Trican Well Service is setting up its spending in 2018 for a return to full operations of its hydraulic fracturing fleet.
The company parked equipment in the first quarter of 2015 following the collapse in crude oil prices.
Trican began reactivating crews and rigs as market conditions improved toward the end of 2016, and says it has been steadily hiring and adding equipment to its fleet throughout 2017 to respond to increased fracking activity and intensity.
The company plans to spend $3 million of its $44-million capital program for the first half of 2018 to reactivate its remaining idle fracking capacity, which is expected to be used in operations during the second half of the year.
“At current commodity prices, our customers continue to indicate that the economics of their capital investment into completions will result in 2018 activity remaining very busy and consistent with 2017,” Trican said in a statement on Monday.
However, “activations will only continue if pricing can be secured for this equipment at the leading edge of our pricing, which would provide Trican with rates of return in excess of our cost of capital,” the company added.
The $44-million first-half 2018 budget also includes $22 million for major components, $4 million for maintenance and replacement capital, $11 million for growth initiatives and $4 million for infrastructure and support projects.
The investments are primarily focused on items supporting 2018 equipment reactivations and items which improve the company’s ability to handle the increased well service intensity, Trican said.
Compiled and Published by GIB KNIGHT
Gib Knight is a private oil and gas investor and consultant, providing clients advanced analytics and building innovative visual business intelligence solutions to visualize the results, across a broad spectrum of regulatory filings and production data in Oklahoma and Texas. He is the founder of OklahomaMinerals.com, an online resource designed for mineral owners in Oklahoma.