Don’t Sleep on the Coloradan Frac’ers

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by Matthew Johnson

If you list out the companies with the most frac spreads in 2016, you are going to be looking almost exclusively at the heart of oil country, Texas Oklahoma and New Mexico.  Just go right down the list and you will see the market share is dominated by EOG (based in Houston, Texas), Chesapeake (Oklahoma City, Oklahoma), Pioneer (Irving, Texas), XTO (Ft. Worth, Texas), Anadarko (The Woodlands, Texas), and on it goes.

Market Share by Operator & Spread in 2016

Market Share by Operator & Spread in 2016

If you break down the number of frac jobs completed last year, however, you can see that there are some fairly significant players basing their operations in Colorado.  Anyone keeping tabs on the business should watch these companies.  The energy business is in the Rocky Mountain region is succeeding and benefitting from Denver’s popularity.  It is routinely named among the fastest-growing cities and best places for business and employees.

Frac Jobs by Operator in 2016

Frac Jobs by Operator in 2016

Discovery Natural Resources

Discovery completed about 45 frac jobs in 2016.  It is a private oil and gas company headquartered in Denver.  Interestingly, even though it is based in Colorado, the company is currently focusing its efforts on the Permian Basin in West Texas.  The company touts over six million barrels of oil production per year from more than 1,000 wells covering nearly 120,000 acres of land.  The company has said that it is well poised to handle market downturns, and press reports back that up.  E&P Magazine reported last year that the Permian Basin was handling the drop in oil prices better than any other region and that Discovery has continued to drill and relentlessly optimize its operations.

Extraction Oil & Gas

Extraction Oil and Gas frac’ed 54 wells in 2016.  Like Discovery, Extraction is based in Denver.  But Extraction actually remains focused on producing in the Rocky Mountain region.  The company was founded in 2012 and highlights its work in the Greater Wattenberg Field of the Denver-Julesburg Basin (commonly called the DJ Basin).  The company just had its initial public offering in October 2016, and it was considered wildly successful at the time, however it appears that they’re experiencing some volatility as the calendar turned to 2017.  It raised more than $630 million at a share price several dollars higher than expected.  It was the biggest energy listing in the world since the oil price crash in 2014, and the company seems poised for future success.

Keep Track of the Marketplace

Data on frac’ing operations is typically cobbled together from months-oil public regulatory filings.  Primary Vision works to approximate real-time data by collecting public and private information and then applying sophisticated math models, advanced cross-validation algorithms, and artificial intelligence to fill the gaps.  Our extensive data on hydraulic fracturing in Colorado, Texas, Oklahoma and across the rest of the U.S. (plus Alberta, Canada) is now available for sale in our new National Frac Spread Count Report.  To learn more, visit www.fracspreadcount.com or contact us at info@pvmic.com.

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Disclaimer

The data presented above has a margin of error of 5-8% as a result of E&P and/or service company errors or incorrect data filings. Neither the information, nor any opinion contained in this site constitutes a solicitation or offer by Primary Vision or its affiliates to buy or sell any securities, futures, options or other financial instruments or provide any investment advice or service.

 

Pumpco Stays Busy in Texas

by Matthew Johnson

You can get an idea of how service companies are dealing with a challenging environment by looking at our data on specific companies, like Texas-based Pumpco Services.  The company has consolidated its operations near its home and it appears to be thriving.

A Leading Pressure Pumping Service

Pumpco Energy Services, Inc. was founded in 1982 by Ronny Ortowski, who had worked for many years in pumping.  The company provides fracturing services, using its high-pressure pumping equipment to fracture rock formations.  It also offers acid and other treatment additives to enhance production.  Finally, Pumpco offers miscellaneous pumping services, such as pump downs between well completion states.  It brags that its focus on service and controlled growth sets it apart from other service companies.

When the shale boom took off, Pumpco became a hot commodity.  It was acquired by Complete Production Services in 2007.  At the time of the merger, Pumpco had an estimated revenue of $96 million and three pressure pumping fleets in the field, with one more on the way.  Complete Production was, in turn, swallowed up by Superior Energy Services in 2012.  The deal was reportedly worth approximately $554 million in cash.  Pumpco has continued to operate under its own name, however, as a subsidiary of Superior.

