Process, Equipment & Technology, we put People first – and our people deliver!

Flawless TCP Job with Record-Setting 30 Time Delays

Allied-Horizontal delivered double successes for customer EOG. First, the team fully completed a challenging pump down RCBL job in the 16,300-ft extended lateral of a North Dakota well with a Total Measured Depth (TMD) of 23,700 ft. Not bad.Discussions with the client led to precautionary use of an addressable cable-head release tool, so the team used it again on a second run in the well, successfully completing a 12-gun cluster toe shoot. Not bad at all.Two days later, the same crew successfully completed a pump down tracer log and toe shoot in a single run, delivering a second outstanding job performance for EOG.

Crew Delivers Extended Lateral RCBL, Then Pump Down Tracer Log / Toe Shoot

Opportunities to SucceedThe second job came about during EOG’s ongoing pump down tracer logging project, when Denver sales recognized an opportunity and suggested that the toe shoot could be completed at the same time as the logging. While this would challenge operations with the task of making the Gamma Gun compatible with our addressable system, weeks of preparation involving Probe technicians resulted in a successful test just two days before the job was called out.Once again Allied-Horizontal’s teamwork demonstrates how we provide the safest and most efficient wireline services in the industry.


Employee Spotlight

Amr Hussein

Hector Flores

Amr Hussein is in the Employee Spotlight this month, recognized for his “very personal approach” to his job.

In his position as Field Service Manager in Midland TX, Amr is responsible for overall organization of his facility, tracking material usage and maintaining cost control. But he does something more, taking steps to ensure there are always clear lines of communication through each department in the facility, and constantly making efforts to improve on overall functionality of the base. “Due to his dedication in the areas, we have seen notable changes in overall facility appearance and decreased material costs,” says Sherrell Ezzell, who nominated Amr for spotlight recognition this month. Amr joined Allied-Horizontal Wireline Services in December,

2014, coming from his own business in California, which he began in 1999 after nine years with Schlumberger. During his career, he has held positions in Open-Hole, Cased-Hole and FSM, fulfilling assignments throughout the Persian Gulf and North Africa.Even after such globe-hopping, the bachelor is still interested in travel, and enjoys spare time activities that include hiking, biking, swimming, running, archery, Qi-Gong, Tai-Chi, Olympic lifting, skydiving and camping. Whew! Amr also has an interest in spirituality, life lessons, self-improvement, Chinese medicine, Human Behavior, comedy, and meditation – all of which no doubt contribute to his “very personal approach” at Allied-Horizontal.

The Employee Spotlight this month shines on Hector Flores, who is noted for going above and beyond the call of duty in his dedicated approach to Service Quality (SQ) and safety.

Currently an Field Service Manager in our Midland district, Hector began working for Allied-Horizontal in January, having previously held positions as an FSM and Wireline Engineer over the last 10 years. Before coming to work in the oilpatch, Hector was a finance manager and gneral manager in the car industry.

According to Sherrell Ezzell, who nominated Hector for spotlight recognition this month, “He goes above and beyond the necessary duties to ensure there are clear lines of communication through each department in the facility and consistently makes efforts to improve on overall functionality of the base.”

Hector says he takes great pride in his career, but is also proud of the manner in which he and his wife Elissa have raised their four children: Jared, Mya, Evan & Ivan. A “family man” at heart, he values quality family time, and enjoys hunting and grilling BBQ in his spare time.


Health environment safety & Compliance News

Mr. Joshua DennisVice President - HESC

Allied-Horizontal Maintains Solid Performance Stats for Q2During Q2, our Lost Time Incident Rate (LTIR) was an outstanding Zero, as no lost time injuries were recorded for the quarter. There was a slight increase in the Total Recordable Incident Rate (TRIR), from 1.05 to 1.21 for Q2; nevertheless, at 1.21, Allied-Horizontal continues to operate below the industry average, which is roughly 1.9. In fact, the past six quarters still show a downward TRIR trend as the Allied-Horizontal safety program continues to mature -- a strong testament to our field employees and their ongoing commitment to put safety first.

The second quarter also showed a significant increase in our compliance audit scores, with DOT audit numbers up across all locations, while ATF audit numbers increased in most locations. Our local management teams have done an outstanding job in ensuring our compliance with applicable government agencies by utilizing the audit program, which provides a comprehensive review of an organization's adherence to regulatory guidelines, and flags potentially serious issues that can lead to non-compliance penalties.

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Service Quality news

An Innovative Approach to Service QualityAllied-Horizontal is very passionate about service quality, we believe outstanding service quality along with HESC, is the way that to differentiate ourselves from our competitors. Allied-Horizontal follows a unique and effective approach to service quality that is not practiced by other wireline service companies. We continuously work on improving, that keeps us always 1 inch over the competitor. Today, I will explain a little about what, why and how our service quality team operates.

