Exterran
Holdings is a natural gas focused oilfield services firm with a positive long
term outlook due to improvements in macro-economic environment, growth of
fabrication business, strong compression numbers in North America and lucrative
opportunities in the international compression market.
Exterran
Holdings (EXH)
is a Houston, Texas based oilfield services firm which specializes in the
natural gas sector, particularly natural gas compression technology. The
company has a workforce of ~10,000 and has operations in more than 30
countries. Its clients include oil majors, state-owned enterprises and
independent E&P firms. The business holds an equity and all the general
partner interests in Exterran Partners (EXLP),
which focuses on providing natural gas contract operation services in the
United States. In this article, I will discuss the major operations of Exterran
Holdings, its top and bottom line and its future prospects.
Exterran was
formed in 2007 through a
merger of Universal Compression, which started operations in 1954, and Hanover,
which has been operating since the early 90s. The business is currently headed
by Brad Childers, a former Occidental Petroleum (OXY) veteran, who serves as the
President and CEO of Exterran Holdings and Exterran GP LLC. The latter is the
managing general partner of Exterran Partners.
Macro
Environment
The macro
environment is looking better now than it was a year ago. Natural gas prices
have fallen in the last four months ending August, but August-2013 prices are
still up 20.7% from the same month last year.
Meanwhile,
according to Energy Information Administration's estimates, the long-term
outlook for shale gas and natural gas liquids is extremely bright. The markets
are expecting a significant increase in shale gas production in the coming
decades. Adding the expected increase in global drilling and production
expenditure of 6% … read full article