Consolidation and Stable Activity

Pumpco’s controlled-growth strategy was probably not controlled enough, as during the boom years it moved a significant operation into the Bakken.  That operation, based out of Minot, North Dakota, was forced to shut down in September 2015.  The company closed up its Bakken shop, laying off 70 people and simply stating that the decision was forced by “economic conditions caused by falling oil prices.”

Since 2015, Pumpco has operated almost exclusively in Texas, with some operations also conducted in New Mexico.  The company had A MAX OF six frac spreads running every week at it peak in 2015, but in 2016 it ran between two and four most weeks.  That said, the company seems to have had a good 2016.  It has had several months with as many as nine frac jobs per month, after never exceeding eight in 2015.  The trend lines suggest 2017 could be a good year.

Primary Vision Has the Details

Keeping abreast of industry trends can be made so much easier by subscribing to the encyclopedia of data developed by Primary Vision.  Service companies do not provide this data to the public in real time, or in some cases ever.  We have developed sophisticated methods for collecting the available public filings and private announcements and using sophisticated models to predict real-time data.  Our extensive data on hydraulic fracturing in the United States and Alberta, Canada is now available for in our new National Frac Spread Count Report.  To learn more, visit www.fracspreadcount.com or contact us at info@pvmic.com.

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Disclaimer

The data presented above has a margin of error of 5-8% as a result of E&P and/or service company errors or incorrect data filings. Neither the information, nor any opinion contained in this site constitutes a solicitation or offer by Primary Vision or its affiliates to buy or sell any securities, futures, options or other financial instruments or provide any investment advice or service.

Macro View of U.S. and Canada Hydraulic Fracturing

by Matthew Johnson

Oil and gas production in North America has huge ramifications across the world economy, and companies in many industries can benefit from keeping track of activity in the oil field. The most common metric is the Baker Hughes rig count, but that only tells you how many drilling rigs are active in a given week. Companies can get a much more complete picture by knowing how many hydraulic fracturing operations, or spreads, are active in a given week.

U.S. Regional Analysis

When people think of the frac’ing revolution, they often think of the contentious debates over land use in Pennsylvania or the boomtowns of North Dakota. The real leader in frac’ing has always been Texas, though. The breakthrough in the unconventional revolution came in 1997 in Texas’s Barnett Shale, where Mitchell Energy engineers discovered that they could stop using expensive gels and instead use cheaper, more watery fracking fluid to crack open shale formations to get economic production of oil and gas. Recent data shows Texas has simply continued its domination.

The state of Texas holds more than 40% of the market share of spreads nationwide

As of January 1, Texas holds more than 40% of the market share of active spreads nationwide

Over 40% of active frac’ing operations, or “spreads,” are in Texas. North Dakota and Pennsylvania come in at 10% each, as does Oklahoma. Colorado has about 7% of active spreads, Ohio has 4%, West Virginia has 2%, and Wyoming has just 1%. Major oil producing states Alaska and California have very little activity on the fracturing side.

Looking at the Eagle Ford region in Texas, the data shows that the number of active frac’ing spreads has held steady this year, even as drilling has fluctuated. The number of drilling rigs continued its plummet caused by low oil prices all the way until the end of spring, and has crept up steadily since. The coming months could be very good for the region, where many openly celebrated OPEC’s recent decision to limit oil production. American frac’ers may benefit more than select OPEC members. The comeback looks to be slow and steady along with the accompanying production bump.

Frac Spread Count in Eagle Ford region

Frac Spread Count in the Eagle Ford region of Texas

Canada Analysis

Alberta, Canada is not all tar sands. Hundreds of wells have been frac’ed in Alberta in 2016, and the rate has been increasing over the summer and into the fall. The future of frac’ing in Canada is somewhat in flux, as it has both financial and environmental concerns. On the other hand, Canada’s largest driller, Precision Drilling, just announced it will spend 60% more on capex in 2017 than it did in 2016. While Canada’s recovery has been volatile, we look for pressure pumpers to demand more equitable terms while the market continues to stabilize.

