PacWest Consulting Partners expects improving conditions in the North American market for hydraulic fracturing services, with pricing increases forecasted in many regions by early 2015. PacWest has just published the 2013 Q4 releases of its PumpingIQ and WellIQ reports. The reports provide in-depth analysis and forecasts of North American drilling and completion activity and the hydraulic fracturing services market.
Demand for frac services in the US Land market is expected to increase by 5% in 2014 and an additional 3% in 2015. The increase is driven by significant growth in the number of horizontal wells and frac stages. “We estimate that a record-breaking number of frac stages were stimulated in 2013, over 375 thousand,” says Christopher Robart, Partner of PacWest Market Intelligence. “We expect another record year in 2014 – over 400 thousand stages.”
Capacity utilization is expected to increase to 77% in 2014; however, potential market improvements are being dampened by frac capacity additions. PacWest forecasts that frac companies will deploy 400,000 hydraulic horsepower (HHP) of net additions to the US Land market in 2014, after adding 660,000 HHP in 2013. Frac assemblers and component manufacturers report improvements in newbuild orders; however, the destinations for most of those newbuild orders are for markets outside North America.
Despite the capacity additions, tightening conditions in key oil/liquids plays will lead to pricing increases by early 2015. Pricing in gas plays will likely be flat through 2015.
The Canada market for frac services is expected to develop similarly to the US market; however, improved pricing is expected by late 2014. Increases in frac demand, led by activity ramp-ups in the Duvernay and Montney plays, will lead to tightening market conditions and increased pricing that will begin in late 2014 and continue through 2015.
Globally, frac capacity is expected to increase by 11.8 MM HHP (+48%) between 2013 and 2018 (year-end capacity), with markets outside North America accounting for 75% of that growth. China, which overtook Canada as the second largest frac market in the world sometime in 2013, will lead the world in frac capacity additions in 2013. PacWest is pleased to announce the launch of newest market intelligence report, PumpingIQ China, and the opening of an office in Beijing in the Fortune Plaza.
PacWest has recently begun publishing key market figures on our website, with plans to update each quarter, in effort to provide greater transparency into the oilfield services market. Please visit PacWest Market Outlook for more information.
Please join us for a conference call on Thursday, February 27, 2014 at 10:00 AM Central Time to discuss our latest view of the market. Call details are provided below.
Dial-in: +1 (800) 830 3581
For more information, contact Jennifer Thomas, 713.929.3285, email@example.com.
“Fracking water treatment is still an emerging area with ‘more than a lot of competition,’” said Alexander Robart in an article on new water technology designed by AquaMost (a company that has developed a machine used to clean water in the fracking process). Robart notes that, “the U.S. land pretreatment market alone is expected to grow to $1.03 billion in 2014,” however, “it is always challenging for newcomers in oil field services to penetrate the market, even if they’ve got a great piece of technology.”
As noted in the article, of the Fracking wells nationwide — more than 80,000 have been drilled or permitted in 17 states since 2005 — produced an estimated 280 billion gallons of wastewater in 2012, according to a report released in October by Environment America. There is always room for new technologies to improve processes or functions within industry.
Read more from Journal Sentinel: http://www.jsonline.com/business/aquamost-strives-to-capitalize-on-fracking-boom-b99202987z1-245471621.html#ixzz2tnNnbPg4
Jennifer Thomas, firstname.lastname@example.org
PacWest speaking at The Bakken/Three Forks Shale Oil Innovation Conference & Expo on Tuesday, February 11, 2014. Discussion takes place on Drilling, Retrieval & Production Optimization, and more specifically, on trends in proppant usage. http://www.bakkenoilconference.com/
PacWest is cited in Fuel Fix on pressure pumping in the Permian Basin. The articles cites Alexander Robart on market conditions, stating ”PacWest forecasts price tags for fracturing jobs will not see much improvement until at least 2015. New efficiencies that enable oil producers to do more with less have been the biggest hurdle, Robart said.
The U.S. rig count fell flat last year, as technological advances enabled oil companies to increase the number of horizontal wells they drilled. Companies also sped up post-drilling operations including fracturing by hiring more experienced crews and implementing more rigorous schedules, according to PacWest.”
Read the full article here: http://fuelfix.com/blog/2014/01/26/pumps-move-to-the-permian-under-market-pressure/
PacWest Consulting Partners is presenting an analysis of frac’ing and proppant trends at the SPE Hydraulic Fracturing Technology Conference (HFTC) in Houston. The conference takes place February 4-6th at the Woodlands Waterway Marriott Hotel and Convention Center, in the Woodlands, TX.
SPE Technical Program Presentation
Paper Title: Analysis of US Hydraulic Fracturing Fluid System and Proppant Trends
Date: Wednesday, February 5th, 2014
Location: Waterway 5-8
More information at: http://www.spe.org/events/hftc/2014/pages/schedule/tech_program/wednesday_techprogram.php