In a departure from its water supply-only strategy, oilfield water services firm XRI has acquired the treatment assets of Fountain Quail Energy Services in a bid to meet growing client demand for produced water recycling services in the US.
XRI’s organic growth since 2013 has seen it focus on the supply of non-potable brackish groundwater for hydraulic fracturing operations in the Permian’s Midland and Delaware basins, where the firm has developed over 300 miles of permanent pipeline handling approximately 700,000 bbl/d of source water, and serves major E&Ps such as Pioneer Natural Resources.
The new deal marks XRI’s first acquisition since private equity house Morgan Stanley Energy Partners took a majority stake in the business in 2016, and is a bold move for a firm without any saltwater disposal well (SWD) assets. Despite the fact that XRI only handles very limited volumes of produced water, president John Durand – who joined the company last month after serving as president and COO of Water- Bridge Resources — maintains that bolting on recycling capabilities to XRI’s existing water sourcing offering is a strategic fit.
