US fracking corporations are more and more sending their idle tools abroad, discovering new markets overseas as development slows within the shale fields of Texas, New Mexico and elsewhere.
Over the previous two years, lots of of pumps the scale of 18-wheelers have been despatched to Argentina by suppliers together with Halliburton Co., Calfrac Properly Providers Ltd. and Tenaris SA, and to Australia by Liberty Power Inc. and Halliburton, in response to estimates from analytics agency Main Imaginative and prescient. The shipments additionally embrace sand towers, water tanks, industrial blenders and miles of hoses used to inject fluid and sand into rock layers greater than a mile underground.
All this tools quantities to almost one-fifth of the fracking energy deployed within the Permian Basin as not too long ago as final 12 months, and extra may comply with. Halliburton, the world’s largest fracking service supplier, has mentioned it sees incentives to maneuver tools overseas as its worldwide enterprise expands. Patterson-UTI Power Inc. additionally sees a gap in Argentina for its diesel tools because it transitions its US fleet to run on pure fuel, Chief Government Officer Andy Hendricks mentioned.
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“The chance in Argentina is likely one of the most promising that we see to place our idle belongings to work globally,” Hendricks mentioned on a name discussing fourth-quarter outcomes earlier this month.
Sending underused diesel-powered fleets overseas may assist oil-field service corporations recuperate after years of squeezed income and strain from prospects to decrease prices. There’s a draw back, nevertheless, for the oil and fuel producers that rent Halliburton and the others to frack their wells: much less tools within the US is apt to drive up prices when and if corporations begin ramping up manufacturing once more.
Non-public operators might really feel the squeeze first. These corporations are likely to ramp up drilling and fracking when oil and fuel costs rise. If tools turns into more durable to safe, initiatives may stall, mentioned Main Imaginative and prescient CEO Matt Johnson.
“It may take an unbiased man and push him right into a non-operational situation, after which doubtlessly put himself into an acquisition as a result of he doesn’t have the provision or means to rent that strain pumper or the tools isn’t obtainable, or they don’t need to get in a contract,” Johnson mentioned.
The heavy-duty frack pumps have been a ubiquitous image of the shale patch for many years — a crucial piece of apparatus used to pump water, sand and chemical compounds underground to blast open tight, oil-bearing rock so the crude can circulation.
Of roughly 18 million horsepower of US fracking capability, about 8 million represents idle stock held in reserve and obtainable for reactivation ought to market demand shift, Johnson mentioned. As a lot as 1 / 4 of that stock can be exported over the subsequent 12 months or two, he added.
Nations together with Saudi Arabia and the United Arab Emirates might deploy extra refined fracking equipment for the primary time to spice up pure fuel manufacturing, with diesel-fueled tools in excessive demand, in response to Barclays Capital Inc. analyst Dave Anderson.
“We’ve been drilling shale for 20 years and realize it in and out, however we’ve by no means actually seen this take off anyplace else,” Anderson mentioned in an interview. “What’s actually taking place proper now could be worldwide unconventional sources, which we’ve by no means seen earlier than.”
To make certain, outdoors of Argentina, it’s unsure shale work can be wanted as a lot in different international locations, Bobby Tudor, a Houston-based banker who helped finance the US shale revolution, mentioned in an interview Tuesday.
“That’s not what you want within the Jap Mediterranean, it’s not what you want in Vietnam, or Malaysia or West Africa, that’s extra of an offshore enterprise,” Tudor mentioned. “I feel the US onshore shale enterprise will proceed to be the swing provider for the foreseeable future.”
The success of the US shale revolution of the early 2000s — when hydraulic fracturing and horizontal drilling unlocked hard-to-reach vitality reserves — prompted some corporations to prioritize home sources over worldwide exploration, mentioned Josh Dixon, a Wooden Mackenzie analyst.
Now, a rising variety of international locations are evaluating these unconventional strategies, and a wider mixture of gamers — together with unbiased operators and nationwide oil corporations — is defining a brand new period of world exploration, Dixon mentioned.
“There isn’t something apparent on the market which goes to distract folks from the second section of unconventional exploration proper now,” Dixon mentioned. “The largest query goes to stay on whether or not these performs will be confirmed to achieve success.”
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