I can't comment on Oasis, I do own a lot of SD and yes SD has had it's own water system but it's only in the core area. That system also cost 1/2 a $billion dollars. The gamble taken by Sandridge is that if salt water disposal does come under more regulation they will either have to go to treatment infrastructure or have a useless system. SD also omits the capital cost of the water system when providing their numbers for well costs which are just over $3 million per well. This system was also installed far in advance of HEK coming to the Miss Lime. SD built out both the electric infrastructure and the water infrastructure in the core area to show lower well cost...and when they show well cost versus competitors they exclude both of these costs from their numbers but include the costs for competitors who have to use both onsite electric generation and fluid handling costs.SD also uses ESP's ( electric submersible pumps ) which boost production much higher over a short term, but it costs about $250,000 per well to install. Tom Ward the CEO is very deceptive, unethical hence the present shareholder activism taking place to oust him. It is what it is ! LSP
Bog, that's why I posted on the subject of the Fool article with my questions because I saw that, rather heard that CC of SD's and it sure sounded like they don't want to keep pursuing the waste water business. They probably want to much for it for HEK to buy it outright. Maybe a partnership towards an MLP with SD this way not doing any damage to HEK's bottom line. GL and thanks to all who replied.
Bog you took my thunder oasis is much the same except they include the costs. I wouldn't be surprised if Ward adj. some of the #s for in house costs he does have a way of playing with the #s and makes accounting adj down the road. They have spent a ton of $ to do it in house I think its a mistake as SD Can use the cash (although alittle better now) IMO he is a piece of humm WORK I use to love this company #$%$ happen Aubrey influence they are pals birds of a feather LPS
There are several companies trying to keep the entire process in house but if you have studied the last few CC transcripts it's apparent more companies are signing on to use HEK's services than exiting to do it on their own. Consider also that there are many companies drilling in approx. ten areas throughout the US and it's easier to call HEK than try to deal with state & federal regulations. HEK is a technology company as well.
Correcto Plus sector (environmental Services) integration / consolidation with very few diversified specialists in the field sets up one of two options (IMO); Buy Out or Sell Out ? However, because HEK is "ahead of market share" I believe they have plenty of room to run and will do so building value while O & G sector has most likely bottomed and smart money is returning to a beaten down sector where small/mid caps will benefit.