MERLIN ERD: Deep Knowledge Underpins Merlin’s Sustainability
As wells become increasingly challenging and complex, the technical knowledge required to deliver economically is lacking around the world. Merlin, a leading complex well consultancy, continues to update and upgrade to ensure it is providing value for clients and the wider industry. Energy Focus discusses growth with Technical Director, Stewart McGregor.
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There is a quiet confidence about Merlin that reflects both its heritage and its trajectory. The Scottish-headquartered complex well engineering specialist has never been one to chase scale for its own sake, instead building a reputation in the margins of the industry where others hesitate to tread. These are the wells that have been written off as too complex, too risky, or simply not economical following the usual approach. Merlin has made a business out of going back to those same assets and proving that, with the right expertise, they can help operators deliver value.
It is a position that feels increasingly relevant. As the industry continues to push the boundaries of what is technically possible, extended reach drilling and complex well design have become essential tools in maximising recovery from brown and green fields. Modern drilling systems are now capable of addressing downhole challenges once considered insurmountable, enabling operators to access reserves that were previously beyond reach. Merlin’s technical knowledge has helped to develop this space, offering not just the engineering capability to unlock wells, but the intelligence transfer required to ensure that success can be replicated.
Energy Focus spoke with Merlin in 2023, and since then the emphasis has remained firmly on depth rather than breadth. Technical Director Stewart McGregor explains that growth has been deliberate, measured, and anchored in capability development rather than expansion for its own sake.
“We are not on an acquisition drive or trying to grow for the sake of growth. We are trying to do more with what we have and build products that make sense by supporting our core business,” he says. “For example, we have spent a lot of time improving, upgrading and extending the functionality of our torque, drag and hydraulics software. We’ve have spent time developing a more robust geomechanics service and integrating that. We are now building a real-time drilling surveillance service and we have built a partnership with an AI startup that we are very pleased with. For a knowledge-based engineering consultancy, it is important that we are at the frontend of technology development so that we can consult sustainably.”
That focus on technical evolution is not happening in isolation. Across the sector, there is a growing recognition that the complexity of modern wells demands integrated approaches, both in the information and commercial domains. Merlin’s investment in software, real-time surveillance, and AI partnerships reflects this shift, positioning the company as both a technical advisor and a technology enabler.
Momentum has followed, albeit not without its challenges. The volatility that has characterised the energy sector in recent years has not bypassed Merlin, but it has reinforced the company’s resilience.
“We have been very busy, and we had a very strong 2024. But things have not been unmitigated success – it has been a rollercoaster. In 2025, we had a balanced year, and we hope to build further on our strengths in 2026,” says McGregor.
Interview with Stewart McGregor, Technical Director
GROWTH DRIVERS
McGregor is candid about the duality of the current market. On one hand, the technical challenges are increasing in a way that plays directly to Merlin’s strengths. On the other, the commercial environment is tightening.
“Wells are getting more complicated and that is good for us. The general level of competency across the industry has diminished on the operator and service side, and that is also good for us,” he explains.
As experienced engineers retire and fewer young professionals enter the sector, a skills gap is emerging that is beginning to affect operational performance. At the same time, operators are restructuring how work is delivered, shifting greater responsibility onto service companies and, by extension, their partners.
“Operators are pushing more work towards service companies, and that helps us. But there is a massive focus on capital discipline, and that makes it harder to sell services that clients perceive as being part of their core business. Service companies are extremely price-sensitive and their requirements for our support are also increasing. What we started out doing 15 years ago is not what our people on the rig do now – if you can even get them to a rig,” he stresses.
This evolving landscape is forcing differentiation. Merlin’s response has been to deepen its offering, particularly in areas such as real-time drilling surveillance, where the ability to provide immediate, data-driven insights can directly impact well performance and cost control.
“It feels like the industry needs our services more than ever, but the cost pressures and general difficulties are making things tough,” McGregor admits. “Service companies are trying to do more, and they are nibbling into what we would have done previously. That means we must do more to differentiate ourselves. There is real demand for real-time operations support, which was the catalyst for us to build our own. We listened to feedback from the main players on where the gaps are and have built something we believe is best in class.”
The interplay between technology and human expertise is another defining theme, particularly as the industry grapples with workforce challenges and the emergence of new digital tools.
“Subject matter experts are disappearing into retirement and there are challenges getting young people into the industry because of the modern perception. That means your mid-stream engineers must be able to do more with less, and that puts more pressure on them. Combine that with AI coming through, and you have a complicated, ever-shifting picture. Being a small, highly technical, knowledge-based consultancy business, the way to navigate these things is not always that clear,” details McGregor.
FUTURE LEADERSHIP
Against this backdrop, Merlin is preparing for a significant leadership transition. The planned retirement of Managing Director the end of a period that has seen the company become fully employee-owned and consolidate its position as a global specialist in complex wells. Taking the reins will be Neil Armstrong, currently Merlin’s Engineering Director.
“That is the biggest thing for Merlin in the next year,” says McGregor. “Neil is one of our most recognisable personalities and he is a technical figurehead for the business. He started as a drilling engineer and has moved across senior roles before taking the MD job. He has developed training materials and is responsible for the direction the company is heading in.”
The continuity embedded in that transition is significant. Armstrong’s background in engineering and training aligns closely with Merlin’s identity as a knowledge-driven organisation, suggesting that capability development will remain central to its strategy.
Training itself is a critical pillar of the business, not just as a service offering but as a means of addressing the broader skills challenges facing the industry.
“We have spent a lot of time renewing our training material,” McGregor highlights. “Training, for us, is huge from the perspective of managing industry competency. Being able to pass on global best practice to engineering and operations teams is a massively important part of our business – that is what get us up in the morning and gets us out talking to people. We have new technical materials, new videos, and all the associated collateral.”
Partnerships remain equally important. The company’s model relies on close collaboration with service providers and operators, navigating a complex ecosystem where access to projects often depends on established relationships and mutual trust.
“We support a lot of the major service providers with training, and we work through them and for them on contracts across the industry. We work hand-in-hand and understand their requirements, trying to be low-maintenance and useful partner,” he adds.
ENDURING VALUE
Longer-term, the fundamentals that underpin Merlin’s business appear set to strengthen. The combination of increasing well complexity, a shrinking pool of experienced professionals, and sustained cost pressure is creating an environment where specialist consultancy is essential.
Within this context, the company’s core message is clear, rooted in its ability to deliver where others cannot.
“We are technical leaders and we know how to manage difficult wells that others cannot,” McGregor confirms. “Our tagline is ‘Complex Wells, Delivered.’ and we want people who are doing things that are outside of their comfort zone to talk to us and acknowledge that our knowledge, experience, and internal capability is a significant value add. This is already happening, and that drives our optimism. We have a positive growth mindset with demonstrable outcomes, and we can overcome hurdles.”
In a market defined by uncertainty and change, Merlin’s steady, capability-led approach offers a different kind of growth story, built on expertise applied in the most demanding conditions.