Oil field service equipment scooped for bargain prices during downturn

Las Vegas-based First Titan says market for used oil field equipment will be huge when industry turns around

Pumpjacks and other oilfield equipment can be purchased cheap because of the oil and gas downturn.

First Titan Corp. believes it has found a lucrative new source of future revenues and is pursuing opportunities in a market some are abandoning: oil field services.

Oversupply and falling demand have the oil and gas industry mired in a slump. Oil field service firms have been caught in a vise of too much debt and not enough work to go around as exploration and production companies cut budgets.

“The current price slump has opened a substantial window of opportunity to obtain good equipment at tremendous, previously unimaginable discounts,” said First Titan CEO Sydney Jim in a press release.

“The oil and gas industry will recover, and when it does, companies that have taken advantage of these once-in-a-generation opportunities can reap windfalls if they plan and act accordingly.”

This has resulted in industry-wide asset auctions where valuable, often pristine equipment, can be purchased for a fraction of its true cost, says Kim.

“We’re looking at buying oil field service equipment, refurbishing it, and when the market does recover, selling it at a significant markup as drilling ramps up again,” Kim said.

“Such a plan holds the promise of solid revenues when the market upturns.”

Auction houses are reporting record turnouts for oil field equipment sales, indicating there is a viable market of companies wanting to put such items to immediate use.

Studies also forecast the market for oil field equipment will top $127 billion by 2020, showing the demand will remain strong.