the IntERnEt of EnERGY well PREPaRED FoR Ge oil & Gas, houston, texas, Usa

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1 Ge oil & Gas, houston, texas, Usa well PREPaRED FoR the IntERnEt of EnERGY General Electric Company, based in Fairfield, Connecticut usually referred to as GE is one of the world s largest conglomerates boasting sales of about 147 billion dollars and approximately 300,000 employees (2011). the corporation resulting from the merger in 1892 of General Electric Company, founded in 1890 in Schenectady, new York, and the thomson-houston Electric Company, established in 1883 in lynn, massachusetts, is a world leader in advanced technology equipment and services for all segments of the oil and gas industry, from exploration & production to downstream. For decades, HoERBIGER has supplied valves, rings and packings to the turbomachinery division of GE s oil & Gas business. this is a partnership that has proven itself even in innovative products like the CnG in a Box tm system. TEXT: Ludwig Schönefeld PHOTOS: Ralf Baumgarten

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3 Since its founding, GE has been engaged in the area of turbomachinery. With 35 production facilities and branches in 120 countries, GE s Oil & Gas business is a major player in the worldwide gas compressor market. The decisive direction for this global presence was set in the 1990s. In 1994, GE acquired the Italian compressor manufacturer Nuovo Pignone S.P.A. This company, rich in tradition, was originally an iron foundry headquartered in Florence, Italy, and for generations has been one of Europe s leading manufacturers of process gas reciprocating compressors. With this much-noticed acquisition, GE gained a substantial foothold in the European process gas compressor market and began what would later be known as GE Oil & Gas. GE s High-Speed Reciprocating (HSR) Compressor product has been part of the GE Oil & Gas portfolio since the acquisition of the Gemini compressor product line in The Gemini name had been used since 1978 by Gas Compressors Inc. of Corpus Christi, Texas, particularly for the MOC compressor design; this unit combines a single-acting gas compressor cylinder with a separable compressor frame. An additional root of GE s current line of high-speed natural gas compressors is the HSR compressor developed in 1950 by Chicago Pneumatic. Along with know-how and the Gemini brand of Gas Compressors Inc., the expertise of Chicago Pneumatic was absorbed by GE as a result of several corporate transactions in In 2000, GE pooled all compressor activities under a single new worldwide brand, GE Oil & Gas. GE High-Speed Reciprocating Compressors The high-speed Gemini compressors have been marketed globally as GE High-Speed Reciprocating (HSR) Compressors since The product portfolio includes high-speed compressors with an output of up to 7,200 horsepower. They are used not only in gas lift, gas gathering, storage and transport both onshore and offshore, but also in natural gas vehicle filling station equipment. Although GE s large-scale process gas reciprocating compressors continue to be built in Florence, in the USA the GE facility in Oshkosh, Wisconsin, became the primary production facility for HSR compressors in 2003,

4 whenthe production operation of high-speed reciprocating compressors was relocated from the former Gas Compressors site in Corpus Christi to Oshkosh. In order to put production closer to the client, another relocation took place at the start of As of January 2012, GE s HSR compressors are manufactured at the GE Jacintoport facility near Houston, Texas, USA. Currently (figures as of 2011) GE Oil & Gas has an installed technology base of 19,000 highspeed reciprocating compressors. Roughly 33,000 GE employees, slightly more than 10 percent of the entire GE workforce, are employed in the Oil & Gas division. In 2011, they achieved sales of 13.7 billion dollars. GE HSR compressors ready for delivery. 056 Part 057 At the start of 2012, GE Oil & Gas completed the move of its HSR compressor production facility to from Oshkosh, Wisconsin, to the Jacintoport facility near Houston, Texas, USA. The site is approximately 47 acres, corresponding to about 4,000 square meters. Presently the top product is the CNG H304 HSR compressor for the new CNG in A Box TM system. At GE Oil & Gas, Omar Jimenez is the HSR Compressor Product Leader. Jimenez explained, These compressors, using a pressure of approximately 250 bar (3,600 psi), can deliver CNG at 7.66 gallons of gasoline per minute. That is about 29 liters per minute. ecomagination GE Oil & Gas has given a name to its corporate initiative to provide environmentally sustainable products: ecomagination. GE considers itself a driving force in the conversion of motor vehicles from gasoline and diesel to natural gas. The company also places great value on limiting the amount of gas released during extraction, transport and refueling. Filling stations equipped with the CNG in A Box TM system are frequently located in the direct vicinity of residential areas, Jimenez stated. Thus, leakage or diffuse and uncontrolled escaping gas would be a serious problem. The developers of H304 compressors were looking for a partner similar to GE, a company with global resources and markets, a leader in research and development which could guarantee excellent environmental standards. A partner like HOERBIGER. Thanks to BCD technology developed by HOERBIGER, fugitive emissions of our high-speed compressors are significantly lower than with conventional technologies, explained Julie Lanear, GE s Manufacturing Cell Leader at the Jacintoport facility. The newly-developed packings, used for sealing the H304 compressor piston rods are largely gas-tight.

