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ProPetro (PUMP) Pens Revised Services Deal With Pioneer

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The oilfield services provider ProPetro Holding’s (PUMP - Free Report) completely owned subsidiary, ProPetro Services, Inc., got into an amended and reiterated pressure pumping services agreement with Pioneer Natural Resources (PXD - Free Report) . Per the agreement, ProPetro will offer its pressure pumping services to the upstream operator.

ProPetro had signed a pressure pumping services agreement with Pioneer in 2018, in association with its acquisition of Pioneer’s pressure pumping services assets. Subsequently, both the entities worked jointly to enhance completions performance in the Permian Basin and accomplished industry-leading results.

The amended agreement offers updated performance standards, operating processes, pricing and terms, and the same is in effect as of Jan 1, 2022 and will end on Dec 31, 2022, possibly extended through 2023.

In accordance with the upgraded agreement, ProPetro will deliver and dedicate hydraulic fracturing fleets to provide fracture stimulation pumping services and offer associated products concerning such services. For this purpose, Pioneer will pay PUMP a definite fee, comprising a service fee which is to be calculated based on equipment and other services provided to Pioneer.

Commenting on the deal ProPetro’s Chief Executive Officer, Sam Sledge, mentioned that his company is excited to carry on and improve its relationship with Pioneer, showing the shared commitment to efficient and safe operations in the Permian Basin. He stated that the revised agreement venerates the fact that the operating standards of both companies have increased over the life of their collaboration. He also stated that his company looks forward to improving its relationship with Pioneer as ProPetro looks to expand its next-generation equipment offering and enhance completions performance. The CEO concluded by thanking ProPetro workers on the field and throughout the organization.

Pioneer’s President and Chief Operating Officer, Rich Dealy, mentioned that the revision to the prevailing agreement echoes his company’s desire for a continuous enhancement in completions performance, which is validated through the material progress that has been achieved from the time when the partnership began. “We thank ProPetro for its commitment to meet and exceed the high standards Pioneer expects in our operations," he further added.

Founded in 2005, Midland, TX-based ProPetro Holding Corp. is an oilfield services provider operating primarily in the Permian Basin spread over west Texas and New Mexico. The company offers a wide spectrum of specialized, complementary services and equipment for the exploration and production of oil and natural gas. Approximately 99% of ProPetro's total revenues come from the Permian Basin.

Headquartered in Irving, TX, Pioneer Natural Resources Company is an explorer and producer of oil, natural gas, and natural gas liquid. The leading upstream energy firm primarily has operations in Permian, the most prolific basin in the United States.

ProPetro currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks from the energy sector that warrant a look include PBF Energy (PBF - Free Report) , and Oasis Petroleum , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for PBF Energy’s 2022 earnings is projected at $1.95 per share, up about 178% from the projected year-ago loss of $2.50. PBF Energy’s stock has gone up about 70.8% in a year.

PBF Energy beat the Zacks Consensus Estimate for earnings in two of the trailing four quarters, the average being around 52.4%. PBF is valued at around $3 billion.

Oasis Petroleum’s stock has increased by about 149.3% in a year. Oasis Petroleum beat the Zacks Consensus Estimate for earnings in three of the trailing four quarters, the average being around 37.6%.

The Zacks Consensus Estimate for OAS’ 2022 earnings is projected at $29.15 per share, up about 206.2% from the projected year-ago earnings of $9.52.


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