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April 13, 2013
Philadelphia, PA

West Chester Firm Launches A Giant Drill Rig for Marcellus Work

NEWS
The Philadelphia Inquirer
Posted: April 13, 2013
By Andrew Maykuth, Inquirer Staff Writer

Schramm Inc., the West Chester drill rig manufacturer that had a moment of fame in 2010 when its drills rescued 33 trapped miners in Chile, is about to enter the big leagues of oil and gas exploration.

The company, which has been making truck-mounted drill rigs for more than 50 years, is launching its biggest drill rig ever - a 102-foot-tall walking, talking monster designed to bore the deep horizontal wells that have turned Pennsylvania's Marcellus Shale into a fossil-fuel bonanza.

Schramm employees on Thursday put the finishing touches on the first T500XD Telemast drill rig at the company's 27-acre factory in West Chester. Next week, the $7.6 million rig will make its way on eight tractor-trailers to Ohio, where its new owner, Alpha Hunter L.L.C., plans to use it to tap into the Marcellus Shale and the deeper Utica Shale formation.

Schramm added 50 employees in the last year, mostly engineers, to design the new rig and hopes to make up to 10 of the machines a year. It now employs 235 people.

"It creates a whole new business sector for us where we hadn't competed before," said Dave Hartzell, the project manager.

For the natural gas industry, Schramm's entry into the big-rig market is important symbolically. The Marcellus Shale Coalition is under the gun to demonstrate to skeptics that the shale boom has economic benefits outside the rural drilling zones.

"Schramm, and their world-class drilling rigs, is just one of the many shining examples of how businesses across the entire commonwealth, especially in Southeastern Pennsylvania, are capitalizing on natural gas opportunities," said the coaltion's president, Kathryn Klaber.

Schramm, which was founded in 1900 and manufactured air compressors for much of its history, has more than five decades of experience building drill rigs for water wells, geothermal systems, and mineral exploration. About 75 percent of its rigs are exported. A key market is Chile, where its rigs rescued the trapped miners in 2010.

Some Marcellus drillers have been using Schramm's smaller rigs to drill the "top holes" that are done before the big directional rigs arrive to thread the more complex horizontal bores into the gas-bearing formation.

The new Schramm rig, which can lift 250 tons of pipe and drill more than 15,000 feet deep, is like a traveling carnival ride. The platform, control room, and telescopic mast are assembled on the ground and then lifted as a unit on massive hydraulic cylinders 28 feet into the air.

"The speed of mobilization and demobilization is a huge advantage," said Kirk Trosclair, a senior vice president of Alpha Hunter, the company that is buying Rig No. 1.

Schramm's promotional literature says the new rig can walk and talk because the entire assembly, weighing 500,000 pounds, can lift itself about six inches off the ground and move, one foot at a time, in any direction. It can travel about 30 feet in an hour.

The mobility is an advantage in modern gas development when an operator may drill a dozen or more individual horizontal wells from a single location.

The rig "talks" because it includes full satellite communications capability so engineers at headquarters can closely monitor the drilling progress.

The new rig is slightly smaller and less powerful than the giant Texas rigs that look like rocket gantries. Schramm is using the smaller size as its selling strength.

A Texas rig typically requires 20 trucks to haul and requires six workers to operate, but the Schramm rig can be loaded onto fewer trucks and needs only three workers to operate.

The Schramm rig requires fewer workers because the drill pipes are hoisted into place and screwed together automatically, rather than by roughnecks using their hands. It eliminates the need for a pipe rigger to work from a crow's nest 100 feet above the ground, also reducing injuries.

"Everything is hands-free and fully automated," said Fred Slack, Schramm's vice president of business development.

Contact Andrew Maykuth at 215-854-2947,
@Maykuth,
or

ABOUT SCHRAMM, INC.

Schramm, Inc. is a century-old Chester County, Pennsylvania manufacturer and global supplier to the hydraulic drill industry, focusing on land based applications. Specializing in mobile, top-head hydraulic rotary drilling rigs, Schramm is a supplier to companies in the energy, mining, geothermal, water well and mine rescue sectors worldwide. Schramm's global reach includes major market positions in China, Chile, Canada, Australia, Russia and South Africa.

Schramm has received numerous awards for its world-class manufacturing excellence, superior quality and innovation, significant growth in international business and its ongoing contributions to its local community. Among them, Schramm received the "Manufacturer of the Year Award" from the Greater Philadelphia Chamber of Commerce in December 2011; the "Business Member of the Year" from the World Trade Center of Greater Philadelphia in May 2010; and the "Chester County Globe Award" from the Chester County Economic Development Council in association with the Pennsylvania Senate and House of Representatives in April 2007. In 2008, Inc. 5000 listed Schramm as one of the fastest growing companies in the U.S.