American Oil and Gas Reporter - August 2021 - 61

SpecialReport: Fracturing Tech
parts on order to bring 33 spreads back to life. It is also
important to consider that not every well is completed the same
way, allowing for some older equipment to come back to
market. Maximum intensity, top-notch horsepower efficiency
and huge proppant loadings are not imperative for every well
completion. At the right price and frac design, less efficient
spreads can get to work too, which will account for some of the
additional spreads returning to the field.
We are coming into peak months for activity, and given
companies' recent comments, it is likely we will see 275 spreads
working with a trend closer to 300 during the first quarter of
next year. There will be some seasonal slowdown in November
and December of 2021, but this year's slow start will prevent it
from reaching the same degree we have seen in the past.
Corporate statements and what we see on the ground confirm
our view of a U.S. crude production rate of 11.5 MMbbl/d-11.7
MMbbl/d. On the completion side, stages per day have climbed
a step, with a rough 2019 baseline of 8-12 with 2021 holding
steady at 10-14. If one includes simulfracs, we are seeing 20-30
stages a day, but the baseline remains a bit skewed because of
the early adoption.
Soon oil field service companies must decide about new
MATT JOHNSON is president and chief executive officer of
Primary Vision, which provides market intelligence and consulting
on the hydraulic fracturing sector, including weekly counts of
active U.S. frac spreads. A diverse background allows Johnson
to view issues from a variety of perspectives to find optimal and
innovative solutions to domestic and international engineering,
exploration, research and development, management, sales,
and operations challenges. He also serves as program director
at Primary Vision Network, a platform for discussing relevant
industry topics. Before joining Primary Vision as national
account manager, Johnson was vice president of business development
at BAR Co. Inc. He holds a bachelor's from Johnson
& Wales University.
spreads. Equipment and parts prices are being pushed higher by
supply chain issues, raw material price increases and order
backlogs. Although some floating spare capacity is being sold
off, the logistical nightmare and inflation mean that delivering a
new spread easily could take more than six months. We simply
are not at that point yet given the cost, but the backlog may push
some companies to put in orders early for delivery in 2022. With
more efficiency in the oil patch comes increased wear and tear,
requiring more parts, maintenance and eventually new spreads.
However, the biggest overhang remains labor, as companies
struggle to hire and train new employees to work in the field.
Wages must be competitive, resulting in sign-on and stage
bonuses to sweeten the compensation package. All these
equipment bottlenecks and personnel issues are being managed
now, but as we approach 2022, the oil field services world will
need to replenish the parts inventory and begin the process of
replacing aged equipment.
As we look back on all the hardships the previous year has
thrown at the U.S. energy industry, it is once again showing its
underlying resilience in the face of hurricanes, freeze-offs and a
global pandemic that hammered demand. The industry always
rises to the occasion.
MARK ROSSANO is founder and chief executive officer of
C6 Capital Holdings in Glen Head, N.Y., providing investment
and consulting services to clients in multiple sectors. He has
14 years of experience spanning the venture capital, private
equity and consulting markets. Before establishing C6 Capital
Holdings, Rossano served as an energy industry analyst at
Bloomberg, a senior energy analyst and macroeconomist at
Elevation, an energy analyst and strategist at Candlewood Investment
Group, an energy analyst and strategist at South
Ferry Capital Management and an associate at Morgan
Stanley Investment Management. He holds a B.A. in economics
from Loyola College in Maryland and an M.B.A. in finance
from Syracuse University.
Grenadier Gets EnCap Commitment
THE WOODLANDS, TX.-Grenadier Energy III LLC has
closed an initial $350 million equity commitment from EnCap
Investments L.P.
Led by Chief Executive Officer Patrick J. Noyes, the upstream
exploration, drilling and production company indicates it focuses
on acquiring, developing and exploiting assets to create significant
enterprise value and return that value to its stakeholders.
Grenadier says it has employed this strategy successfully
through multiple iterations, most recently with Grenadier
Energy Partners II LLC, which sold assets in the Midland
Basin to Surge Energy U.S. Holdings Company for $420
million in March. The divested assets included more than
18,000 net acres and 9,000 barrels of oil equivalent a day from
a successful horizontal development program in the Wolfcamp
and Spraberry formations.
" The Grenadier team has a proven track record of acquiring
high quality assets and developing them effectively to build
attractive businesses of scale, " Noyes states. " We are excited
to again partner with EnCap as we embark on this next
adventure together and continue the success this company has
shown over the past 14 years. I am extremely confident in the
ability of our staff to utilize our experience and leverage new
technology to capture the next profitable venture as we navigate
the energy transition. "
" We are excited to continue our longstanding partnership
with Pat Noyes and Grenadier, " relates EnCap Managing
Partner Doug Swanson, " This newest equity commitment is a
testament to our confidence in the entire Grenadier team and
its strategy. "
Vinson & Elkins LLP served as legal counsel to EnCap and
Akin Gump Strauss Hauer & Feld LLP to Grenadier on the formation
of the new company.
❒
AUGUST 2021 61
❒
American Oil and Gas Reporter - August 2021

Table of Contents for the Digital Edition of American Oil and Gas Reporter - August 2021
