4WARD: Permian Pursuit

12-Jul-2017

By: Eric Danos

The Permian Pursuit strategy has its roots in our desire to fulfill the Danos Vision through continued growth. We believe that certain shale areas are a good place to grow our business, especially in light of what has been a difficult market in the Gulf of Mexico. Our shale growth strategy starts in the Permian basin because this is Danos’ largest shale work area, but it does not end there. The strategy extends from the Permian to the Eagle Ford and the Marcellus. These three locations were strategically selected because they have advantages that make them more economical at lower oil & gas prices, and their larger size creates more work opportunities.

Danos is empowering a great local management team to tackle our Permian Pursuit strategy with the support of lots of us who are not located out in the shale regions. As a reminder, the vision we’ve developed for Permian Pursuit is to:

  • Double our activity levels by 2019
  • Localize employee development
  • Integrate our lines of business in a way that is effective and efficient for our customers
  • Execute multiple lines of business, not just Production services
  • Move [fast] at the pace of the shale markets

We’re making good progress toward this vision and taking advantage of good opportunities right now. Activity levels in the shale basins where we are working continue to increase. Virtually all operators in our focus basins are drilling more than they did last year with more drilling planned. For the most part, the other shale plays where we don’t have a presence aren’t seeing increases in activity today. This validates our selection strategy.

One of the interesting dynamics happening right now that affects us is ownership changes. Operators are trading or buying blocks of properties to form larger contiguous blocks of property. They do this to improve their logistics efficiencies. What it means for us is that we sometimes gain a new customer when they acquire a block of property where we were formerly working for another customer. This usually works to our advantage because our service value is so strong that new customers immediately see the benefit we bring to their operations.

Looking forward we have recently begun to evaluate a new market called the SCOOP/STACK. This is an area north of the Permian basin primarily located in Oklahoma. As we have been out talking to our customers and others in the industry, we’ve found that the Permian is drawing the majority of interest and investment, but the SCOOP/STACK is a close second in drawing investor attention. We believe we can leverage our resources in the Permian to grow into this market too. It may provide a fourth focus area for our shale growth strategy sometime in the future. Stay tuned.

Eric Danos

Eric Danos oversees the company’s finance, safety, human resources and land activities. A third-generation owner and member of the Danos Board of Directors, Eric began his career at Danos in 2004 as an operations manager for the international labor division. Eric has a B.S. in Marketing from Louisiana State University and an M.B.A. from Stanford Graduate School of Business.


Comments


Ross || 13-Jul-2017 02:56 PM
Just started with Danos and it looks like an exciting time to be working for this company. Thank you for the opportunity.


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