Oil Gig

For years, the infrared cameras made by Oregon-based manufacturer FLIR Systems have been, in many cases, tools of war.

The Wilsonville company's night-vision equipment has been deployed in hot spots from the U.S.-Mexico border to conflicts in Iraq and Afghanistan, where soldiers, guards and contractors have used them to see at midnight as if it were noon.

But now, in the oil-soaked Gulf of Mexico, FLIR's 1½-pound, 10-inch cameras have been charged with a different task: seeing oil on and in the water where human eyes can't.

In April, after three days of testing at the government-run Ohmsett wave tank in New Jersey (testing that, coincidentally, came about a week before the Deepwater Horizon exploded April 20), FLIR workers realized their cameras could see the infrared waves emitted by water and oil and quickly tell them apart.

The testing, coordinated by FLIR distributor and oil fields company Deep Down Inc., demonstrated that in almost any conditions—high winds, turbulent water, darkness of night—the cameras could show cleanup crews and rig operators where oil was coming from, where it was going and how much was actually being removed.

That data allowed the company, which has annual revenues of $1.1 billion—about 25 percent from military applications—to open an entire new market in a part of the country bathed in tragedy.

"It's a fundamental, physical issue," says Andy Teich, president of commercial systems at the 1,900-employee company. "It turns out the technology works quite well. We've been actively promoting this technology from an awareness standpoint" for multiple uses in the Gulf. He says those uses include giving boaters the ability to see at night.

While the flood of Gulf business appears to be lucrative for FLIR, Teich says that in the big picture, money from camera buyers in the Gulf wouldn't make much dent in the company's bottom line. But the interest from the private sector—including those working in the Gulf's soiled waters— has put some cameras on backlog and have kept store shelves empty while the company rushes to fill dealers' orders.

A rough calculation of what the company says it has sold so far puts FLIR's revenues from the oil spill at upward of $100,000.

"I know that these orders are being used in those specific applications," Teich says of the cameras' use in the Gulf. "The dealers tell us. We have been making accommodations out there."

Steve Jackson, a FLIR dealer at Deep Down Marine Technologies, an oil fields company that makes ballast controls, tank gauges and other monitoring systems, is less modest. He called the spill itself a "boondoggle," but says that in his weekly conversations with FLIR sales staff, they tell him the oil spill has created furious demand for the cameras.

"They've been getting calls all over the place, and they've been putting cameras everywhere," Jackson says.

He says the company recently filled an order for 20 or 30 of FLIR's handheld "First Mate" cameras.

And Teich says several dealers have approached the company requesting FLIR "M-Series" boat-mounted cameras for use in the Gulf. A quick glance at a few different online retailers (yes, you too can own one) indicates the price tag for a First Mate runs anywhere from $2,500 to $4,000, while the M-Series can sell for as much as $17,000. Those sales add up.

But for FLIR, the business possibilities after the spill may be even greater. Under the current system, oil rig operators use people—either in planes or up close—to monitor whether oil has leaked into the water. Depending on a range of factors—including a rig's proximity to a shoreline or other rigs, the direction of the wind, and so on—these human observations and subsequent reports filed with the U.S. Minerals Management Service happen as often as once a day or as rarely as once every couple of weeks.

In the wake of the Deepwater Horizon catastrophe, Jackson believes the battered and bruised MMS will be ready and eager to replace human observation with a 24-hour infrared watchdog as soon as it's practical.

Of course, this decision isn't up to MMS alone.

The rig operators—oil companies, mainly—must request an exemption to use cameras instead of people, and that hasn't happened yet.

Plus, for the system really to work, it needs to be automated so it no longer relies on potentially flawed human observation. And Jackson says the software that would allow it to report back without oversight is still under construction.

But once the system is complete, Jackson is confident that oil companies will seek waivers to use the new technology.

As he says, it's a way for rig operators to save money on man hours, and for FLIR and Deep Down to do more business in the process.

"They need the product," Jackson says. "There's no doubt the waivers will come. I think we have a better mousetrap."

WWeek 2015