Archrock Inc., the nation’s largest contract compression firm, grew its contract operations revenue 13% and its average operating horsepower 8% during the first quarter of 2019, compared with the same period in 2018.
Brad Childers, Archrock’s president and CEO, said record gas production in 2018 caused the build-out of more midstream infrastructure and continued strong demand for contract compression equipment and services.
Archrock posted net income of US$19.5 million for the first quarter compared to US$2.1 million a year ago. Operating horsepower at the end of the first quarter was 3.6 million, up 7% from 3.3 million a year earlier. Utilization was 88% compared with 86% a year earlier.
Childers said the company’s 2019 business would equal or exceed 2018 totals, as it is experiencing more demand than it can meet. Some high-demand units deployed to customers’ sites are getting 20% year-over-year price increases.
Archrock plans to spend US$250 million to US$300 million to grow its fleet this year, supporting between 285,000 and 345,000 of new horsepower. Customers have contracted for nearly 95% of that capacity.
The investments will be focused on large horsepower units for midstream applications, about half destined for the Permian Basin of West Texas and southeastern New Mexico.