News

A re-finance event or also commonly called investor’s cash-out, is a transaction that allows the investor to withdraw equity in the form of ‘cash’ from an asset owned by the investor. After a cash-out, the investor may re-invest in new properties to keep building wealth or diversifying a portfolio.

The simplest example is a residential home refinance. The investor buys a property for $100, after some time, market prices go up say 25%, with the property value increasing to $125. If the investor refinances 80% of the property value, he would be able to pull out the original $100, while still owning the property. The $100 might be used to invest in a new property or any other use.

Commercial real estate prices are not as market-driven as residential real estate. In commercial real estate, market prices are mainly determined by the net operating income (NOI) that the property generates and the market Capitalization Rates (Cap Rate).

The NOI is the bottom line of the commercial real estate rental business. In few words, NOI is sales (rental revenues) minus operating costs. The NOI can be improved through a professional property management which increases occupancy and/or rental prices; and/or reduces costs (insurance, maintenance, staff, etc.)

The Cap Rate is the NOI divided by the property sales price. The capitalization rate indicates the rate of return that is expected to be generated on a real estate investment. As an example, if the property’s NOI is $100 and the property asking price is $1,000 its cap rate is 10%. Similar to a bond, a lower cap rate renders a higher valuation.

Now, taking the previous example to the Commercial Real estate arena. If an investor purchases a warehouse for $1,000 with NOI of $100 (10% cap rate), if after a given time the investor manages to increase the NOI by say 35%, assuming that Cap Rate is still 10%, now your property value is $1,350. Therefore, if the property is refinanced with a bank willing to lend say 75% of property value, the investor would be able to pull out ~$1,000 as a cash-out, while keeping the property operating and generating income. Investors can then re-invest this cash in different projects.

Refinance is a simple mechanism. However, timing is as critical as having an appealing NOI. Prevailing Interest rates and lending options, due to global, domestic and market economy conditions, are also part of the equation. These variables might reduce the loan amounts or increase financial costs delaying the refinance until better market conditions.

In conclusion, a re-finance is an attractive strategy to build equity. However, it cannot be achieved without experience and a professional Real Estate management team, which sources properties at attractive entry prices, has a network of lending institutions and the experience to improve Net Operating Income.

Legal Disclaimer: This information is provided for educational purposes only. Readers of this article must consult a qualified professional in their jurisdiction for all opinions for their specific situation.

About the author – Houston Equity Partners LLC.

www.hepinvestments.com    |     HEP@HEPinvestments.com     |       Linkedin

Optimization of mature well production, new technology ...

When collecting the scarce production delivered by most mature wells, the operators turn to the conventional method of closing the well, hoping that will increase the pressure, and open it again. This task is usually carried out in an haphazard way and taking advantage of the casual presence of a visitor near the well.

In the presence of liquids in the mature well, other operators resort directly to the use of the plunger lift system, ignoring the existence of new technologies that do not require leaving the API6A installation of the well, nor the installation of lubricator, plunger and intervention with wireline to place a receiver in the production tubing.  

How does it work ?

This technology, called OPTIPRO, uses a SIL2 certified electronic controller that intelligently manages the closing and opening of the well without the intervention of the operator. The controller measures the pressure increase gradient when the well is closed to determine the optimal moment to open it and measures the accumulated production when it is open, generating a production index that allows using an algorithm to command the optimal moment for closure starting a new cycle.

The periods and pressures of closures and openings can be quite different since they do not obey determined rules but to the analysis of the real condition of the well in real time, it is even possible to clearly observe through the graphs the output of the accumulated water plugs during some periods.

The other novelty of this new technology is that the closing and opening of the well is done by means of an actuator that is mounted on an existing positive choke in the well, allowing API6A classification of the production tree to be maintained.  

Case study in Neuquén, Argentina

A case study was conducted in Neuquén, Argentina, recording production during similar periods of time and using 2 different methods.

1) Automatically timing the closing and opening and adjusting the times manually by an operator to find a better performance.

2) Using the new OPTIPRO technology described above.

The results showed increases in the order of 18% for the case study that lasted 21 days for each of the tested modes.

Conclusion:

It is always convenient to evaluate the hidden potential in the mature wells existing in each field even in some forgotten cases. Using the appropriate technology, it is possible to obtain extra profits from them.

This report was prepared by Cristian Decia, Automation and Control Manager of Motomecanica Argentina SA. For more information on how this technology operates, visit the following link: https://drive.google.com/open?id=1wNLw3Osl_iGHsbevNAjoqcuY-l-zqlS3 or www.motomecanica.com

The ability to work in agile teams is becoming a key skill not only for entrepreneurs but also for individuals working for companies that embrace innovation.

