Basic Energy Services boosts 2014 capital budgetMay 29, 2014
A. Lee Graham
Basic Energy Services Inc.’s board of directors has approved increasing the Fort Worth company’s 2014 capital expenditure plan by $50 million for purchasing about 60,000 hydraulic horsepower of hydraulic fracturing equipment.
The total 2014 capital expenditure plan, including the increase, totals $285 million, which includes $155 million for expansion projects.
"Due to the improving environment of completion activity and the increase in customer demand, we decided to take advantage of these positive trends to expand our pumping services fleet,” said president and CEO Roe Patterson in a news release.
“Profit margins for these services have been stable and have recently begun to improve with increased utilization. We believe the fundamentals and competitive returns we're experiencing justify adding more growth capital at this time,” Patterson said.
The equipment should be operational by September and generate about $24 million of revenue in 2014, according to the company.
“We now expect to have a total of 400,000 HHP [hydraulic horsepower] of pumping equipment by the end of this year," Patterson said.
Basic Energy Services, which provides oil and gas well-site services, employs more than 5,500 workers in Texas, Louisiana, Oklahoma, New Mexico, Arkansas, Kansas and the Rocky Mountain and Appalachian regions. More information about the company and its latest quarterly results is available at www.basicenergyservices.com.