Service & Supply | Oilfield Services | Frac Markets - Pressure Pumping

US Well Services to Deploy More Electric Frac Fleets; Talks 3Q19 Ops

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   |    Thursday,November 21,2019

US Well Services provided an update to its 3Q19 operations. 

Quick Read

- Finalized a long-term contract for an electric fracturing fleet for work in the Northeast beginning in November 2019

- Averaged 8.4 fully-utilized fleets compared to 10.4 fully-utilized fleets during the second quarter of 2019

- The company ended the quarter with 7 active fleets:

• 2 Fleets = Appalachia
• 2 Fleets = Eagle Ford
• 3 Fleets = Permian

- Total revenue of $130.9 million compared to $151.4 million in the second quarter of 2019

• Net loss attributable to the Company of $17.0 million compared to net loss of $21.5 million in the second quarter of 2019
• Adjusted EBITDA of $35.3 million compared to $42.6 million in the second quarter of 2019

Operational Highlights

U.S. Well Services exited the third quarter with seven active frac fleets, with two fleets in the Appalachian Basin, two fleets in the Eagle Ford and three fleets in the Permian Basin.  Currently, the Company has nine active frac fleets.

U.S. Well Services delivered increasing operating efficiency for its customers during the third quarter.  The Company increased its stage count per fully-utilized fleet by approximately 6%, completing 4,823 frac stages during the third quarter, or 574 stages per fully-utilized fleet, as compared to 5,658 frac stages, or 544 stages per fully-utilized fleet, during the second quarter of 2019.  Pumping hours per day increased approximately 3% sequentially.  The Company pumped for 9,174 hours during 696 frac days, as compared to 11,019 hours during 854 frac days in the second quarter of 2019.

U.S. Well Services continues to be the market leader in electric fracturing, with 9,974 electric fracturing stages completed since the deployment of our first Clean Fleet® in 2014.  The Company continued to expand its intellectual property portfolio during the third quarter, receiving a grant for one additional patent, bringing our total granted patent portfolio to 23 patents, with over 95 patents pending.

Joel Broussard, President and CEO of U.S. Well Services, said: “U.S. Well Services continued to execute our business strategy in spite of volatile commodity prices and a challenging operating environment. During the quarter we continued to improve efficiencies for our customers, demonstrating sequential growth in both pumping hours and stages completed per fleet.

“As we look to the fourth quarter, we expect our customers to continue to exercise capital discipline and limit drilling and completion spending, which will result in a reduced number of active fleets for USWS.  However, based on recent commercial success, including the execution of a new long-term contract to provide electric hydraulic fracturing services in the Northeast, and visibility into our customers’ completions schedules, we expect to experience higher activity levels beginning in early 2020."

Outlook

U.S. Well Services began taking delivery of equipment for the one new electric fleet currently on order during the third quarter.  This fleet will begin working under contract for Shell in the first quarter of 2020. 

Market conditions remained challenging during the third quarter of 2019, driving a lower number of active fleets for U.S. Well Services as well as reduced utilization.  While we expect these conditions to persist through the remainder of the year, U.S. Well Services anticipates an acceleration in activity beginning in the first quarter of 2020 as E&P companies’ budgets reset.  U.S. Well Services currently has 9 of its 13 fleets contracted or dedicated to customers in 2020 and expects high demand for its remaining fleet based on dialog with customers.