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Fracking activity in the U.S. shale patch is set for growth early next year, according to Liberty Energy, one of the biggest oilfield service providers said at the presentation of its third-quarter financial results.
The growth, however, would be modest, the company also said.
“Frac activity has largely stabilized at current levels, representing a baseload of frac fleet demand needed to sustain E&P operators’ flattish production levels,” Liberty said.
“Fourth quarter trends will likely see seasonal softness, winter weather, and holiday disruptions. We expect the recent strengthening of commodity prices will drive a modest increase in activity beginning in 2024.”
The company also noted the recent developments that led to higher oil and gas prices and improved the global outlook for the industry, including Saudi Arabia’s production cuts extension and the Israel-Hamas war.
“Energy market fundamentals support positive momentum in North America resource development, leading to consolidation and investment amongst E&P operators focused on long term value creation,” Chris Wright, Liberty chief executive.
“Liberty is uniquely positioned to support our customers’ ambitions to unlock value with our next generation technologies, integrated services, and scale,” Wright also said.
Consolidation in the shale patch is indeed underway, with the latest deal in the space seen as heralding a new era for the industry. Exxon said it would acquire Pioneer Natural Resources for close to $60 billion, suggesting the future of shale will see a lot fewer independent players with more production focused in the hands of integrated supermajors.
In a sign that things are looking up for oilfield service providers, too, and not just exploration and production players, Liberty reported an annual increase in both revenues and profits and boasted record pumping efficiency.
Liberty’s larger peer Halliburton is releasing its third-quarter results on October 24, Baker Hughes is reporting on October 26, and Schlumberger will release its Q3 results on Friday.
By Charles Kennedy for Oilprice.com
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Charles is a writer for Oilprice.com