From Calgary to Oklahoma, STEP bolsters US frack ops

By Luke Geiver | March 05, 2018

STEP Energy Services has made a $275 million move to become part of the growth story happening in the SCOOP/STACK play of Oklahoma. With a rig count increase of 103 percent over the last two years, the Cana-Woodford play has recorded the second highest rate of growth. Through its acquisition of Oklahoma-based and focused Tucker Energy Services, STEP will now have a presence in the play.

Tucker currently contracts with major oil producers with a frack fleet of 142,500 horsepower. Later this year, Tucker will bring a fourth fleet into service. The company also has two coiled tubing units and 15 wireline units. Although STEP has acquired the company, current leadership of Tucker will continue to run the 400-person company.

According to STEP’s team, Tucker generated roughly $6 million per frack spread during a nine-month period ending September 30, 2017. With all four spreads active during that time, the company could have generated more than $30 million in net income over the same period.

“The acquisition represents an incredibly exciting and unique opportunity for STEP and its shareholders,” said Regan Davis, CEO. The move gives STEP a launching pad into the U.S. fracturing market, he added.

STEP hopes to add new clients in Oklahoma or Texas that are currently using its coiled-tubing services.

To finance the acquisition, STEP is using $30 million from its balance sheet, $50 million from an equity offering and new credit facilities.

In July last year, STEP added a U.S. facility in Louisiana for coiled-tubing clients. Also in 2017, company founders for STEP were named EY Entrepreneur of the Year winners for their ability to dare to “dream big and build boldly,” according to Rob Jolley, region program director for the awards.