What is the Allied-Horizontal definition of Service Quality?The official definition of service quality is an achievement in customer service. It reflects at each service encounter that exceeds customer expectations. Now Customers form service expectations from past experiences, word of mouth and advertisement. This basically means that service quality is the interpretation of how good or bad our service delivery is to the customer. This form of Customer interpretation can make the definition of service quality a bit convoluted. The status of our Key Performance Indicators (KPI’s) e.g. Run/Mrun, LT/1000hrs, Efficiencies, etc. will affect our service quality; however, there are many other service quality criteria that people might overlook. For example, how professional our crews and equipment project themselves on location. This can be from wearing clean coveralls, exhibiting positive attitudes, conducting effective internal or external communication, operating serviced and reliable equipment, answer customer queries etc. It is all about how the client feels and interprets our service. Basically, in my opinion everything you do and every decision you make while working for Allied-Horizontal can positively or negatively affect our service quality.

Why do we need focus on Service Quality?The answer to this one is actually pretty simple. The better our service quality, the happier our customers will be with us. The happier our customers, the more they will want to use us. Whenever there is a lost time incident on a wellsite, it takes money out of the customer’s pocket. Remember, there are other service companies on location e.g. Frac, crane operators, PCE, pump trucks etc. They will go on standby which the customer will have to pay, in addition to the delay in putting the well on production. In a down market, like we are currently experiencing, service quality is even more important. The market is so price driven that we have to be way better than our competitors, to keep the work based solely on service quality. When you win work based on service quality then you can generally ask for a higher price than our competitors.

How do we provide outstanding Service Quality?To answer this question, I will present you with a day in the life of a SQM (Service Quality Manager/Service Quality Coordinator). All of our SQM/SQCs are tasked with spending at least half of their time in the field training, doing audits and in the unfortunate case conduct an investigation. If there is an SQ incident, the SQM’s have to collect evidences, interpret them and find the root cause of the problem. A preliminary Customer report needs to be generated within 24 hours. Allied-Horizontal is the only wireline service company that generates reports this quickly. Training is also an important part of the SQM/SQC job description. They are tasked to coach field engineers and operators to facilitate efficient and effective development of the skills associated with those positions.

While in the field, the SQM/SQC will be constantly monitoring to see if all the procedures are being followed. If they find a gap in the procedures they are tasked to create new or update the procedures to fill the gaps. When not in the field, the SQMs take the Field Engineer’s calls to help with troubleshooting or answer technical questions. SQ incidents happen any time thus keeping our SQ team awake for long hours. SQMs will also conduct a service quality meeting with all of our Major Customers every quarter. These meetings will highlight KPI’s and new technology. The service quality meeting also gives our management a chance to talk to the clients to ensure all their issues are taken care. With new technology, the SQMs/SQCs are in charge of preparing, testing and finalizing the new products. SQM analyze KPI’s and trends are monitored to give Allied-Horizontal current Operation health. Opportunity for improvements are discussed and initiatives are undertaken to fix the gap. There are many other tasks that the service quality team performs that I will not elaborate on but I hope the description above gives you some insight on what these SQMs/SQCs are doing from day to day to improve Allied-Horizontal service quality.

Mr. Clint WilsonVice President - Service Quality


events

Chance for Change: Making a Difference By Coral Meador

Career Day By Casey Clark – FSM, OKC

I would like to thank each and every one of you who participated in our ‘Chance for Change’ fundraiser for Feed The Children this summer. I am happy to announce that over the past six weeks Allied-Horizontal successfully raised a total of $455.00 to help feed those who are less fortunate. Hats off to The Rockies for leading the way, bringing in a total of $200.00 in donations!Recently, I was able to see firsthand what the Feed The Children organization is all about and how they are helping change the lives of so many every day. In June, I attended a distribution event in East Houston where I got to see FTC in action. The experience was phenomenal: hundreds of boxes with tons of donated goods, sorted and distributed by dozens of volunteers. One of the largest international charities based in the US, Feed The Children works with a network of partner agencies in communities, including food pantries, shelters,

Feed The Children staff and volunteers gather to distribute donations at the Denver Harbor Community Center in East Houston in early June, while our ‘Chance for Change’ fundraiser for the organization was getting underway at Allied-Horizontal.

soup kitchens and churches. These agencies then deliver the donated products--free of charge--to families in need, reaching an average of 150,000 US families per year. I look forward to working with this organization in the near future, and encourage anyone else who may be interested in helping Feed

The Children, to check out their local chapter of the organization. The Houston Feed The Children Distribution Center currently has volunteer opportunities to help prepare food and personal care hygiene boxes, build boxes, and sort donated products for packing. For more information please visit their website @ www.feedthechildren.org.

Mustang Elementry School in Oklahoma City got a visit from Allied-Horizontal Wireline Services in May, when I was invited to speak at Career Day at the school, where my two sons attend, with Eli in Ms. Witty’s 2nd grade class and Noah in Mrs. Neu’s 4th grade.

Accompanied by our TCP hand Sam Pantoja, who drove the Allied-Horizontal logging unit, I spoke to both classes, covering several topics, such as how fossil fuels are used daily, and discussing examples of them. We also talked about wireline in general, and how and why it is used in the oil field

for logging, perforating and other activities. The kids seemed really engaged and asked several questions before

taking a “tour” of the logging unit, after which I handed out hard hat stickers as the students went back to class.