Email us at info@pvmic.com for a free output of Frac Spreads in Canada.

Primary Vision Explains Oil Field Activity

Primary Vision has developed a proprietary method for collecting public and private data on frac’ing and then applying sophisticated math models, advanced cross-validation algorithms, and artificial intelligence to fill the gaps caused by industry secrecy and delayed reporting requirements. Our extensive data on hydraulic fracturing in the United States and Alberta, Canada is now available for sale in our new National Frac Spread Count Report. To learn more, visit www.fracspreadcount.com or contact us at info@pvmic.com.

sources:

Disclaimer

The data presented above has a margin of error of 5-8% as a result of E&P and/or service company errors or incorrect data filings. Neither the information, nor any opinion contained in this site constitutes a solicitation or offer by Primary Vision or its affiliates to buy or sell any securities, futures, options or other financial instruments or provide any investment advice or service.

Tracking the Lesser-Known Frac’ers

by Matthew Johnson

Frac’ing has not been dominated by the big names you might expect. The costly technique was driven to prominence by independent producers that had to find a way to do business profitably in the United States. This is evident when you look at data on the active pressure pumpers and well operators in the United States.

Don’t Overlook Smaller Pressure Pumpers

A typical hydraulic fracturing pumper unit includes a large engine, pump, and control panel that are mounted on a truck or trailer. The pumper is part of a frac spread typically run by a well operator that includes storage tanks and additive mixers. Major well operators like Chevron and XTO/ExxonMobil hire a number of pumpers, but they tend rely heavily on the big names: Halliburton, Baker Hughes (soon to shift to the new entity BJ Services), Schlumberger to name a few. This chart below shows just how active Halliburton is:

Frac Spread Count for BAKER HUGHES

Independent operators do not hire as many pumpers, but they tend to be more diverse in their hiring. Anadarko, for example, also utilizes the pumping services of Trican, Calfrac, FTSI, Universal, and Nabors. Pioneer Resources is a bit of an outlier in the operating world, because they’re vertically integrated.

A frac’er to watch: Keane

One smaller pumper that is worth keeping an eye on is Keane Group Inc. The company is based in Houston and run by alumni of some of the major service companies. It is currently in the midst of an initial public offering that could be worth as much as $287.5 million, and it will lead to the company being listed as “FRAC” on the New York Stock Exchange. Keane is owned by a New York-based, private-equity firm called Cerberus Capital Management, and that has allowed Keane to stay well financed during the current downturn.

Keane Group reported in a recent filing that it has 944,250 horsepower behind 23 frac’ing spreads and wireline trucks operating primarily in the Permian, Marcellus, and Williston Basins. Other reports say that 13 of those frac’ing spreads were deployed as of November 30, 2016. Data collected by Primary Vision shows a maximum of seven Keane-branded spreads active at any one time during the past 12 months.

Frac Spread Count for KEANE

Some of the discrepancy is likely due to the fact that Keane doubled in size in 2016 through the purchase of the U.S. operations of the Canadian service company Trican. Keane seems to be counting some of its spreads while they were still branded as Trican, and some downtime is inevitable during a merger. Looking forward, Keane says it will use proceeds from the IPO to repay debt and create working capital, and it is possible the company is positioning itself to buy additional equipment as the market turns upward. Does it make sense for Keane Group to step in and purchase Weatherford’s pressure pumping division?

This Data And More From Primary Vision

If you want to be successful in the frac’ing business, it helps to know what the pumpers are doing. Primary Vision’s new National Frac Spread Count Report can provide both top-line data on the industry and detailed data on specific companies and markets. We have collected data from a range of public and private sources and then augmented that data with our own analysis to provide a clear picture of the hydraulic fracturing happening in the United States and Alberta, Canada. To learn more, visit www.fracspreadcount.com or contact us at info@pvmic.com.

sources:

Disclaimer

The data presented above has a margin of error of 5-8% as a result of E&P and/or service company errors or incorrect data filings. Neither the information, nor any opinion contained in this site constitutes a solicitation or offer by Primary Vision or its affiliates to buy or sell any securities, futures, options or other financial instruments or provide any investment advice or service.