OOO Burovoya Kompaniya Eurasia (BKE) is the largest onshore drilling contractor in Russia
How we differentiate
Having established a leadership position in the Russian drilling market over the past nine years, our priority is to sustain and extend this leadership position in the future.
Our differentiated proposition is built around our scale, our efficient execution and our partnership with our customers and we will seek to maintain this differentiation as we pursue the following:
Focus on our core strengths
We seek to be the market leader in our core competences of drilling and work-over. In 2011, we sold the bulk of our drilling service assets to Schlumberger as part of a larger transaction in which we bought 19 existing drilling rigs with 17 drilling crews, 34 work-over rigs with 25 related crews, and 23 side-tracking rigs with 20 related crews.
Invest in our assets and our people
We believe that the key to our differentiation is the quality of our assets and the quality of our people. We have invested heavily in both our rig fleet (almost half our fleet is now less than 10 years old) and our rig crews (in 2012 we hired Aberdeen Drilling School for drilling optimisation training) and we believe the most competitive remuneration structure, ensuring our people are incentivized to deliver best performance.
Constantly strive to improve efficiency and safety
EDC has long experience of driving operational efficiencies, which contributed to doubling EBITDA margins since our formation. We have increased metres drilled by crew per day by 34% since IPO in 2007(by 60% since 2005). We have one of the best health and safety records in the industry.
Become our customers' partner
One of the unique characteristics of the Russian oil industry, and essentially the biggest barrier to entry, is that oil companies often have virtual monopolies in certain brownfield producing regions. There are legacy relationships between oil and service companies in these regions and retaining these requires a partnership approach. Our focus on developing longer-term framework agreements with all our customers will give us greater certainty and visibility of cash flows, allowing us to make the investments that our critical to our long-term growth.
Anticipate structural changes in the industry
Sustaining our leadership position owes as much to the ability of our management team to anticipate changes in market dynamics as it does to the execution of our stated strategy. We anticipated that demand for horizontal drilling would grow strongly and so we have strengthened our ability to deliver complex well solutions by investing in our rig fleet, training our crews and by forging a strategic alliance with Schlumberger.
Commitment to strong shareholder returns
Our leadership position, substantial growth prospects, focus on improving efficiency and prudent financial management will allow us to continue to deliver strong returns to shareholders. We are committed to retaining a strong balance sheet, allowing us to safely navigate volatile financial markets while giving us the flexibility to take advantage of opportunities that may arise to grow the business in a value accretive way.