The Guardian Notes Energy Industry Advancements in Water Treatment

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PacWest cited in a recent “The Guardian” article on advancements in water treatment:

“Competition over water between different industries – and the prospect of regulations on use – has pushed oil and gas drillers to invest in on-site water treatment, says Christopher Robart, a partner at PacWest Consulting Partners, which tracks about 100 water companies serving the oil and gas industry. These well-heeled industrial companies have created an environment to stress-test water treatment technologies that might have withered in the lab or never been deployed at scale.”

Robart continues by explaining that oil companies are looking at water issues as a major risk, however he notes that, “putting water treatment processes into the field has helped bring down the cost of products significantly in the past few years, Robart says. PacWest Consulting, which estimates the oil and gas water treatment market was $716m last year, projects it will grow 23% annually through 2016.”

Read the full article at http://www.theguardian.com/sustainable-business/fracking-oil-gas-energy-water-tech

jthomas@pacwestcp.com

PacWest Market Update Conference Call Playback

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PacWest Market Update Conference Call for 2013 Q4

PacWest hosted an open call on the hydraulic fracturing market on February 27th at 10:00 AM CDT.

You can download a playback of the PW Conf Call 13Q4.

For questions on the call or our latest PumpingIQ release, please contact Jennifer Thomas, jthomas@pacwestcp.com, 713 929 3285.

Alexander Robart Discusses Frac’ Water Management in Global Water Intelligence

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Global Water Intelligence Publication discusses outlook for frac water in which it suggests: as the market continues to mature, and frac’ water recycling and reuse become more widely accepted, the integrated model of frac’ water management will continue to gain ground.

Growth_in_oilfield_water_management_services_spend-chart

Alexander Robart shared that as operators become more advanced in how they think about water, “they’re going to have to think harder about how they tie all these things together.” The article posits the unanswered question about timing of when this will occur. “US frac’ water specialists and technology firms have beaten the drum for water recycling and increased integration for years, but the adoption of reuse and the market integration that comes with it have been slow to gain traction. Robart said that – barring any disruptive technological breakthroughs – PacWest’s most recent projections (see chart above) give him little reason to believe that a dramatic uptake of recycling or a wide shift towards integration is coming before 2016.” Currently, in industry it appears that water utilization will evolve into long-term outlook.

Read more at: http://www.globalwaterintel.com/archive/15/3/general/select-energy-bets-frac-services-consolidation.html

Jennifer Thomas, jthomas@pacwestcp.com

New Ceramic Proppant has Potential to Address Flowback Issues

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New ceramic proppant being tested has unique potential because of its shape.  Robart says “the proppant process creates an “ant farm” look within the fracture, and the fibers keep the proppant in place to avoid flowback issues.”

“One of the two inventors of the distinctively-shaped proppant is focused not just on shape, but on the method of the proppant’s flow. Schlumberger Technology Corporation in Sugar Land, Texas, developed the rod-shaped proppant to coincide with a “channelant,” dissolvable fibers that initially act as a filler material during placement of the proppant, and later dissolve, creating channels for the oil and gas to flow.

Samir Nangia of PacWest says that “initial testing in the field is not promising. Although the product seems to score well in preventing flowback, conductivity results have not matched projections.”

Another rod-shaped proppant, invented by Imerys may have stronger potential, but it’s not in the US yet.

Read full article at: http://bismarcktribune.com/bakken/breakout/how-a-new-proppant-shape-may-offer-a-path-to/article_40408e56-99a3-11e3-aefa-0019bb2963f4.html

jthomas@pacwestcp.com

Frac Price Increases on the Horizon; US Land Achieved Record Frac Stage Counts in 2013

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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.

Conference Call

Dial-in: +1 (800) 830 3581

Passcode: 2922791

WebEx Presentation:

https://meetingvisuals.webex.com/meetingvisuals/j.php?ED=273017277&UID=499204927&RT=MiM3

For more information, contact Jennifer Thomas, 713.929.3285, jthomas@pacwestcp.com.

 

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