With SWD activity rising, Nuverra acquires Marcellus shale rival

By Luke Geiver | October 09, 2018

A wastewater and logistics company with a strong presence in the Bakken and Haynesville shale is expanding in the Marcellus and Utica. Nuverra Environmental Solutions will acquire Clearwater Solutions for roughly $42 million in a deal that will give the Arizona-based company more saltwater disposal wells in Guernsey County, Ohio, which is in the heart of the region’s oil and gas activity, according to the company.

Several market factors led to the deal, including a projected 20 to 30 percent volume increase for the shale gas market by 2019, Nuverra noted in its investor presentation announcing the acquisition. “Long-term trends are also robust, as pipeline capacity and gas plants support demand increases of 35 percent by 2019,” the company said. In addition to a trend of more water being used per unit of gas produced, Nuverra also said that out-of-state water trucked into Ohio for disposal is increasing. “Operators report signs of congestion at disposal wells,” Nuverra said, adding that SWD capacity is tightening up.

“The Clearwater acquisition significantly improves our competitive position in the Northeast marketplace due to the added capacity of the new wells and logistical advantages for our trucking business,” said Charlie Thompson, interim CEO. “Based on recent volume statistics, Nuverra will be the second largest commercial operator of SWDs in the region.”

To pay for the acquisition, Nuverra will turn to two of its largest shareholders for a bridge loan of roughly $32.5 million that will be paid back following a planned offering to shareholders of common stock purchase rights.