Around the world, investment dollars are being poured into energy projects. Opportunities for the gas compression marketplace remain robust and are firmly rooted in two categories – the continued increase in demand for natural gas to fuel the ever-growing need for more power generation (both in emerging economies and booming population centers) and the global desire to reduce emissions and stave off climate change. Both cases serve as favorable tailwinds for the gas compression industry for the foreseeable future and present myriad opportunities for those involved in the manufacture, maintenance, and operation of gas compression equipment. The need for natural gas continues, and the outlook for the gas compression industry remains strong.
“Market conditions for compression remain highly constructive, predominantly in oil plays with associated gas production like the Permian Basin,” said Bradley Childers, president and chief executive officer (CEO) of Archrock during the company’s Q2 earnings call. “Our fleet remained fully utilized, with utilization exiting the (second) quarter at a rate of 95%. Booking activity increased sequentially, as we continue to build an order book into 2025. We expect to see sustained compression booking demand well into the future, as our customers plan for the call on natural gas production to support LNG [liquefied natural gas] export capacity growth, and incremental electric generation demand from AI [artificial intelligence] and data centers.”
“Our period end utilization was at an all-time high and average utilization remained near an all-time high, both at 95%, with our large horsepower over 1000 hp (746 kW) effectively fully utilized at 99%,” said Eric Long, president and CEO of USA Compression during the company’s Q2 earnings call. “These results indicate a strong and stable contract compression market, which we believe will continue for the foreseeable future.”
“Our utilization currently sits at 94%. However, the core large horsepower group of assets that was the focus of the legacy Kodiak fleet and the target of the CSI acquisition remains at effectively full utilization in excess of 98%,” said Mickey McKee, president and CEO of Kodiak Gas Services Inc. during the company’s Q2 earnings call. “In fact, the entire industry utilization in this large horsepower group remains at historically elevated levels, continuing to contribute to the tightness in the market. Demand for contract services remains strong. During the second quarter, we added over 41,000 hp (30,586 kW) of new units to our fleet. All were large horsepower, averaging over 2000 hp (1492 kW) per unit. We also had tremendous success in recontracting units that came up for renewal during the quarter.”
In tandem with increased utilization, maintenance activities throughout gas compression applications are up. “With the market as tight as it is, our customers are very focused on …” Click here to read the entire story in the September issue of Gas Compression Magazine.