I recently had the chance to visit Zappos headquarters in Las Vegas. Another successful example of a We Culture where employee's ideas matter and self-organization prevails over the chain of command. Work is organized by autonomous teams, everyone focuses on their job, not their position. Everyone is important, from front-line employees to clients and suppliers. Does it look like something impossible or unthinkable? Maybe, but it is here already. It is not easy but can be done, and it generates great bottom-line results at the same time. The way that Tony Hsieh, Zappos CEO put it, chase the dream, the money will eventually follow.

So, is it true that these teams have no managers? Well, they have less layers between employees and customers, as they are organized in teams. There is no clear hierarchy. Teams have leaders, they are called lead links (Zappos uses this title, other companies use different names), as they still need people to facilitate work and hold others accountable. In traditional structures only managers have the authority to make decisions. In their organization, everyone has the authority to make changes to the company and decisions in their work. That is what we call self-organizing or agile teams.

Characteristics of agile teams

• Small teams: less than 12 people including a lead, the magic number is usually six. Jeff Bezos uses the “two-pizza team” philosophy, meaning the than should be small enough to be adequately fed by two pizzas, that is six to ten.

• Transparent: communication is fast and mostly face-to-face or online to ensure no delays or miscommunication.

• Autonomous: people are encouraged to choose how they will work. They are encouraged to experiment and create new ways of adding value to customers. The fact is that the people actually doing knowledge work usually have the best idea of how to do that knowledge work, given they have the proper experience. So, why not let them do it their way? This way you get faster and more creative decisions that improve customer satisfaction because they have taken closer to the gemba, where the customer is or where the action takes place.

• Quick decision making: A self-organizing team sets the limit of how much work they are expected to complete within a certain time frame. This means the team sets the expectations about what they have to complete. Usually, they even have their own budget

• Cross-functional: They consist of a mix of people who have different knowledge so that they have access to all the skills necessary to effectively deliver value to customers.

• Disciplined: even though they make lots of decisions about how they work, they follow through the agreements that were made at the beginning of the team formation, so that’s why is important to set clear goals, values and rules, and follow-up or assist closely when someone is not able to meet them. The team members must be able to work in a self-organized environment. Almost everyone can do it, but people are not usually used to it, so at first, it may be hard. Zappos recommends “Hire slowly for culture and fire quickly for culture.” They have two interviews, one for technical fit and another for culture fit, both need to be a YES. And after the first week, they offer $1000 to the employees that want to leave the company, that way they make sure they only keep the ones that are engaged.

• Value Respect: achieving a diverse workforce and obtaining the potential benefits of diversity is not just about recruiting and hiring a diverse team. To fully experience the benefits of diversity, leaders need to create a workplace wherein members of that diverse team feel appreciated and encouraged to share their perspectives

• Clear company culture: The team members share a company culture or common behaviors and habits that they value and respect, that helps them make decisions and achieve results aligned with the company purpose. I call this "The We Culture". In every company is different, but there are main habits that are practiced by everyone (any employee, no matter the hierarchy) at any time: connect to each other, ask questions (don't simply accept the status quo), respect and empower.

Bottom-line benefits

Benefits if this agile cultural change are huge. Employee engagement increases with team agility. They become more aware of safety issues, they are more engaged with the tasks offering more ideas for improvement and bringing up problems faster, they stay longer in the company and they become more customer-focused.

How to choose where to start?

The cultural transformation can start in a pilot group, or with all teams at once. I firmly recommend starting with a pilot agile team. Providing general training to everyone else and follow-up with monthly audits can complement a specific training to the pilot section. Once the first team has started and there are some learnings on what worked and what did not work, then you can continue with the next teams, in waves.

Leaders must consider multiple criteria, including strategic importance, budget limitations, availability of people, return on investment, cost of delays, risk levels, and interdependencies among teams to choose where to start. Some companies choose based on pain points felt by customers, and others start with the more matures teams to make sure the pilot is a success.

Lu Paulise

luciana@biztorming.com

Thank You!

Thank you for joining us at the O&G Business Seminar and for being part of our Pre-OTC Cocktail.
It was an honor to have you in attendance. We hope that you found the event to be both interesting and informative. 
We enjoyed having you and other 300 attendees building relationships and creating business opportunities. 

We look forward to seeing you next year.