5 For about a century we have basically been involved in producing, storing and transporting gas. This was a manageable business. Ujjwal Kumar, General Manager North America Operations, has been responsible for GE Oil & Gas Turbomachinery since Continuous Change Among the strengths of GE is its high flexibility, allowing rapid response to new market opportunities. Since 2011, Ujjwal Kumar, General Manager HSR Compressors & Unconventional Solutions, has been responsible for the growth of GE s HSR product line globally. Benefiting from management premier leadership development program at GE, the internationally experienced manager had the opportunity to work in several business areas of the global corporation prior to assuming his present position at GE Oil & Gas. His family roots are in India. Global orientation is a component of his professional and personal identity. Ujjwal Kumar s goal is to use new and unconventional business models to transform GE Oil & Gas Turbomachinery into a global leader in the manufacture of high speed reciprocating compressors and unconventional solutions. He is taking advantage of the far-reaching changes in the market environment. The oil and gas industry has fundamentally transformed, Kumar explained. The world has changed. Now the oil and gas industry has the technology to economically utilize unconventional gas reserves in sedimentary rock. North America is not the only country to become a global energy-producing leader again as a result of shale gas trapped in shale formations. Shale gas deposits are significantly more prevalent around the world than previously utilized conventional gas deposits. Our future markets are completely fragmented. That s going to change the world. Opportunities have opened up in less traditional areas as countries in Latin America, North Africa and Asia become the new players in the oil and gas business, Kumar explained. Experts assume that world natural gas reserves in shale gas deposits will significantly exceed the quantities of gas produced to-date by conventional means. For global energy companies like GE, this means a completely new business outlook. The Internet of Energy What we re seeing now is the rise of a new Internet the Internet of Energy. What does this mean for us? Our market will be completely transformed. Gas will be consumed where it is produced. Kumar is confident that nations that have been transformed from gas consumers to gas producers as a result of their shale gas deposits will do everything to profit from their

6 053 Our future markets are completely fragmented. That s going to change the world. The large-scale gas producers are no longer cornering the market Ujjwal Kumar Houston CNG Gas Truck Erik Barton, GE Oil & Gas HSR Compressors Global Sales Leader, with his brand-new company vehicle, a Ford F-250 Super Duty truck. The vehicle is part of the GE Capital fleet and is operated with Compressed Natural Gas. 052 accessible natural resources. This situation will give rise to completely new markets for companies like GE. To meet the demand, we will not need completely new technical solutions, but will at least require integrated products that will enable us to serve these markets appropriately. Kumar explained that this access to shale gas has stirred up the oil and gas industry. The oil and gas business is a mature market. Current high standards must be maintained. No one wants to make a mistake using new technological solutions. On the other hand, winners in the Golden Age of Gas will include only those companies that can respond rapidly and be flexible as the market develops. Therefore it depends on the speed with which we develop new solutions, Kumar said. Essentially this means that we will reinvent our business models, redefine our role and develop new combinations of proven tools. Ujjwal Kumar General Manager North America Operations, GE OIL & GAS turbomachinery Ujjwal Kumar holds a bachelor s degree from the Indian Institute of Technology in Bombay and an MBA from the University of Michigan, Ann Arbor, Michigan, USA. In addition, he acquired a Master s Degree in Mechanical Engineering from the University of Maryland in College Park, Maryland, USA. After gaining initial professional experience in strategy development at General Motors in Detroit, Kumar joined GE s Experienced Commercial Leadership Program (ECLP) in Important stages of his career at GE included Business Development in India, and Global Product Development at GE Oil & Gas in Florence, Italy. As General Manager of HSR Compressors and Unconventional Solutions at GE Oil & Gas, his key responsibilities presently include the global growth of GE s HSR compressor portfolio.

