HOUSTON, July 26 (Reuters) - Nextier Oilfield Solutions said on Wednesday it expects fracking demand to recover next year, but that a shortage of equipment could hinder growth in U.S. oil and gas production.
Weaker oil and gas prices forced U.S. shale producers to cut drilling and well completions activity in the April-June quarter, hurting demand for equipment and services.
Nextier said it expects fracking activity to bottom out later this year after dipping briefly from current levels.
"We view the current slowdown in industry activity as transitory, and by 2024, we see a path for U.S. land completion activity to recover to levels that we saw in the first quarter of this year," Chief Executive Officer Robert Drummond said.
However, insufficient new build in fracking equipment to keep pace with the recovery in demand could be the bottleneck to U.S. oil and gas production growth by next year, he added.
The company said it would take stack, or put aside, its equipment rather than cut pricing if demand falls in the near term, adding it could cut up to three fracking fleets by the end of the third quarter.
Nextier, which is in the process of merging with Patterson-UTI Energy, on Tuesday reported better-than-expected earnings of 68 cents per share for the quarter ended June 30.
The upbeat outlook and profit beat for the second quarter helped the company's shares rise as much as 1.6% to $11.69 on Wednesday, its highest level in over a year. (Reporting by Arathy Somasekhar in Houston Editing by Matthew Lewis)
