USA Compression Partners Cuts 2020 Capex

Reflecting the industry downturn, USA Compression Partners LP (USAC) has reduced its 2020 equipment orders and overall capital expenditures.

A year ago USAC had forecast a 2019 capex of up to US$150 million, including 132,000 hp (98 MW) of new units. For 2020, the partnership expects to spend US$110-120 million and buy compressors totaling 56,000 hp (42 MW).

The Austin, Tex. contract-compression company reported fourth-quarter 2019 net income of US$9.3 million compared to US$10.2 million in the same period of 2018. Adjusted earnings before interest, taxes, depreciation, and amortization were US$109.2 million versus US$103.3 million year earlier.

USAC acquired 8750 hp (6.5 MW) of large-horsepower units in the fourth quarter. Its revenue generating fleet was 3.3 million hp (2461 MW) on Dec. 31, 2019. Fourth-quarter utilization was 93.9%.

Eric Long, president and CEO, said USAC’s book of long-term, high-horsepower contracts will enable it to maintain stable cash flows and distributions.

“It is no secret that the energy industry as a whole is currently facing some strong headwinds, including uncertain global demand due in part to the coronavirus, continued trade friction and overall weakness in commodity prices,” Long said. “While this may ultimately impact the rate of growth, none of the above factors will bring the energy industry to a complete halt.”

He said although producing and pipelining activity has slowed, chemical companies, liquefied natural gas exporters and power generators continue to expand and create opportunities for compression companies.

Long said some Appalachian operators, beset with low prices, are boosting compression horsepower in order to increase gas flows and revenues.

“We continue to believe that Appalachia, which is the largest gas producing region in the country by far from both the Marcellus and Utica shales, will continue to serve an important role in meeting domestic and global demand long into the future.”

Related Articles

Siemens Appoints New CEO, Shakes Up Management Team
Update: Coronavirus impacts natural gas shows
Ariel Introduces KBE Compressor
CSI Compressco To Curtail 2020 Spending
Exterran Glum On Compressor Fabrication
L.A. Turbine Commissions Second ARES Unit
Supreme Court Hears Pipeline Case
Archrock’s Fleet Grows Younger

Latest News

Gas Production Rises Again: EIA
SIAD Supplying System For Italy’s First LNG Deposit
ADIPEC Call For Papers Extended
MAN Developing Terminal For Liquefied Methane-Based Fuels
Compressor Specs-at-a-Glance 2020
Warburg Pincus Acquires Sundyne
COMPRESSORtech2 Sourcing Supplement – 2020
COMPRESSORTECH2 – Packagers Guide 2020

Log In

Forgotten Password?

Haven’t got an account? Click here to register.