U.S. CitiesCity-Data Forum Index
Go Back   City-Data Forum > U.S. Forums > North Dakota > Williston
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
View detailed profile (Advanced) or search
site with Google Custom Search

Search Forums  (Advanced)
Old 06-27-2013, 12:10 AM
1 posts, read 5,831 times
Reputation: 11


I noticed that Weatherford International has been laying off people left and right and are stuck without a steady contract with an established oil company in the middle of a booming oilfield economy...this seems strange. What is going on? How can they invest in all this infrastructure in ND and not make any money domestically? I'm not a financial genius, but this should be a no-brainer, right?

3000 jobs cut and 20 facilities closed down in the US...that's massive. I heard that layoffs will continue throughout the summer and maybe into fall if the next quarter earnings aren't as good as expected.
Reply With Quote Quick reply to this message

Old 06-27-2013, 12:33 AM
738 posts, read 1,406,303 times
Reputation: 485
Weatherford apparently badly misplayed pricing for guar gum, which is a key thickening ingredient for fracking. So effectively, Weatherford can't make money in fracking until pricing with Halliburton and Schlumberger is more equal. Weatherford is also highly leveraged, so it has a lot of debt to service.

India to raise 2013 output of fracking ingredient guar gum -trade | Reuters

Guar gum is one of "those chemicals" that environmentalists freak about, but its a natural product mostly from India. Would be equivalent to pumping corn syrup into the fracking solution.

Indian farmers/peasants are very happy about guar, as it has become in a very short time frame a very profitable export market for Indians.

But in the past few days, guar prices have dropped precipitously. Since Weatherford apparently bought guar near the market high, Weatherford could be heading down quite a bit.
Guar gum exports halve on low demand by oil companies - Economic Times

Madhvi Sally, ET Bureau Jun 25, 2013, 04.01AM IST
NEW DELHI: Guar gum, which set the futures market on fire a year ago, faces headwinds in the international market. Shipments of India's top agri-export commodity halved in the April-May period this year from a year ago as demand from oil and gas exploration companies has slowed down, say companies. Futures prices have remained lacklustre, worrying farmers and traders.
Traders who had never seen guar gum prices topping Rs 5,000-Rs 6,000 a quintal till 2011 made a quick buck last year when prices skyrocketed. Current spot market prices are around Rs 21,000- Rs 22,000 a quintal.

"Oil and gas exploration companies abroad are now adopting waterless fracturing where guar consumption is nil. This has led to negligible orders for Indian companies," said Guar Gum Manufacturers' Association president Purushottam Hisaria. He said guar was still the best bet for farmers because guar prices were far more remunerative than cotton and soya bean.
Halliburton and Schlumberger will probably pick up much of Weatherford's fracking business.
Reply With Quote Quick reply to this message
Old 06-28-2013, 11:12 PM
Location: Western Nebraskansas
2,707 posts, read 4,843,409 times
Reputation: 2370
Side note: guar gum is more like corn starch than corn syrup. It's a thickener and is found in a lot of foods.
Reply With Quote Quick reply to this message
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.

Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.

Please update this thread with any new information or opinions. This open thread is still read by thousands of people, so we encourage all additional points of view.

Quick Reply

Loading data...
Based on 2000-2013 data
Loading data...

Hide US histogram

Over $104,000 in prizes was already given out to active posters on our forum and additional giveaways are planned!

Go Back   City-Data Forum > U.S. Forums > North Dakota > Williston
Similar Threads

All times are GMT -6.

2005-2017, Advameg, Inc.

City-Data.com - Archive 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32 - Top