Ms. Witty’s second graders – including Eli Clark -- learn about wireline technology on Career Day at Mustang School in OKC.

Mustang School fourth graders from Mrs. Neu’s class show new hard hat stickers when Noah Clark’s father visited for Career Day.

http://www.feedthechildren.org


Human resources News

The Road to Wellness Part 2: Eat, Sleep and Feel BetterBy Su Das, Director of Human Resources

Overall physical wellness encourages the balance of physical activity, nutrition, rest, and mental well-being. Even when we’ve got a good exercise plan going, easy access to fattening foods can compromise our nutritional health, and constant stress from work and worry threatens our emotional wellbeing. Achieving and maintaining wellness then, is an ongoing process that requires not only physical exercise, but attention to our eating and sleeping patterns as well.In this Part 2 on The Road to Wellness, we look at some information and a few easy-to-try ideas that can help us to eat, sleep and feel better:What are You Eating?How much do you eat? An average healthy male requires about 2200 calories and an average healthy female needs approximately 1700 calories a day. First tip, then: Find out how many calories you need to achieve and maintain a health weight, and plan your meals from there. Eat a variety of healthy foods and control your meal portions.

Take the time to enjoy your food and recognize when you have had enough. Use a smaller plate and portion out foods before you eat. When eating out, order an appetizer-sized portion or a side dish instead of an entrée or share a main dish with a friend.As a beverage choice, choose water or fat-free or low-fat milk, unsweetened tea, or other drinks without added sugars.Use whole-wheat bread for sandwiches. Switch from white rice to brown rice. Start your meal with a salad packed with veggies, to help control hunger and feel satisfied sooner. Or end your meal with fruit as a dessert.Add lean proteins such as lean beef and pork or chicken, turkey and fish. Try new foods like tofu, beans and lentils. You may find a new favorite!When eating out, order steamed, grilled, or broiled dishes instead of those that are fried or sautéed.On long commutes or shopping trips, pack some fresh fruit, cut-up vegetables, low-fat string cheese sticks, or a handful of unsalted nuts

to help you avoid stopping for sweet or fatty snacks.Sweet Dreams are Made of ThisIt is essential that our bodies get the rest they need. Good quality sleep helps not only with our mental state, but gives the body time to restore and repair. Consider some basic strategies for better sleep.Maintain a regular sleep schedule and get between 7-9 hours of sleep each nightNever Oversleep - Get up at about the same time every day (weekends too!), even on a morning after you have lost sleep. Sleeping late for just a couple of days can reset your body clock to a different cycle – you will be getting tired later and waking up later. Set Your Body Clock - Light helps restart your body clock to its active daytime phase. So when you get up, get some sunlight in your room. If that’s not possible, go outside and admire the scenery or turn on all the lights in your room and walk around for a few minutes. Exercise - Be active, this is especially important the day after a bad night’s sleep to reset your body clock. Take a Nap - 20-30 minute naps have been shown to be beneficial as a supplement to getting 7-9 hours of sleep. Naps can boost energy and help increase memory. Develop a Bedtime Routine – Stop working and don’t get into any stimulating discussions or activities a half hour or hour before bed. Do something that’s relaxing instead. List To Do’s - Keep a pad and pencil handy. If you think of something you want to remember, jot it down. Then let the thought go.



Human resources News

The Road to Wellness Part 2 (continued)

Stretch and Relaxation - Some people find that a gentle stretching routine for several minutes just before getting into bed helps induce sleep, while others practice relaxation techniques. Avoid Caffeine in the Late Afternoon Onwards: Caffeine, a chemical in coffee, colas, tea, chocolate, etc., causes hyperactivity and wakefulness. Cut Down on Alcohol - Alcohol might help you get to sleep, but it results in shallow and disturbed sleep, abnormal dream periods, and frequent early morning awakening. Sleeping Environment - Sleep in a cool room (60 degrees or so). Pile on another blanket or add one under the mattress pad rather than turn up the heat.

Good Thoughts, Good HealthAs well as being physically healthy, we need to pay attention to mental well-being. Emotional wellness increases our sense of awareness, it creates a sense of balance, and helps us learn from our mistakes. Below are some strategies to practice in order to boost emotional wellness. • Always stay positive. • Smile. • Seek or accept help and support

from others when needed. • Be grateful for family and friends. • Practice being mindful by focusing

on the here and now. Cultivate mindfulness by doing one thing at a time and giving it your full attention.

One final tip: Don’t feel that you have to make all of these changes at once. Often, it’s better to get one new habit firmly established before adding new ones. So here’s wishing you a happy, healthy road ahead!Please let Human Resources know if you want any specific wellness information or would like to see us implement any wellness programs. Visit myuhc.com and go to the Health & Wellness tab to take advantage of wellness tools available to you. You can enter sweepstakes and earn rewards as you meet your fitness goals!

Photo Submissions

Thank you Frank Whitehead for submitting this picture of

Allied-Horizontal on location in Oklahoma.

We hope you enjoyed this edition of The Thread, but we cannot do this without you. If you have a nice image or information that will make a good feature or success story or if you know that employee who goes above and

beyond the call, please let us know.

Please submit to: [email protected] or [email protected]

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