John Jackson: Well, the Egyptian sale was just shy of 6,000 horsepower, and it was three, what we would call large horsepower units over 1,000 horsepower and one, it was a little bit smaller. So the customer just exercised their purchase option there, and we negotiated a little bit of an early exit there. So that just came out of our large horsepower fleet, and we were still able to grow that in. As far as the horsepower that’s moving we’ve made a conscious effort to try and get our horsepower with the right customers in the right place, the way they want them and the way we want them. And what I mean by that is — we have customers that contract will come up for renewal. And the other side, I just want to renew for a year. I just want to stay month-to-month and if it’s larger horsepower in this market, we want to chase duration and we want to chase density.
So we want to get it longer and closer where we can. So we’ve made a very conscious effort to try and price our product in a way that forces the customer to determine if they need this long term. And I don’t mean that as a negative to the customer, but if they just need it for six more months, we want to know. And so the way we find out is by saying, here’s a three-year rate, here’s a two-year rate, here’s a one-year rate. and we find out where they are and we price the three-year much more attractive than one or a month-to-month rate. And so we’ve had some customers let’s say, resized their fleet. Maybe they’re building electric or maybe they’re saying, “Well, I really don’t need a 1,300 horsepower. I need a 700-horsepower or 630-horsepower unit coming up.
So I’m going to do this short duration and pay you higher and then we’ll work out of transition plan. With that, and we’ve been doing that fairly actively over the last six months. With that, we’ve had some churn in our fleet that’s not really not contracted. It just goes off revenue for three months or so. It may come off the unit of the side of the customer. We take it through the shop, have to do a little bit of work to it, get it back out to someone else’s site or we ship it to a side, it’s just not on revenue for a month. So again, probably a lot more than you want to know, but when we look at our large horsepower fleet, I’m trying to give you a quantification. I don’t have a good quantification of where we sit at a spot moment in time at June 30, but we’ve probably got another 10,000 to 15,000 horsepower easily that’s in transition that’s the large horsepower at any one point in time that we’re moving off one side to another, that’s not on revenue.
We expect that to kind of settle out over the next six months to eight months or so and be less disruptive to the utilization numbers that we’re seeing right now, but this is all — we call it positive churn. It’s all positive churn in our mind because we’re able to get these things termed out with someone who really wants them for the next three to five years, not the next three to six months. Hopefully, that’s helpful.
Brian DiRubbio: No, that’s extremely helpful because it shows that you’re basically upgrading the fleet in terms of customers in the region.
John Jackson: Yes. Indeed.
Rob Price: Longer term, in one spot gives ability to plan the work more, which gets back to raising operational margin, the short-term disruption in make ready.
John Jackson: People, staffing, parts, inventory, just knowing what you’re going to be dealing with is very helpful. And we’re trying to use this environment to really figure that out with customers.
