Via email, Ben Beasley, Director, Strategic Accounts (Ritchie Bros.) provided PB Oil and Gas Magazine with feedback, as follows.
PB Oil and Gas: What are the top items, count-wise, being put up for auction in the Permian over the last six months, or since January, whichever way you have recent time frames calculated? How has this changed since the same period last year?
Beasley: We have seen an increase in the number of sellers and buyers of wireline equipment in our 2019 Kruse Energy auctions, while drilling equipment has remained steady across our various sales channels. As always, we continue to sell a ton of rolling stock assets (yellow iron and transportation equipment) used in and around the worksite.
PB Oil and Gas: In what ways have prices changed since last year? Up or down overall, or certain equipment up and other down? What are the major pieces in each price-direction category?
Beasley: Late-model, low-usage equipment continues to sell well, while older, more obsolete equipment has seen some softening in pricing in 2019. Our ability to attract international buyers, who participate in our events online from around the world, help mitigate significant price drops for older equipment as they can still use it in their markets.
PB Oil and Gas: How does the Permian compare to other U.S. basins?
Beasley: The Permian Oil Basin continues to the busiest basin in the United States, making equipment coming out of the Permian extremely attractive for buyers. Customers are generally more interested in equipment that was working than sitting—if it was working for one customer, it can work for them. Equipment coming out of the Permian also tends to be later-model because companies working in the Permian tend to upgrade their fleets more often.
PB Oil and Gas: Where are buyers/sellers located primarily?
Beasley: Late-model assets used in the Permian are usually snatched up by buyers from Texas, Oklahoma, New Mexico, and Louisiana, though we do see bidders from across the country and internationally. International buyers can sometimes get their hands on some of the older assets that have less demand locally.
PB Oil and Gas: With your years of experience, what do these trends tell you about the health of the oil and gas industry—overall and in particular sectors?
Beasley: Our customers are the experts, so probably better to ask them this question—to prognosticate the health and future of the industry. What I can say is, the oil and gas industry has long been volatile, but our customers are prepared for those ups and downs and we are here to help them buy and sell equipment as needed.
PB Oil and Gas: With tech advances in the last 5-10 years, has this changed what equipment is being auctioned? Is there obsolete equipment being put up that no one else wants, either? Do you turn down some items because there’s no market for them other than scrap?
Beasley: Technology changes quickly in the oil and gas market, but equipment that may become obsolete in the United States still has value internationally. That’s why it’s so important to work with a disposition/auction company that can reach those markets. All our solutions—Ritchie Bros. Auctioneers and Kruse Energy live auctions, IronPlanet weekly featured online events, and our Marketplace-E solution—reach buyers around the world.
PB Oil and Gas: Is there anything else of note–any surprising trends, new technology, etc., that might be of interest?
Beasley: The power of online is only growing—there is no stopping it. It’s important that sellers take full advantage of the global market through online bidding and sales. Local buyers are also buying more and more online—they don’t have the time to be away from their business for a whole day to buy equipment. With online bidding they can log on when the piece they are interested in [comes up], buy it, and then go straight back to work.
—Paul Wiseman