Warm regards
ATCC

 

GOLD SPONSORS

 

SILVER SPONSORS

  

BRONZE SPONSORS

       

Tips For Making A Start In Argentina As A Foreigner

In the 20 years I lived in Argentina, I met many foreigners visiting the country who said they would love to live there if they could only find a way to make a living. It was easy to understand how they could feel that way. Despite its many ups and downs, it’s a beautiful country, Buenos Aires is a jewel of a city, the climate is great, and the people are friendly.

So, how can a foreigner make a go of it in Argentina? Here are five ways:

• Expatriate: Get the company you’re working for to send you there. Of course, in most cases this will be for only a few years before you’re rotated to your next assignment.
• Teleworking: Have a job that allows you to work remotely for employers/clients outside the country. Lots of people who work in fields like IT, design and publishing have taken this route and they can get the best of both worlds: an income in foreign currency and the pleasure of a great place to live.
• Investor: go there and start your business make a investment.
• Local Employee: Go there and find a job.
• Entrepreneur: Start your own business venture.

For the adventurous the last two options certainly offer an adventure, and many who have taken the challenge have succeeded. Despite having much in similar with the US or other Western countries, Argentina is very different in ways that might not be readily apparent. For those who have considered taking the leap, here are a few things to keep in mind:

1. Relationships. Family and personal relationships are very important. Unlike in the US, where people move constantly and the rules tend to be clearer, feeling you can trust the people you are working or doing business with in Argentina is critical. You can build that trust, but it takes time.

2. Learn Spanish, and don’t be afraid to use it. Sure, we all know the importance of learning the local language. The hard part is being willing to put yourself in situations where you need to use it and learn to take your errors in stride. In my early days as a journalist, I once went on a TV program to speak about the then government’s latest “measures” to fix the economy. It was only afterwards I learned that instead of saying medidas (measures), I kept saying medias (socks).

3. Network, network, network. Ok, so you don’t have relationships that go back decades and your Spanish needs some work. What to do? Beyond doing the kind of networking within your area of interest you would do in the US when you’re looking for a job or doing business, network and socialize as much as you can in other circles too. As suggested in item 1, relationships run wide and deep in Argentina so the person you are talking to might not be in your line of work but he or she may have a primo (cousin) or childhood friend who is and would be willing to make an introduction.

4. It takes time to understand local rules and regulations, and keep you up to speed.

5. Assess your tolerance. Argentina’s economy has had its ups and downs. You need to be the kind of person who can adapt to change and figure out how to work around obstacles you may encounter.

6. Figure out your competitive advantage: Beating out the local talent for a job or in a business field can be tough, unless you have some competitive advantage. In my case, the combination of my business experience and ability to write well in English opened opportunities for me, first as a freelance journalist and then as a newspaper editor. Maybe your competitive advantage is experience with a business concept that hasn’t been tried yet in Argentina or an extensive network of contacts or business associates back home that can be leveraged somehow. Whatever it is, you’ll need it.

7. Have realistic expectations: Even if you have an outstanding resume, you might have to settle for less than your dream job, until you get established and prove yourself. If you’re starting your own venture, you might not want to go all in right away but give yourself some time to get the lay of the land. When folks down there start to see that you’re planning to stay for a while – and not just out to make a quick buck – opportunities will open.

Of course, staying long enough to pursue your ambition will require you to get residency in the country, but an immigration lawyer can tell you more about your options for that.

Starting anew as a foreigner in Argentina can be challenging, but if you’re willing to invest the time and effort it can be done. It is, after all, a country like the US that has become home to millions of immigrants over the years.

Dan Krishock is a former editor of the Buenos Aires Herald. He has worked for Tenaris and Weatherford and now works in Houston for a leading company in the energy sector.

In this article we share how we implemented 5S in an international bottling company, in all sectors, and with suppliers, to reduce costs, increase engagement and improve safety.

An international bottling company defined the 5S methodology as a fundamental part of its growth and sustainable development. We worked with them to implement 5S on the bottling lines, the manufacturing sector, administration, the dining room, the first aid room, and even the entry and security areas. Even suppliers were trained. Why did they choose this tool? How did they benefit from it?

5S is a Japanese tool that aims to help companies improve organization and housekeeping to increase productivity. With 5 steps -- sort, store, shine, standardize and sustain-- 5S aligns the objectives of the different sectors of an organization by applying new habits and behaviors.

With a clear definition of responsibilities and processes, presented visually, it is possible to improve communication between sectors and eliminate "gray areas" where no one takes full accountability. It seems like a simple tool since it does not use statistics like Six Sigma, nor does it require prior knowledge. However, it is difficult to implement because it requires a cultural change and working in a different way. It involves a set of activities designed to change the habits and behavior of people to create good working and environmental conditions, and to improve quality, productivity, commitment and safety.

