Aztec Well Servicing

Source: Energy Digital

Date :12/12/2007 6:21:15 AM

The pragmatic, prudent and professional roughnecks at Aztec can meet any challenge

Written by Emmet Cole and Produced by Nick Ledue

The $100 a barrel oil rush has created a Wild West boom in American oil fields, and it’s a transient worker’s haven - allowing roughnecks to jump from job to job, wage to higher-paying wage. Contractors routinely snatch employees from other contractors. Safety and training are often ignored.

But in the midst of this oil-fueled chaos are 400-plus hardhats with stickers all reading the same thing: “Aztec Well Servicing: Home of the Professional Roughnecks.” It’s more than just semantics.

“We don’t want a transient-type employee, because that’s not a professional-type employee,” says Jason Sandel, Aztec Vice President.

The company, formed in 1963 by Sandel’s grandfather and currently owned by his father, Jerry, runs out of the tiny town of Aztec in northwestern New Mexico, and provides services for wells all over the Four-Corners and San Juan Basin region.

Following the motto on their hardhats, the Sandels have built an oil well services conglomerate on a foundation of employee relationships, employee safety and customer service.

Close-knit employees

Aztec has responded to the proliferation of transient workers in the oil business by investing in areas that make employees easier to retain: training, bonuses, and a close-knit family atmosphere. It’s a far cry from the strategy other well service companies take.

“Some companies will increase their wage rates by 50 cents an hour across the board to try and attract drillers from competitor’s rigs,” Sandel says. “Instead of that, we believe what we ought to do is invest that 50 cents in training people up to the position.”

The company has a 50-65 percent annual turnover ratio – a number Sandel says is amongst the best in the industry, but considerable nonetheless. With more than half the company leaving each year, Aztec has focused on employee investment that is paying dividends in the form of safety-conscious and effective employees who hang around when the wind changes direction.

“We spend tremendous amounts of effort in the training area and also in pre-hire arena, so what we’re interested in is quality employees who are looking for a profession out of this job,” Sandel says.

Once hired, every employee goes through five days of an OSHA and IADC (International Association of Drilling Contractors) required training program called “HSE RIG PASS,” which ensures that employees meet basic safety and training requirements. Employees must also pass first aid and CPR training before they’ll be allowed on the job site.

By contrast, most of Aztec’s competitors send their employees out on location on their first day, Sandel says.

Aztec’s commitment extends well beyond the first day, however. The company isn’t afraid of shutting its rigs down for a time to provide additional, on-going training, for example. Aztec doesn’t provide “camp jobs”, where workers live on remote job sites, choosing instead only to take jobs where their employees can be close to friends and family.

During the mid-80s oil bust, when work bottomed out and rigs were shut down throughout New Mexico, Sandel started making cattle guards, rather than letting the operation fold completely and leaving employees jobless.

“We had to do something to be able to pay our employees a livable wage and keep them working for us during those difficult times,” Sandel says.

Devotion to safety

Aztec supports its employees by demonstrating a serious commitment to health and safety best practices.

“It all ties back to the family nature of our business, of making sure that employees are taken care of and treated well,” Sandel says. “Safety is our core value. Particularly in a dangerous industry, we believe that the way we can show employees that they matter that we care about them is by focusing on safety as our number one priority.”

Aztec became the first drilling and well servicing contractor in New Mexico to win the New Mexico OSHA Safe Site Award.

Happy employees, happy customers

With a satisfied, safe and stable employee base, the company can better focus on meeting their customers’ requirements. Aztec is an industry leader in “preventative maintenance,” for example - a proactive approach to equipment upkeep that identifies maintenance issues in advance and reduces downtime.

With a well-trained and professional workforce, employees and the company as a whole can adapt quickly to unusual requests.

“Often times requirements change, or drilling programs change,” Sandel says. “We can respond quickly to those changes, which is something most contactors can’t say.”

The result? Aztec has experienced 100 to 125 percent growth over the past five years and employs between 700-725 people across the entire operation. In addition to well services and drilling, Sandel runs Triple S Trucking, which provides water-hauling and rig-moving services.

“The first question I’m asked is always ‘What company did you buy to achieve such growth?’ The simple answer is that we didn’t purchase anybody - we’ve done it all from within.”

Future flexibility

Aztec faces new challenges in the coming year as New Mexico legislators debate an initiative, which Sandel says is “affectionately and non-affectionately” known as the ‘pit rule.’

If passed, the law will require all drilling and well servicing to use closed loop drilling systems, rather than open pits. The effort is aimed at protecting against damaging waste storage practices, but it will dramatically increase the cost of retrieving gas.

Sandel believes that Aztec’s flexibility will see the company through those challenging times.

“We are planning ways to package our services to help provide a turnkey type service to address that issue,” Sandel says.

If recent success is any indication, the pragmatic, prudent and professional roughnecks at Aztec possess the model to meet this challenge too.