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Monday, 12/22/2014 4:44:23 PM

Monday, December 22, 2014 4:44:23 PM

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Compensated Awareness Post View Disclaimer
IESCF Safe, Efficient & Environmentally Sound Frac Water Heating Systems Mean Big Business in the Bakken

Intercept Energy Services’ proprietary, high-efficiency water heating systems designed to support the hydraulic fracturing industry offer some of the best emission, fuel consumption and safety advantages available today. The company’s growing fleet of HE Heater™ based systems, administrated by the company’s wholly-owned subsidiary, Intercept Rentals, allow oil and gas operators to continue working even in extreme cold weather situations, yet the systems emit minimal to zero radiant heat from their fully encased burners, making them extremely safe for workers to be around.

The hydraulic fracturing market continues to grow at a steady pace, even in an environment of downward pressure on crude oil prices, with the advent of even newer technologies like “super fracking,” which uses a high volume of sand pumped down hole to increase production from the targeted shale by around 50%, also lowering the break-even cost for producers. According to senior energy analyst and a managing director at Oppenheimer & Co., Fadel Gheit, who has been analyzing energy trends for over 28 years and who has been named four times to the Wall Street Journal’s All-Star Annual Analyst Survey, U.S. shale production will keep on growing despite falling crude prices that are making energy much more affordable to average consumers.

Gheit was recently quoted describing some of the underlying factors driving this sustained growth trend and indicated that the sharp reduction in well completion time, from as much as 90 days only five or six years ago, to around two weeks today, as well as the ability of a single rig to go from drilling one well back then, to as many as four wells today, would continue to provide strong tailwinds for sector operators. This outlook lends substantial credence to a report on the overall $41.5B hydraulic fracturing market published this year by MarketsandMarkets, which projects an 11.8% CAGR for the space through 2019, when their estimates indicate the market will grow to around $72.6B.

IEA forecasts even predict a potential golden age for unconventional gas recovery like shale gas and coal bed methane, with unconventional currently making up more than half the estimated natural gas resource base and expected to grow to around 70% of the resource base by 2035. Since just 2008, oil production in the U.S. has climbed 80% to around 9M bbls/day and even the vast majority (around 80%) of the so-called “tight” oil estimated to be pumped next year, will remain profitable with prices in the $50 to $69 range, according to a new study by strategic planning, operations and engineering powerhouse IHS.

One of the top domestic oil and gas plays continues to be the Bakken and Three Forks formations of the Williston Basin, which stretches across North Dakota into eastern Montana, and which jumped up past 1M bbls/day of crude oil production earlier this year, according to EIA data. With around 190 rigs currently active in North Dakota, the recent move by Intercept Energy Services (OTCQB: IESCF) to expand their operations in the Bakken is a shrewd one indeed.

The heated water for fracking niche is an excellent way to play the burgeoning $750B oil and gas services market, as the company makes money off drilling activity itself and is not impaired by well failure rates. Moreover, because the company’s proprietary mobile heating units virtually eliminate the possibility of on-site injuries and accidents, which are a serious concern when using traditional water heating systems, IESCF has found fast favor among operators. The company’s systems have seen strong reception among particularly those operators working in tight spaces where an open-flame diesel water heating truck, ambient gasses and the risk of severe burns to workers who put their hand on the wrong part of the vehicle, pose a considerable accident risk, as water heating truck-related accidents often result in costly downtime or worse.

Intercept Energy Services prides itself on the safety of their heating unit designs and the clean, efficient burning of their patent pending propane-powered systems, which can even recycle typically spent/waste heat back to the process of heating the water. The company boasts some of the most cost-effective and environmentally sound frac water heating technology available on the market today, giving operators who are under growing pressure to clean up their environmental footprint a strong competitive advantage.

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