STAGES Update: 5/28/2021

Here is the update for the last week in May. I hope you had an enjoyable Memorial Day holiday!

STAGES Pumped

The frac crew count gained three last week.

STAGES Created

Oklahoma continued its rig growth by adding 3 weeks in the Baker Hughes “Other” category for Basin. The Permian added 2 and the Eagle Ford added 1. The Marcellus and DJ lost 2 and 1 respectively.

STAGES Ratio

The frac crews and rig count increased by 3. The result is a drop in the STAGES ratio by 1%.

STAGES News

US Well Services, a frac provider in the US, announced that it would exit the diesel-powered frac market by the end of the year. They expect to add an additional 6 electric frac fleets by the end of 2023. More details are located here.

Last week Cimarex and Cabot announced an all-stock merger. The two companies had different operating basins with Cimarex in Oklahoma and the Delaware Basin and Cabot operating exclusively in the Marcellus. Wall Street didn’t appear to agree with the rationality with Cimarex and Cabot falling 8% and 7% respectively on the news of the merger. Several analysts downgraded the Cimarex stock after the news. Raymond James analyst John Freeman noted that individually Cimarex has a 15% FCF/EV and one of the most attractive valuations compared to peers, however with the addition of Cabot they’re just in line.