That's why the first thing we did in our project was implement the first S, sort: divide the entire organization into sectors, both physically and in terms of personnel, and choose a pilot sector with which to start training.

The first S, Sort

As part of the first S, Sort, we defined which tools or documents were needed, and which were not. We prepared an inventory. Many tools and objects did not belong in the sector, or there were too many of them. While others were necessary but not in good condition, or not in the location or quantity needed. The operators were the first to discover these details by observing their own place of work. One of the characteristics of 5S is to work with the ideas of the employees. The workers themselves know what they need and what they don't need, though they do not know how to express it. They do not know who to tell or they are afraid to provide feedback.

The second S, Store

Although we eliminated many things, it was difficult to maintain the workplace organized. New employees or suppliers were the main cause of chaos and disorder, and it was difficult to avoid. So, we identified what we needed, and defined a specific “home” for each item, so that everyone could find it and return it to its home after using it.

The third S, Shine

Storing objects is essential to keeping them "good as new", and that is the beginning of the third S: Shine. A lot of money is spent maintaining unneeded stock or replacing and repairing tools, when just taking care of them is much more efficient. As part of the third S, cleaning schedules for each sector and its instruments were defined. From the roof and the windows, to the floor, machinery, tools and drawers. 5S in industries seeks not to clean, but to avoid letting things get dirty in the first place.

The fourth S, Standardize

We needed to increase the visibility of the norms to make them "unforgettable". The bottling company began to apply visual controls everywhere and defining procedures or adding 5S standards to existing procedures. We emphasized making the procedures “baby proof” by including pictures, sketches or examples, and being very specific. The graphics not only had to say what must be done, but how, when, and by whom.

The fifth S, Sustain

The fifth S is where many companies abandon 5S. 5S in industries is not simply a couple of months of training It is a new habit. 5S is not implemented until employees are proud of their workplace. When they reach this level, they have incorporated 5S in their way of working and living. They even apply the knowledge at home and in their personal lives. Clear indications of a 5S level are when employees are requesting an internal audit, or sending pictures showing their accomplishments.

Luciana Paulise
Biztorming Training & Consulting
luciana@biztorming.com
@lupaulise

Rod Pump Assisted With Compression

While most operators are familiar with using a rod pump for artificial lift, many overlook the opportunity to reduce the bottom hole flowing pressure and increase production by assisting with a rotary screw compressor. Using this method of production, operators also see a decrease in gas locking in downhole pumps, which increases “fill-up” and pump operating efficiency.

How it works
Depending on the pad set up, operators can connect a rotary screw compressor to either the casing line of a single well, or the separator on a pad of wells. The compressor becomes a gathering system on all casing head gas, relieving and lowering the pressure at surface, and in turn increasing the differential pressure between the casing line and the bottom hole pressure. This allows reservoir fluids to flow more freely into the wellbore, resulting in an increase in both oil and gas.

Additionally, if the downhole pump is experiencing gas locking, the well is operating in inefficient conditions. Due to internal clearance and spacing, downhole pumps often leave un-swept areas. This creates space for gas to become trapped and expand on the upstroke. Rather than having fluid entering the pump, a cycle begins of gas expanding, preventing fluid to enter, and compressing back into the original space. Tying in a rotary screw compressor to the casing line help to alleviate this issue, allowing for increased pump fillage, as stated above.

Permian case study
A Flogistix customer had an eight well pad producing from the Sprayberry and decided to use rotary screw compression to gather all casing head gas. This lowered line pressure from 35psi to 17psi, resulting in an increase from 55 to 105 barrels of oil per day and gas increase of 370 to 659mcfd.

Take away
Always evaluate older or low production wells on rod pump to determine if they are a candidate for a compression assist. An easy addition of a rotary screw compressor could easily increase your recovery.  For an even more in-depth look at this application, please see SPE paper 38211, which provides details of oil and gas recovery from the El Tordillo field in the Gulf of St. George Basin, Argentina. Please visit www.flogistix.com for further case studies and information.

