Labour shortages slowing pace of fleet activations for Calfrac Well Services

Calfrac Properly Providers Ltd says widespread labour shortages are a problem for the sector whilst a rally in commodity costs helps drive a restoration within the oilpatch.

The Calgary-based firm — which is likely one of the largest hydraulic fracturing corporations on this planet, with operations in Western Canada, the US, Russia, and Argentina — reported Tuesday its revenues doubled within the third quarter of 2021 in contrast with a yr in the past.

Calfrac president Lindsay Hyperlink mentioned the corporate can also be anticipating a rise within the demand for its providers in 2022, which is predicted to drive enhancements in working and monetary efficiency.

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However he added, for now, Calfrac will keep its present fleet footprint, partly as a consequence of widespread labour scarcity points affecting all the oil and gasoline sector.

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“I feel the labour market remains to be persevering with to be very tight, and it’s positively an element,” Hyperlink mentioned.

“I feel everybody has learn concerning the nice resignation . . . We’re not resistant to that. However we’re nonetheless an excellent trade to work in. I feel we simply have to get the lively recruiting machine again up and working for that, however in no way will it ever be simple.”

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The oilfield providers firm mentioned it misplaced $1.5 million or 4 cents per diluted share for the quarter ended Sept. 30, in contrast with a lack of $50 million or $17.20 per diluted share in the identical quarter final yr.

The loss got here as income totalled $295.8 million, up from $127.8 million a yr in the past.

Calfrac reported increased exercise in all working divisions. The corporate’s North American lively fracturing fleet depend elevated over 60 per cent year-over-year, whereas its fracturing job depend has greater than doubled. On a companywide foundation, Calfrac’s lively fracturing fleet depend elevated by virtually 50 per cent and its fracturing job depend elevated over 130 per cent.

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Nonetheless, Hyperlink mentioned regardless of this yr’s dramatic enchancment in commodity costs, many oil and gasoline producers stay cautious, opting to return extra money move to shareholders and pay down debt as a substitute of reinvesting it in manufacturing development.

“We predict that the present marketplace for our providers is robust and strengthening on daily basis,” Hyperlink mentioned on a convention name with analysts Tuesday. “Nonetheless, as evidenced by the tempered rig depend in the US, the oilfield service restoration will probably be a extra gradual journey than in previous cycles.”

Calfrac underwent a recapitalization plan late final yr that noticed holders of its senior unsecured notes swap debt for shares, leaving current shareholders with a lowered stake within the firm.

© 2021 The Canadian Press

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