7 Valves, rings and packings are the primary wear parts of reciprocating compressors. HOERBIGER has the expertise to fill these needs. Consequently we chose HOERBIGER as a service partner. Omar A. Jimenez Omar A. Jimenez Product Leader GE Oil & Gas High- Speed Reciprocating Processors Omar A. Jimenez is the HSR Compressor Product Leader for GE Oil & Gas and is responsible for the global product strategy for the HSR product line from market launch to service in the aftermarket. After attending the University of Houston, Texas, USA, from which he graduated with a Bachelor of Science in Mechanical Engineering and a master s in Business Administration, his path first took him to CONMEC, Inc. This company, specializing in Turbomachinery re-engineering, was acquired in 2001 by GE Oil & Gas. Jimenez worked in various commercial positions at GE until In 2009, he became Vice President Oil & Gas at Synchrony, Inc., a manufacturer specializing in magnetic bearings and high-power electronics. In 2011, Jimenez returned to GE Oil & Gas, where he assumed his current position. George Villareal (front) and Mike Davies during assembly work on the HSR compressor. PARTNERSHIP The relationship between GE and HOERBIGER has withstood the test of time. When it comes to key high speed reciprocating compressor components, HOERBIGER is a key supplier for GE compressors worldwide. In addition to the new high-speed compressors for the CNG in A Box TM system DS-, ES- and FS-series reciprocating compressors used in various applications in the downstream, midstream and upstream markets are assembled in Jacintoport. These are also equipped with HOERBIGER components. According to Lanear: The majority of compressors produced by GE are equipped with valves, rings and packings made by HOERBIGER. Global Service Contract In 2010, GE Oil & Gas and HOERBIGER entered into a contract that allows HOERBIGER to provide services worldwide for GE s HSR compressors. This agreement includes both regular maintenance of the HSR compressors and upgrades on the valves, rings and packings of older compressors with modern components from the HOERBIGER portfolio. At the same time, the contract qualifies HOERBIGER as a global replacement part distributor for the HSR product line. Valves, rings and packings are the primary wear parts of reciprocating compressors. HOERBIGER has the expertise to fill these needs, Jimenez explained. Consequently we chose HOERBIGER as a service partner.

8 Lean Modular Plug & Play Everything will get leaner and more modular, Kumar continued. In order to monetize these resources in areas with little to no existing infrastructure, we don t need high-volume reciprocating compressors, but rather small, portable, standardized, simply-built, plug & play, environmentally sustainable solutions. One example of this is the adoption of compressed natural gas, or CNG, as a vehicle fuel replacing conventional liquid fuels such as gasoline and diesel. GE anticipates that due to the global availability of shale gas, classic fuels such as gasoline and diesel will be increasingly displaced by CNG and liquefied natural gas (LNG). In this context, Kumar and his team developed new products within just a few months that GE intends to use to become a worldwide leading equipment supplier to natural gas filling stations: Micro LNG, the CNG in A Box TM system and LNG in A Box TM system. The goal is to equip as many conventional filling stations as possible in the shortest amount of time with compact units for refueling natural gas powered vehicles. CNG in A Box TM system The CNG in A Box TM system is currently the most intensively pursued product concept. The core element is a compact unit consisting of a GE HSR compressor for delivering gas, pumps and shut-off valves as a plug & play application installed in a 20-foot ISO container. Additional components required for a CNG retrofit package at a conventional filling station include natural gas storage tanks and dispensers supplied by Wayne, A GE Energy business. GE can offer the entire corporate expertise to simplify filling station retrofitting as much as possible for station operators. GE Oil & Gas supplies the HSR compressor, while others GE businesses provide the drive units, metering and control engineering and electrical installation. If needed, GE Capital can offer suitable financing options. Flexible Standard Applications Kumar views the capability to develop reliable HSR compressors for the CNG in A Box TM system as one of the key competencies of GE Oil & Gas for the new business models. For us, it s not about inventing entirely new rules for the game, Kumar stated. We were looking to develop a solution that is tailored exactly to our new business model, a standard application with high flexibility and since we re not doing this in a vacuum it has to be safe and environmentally sustainable. Based on existing reciprocating compressors, a modified high-speed compressor was developed for the CNG in A Box TM system. Its essential components have been factory-tested and proven by years of use. For the anticipated series production, they have been standardized more than previously. By February 2012 the new CNG in A Box TM was sufficiently mature to initiate the market launch. We have already delivered more than 25 CNG In A Box TM units. We install a new CNG In A Box TM unit at a filling station each week directly increasing the natural gas fueling infrastructure in the United States. The customer receives a turnkey system from GE Oil & Gas. Standard, reliable performance, that is our promise to the customer, Kumar declared. GE a Model of Success The ability to reinvent itself at any time that has been and will continue to be the model of success for GE, explained Kumar. Initially, you stand alone building a new team. We ap- proached the task with the knowledge that the new market would require a new mindset, but also using a proven set of tools, so that we could create something in compliance with current and anticipated future EPA and OSHA regulations. Kumar deliberately included new age thinkers and conservatives when forming his team. At the start, this creates some tension, but is decisive in developing a team architecture that will function in the long run. It s an approach we had to use. When it comes to tapping new markets, a company like GE dare not risk missteps. Consequently GE uses a 360-degree approach, bringing together the best engineers, field people and sales force. The CNG in A Box TM system is the baby of the entire team, said Kumar. And we are all proud parents. Left: Mike Davies during the heating of the cylinders to attach the liner to guide the piston. Right: Karl Daigle at the compressor test bench. The key components of the high-speed reciprocating compressor are factory-tested