Half of the 41 fracking companies operating in the U.S. will be dead or sold by year-end because of slashed spending by oil companies, an executive with Weatherford International Plc said.
There could be about 20 companies left that provide hydraulic fracturing services, Rob Fulks, pressure pumping marketing director at Weatherford, said in an interview Wednesday at the IHS CERAWeek conference in Houston. Demand for fracking, a production method that along with horizontal drilling spurred a boom in U.S. oil and natural gas output, has declined as customers leave wells uncompleted because of low prices.
There were 61 fracking service providers in the U.S., the worlds largest market, at the start of last year. Consolidation among bigger players began with Halliburton Co. announcing plans to buy Baker Hughes Inc. in November for $34.6 billion and C&J Energy Services Ltd. buying the pressure-pumping business of Nabors Industries Ltd.
Weatherford, which operates the fifth-largest fracking operation in the U.S., has been forced to cut costs dramatically in response to customer demand, Fulks said. The company has been able to negotiate price cuts from the mines that supply sand, which is used to prop open cracks in the rocks that allow hydrocarbons to flow.
Oil companies are cutting more than $100 billion in spending globally after prices fell. Frack pricing is expected to fall as much as 35 percent this year, according to PacWest, a unit of IHS Inc.
While many large private-equity firms are looking at fracking companies to buy, the spread between buyer and seller pricing is still too wide for now, Alex Robart, a principal at PacWest, said in an interview at CERAWeek.
Fracking News
Discussion in 'Oilfield Trucking Forum' started by Chinatown, Apr 23, 2015.
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We just spent a week in Louisville, sandwiched between two weekends. Driving through SE PA, WV and OH over both weekends I was amazed at the number of fracking trucks on the road. Just amazing the amount of materials that were being moved. The small towns and cities we were going through must owe their rebirth to fracking. If what Weatherford states is true, I'd hate to see those places a year from now.
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checked out to frac sand hauling companies in Texas last month,,both last fallhad about 150 trucks , last month both were down to about 50 and had about 3-4 trucks on the road each day,,drivers told me they were lucky to make $400-500 a week,,It will take about a year of stabilized higher oil prices for ####### to pick up again,,it will come back but will be a while before companies will be willing to invest multi millions to increase drilling
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I heard some guys jawing on ch19 about this...
The one driver said our friends the Arab's are driving down the price of oil on purpose to hurt the frac companies here..
don't know if thats true or not ?? -
Yes Saudi Arabia has said they are going to keep cutting cost and force some fracking companys out of the market. Sucks we will loose some jobs but there is no down side to having cheap oil on the market oil is a world wide traded comodity and if the middle east can produce cheaper then we buy from them its capitalism.
Tall Mike Thanks this. -
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That is his job...or one of them.....boost the share price. And in every slump there will be deals of all kinds. The smart folks put most of the cash back and are ready to go long, the others will move on empty handed.
JMOgdyupgal Thanks this. -
I want to know if towns like Williston ND have started seeing prices for housing come down from NY city pricing back to ND pricing. Also with are current administration in office what happens if Nuclear Iran is allowed to sell there oil on the market.
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