Outlook for Houston Industrial Real Estate Market remains positive

Metro Houston created 72,600 jobs, a 2.4% increase, in the 12 months ending February 2019, compared to 56,400 jobs created in the 12 months ending February 2018, a 1.9% increase, according to the Texas Workforce Commission. The three sectors adding the most jobs over the past 12 months were durable goods manufacturing (15,200); professional, scientific and technical services (12,800); and health care (10,300). In energy, exploration and production lost 300 jobs while oil field services added 3,600. Energy prices recovered over the first quarter from year-end 2018. 2019 began with West Texas Intermediate trading at $46.31 a barrel, trending up through Q1 2019, and closing on the last day of March at $60.19 per barrel, a 30.0% increase.  While oil prices recovered, Baker Hughes reports that the U.S. rig count peaked at 1,083 the last week of December and trended down in the first quarter of 2019. The rig count typically responds to fluctuations in monthly oil prices with a three-month delay. At the end of the first week in April, the rig count was at 1,025. Softness in the rig count suggests less work for oil field service firms now and slower U.S. production growth in the future. The unemployment rate in Houston was 4.1% in February, compared to the rates in both Texas and the United States at 3.8%.

Record-breaking development pipeline

Houston’s overall industrial vacancy rate ended Q1 2019 at 5.9%, up 30 basis points quarter-over-quarter, and an increase of 80 basis points year-over-year. 

Net absorption was 1.4 million sq. ft. for the first quarter of 2019, down 44.2% over the prior year’s 3.1 million sq. ft. New construction delivered during the first quarter stood at 3.4 million sq. ft.—up from the fourth quarter’s 2.7 million sq. ft. There is currently a record-breaking 16 million sq. ft. under construction, with the lion’s share in the Southeast (5.8 million sq. ft.) and North (5.4 million sq. ft.). Triple net average monthly asking rents remained at $0.60 per sq. ft. quarter-over-quarter, and up 7.1% from $0.56 year-over-year.

Houston Equity Partners
Corporate Offices
2313 West Sam Houston Parkway N
Houston, TX 77043

Inquiries: 281-899-0579
Investor Relations: 919-593-7737

Webpage: www.hepinvestments.com
Email: HEP@HEPinvestments.com

With the goal of strengthening regional development and accompany growth in the Oil & Gas sector, final touches are being put on opening a new cargo service from Houston to Neuquen, Argentina (NQN), via Atlantic Airways.

Administrative Assistant / Part-time

ATCC

• Role and reporting

We are looking for a new Administrative Assistant to support our executive team.

 

This individual will manage mostly business support activities for the team such as administrative support, selected membership services, marketing, and public relation tasks. To do this role properly, the candidate selected should have sound relationship management skills, be fast at solving problems, very good understanding of the Microsoft Office suite, and previous experience as administrative assistant/coordinator, preferably of a Chamber of Commerce, non-profit organization, or an international trade / investment organization.

Key duties

Administration

• Provide administrative support to the President of the Chamber and its Executive Committee.
• Coordinate administrative duties with all chapters of the ATCC in Texas and Argentina.

Membership Services

• Provide administrative support, coordination, marketing and logistics services to plan, organize and oversee services and events for members and non-members (e.g.: missions, training, cocktails, webinars, newsletters, news, etc.).
• Retain and grow the membership by attending selected networking events and promoting the ATCC mission and its commercial programs.
• Maintain the website, social media account, and the database of members and contacts.
• Respond to members and non-members inquires.
• Manage membership renewals and new registration.
• Generate and curate media content such as articles, summary of events, etc., related to the Chamber’s mission.

 

Public Relations

• Attend selected events organized by other chambers of commerce, non-profit, and governmental organizations.

Marketing Activities and event coordination

• Find innovative ways to increase sponsorships.
• Identify potential donors / sponsors at networking events

 

Background

• Relevant administrative support and coordination experience.
• Very good understanding of the Microsoft Office suite.

• Ability to organize a daily workload by priorities.

• Able to meet deadlines in a fast-paced environment.

• Professional level verbal and written communications skills

• Bilingual in English and Spanish

• Ability to travel within Texas

• Preferable: international trade and/or investment knowledge.

• Preferable: experience in chamber or commerce or non-profit organizations.

• Desired: knowledge in e-marketing tools (e.g.: Mailchimp, Google Ads), social media administration (e.g.: LinkedIn), conference call software (e.g.: WebEx), chamber of commerce software (e.g.: Wild Apricot).

 

The position is planned for a part time dedication of 20 hours per week.

The candidate will be based in Houston. Initially, he/she would work from home or from our offices at The Galleria.

Please send you resume and remuneration aspirations before May 15, 2019, to:

Eduardo R. Nunez

President-Elect

Argentina Texas Chamber of Commerce

Email: info@argentinatexas.org (send your resume to this address)

Email: eduardonunez@3rdwavedigital.com (cc your resume to this address)