Calfrac reports 4th-quarter loss as drilling remains depressed

One of Canada's largest oil and gas well completion companies is reporting a loss in the fourth quarter of 2019 as demand for its services remains at a low ebb.

Using preliminary figures, Calgary-based Calfrac Well Services Ltd. says it will register a loss before income taxes of between $69 million and $74 million for the three months ended Dec. 31 on revenue of between $310 million and $325 million.

In the same period of 2018, the company, which has operations in Western Canada, the United States, Argentina and Russia, reported a net loss of $3.5 million on revenue of $499 million.

Calfrac announced two weeks ago its 2020 capital budget of about $100 million would be used mainly to maintain equipment, not buy new gear. Its capital budget was about $140 million in 2019.

The company has cut staff and is marketing fewer of its pressure pumping crews which provide hydraulic fracturing or "fracking" services needed to enhance production from oil and gas wells because of the low-demand, low-price environment.

The Canadian Association of Oilwell Drilling Contractors predicted in November that just 4,900 oil and gas wells will be drilled in Canada this year, less than half the 11,226 wells drilled in 2014.